Lords Sitting of 22 December 1988

Preamble
The House met at eleven of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Chichester.

Schools: Pupils' Staying-on Rate
Lord Gainford Lord Gainford asked Her Majesty's Government:
How many young people are staying at school beyond the compulsory schooling age.
The Parliamentary Under-Secretary of State, Department of Energy (Baroness Hooper): My Lords, at the beginning of the 1986–87 academic year, 282,000 young people aged 16 were in school in the United Kingdom. This represents a staying-on rate of 32 per cent.
Lord Gainford: My Lords, I thank my noble friend the Minister for that information. Has she any evidence that in staying on at school these young people have been able to gain suitable qualifications in order to make employment and careers easier for them?
Baroness Hooper: Yes, my Lords. Those staying on at school do achieve better qualifications. Most of them take one year courses at GCSE level in order to improve their qualifications. Typically, they achieve one or more passes and better grades in up to three further subjects. Furthermore, the A-level scene is also improving. The figures for England in 1986–87 show 122,000 students or nearly 17 per cent. of the 17 year-olds have achieved one or more A-level passes in school. When one considers full-time students in FE colleges, the number increases to 147,500 students. They will now be able to take AS-levels as well which should have a further impact.
Lord Hatch of Lusby: My Lords, can the noble Baroness tell the House what is the comparative figure between the number of students staying on after the age of 16 in this country and those in similarly industrialised countries in Europe; namely, France, Germany, the Netherlands and Belgium?
Baroness Hooper: My Lords, I am unable to give the noble Lord the exact figure at this moment. We realise that our staying-on rate is not as good as that of other countries. This accounts for the reforms that have been introduced into our education system.
Lord Peston: My Lords, if it will help the noble Baroness I can tell her that in countries such as Germany and Japan 80 to 90 per cent. of the age groups stay on. That shows how abysmal is our staying-on rate. Given that abysmal position, although, as she rightly says, the situation has improved slightly, can the Minister tell us whether the improvement, in the Government's view, is occurring for educational reasons or as a result of economic factors because young people, on the one hand,
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cannot find jobs and, on the other, have been disqualified from various social security benefits?
Baroness Hooper: My Lords, we believe that there is a dawning realisation that leaving school without any qualifications makes the finding of a job difficult. However, there is a good deal of evidence that the improvement in the staying-on rate is as a result of the restructuring of the exam system in the GCSE and AS-levels besides other kinds of programmes such as CPVE and TVEI. They provide more attractive forms of provision for 16 year-olds We certainly hope that the trend will continue in the right direction.
Lord Beloff: My Lords, is the Minister aware that while it is perfectly true that in Japan over 80 per cent. of pupils stay on at school after the age of 16, they do so because their parents pay for their education? Does the Minister believe that that is what the party opposite now advocates?
Baroness Hooper: My Lords, I hope that that may well be the case.
Lord Dormand of Easington: My Lords, is the Minister aware that one of the main reasons why young people do not stay on beyond the compulsory school leaving age, particularly in areas such as the northern region, is that their parents cannot afford to keep them there? When are the Government going to consider introducing mandatory payments in place of the present system whereby it is left to the LEAs to decide whether payments can be made to families or to the youngster concerned? Is this not long overdue in order to encourage and help younger people to stay on at school?
Baroness Hooper: My Lords, we have no evidence to show that giving young people a right to a maintenance allowance would have a significant effect on the participation rate. We believe that the experience of young people at school and the qualifications they achieve at the age of 16 are far more important in motivating them to stay on.
Lord Mellish: My Lords, can the noble Baroness give us some other figures so that we can compare like with like? The Minister has given figures for the number of youngsters staying on at school at the moment. Can she give us any idea what they were like 10 years ago?
Baroness Hooper: My Lords, the staying-on rate in 1975 for all 16 year-olds in full-time education at school or further and higher education establishments was 37 per cent. In 1987 that figure had increased to 46 per cent. with the addition of the YTS figures which provided a further 27 per cent.
Baroness Seear: My Lords, can the noble Baroness tell us what progress has been made in the work of the National Council for Vocational Qualifications? I am sure she will agree that once youngsters know what qualifications they can get by staying on at school they will be greatly encouraged to do so.
Baroness Hooper: My Lords, we believe that the coherence that the National Council for Vocational Qualifications will bring as a result of its work will help very much in the pattern of post-16 vocational courses. The work of the council is progressing satisfactorily.
Baroness Blackstone: My Lords, is the Minister aware that one reason why we have such a poor staying-on rate in this country is the content of sixth-form education? Despite what the noble Baroness has said about some improvement, making it less specialised and widening the opportunities, are the Government going to take any further steps to implement the recommendations in the Higginson Report and move us away from a very overspecialised three A-levels system?
Baroness Hooper: My Lords, substantial reforms were made to the whole education system as a result of the Education Reform Bill which passed through the House earlier this year. The Government will be keeping under review the consequences of those reforms and seeing how they reflect on A-levels. As we have said in the past, the introduction of AS-level is already having an impact and we expect it to have a continuing impact in broadening the base of studies at that stage in the school career.

Disabled Persons Act 1986
11.13 a.m.
The Countess of Mar The Countess of Mar asked Her Majesty's Government:
When they intend the Disabled Persons (Services, Consultation and Representation) Act 1986 to be fully implemented.
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Skelmersdale): My Lords, we are making good progress in implementing the Act. Six key sections are now in force. The first report under Section 11 will be laid late next year. We have agreed with the local authority associations that Section 7 is the next priority, and we are discussing its resource implications with them.
The Countess of Mar: My Lords, I thank the noble Lord for that very helpful Answer. Is he aware that in addition to the fact that certain sections have not been implemented there is a problem with the funding of sections that have already been brought into force? For example, Hereford and Worcester County Council's treasurer has refused to identify the county's portion of the £5 million for implementing Sections 5 and 6 and therefore no allocation has been made to the social services committee. What would he say to the parents of a disabled child in Hereford and Worcester who know that the social services committee has deferred the implementation of Sections 5 and 6?
Lord Skelmersdale: My Lords, I did not know that Hereford and Worcester County Council had
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deferred implementation in regard to Sections 5 and 6. Extra money has been added to the personal social services allocation of public expenditure to local authorities. We are taking steps nationally through the social services inspectorate to discover how the Act is being implemented. I shall refer the noble Countess's comments to it. However, in the last analysis, it must be for the local authorities to determine their own expenditure in the light of local priorities as they see them.
Baroness Jeger: My Lords, has the noble Lord received the observations on this subject of the Social Security Advisory Committee, and are the Government taking any notice of them?
Lord Skelmersdale: Yes, my Lords. We have received the comments of the Social Security Advisory Committee on this subject. They are taking a little time to study and we shall respond to them in due course.
Lord Mottistone: My Lords, it is a welcome fact that the Government are discussing Section 7 with the local authorities. Can my noble friend give us an idea of when he thinks these discussions will be concluded and action will begin to be taken on this part of the Act?
Lord Skelmersdale: No, my Lords; I regret that I cannot. Discussions are continuing and the next meeting will be in mid-January.
Lord Allen of Abbeydale: My Lords, I am glad to hear about Section 7 and discharge from hospitals. Is the Minister aware that it is now two and a half years since Royal Assent was given to the Act?
Is he further aware that an increasing number of people are concerned about the priorities of the Government, given the delays in implementing the Act, the prolonged delay over the Griffiths Report and the extraordinary attitude to the poor and the disabled under the poll tax legislation? The Government have recently undergone a conversion in regard to green issues. Can they go through a similar conversion and become a compassionate government?
Lord Skelmersdale: My Lords, I do not believe that we have been slow in implementing the Act. Six key sections are now in force. But it is essential that before each section is implemented the resources required should be identified and made available. Any other approach would be irresponsible. Before any section of the Disabled Persons (Services, Consultation and Representation) Act is implemented the cost must he identified, discussed with the local authority associations and made available. This inevitably takes time.
Lady Kinloss: My Lords, can the noble Lord confirm that Section 7 includes elderly mentally infirm people?
Lord Skelmersdale: Yes, my Lords.
The Countess of Mar: My Lords, to follow on from my question about Hereford and Worcester, is there any way in which the money allocated to local authorities can be separately identified, so that when the Secretary of State allocates £5 million it is put to the purpose for which it was originally intended and does not fall into the general pot?
Lord Skelmersdale: My Lords, over the years local authorities have been very resistant to identifying particular pots of gold, as the noble Countess might call them, and applying them to particular areas. Local authorities are elected bodies. It is up to them to identify for themselves their local priorities and act upon them.

Internal Market: Veterinary Education
11.18 a.m.
Lord Molloy Lord Molloy asked Her Majesty's Government:
What problems remain to be resolved in respect of veterinary education, science and practice in the period before the completion of the internal market.
The Parliamentary Under-Secretary of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington): My Lords, I am not aware of any such problems in connection with completion of the internal market.
Lord Molloy: My Lords, that is an extremely sad Answer. The Minister says that she is not aware, so I shall have to inform her of the concerns of Britain's veterinary surgeons. Is she aware that in the run-up to the completion of the internal market there has been a dramatic increase in the number of vets coming here from other countries? British vets are very anxious about the rumour that the findings of the Riley report may lead to the closure of two veterinary schools. Is she further aware that, in addition to vets from the EC, young trainee vets are coming here from Commonwealth countries as well as from Ireland and South Africa? This means that the vets coming into Great Britain constitute half the numbers being trained. British vets think that that is too high a figure. Is the Minister aware—
Noble Lords: Reading!
Lord Molloy: My Lords, is the Minister aware that the increase in animal health research is a topical subject? Vets are worried about disease in the animals we eat. With such a threat hanging over us they believe that there should be no moves to reduce the number of vets.
Baroness Trumpington: My Lords, European Community rules have pi ovided since 1980 for free movement of veterinary surgeons. This is made possible by harmonisation of veterinary education standards and qualifications across the Community.
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With regard to the UGC working party, chaired by Sir Ralph Riley, the Riley review is considering the provision of veterinary education in the six veterinary schools and the scope for rationalisation; it is not explicitly addressing the future demand for veterinary graduates. The working party is expected to report to the UGC early in the New Year.
Lord Molloy: My Lords, I thank the noble Baroness for that reply. Would she be prepared for the department to consider talking to the president of the British Veterinary Association and its general secretary, which could he to the advantage of both the Government and British vets?
Baroness Trumpington: My Lords, my department is in constant touch with the veterinary profession and the RCVS. Perhaps I may say at this point—and I am sure that other people will agree with me—that the veterinary surgeons in this country have the highest possible qualifications and are simply splendid people.

General Optical Council: Composition
11.21 a.m.
Lord Rugby Lord Rugby asked Her Majesty's Government:
Whether the composition of the General Optical Council will reflect the rights and needs of the consumer, following the deregulation of the supply of reading spectacles by the Health and Medicines Act 1988.
Lord Hesketh: My Lords, the deregulation of reading glasses has no implications for the composition of the General Optical Council. The council continues to be responsible for the promoting of the high standards of professional education and conduct among opticians in the interests of the public.
Lord Rugby: My Lords, I thank the Minister for that Answer. But of course the deregulation of reading glasses has in fact been effectively blocked for 30 years by the General Optical Council. Consequently, can the public have any confidence that the council's future decisions in relation to the new technology which is becoming available—some of it very good technology—do not block that new technology in order to protect the commercial interests of its members?
Lord Hesketh: My Lords, the General Optical Council does in fact include six lay appointees of the Privy Council to ensure that consumer opinion as well as optical medical opinions are available to the council.
If I understand the noble Lord, Lord Rugby, correctly, he is referring to autorefractors as part of the new technology. I am given to understand that an autorefractor cannot perform the health check on the eye, but there is no bar to the use of such equipment by an opticianal medical practitioner in the course of a sight test.
Baroness Gardner of Parkes: My Lords, can my noble friend tell us whether there are elected members of the General Optical Council in the same way as there are for the General Dental Council following the new dental legislation?
Lord Hesketh: My Lords, I fear that I shall have to write to the noble Baroness on that point because I do not have the answer.
Lord Peston: My Lords, again, ever helpful, 1 can say that there are certainly elected members of the General Optical Council; indeed, the majority of them are elected. The Minister's reply, following the spirit of the question, seemed to follow the spirit of what the Government have been doing and was not as pro-consumer as one would have liked. Surely what is required in this area is precisely what the noble Lord said; namely, a much greater consumer representation among the Privy Council nominees.
Will the noble Lord convey to his right honourable friend—who no doubt is the person who nominates the Privy Council nominees—that it would be a good idea if the majority of those nominees reflected consumer interests, rather than all kinds of quasi-producer interests?
Lord Hesketh: My Lords, I shall certainly pass on the comments of the noble Lord, Lord Peston. However, judging by the way in which he just spoke, one would slightly feel that no deregulation was about to take place. I think that I ought to remind your Lordships' House that deregulation is about to take place.
Lord Peston: My Lords, perhaps I may just clarify the matter. The reason I asked the question is that some of us strongly approve of deregulation but we would like to see it reinforced rather than interfered with by the professionals, which 1 am afraid does occur occasionally.
Viscount Montgomery of Alamein: My Lords, is my noble friend aware that the autorefractors, to which he referred in his earlier statement, are in fact extremely accurate and can he easily used following simple training? Therefore that should preclude the necessity in due course for every reading glass prescription to he signed by a qualified optician. However. that will require a slight modification of the present law. Will the noble Lord be prepared to consider that?
Lord Hesketh: My Lords, my technical ability is somewhat limited with regard to autorefractors. However. I shall draw the noble Viscount's comments to the attention of my right honourable friend.
Baroness Gardner of Parkes: My Lords, can the Minister tell us whether his department is doing anything to ensure that those on the National Consumer Council have among their number people with an interest and knowledge in health matters?
Lord Hesketh: My Lords. I am afraid that I shall have to draw that matter to the attention of my right honourable friend.

Air Disaster at Lockerbie
11.26 a.m.
The Minister of State, Scottish Office (Lord Sanderson of Bowden): My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Secretary of State for Transport. The Statement is as follows:
"With permission. Mr. Speaker, I wish to make a Statement about the disaster that occurred last night at Lockerbie.
"A Boeing 747 aircraft of Pan American Airways, Flight 103 from Heathrow to New York, believed to he carrying 243 passengers and 15 crew, was following its normal track over south Scotland under surveillance from the Scottish air traffic control centre at Prestwick. Shortly after seven o'clock, when the aircraft was 20 miles north-west of Carlisle, and two minutes after the last radio contact, the controller at Prestwick observed the disappearance from his screen of the secondary surveillance radar response, which identifies the aircraft. The primary radar return from the aircraft then split into several returns around the last known position. I am assured by the Civil Aviation Authority that the Scottish air traffic control centre had no indication of any other aircraft in the vicinity at the time.
"Wreckage of the aircraft came down in an area in a swathe approximately 10 miles long and substantial parts fell on the town of Lockerbie, causing the destruction of houses, a petrol station and cars on the A.74, and substantial further damage from fire. Honourable Members may already have seen on their television screens some of the devastation that occurred as a result. The emergency services are still searching for survivors but it seems unlikely that anybody escaped from the aircraft. Some five people in Lockerbie have been taken to hospital but the full extent of the casualties on the ground is still not known.
"It is of course too soon to draw any conclusions about the cause of this terrible disaster. A team from my department's air accident investigation branch arrived at Lockerbie just after midnight and has already begun its work. Representatives of the US Government and the manufacturers are being invited to assist them in accordance with international practice. The inquiry will be conducted with all the urgency appropriate to an event of this kind. A full report will be published as soon as possible and an initial bulletin setting out the facts revealed in the first stage of the investigation will be published shortly.
"The House will wish to join me in an expression of deeply felt grief at this tragedy. It is already clear that the loss of life is greater than in any air accident that has previously taken place in the United Kingdom and as yet we have little

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indication of the extent of the losses among the people of the Lockerbie area. May I also express on behalf of the Government our deepest sympathy with the American people and our great admiration of the emergency services who served so well last night. Search and rescue and support helicopters, aircraft and mountain rescue teams were involved, as well as ground support medical and search teams from service units all over the country. Their work is still going on at the site of the crash and in the surrounding areas and will continue for as long as is required.
"Our thoughts today and throughout Christmas will be with those whose relatives and friends died there last night".
My Lords, that concludes the Statement.
11.30 a.m.
Lord Underhill: My Lords, the House is obliged to the Minister for repeating the Statement on this awesome tragedy. It gives all noble Lords an opportunity to join in the expressions of grief and sympathy for the families and friends of the large number of people who have lost their lives and also to express our regard and sympathy for the people of Lockerbie who are seriously injured and to give our best wishes for their recovery. Other noble Lords may, as I did, have listened to the reports throughout the early hours. As the Statement says, we must have admiration for all the emergency services which came in from various parts to assist and did all that they could to help in the circumstances arising from the terrible accident.
We should also express our gratitude to the Aviation Minister, the noble Lord, Lord Brabazon, who hurriedly joined other Ministers visiting Lockerbie, especially as he was engaged with some of us late last night in the British Rail debate.
As the Statement says, obviously no conclusions can be drawn at this time. Many people are jumping to conclusions, as they often do when accidents of this kind happen. That is rather regrettable. We are pleased to note, as the Statement says, that the United States Government and the manufacturers will be involved in the inquiries, the results of which we shall all be awaiting with some anxiety.
I am one of those who has been through and stopped at Lockerbie many, many times. I listened to two local councillors this morning and one can understand the feelings of the local residents of Lockerbie. I have only one question to ask the Minister. In the event of assistance being required, will the Scottish Office give every possible assistance, especially with social services help with counselling? A considerable amount of that will obviously be required by many residents of Lockerbie.
Lord Tordoff: My Lords, we too wish to thank the Minister for repeating the Statement. We feel a spirit of togetherness with the noble Lord, Lord Brabazon of Tara, who in a sense represents your Lordships' House at the scene of this terrible accident.
One is frankly overwhelmed by the year that we have just had. It seems to have been a terrible year of
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tragedy. This country's greatest ever air accident, coming right at the end of the year, leaves one feeling numb. The Government and all the other people involved are to be congratulated on the speed with which they reacted to the terrible disaster. As has been said, the emergency services swung into action with remarkable speed and efficiency in a part of the world where the centres of the emergency services must be somewhat scattered. I am not suggesting that Lockerbie is in the back of beyond, but it is not one of the most highly populated parts of the country. To be able to put in the amount of support that there was within a few hours is a remarkable achievement.
We too wish to join in sympathy with the American people in the tragedy they have suffered of friends and relatives going back for the Christmas holidays who simply do not appear. The devastation that that will cause for so many families will cone inue for many years to come.
Thankfully the number of casualties at Lockerbie seems to be somewhat less than originally supposed by the media. Like the noble Lord, Lord Underhill, I am anxious not to speculate on what might have been the cause of the accident. That will be found out soon enough. Sufficient today to repeat the words of the Statement on all sides of the House and say that our thoughts and prayers today and throughout Christmas will be with the relatives and friends of those who died in the accident.
Lord Taylor of Gryfe: My Lords, from these Benches I should like to express our sorrow at the sad happenings of last night. As Chairman of the Scottish Peers in the House, on whose behalf I presume to speak, perhaps I may say that we should like to share the great sadness that has descended on our community. In the past few weeks we have experienced a number of major tragedies. Despite that, we are deeply sensitive and saddened by an event of this kind happening on our c wn doorstep. Lockerbie is a douce and decent Scottish village. Those of us who know the community can readily realise the extent of the tragedy in its midst. Like other noble Lords, we join in the expressions of sorrow to the Americans who were making their way home to celebrate Christmas.
Perhaps I may ask the Minister to speed up the investigation if possible. I know that such investigations take a long time, but in the case of the Manchester disaster it was possible to make an interim public statement which allayed some of the speculation taking place. Perhaps I may make an appeal to the media, through the Government, to stop speculating on these matters and almost prejudicing judgments before they are made. Finally, let me say how much we appreciate the services which were made available last night and the prompt presence of the Secretary of State for Scotland at the scene of the tragedy.
Lord Sanderson of Bowden: My Lords, I should like to thank the noble Lords, Lord Underhill. Lord Tordoff and Lord Taylor of Gryfe, for their expressions of sympathy at this time. Like them, I believe that the response from the emergency services was second to none. The Dumfries and Galloway

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social work department is helping the bereaved and homeless with comfort and support. I am grateful for the remarks made about my noble friend Lord Brabazon and my right honourable friend the Secretary of State for Scotland who hurried to the scene. The Government will do everything in their power to ease the blow which has befallen Lockerbie. I repeat our sympathy for the American people at this time.
With regard to speeding up the AAIB report, as I said in the Statement, a special bulletin describing the circumstances of the accident will be published as soon as possible. I mean what I say there. I take note of what the noble Lord, Lord Taylor of Gryfe, said about the Manchester inquiry. As to his comments about the media, I am sure that they will have heard them and will have taken note.
The Lord Bishop of Chichester: My Lords, perhaps I may associate my colleagues on these Benches with the expressions of distress and sympathy. The most reverend Primate the Archbishop of Canterbury has already issued a statement asking all Church people to remember in their prayers now and over Christmas all those who are suffering as a result of this terrible disaster. I am sure that we shall all respond to that plea and bear in mind not only those who are suffering but those who are involved in the exacting and harrowing rescue work.
Lord Sanderson of Bowden: My Lords, I thank the right reverend Prelate for those words. It is a sad event, especially at Christmas time, and the relatives and friends of those who have perished and those who are injured are much in our thoughts.
Lord Grimond: My Lords, we all share the deep distress that has been expressed about this appalling accident. I fully understand that information is still coming in, but I wonder whether the Minister can tell us a little more about the casualties on the ground. I believe that he said that five people have so far been identified as dead in the town of Lockerbie. Can he tell us which villages and small towns in the 10-mile swathe of which he spoke are the worst affected, what are their names and whether he has any information about the casualties there?
Lord Sanderson of Bowden: My Lords, I must refrain from speculation on this matter and stick to the facts which were given to me from a report at 8.30 a.m. this morning. Five people attended Dumfries Royal Infirmary with injuries arising from the disaster. Of those five, two have been discharged. Two elderly people have suffered major burns and are described as being in a very serious condition. The remaining person has suffered a scalp wound which is not believed to be serious. That is an interim report, it is factual. No information on the surrounding villages or how they have been affected has yet come to me.
Lord Boyd-Carpenter: My Lords, will my noble friend convey a very special expression of sympathy from this country to the families of those American
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servicemen who had been participating in the defence of the free world and who were going home for their Christmas holidays? Will he convey the understanding, particularly of those of the wartime generation in this country, of their real grief and of our desire that they should be comforted in every way?
May I also ask the Minister whether The Times is accurate in its article stating that the aircraft in question was rather more than 18 years old? If that is right, is urgent consideration being given to an examination of aircraft of the 747 type of similar age on the British register?
Lord Sanderson of Bowden: My Lords, as regards the expressions to the American people and particularly those who are in the services, I thank my noble friend Lord Boyd-Carpenter for his remarks.
As to the safety of the Boeing 747, again I should not like to speculate on that nor to talk about the age of the aircraft. I am sure that at this stage my noble friend would like me to look into this and as soon as information comes to hand I shall drop him a line.
Lord Hayter: My Lords, does the Minister agree that in catastrophes like this all the media should ask everybody to stay away from the area unless they have reason to be there? And in particular people should be asked not to flood the telephone with the numbers given on the radio and television unless, again, they have real reason to ring up, should they not?
Lord Sanderson of Bowden: My Lords, I thank the noble Lord for those remarks. I could not agree with him more. It hinders the task of the emergency services when this kind of event happens and I am sure that due note will be taken of the circumstances of the situation.

House of Lords Offices: Select Committee Report
11.42 a.m.
The Chairman of Committees (Lord Aberdare): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the first report from the Select Committee be agreed to (HL Paper 11).—(The Chairman of Committees.)
The report was as follows:
1 Appointment of Sub-Committees
The following members of the Committee were appointed to the Sub-Committees:

(a) Library Sub-Committee

L. Dainton (Chairman)

L. McIntosh of Haringey

V. Davidson

L. Peston

V. Falkland

With the Clerk of the Parliaments.
With power to co-opt further Lords.

(b) Refreshment Sub-Committee

L. Allenby of Megiddo

L. Nugent of Guildford

L. Ampthill (Chairman)

L. Ponsonby of Shulbrede

L. Dean of Beswick

B. Stedman

L. Denham

L. Tordoff

B. Hylton-Foster

With the Clerk of the Parliaments.
With power to co-opt further Lords.

(c) Works of Art Sub-Committee

B. Birk

L. Gibson (Chairman)

M. Cholmondeley

L. Hesketh

B. David

With the Clerk of the Parliaments.
With power to co-opt further Lords.

(d) Computer Sub-Committee

L. Dainton

B. Nicol

E. Halsbury

L. Peston

L. McIntosh of Haringey (Chairman)

With the Clerk of the Parliaments.
With power to co-opt further Lords.

(e) Staff of the House Sub-Committee

L. Aberdare (Chairman)

B. Nicol

L. Belstead (L. Privy Seal)

With the Clerk of the Parliaments and the Gentleman Usher of the Black Rod.
With the power to co-opt further Lords.

(f) Finance Sub-Committee

L. Aberdare (Chairman)

L. McIntosh of Haringey

L. Ampthill

L. Ponsonby of Shulbrede

L. Denham

L. Tordoff

E. Ferrers

L. Walston

With the Clerk of the Parliaments
With power to co-opt further Lords.

(g) Administration Sub-Committee

L. Aberdare (Chairman)

L. McIntosh of Haringey

L. Ampthill

L. Nelson of Stafford

L. Denham

L. Ponsonby of Shulbrede

E. Ferrers

L. Tordoff

L. Gibson

L. Walston

B. Hylton-Foster

With the Clerk of the Parliaments and the Gentleman Usher of the Black Rod.
With power to co-opt further Lords.
2 Gift of Vice-Regal Chair to Australian Commonwealth Parliament
A letter from the Lord Chancellor was laid before the Committee communicating to the House of Lords the thanks and appreciation of the Australian Parliament for the gift of the Vice-Regal Chair for the new Parliament House in Canberra.
3 New Dining Facility for the Refreshment Department
A report from the Administration and Refreshment Department Sub-Committees was made to the Committee.
4 Security
The Committee approved an increase in the complement of the security force for the Palace of Westminster.
5 Staff of the Houe
A report by the Chairman was made to the Committee who agreed to:

(a) a revised salary payable to Hansard Typists.

(b) the creation of two additional posts of Hansard Screen Corrector for a period of one year in the first instance.

(c) the regrading of one Clerical Officer/Senior Clerical Officer post in the Hansard Department to Executive Officer.

(d) a revised scale of pay for Watchmen.

(e) a revised retirement age of 65 for Cleaners.

6 Parliament Office
The Committee were informed of the retirement of the Receiver of Fees and Accountant and instructed the Clerk of the Parliaments to convey to Mr Edward Field their warm appreciation of his long and valuable service to the House.
The Committee were also informed that, following Mr. Field's retirement, the Clerk of the Parliaments had appointed Mr. C. Preece, the Assistant Accountant, to be Receiver of Fees and Accountant, and Miss J. M. Lansdown as Assistant Accountant with effect from 12th November 1988.
The Committee were informed of the promotion of Mr. A. Makower to Senior Clerk.
7 Insurance for Lords
The Committee approved an additional increase in the current premium for the personal accident insurance for Lords whilst on Parliamentary duty with effect from 1st January 1989.
8 Revised Scales of Pay and Allowances
The Committee confirmed the application of the following Civil Service memoranda to staff of the House of Lords:—

CM/849 (Pay of Clerks)

CM/851 (Pay of Grade 4)

CM/853 (Proficiency Payments)

CM/854 (Range increments, IPCS grades)

CM/857 (Responsibility Allowances)

CM/858 (Pay of Grades 5, 6 and 7)

1M88/4 (Industrial Staff Pay)

IM88/5 (London Weighting for Industrial Staff).

9 Superannuation
The Committee were notified of the following awards made under the House of Lords' Staff Pension Scheme:—

(a) Revised pension and lump sum to Mr. M. T. Nevin, re-employed Nightwatchman, who finally retired on 23rd May 1988.

(b) Pension and lump sum to Mrs. H. M. Smith. General Assistant, Refreshment Department who retired on 27th August 1988.

(c) Pension and lump sum to Mr. G. W. Bond, Executive Officer who retired on actuarially reduced early retirement terms on 1st October 1988.

(d) Lump sum death benefit and widow's pension to Mrs. M. A. Scott, widow of Mr. R. G. Scott, deceased former Assistant Superintendent who died on 30th September 1988.

(e) Pension and lump sum to Mrs. D. S. Grealis, Cleaner, who retired on 1st October 1988.

(f) Pension and lump sum to Mr. E. W. Field, OBE., Accountant, who retired on 12th November 1988.

10 Refreshment Department
The Committee approved a recommendation from the Refreshment Department Sub-Committee for an ex gratia payment from the Trading Account to the Refreshment Department Staff Christmas Fund.
On Question, Motion agreed to.

Civil Aviation (Air Navigation Charges) Bill [H.L.]
11.43 a.m.
Lord Strathclyde: My Lords, on behalf of my noble friend Lord Brabazon of Tara, I beg to move that this Bill be now read a second time. As noble Lords are aware, my noble friend is in Lockerbie dealing with the tragedy. That is why I am replacing him this morning. Although this is not my subject I shall do my best to answer all noble Lords' questions as they come up on this piece of legislation.
In contrast to a number of transport measures which have been considered by your Lordships' House in recent years, this Bill is mercifully short and straightforward. It contains a mere two clauses. Its purpose, very simply, is to enable the charges which aircraft operators have to pay for using air navigation services, to be prescribed and paid in units of account, instead of in conventional currencies as at present.

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The immediate reason for bringing this Bill before your Lordships is to enable the UK to agree to en route air navigation charges, which are collected by Eurocontrol, to be prescribed and paid in European currency units instead of US dollars as at present. This will bring the UK into line with the other member states of Eurocontrol, which already have such powers, and it will allow the simultaneous changeover throughout the twelve countries concerned to charging in ecus.
I think it may be helpful if I briefly describe the system which is used for charging for air traffic control and other air navigation services when an aircraft flies through the airspace of a Eurocontrol member state. The charging system goes back to a multilateral agreement first signed in 1970. The signatories to the agreement (which was renewed in 1981) now include the nine states which are full members of Eurocontrol (Germany, Belgium, France, Luxembourg, the Netherlands, the Republic of Ireland, Portugal, Greece and the United Kingdom and three associated countries (Spain, Switzerland and Austria).
The effect of the 1981 agreement is that 12 European countries have entrusted Eurocontrol with the task of calculating, billing and collecting charges from airlines in respect of en route navigation services made available by the national air traffic services of the countries concerned. The system is administratively very convenient since an airline simply pays one charge for each flight, even though the flight in question may pass over one or more of the 12 countries which have signed the multilateral agreement.
The calculation of the charges is complex. Broadly speaking, a unit rate of charge is calculated in US dollars for each country by dividing the cost base of the country concerned by the amount of traffic which it is estimated will be using its en route navigation services in the year in question. The cost base consists of the relevant expenditure incurred by the country's national air traffic services organisation, plus the country's share, if any, of Eurocontrol's annual expenditure budget and an administrative charge to cover the cost of collection. The charge made for a flight is calculated by multiplying the unit rate by the aircraft's weight factor and the distance travelled. Since the unit rate varies from country to country, calculations are made by Eurocontrol's central route charges office for each country over which the flight passes and the total for the flight is then worked out. Airlines are billed on a monthly basis.
Having collected the charges from the airlines, Eurocontrol then reimburses to each state its share of the income. Differences between the income received and the actual cost incurred by each country are repaid to, or recovered from, the airlines by reducing or increasing the cost base in the year after the following year.
This Bill is strongly supported by British airlines, who have been pressing us to introduce it. Airlines generate revenue and incur costs in all hard currencies. In an ideal world, the revenue generated and costs incurred in each currency would be closely
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related, but in practice this rarely happens, so airlines have to manage cash flows in various currencies and plan their foreign exchange requirements to minimise risk.
European airlines generate much of their revenue and incur most of their non-fuel costs in European currencies, so it has long seemed anachronistic to them that they have to pay in US dollars to overfly European countries, especially as the US dollar can fluctuate widely against the European currencies in which revenue is being generated.
Charges for air navigation services are set in advance. Regulations are laid before Parliament in December each year, and come into force on 1st January. The unit rates are calculated in European currencies (as they are designed to cover costs incurred in those currencies) and then converted into US dollars. It is the dollar amounts which appear in the regulations (although the rates of exchange used to arrive at the dollar values are also quoted). Because of the effects exchange rate fluctuations were having on the system, the airlines requested that unit rates be adjusted monthly, and this change has been implemented. However, it has not entirely overcome the problems caused by the volatility of the US dollar, because the exchange rates used to adjust the unit rates are the average exchange rates for the month immediately prior to that in which the flights were made. The bill is sent to the airlines in the third or fourth week of the month following that in which the flights took place, and is due to be paid within 30 days.
For example, a bill for 1 million dollars for flights made in November last year would have been calculated using the average exchange rates for October; the invoice would have been raised in December, and payment made in January this year. During that time, the dollar-sterling exchange rate moved from US dollars 1662 to £1 to US dollars 1.798 to £1, so a million dollars at October's rate would be worth approximately £602,000, but by January they would be worth only about £556,000, a drop of £46,000.
The charges which made up the I million dollar invoice would be in the currencies of all (or most) Eurocontrol member states, not only sterling, so it is perhaps unfair to equate them all to sterling. However, during the period in question the dollar was declining in value against most European currencies, and I have used the sterling-dollar rates to highlight the effect which the three-month period between calculation of amounts due and actual payment can have, when US dollar exchange rates are fluctuating.
Eurocontrol's purpose is to charge airlines with the cost of providing air navigation services, but if the dollar declines in value airlines are undercharged and if it appreciates they are overcharged. Either way, adjustments have to be made later. It is this uncertainty about the future value of the dollar which causes problems for airlines in managing their cash flows.
As the ecu is based on a basket of European currencies, its exchange rate with each currency in the

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basket is relatively stable. During the same October 1987 to January 1988 period which I used in my earlier example, the sterling-ecu exchange rate changed from 1·442 ecu to £l, to 1·441 ecu to £1. That is hardly any change at all and shows a far more stable situation. The use by Eurocontrol of the ecu, in place of the dollar, will lead to far greater stability, as the movement between the ecu and European currencies can confidently be predicted to be far less than that which might occur between European currencies and the US dollar. The result will be that airlines' currency risks will be reduced and it will be easier for them to achieve a closer correlation between currency receipts and disbursements.
To achieve the necessary change in the law, the Bill amends Section 73 of the Civil Aviation Act 1982 by inserting a new subsection 1A. Under Section 73(1) the Secretary of State is empowered to make regulations requiring the payment of air navigation service charges in such currencies as may be prescribed, and the new subsection empowers the Secretary of State to prescribe the charges in units of account defined by reference to more than one currency, and to provide for payment either in units of account or their equivalent in conventional currencies. Charges may thus be prescribed and paid not only in ecus but also in any other suitable unit of account which may come into being in the future.
The other member states of Eurocontrol are waiting for us to make this change in our law. The Eurocontrol Agency has geared itself to make the switch to ecus some two months from the date when the UK's powers come into being. I hope I have said enough to convince your Lordships that this is a very worthwhile measure. I commend it to your Lordships. I beg to move.
Moved, That the Bill be now read a second time.—(Lord Strathclyde.)
11.54 a.m.
Lord Underhill: My Lords, the House will be grateful to the noble Lord for explaining the provisions of the Bill. That was necessary for some of us, even though the Bill contains only two clauses. I hope the noble Lord will convey my thanks to his noble friend Lord Brabazon of Tara for so kindly writing to me, and other noble Lords, a few days ago explaining the Bill.
I do not want to say a great deal at this stage. It seems a very commonsense Bill and one that deserves support, if only for the following measures. The other countries of Eurocontrol want us to approve the procedure. It will avoid the possibility of legal challenge in the light of world currencies. Further, the airlines want this change to be implemented as soon as possible. Therefore, I have great pleasure in supporting the Second Reading of this Bill.
Lord Tordoff: My Lords, I also thank the noble Lord for the explanations he has given. He has come into this legislation at very short notice, and we are most grateful to him for the excellent way in which he explained the Bill.
We fully support the measures that are being taken. It is a very simple, commonsense Bill. As an
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aside, I would say that it seems to us that the Bill puts another reinforcing plank in the platform of having a European currency and this country getting into a European monetary system. One wonders why we are the last country in Europe to have got around to producing this piece of legislation. That is an aside, but nevertheless I think it is an important one.
I am sure that what has been said about this problem applies to a large number of pan-European matters where a European monetary system in which we were fully participating would be a great help to everybody. Having said that, we give our wholehearted welcome to the Bill as it stands.
Lord Boyd-Carpenter: My Lords, I congratulate my noble friend Lord Strathclyde on his rapid mastery of a Bill with which yesterday he was no doubt not particularly concerned. I thank him for the clear and helpful explanation which as a result he gave to your Lordships.
I join with the noble Lord, Lord Underhill, in asking my noble friend to convey to my noble friend Lord Brabazon of Tara my thanks for the helpful letter of explanation which he also sent to me. In so doing I express the view, which I know all your Lordships hold, that we much admire the quick move of my noble friend Lord Brabazon to Lockerbie in the light of last night's tragedy. He follows the example of a great name in the aviation world and his action last night fully lives up to that.
On the merits of the Bill, I shall not be led astray by the noble Lord, Lord Tordoff, into opening up the question of a European currency, or we shall be here until Christmas. But 1 wish to say that, on its own merits, there is now an unanswerable case for this Bill. My only surprise is that this is a matter which needs legislation. It is so obviously a matter of sensible administration that it seems a pity that the 1982 Act tied it up in a way that resulted in its having to be untied by legislation.
Plainly the way in which the dollar has behaved in the past few months has created real difficulties for the airlines. My noble friend gave a very good example of the change over a matter of months. It makes sense, surely, to put this right. The ecu seems the sensible way of doing that. I fully support the Bill.
11.58 a.m.
Baroness Burton of Coventry: My Lords, I too would like to support the Bill and to thank the Minister for introducing it to us in such a clear way. I also wish to thank the noble Lord, Lord Brabazon, as everyone else has done, for the helpful remarks that he sent to most of us concerning the Bill. I was aware that the United Kingdom was one of the 12 European countries to have entrusted to Eurocontrol, as the Minister told us, the detailed task of calculating, billing and collecting en route charges.
As most of us know, these services are provided almost entirely by the national authorities. In the UK's case that is the National Air Traffic Services. But I had not realised that, since the inception of Eurocontrol, the en route charges have been set in US dollars. I see now, having learnt that, that the fluctuation of the dollar in relation to the value of

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European currencies has made it very difficult to pitch the unit charges at a level which covers costs without overcharging or undercharging the airlines. I believe the Minister mentioned that to us.
I believe the Minister also told us that in November 1986 Eurocontrol decided that the charges should be set and collected in European currency units. When that was done, the UK made it clear on that occasion that legislation would be required before the change could be implemented. What I did not know, until I obtained the information from the noble Lord, Lord Brabazon, was that the United Kingdom was alone in not having the necessary powers but that the infrastructure now exists for the change to be made, subject to the agreement of Parliament.
I hope that the House will expedite the new charging arrangements. From what has been said today I should have thought that the Minister could be sure that the matter will pass through very speedily. I am glad to support the Bill.
12 noon
Lord Strathclyde: My Lords, I am extremely grateful for the reception given by noble Lords to the Bill on its Second Reading. I am especially grateful to those who have taken the time to give some thought to the reason for the Bill and the financial implications of changing from dollars to ecus. I shall of course convey the thanks of noble Lords to my noble friend Lord Brabazon of Tara for the information he has provided over the past few days.
I am grateful for the congratulations of my noble friend Lord Boyd-Carpenter today. I agree with him that we shall not be drawn into a grand discussion with the noble Lord, Lord Tordoff, on European monetary union. I should also like to confirm to the noble Baroness, Lady Burton of Coventry, that Eurocontrol charges have been in dollars ever since its inception and that that is one of the reasons for making the change today.
Finally I should like to thank the noble Lord, Lord Underhill, for his speech. Our thoughts are with my noble friend Lord Brabazon of Tara in Lockerbie. We hope that he will he able to return as soon as possible. I hope that everything that I have said answers the questions raised by your Lordships. I therefore ask your Lordships to give the Bill a Second Reading.
Lord Mayhew: My Lords, before the noble Lord sits down I wonder whether he will answer the question of my noble friend Lord Tordoff as to why, as he mentioned in his introductory remarks, other European countries have been waiting for us to act? Why are we last?
Lord Strathclyde: My Lords, I am not sure why we are the last European country to enact this piece of legislation. I suggest to the noble Lord that somebody has to be last and that in this particular case it was ourselves.
On Question, Bill read a second time, and committed to a Committee of the whole House.

Merchant Shipping (Safety at Work) Regulations (Non-UK Ships) Regulations 1988
12.2 p.m.
Lord Hesketh Lord Hesketh rose to move, That the draft regulations laid before the House on 1st December be approved [2nd Report from the Joint Committee].
The noble Lord said: The regulations would extend to foreign ships when in UK ports the offence provisions of the five sets of merchant shipping regulations laid before Parliament on 30th September, namely the Merchant Shipping (Revised Means of Access) Regulations, the safe movement on board ship regulations, the entry into dangerous spaces regulations, the guarding of machinery and safety of electrical equipment regulations and the hatches and lifting plant regulations.
The five principal regulations apply in substance to foreign ships and have the effect of implementing ILO Convention 147 on minimum standards in merchant ships which provides very general requirements as to safety standards and so forth but which in general does not allow prosecution of foreign ships. The substance of those regulations also has the effect of implementing certain of the more detailed requirements of ILO Convention 152 concerning occupational health and safety in dock work. ILO Convention 147 has ben ratified by the UK, but ILO Convention 152 has not yet been ratified.
The regulations we are discussing today are made by the affirmative procedure since, under Section 49(3) of the Merchant Shipping Act 1979, as amended in 1986 and 1988, regulations made under Section 21 of the 1979 Act, as these and the principal regulations are, which apply to foreign ships must be subject to affirmative resolution unless giving effect to a convention already ratified by the UK.
These new merchant shipping regulations are limited to the essential features of the convention. They are quite short and backed by codes of practice which update where necessary existing chapters of the Code of Safe Working Practices for Merchant Seamen. Those codes will be issued as merchant shipping notices. The regulations and codes will of course apply to United Kingdom ships wherever they may be in the world and not just in the UK. For the most part they represent current practice. A useful and very comprehensive consultative exercise on both the regulations and the codes confirmed that there were no objections from the industry to the proposals in their final form. I beg to move.
Moved, That the draft regulations laid before the House on 1st December be approved [2nd Report from the Joint Committee].—(Lord Hesketh).
Lord Underhill: My Lords, I should like to thank the noble Lord for outlining the regulations. Once again we give our full support. Any proposal from the ILO generally receives the support of the Opposition, particularly when it deals with health and safety. In this particular instance it concerns health and safety in dock work. Naturally we give the regulations our full support.

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It is rather unfortunate that it takes so many years before such measures come to fruition. Reading very carefully the explanatory note—at least I hope that I have read it sufficiently carefully—one finds that the ILO convention was laid before Parliament in 1980, came into force internationally but was not ratified by the United Kingdom. Here we are in 1988 requiring regulations to bring the matters into effect. I am delighted that they are brought forward now; they have our full support.
Lord Tordoff: My Lords, I too support the regulations. I should also like to raise the critical question of why ILO Convention 152 has not yet been ratified by the United Kingdom. I have heard that ILO Convention 147 which was laid before Parliament in 1978 was ratified within two years. But it is now eight years since Convention 152 was laid before Parliament. It seems rather strange.
However, one is glad to know that the matters will take effect as a result of what we decide today. Not only does one want to see the best health and safety practice introduced in merchant shipping in our own country but also in competitors' vessels visiting this country. There is nothing worse than people undercutting the market not merely on price but also on standards, particularly relating to health and safety. The regulations are to be welcomed for that very reason.
Like the noble Lord, Lord Underhill, I should like to thank the Minister, as the second variation on the noble Lord, Lord Brabazon, we have had today—indeed, the third variation. One wishes that the circumstances which have taken the noble Lord away were not quite so tragic. I thank the Minister for his statement.
Lord Hesketh: My Lords, I am pleased to have been able to present the regulations. I am pleased too that both the noble Lord, Lord Underhill, and the noble Lord, Lord Tordoff—although they feel that the regulations have arrived rather later in the day than they would have hoped—are nevertheless glad to see them.
I should say to the noble Lord, Lord Tordoff, that ILO Convention 152 cannot be ratified until the regulations are in place. That is why it has not been ratified. I hope therefore that the regulations will meet with the agreement of the House.
On Question, Motion agreed to.

Social Security Benefits Up-rating Order 1988
12.8 p.m.
Lord Skelmersdale Lord Skelmersdale rose to move, That the draft order laid before the House on 7th December be approved [3rd Report from the Joint Committee].
The noble Lord said: My Lords, I understand that it will be for the convenience of the House if we debate this order and the Social Security (Contributions and Allocation of Contributions) (Re-rating) Order 1988 together.
Only a successful economy can enable us to afford to make nearly £50 billion worth of social security payments a year—and the uprating of benefits from next April will add more than £2 billion to that figure. About half of that is spent on the elderly. Our job as a government is to strike the right balance between the interests of benefit recipients and the interests of the working population who pay for those benefits. That is why we have pursued policies which take both of those interests into account and concentrate expenditure effectively where it is needed most.
I turn first to benefits uprating. Our proposals mean that we have kept our promise to continue to maintain the value of the state retirement pension—which goes to nearly 10 million people—and provides a secure foundation for income in retirement. As my right honourable friend the Secretary of State has announced, the basic pension for a single person will rise by £2·45 a week to £43·60, and for a married couple by £3·90 a week to £69·80. The uprating of basic pension alone from next April will cost nearly £1·2 billion in 1989–90. In other words it represents no real terms increase.
Nonetheless, like Beveridge all those years ago, we believe that the basic state pension is only a part, and a declining part at that, of pensioners'. total income. The Government believe that pensioners want to make their own preparations for retirement where possible and recent figures indicate that they are.
What pensioners want is total income buying more goods and services. During our first seven years in office pensioners' total incomes grew overall twice as fast as those of the population as a whole—and more than five times faster than under the last Labour Government.
As the House will recall, we restructured these benefits last April in a simpler scheme with new rates, which is proving easier both to understand and operate. And my right honourable friend the Secretary of State recently announced that from next October extra help is to be made available in the form of a new and extended structure of pensioner premiums in income support. These arrangements will provide an extra £2·50 a week for single pensioners and £3·50 for couples. This money will be extra; it will involve a total additional cost to the taxpayer of nearly £100 million in 1989–90 and nearly £200 million in a full year.
I should now like to set out our intentions for financing these and other contributory benefits, on which we plan to spend nearly £27·5 billion in 1989–90. As the House is aware, the key to the contributory principle is that entitlement to these benefits is earned by the payment of national insurance contributions. The Government's proposals for national insurance contributions were announced by my right honourable friend the Secretary of State on 1st November. We do not propose to change the rates of Class 1 contributions in the coming year. 1989–90 will be the sixth year in succession when we have not increased the main Class 1 rates. The lower earnings limit for Class 1 contributions, which is linked by statute to the basic retirement pension rate rounded down to the nearest

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pound, will be £43 a week from next April. The upper earnings limit will be fixed at £a325 a week, nearly seven and a half times the basic pension level. The regulations which bring the new earnings limits into effect will be made and laid as soon as the benefit uprating order has been approved by Parliament.
I turn now to the draft Social Security (Contributions and Allocation of Contributions) (Re-rating) Order 1988. The House will recall that in 1985 we reduced the contribution rates paid by lower paid workers and their employers to help those workers and reduce employment costs. The reduced contribution rates cut significantly the impact of contributions on people on lower earnings, but they did not affect their benefit entitlement in any way. We now propose to increase each of the earnings limits below which the lower contributions rates are payable in line with inflation rounded to the nearest £5. These proposals ease the burden on some lower paid workers and their employers and I am sure that the House will welcome that. Most other employees will not pay any more in contributions unless their earnings rise.
The House is aware that self-employed people pay their national insurance contribution in two parts—the flat rate Class 2 contribution and the profits related Class 4 contribution. We do not propose any change to the Class 4 rate, which will remain at 6·3 per cent. in the coming year. The profits limits for Class 4 contributions which determine the level of profits on which contributions are payable will be increased broadly in line with the earnings limits for Class 1 contributions to £5,050 and £16,900 respectively. The upper profits limit is exactly 52 times the Class 1 upper earnings limit. The order also increases the Class 2 contribution by 20 pence to £4·25 a week from next April. The Class 2 rate is linked to the Class 1 lower earnings limit and its increase reflects the proposed rise in that limit.
The draft order also increases the amount of Class 1 contributions which are allocated to meeting the costs of the National Health Service. From April 1989 we propose to increase the employees' NHS allocation to 1·05 per cent. and the employers' allocation to 0·9 per cent. in respect of earnings on which Class 1 contributions are paid. The NHS allocation will raise over £4 billion for the National Health Service in the coming year.
To return now to the uprating of benefits, successive upratings by this Government have also ensured that the benefits paid to people with longterm illness and disabilities have kept their value. Indeed, many of these people have had real-terms increases in the amount they receive—notably those with mobility allowance who have had a 9 per cent. real-terms increase since July 1978—and an estimated 190,000 people under pension age receive more from the disability premium with income support than they would have done on supplementary benefit. This record of sustained or enhanced value of benefits must be seen against a background of a prodigous rise in the number of recipients, a point that is regularly made in this House.
The combination of real increases in the amounts of benefits paid and the large increases in the number of recipients has produced a 90 per cent. rise in real expenditure since 1979 on benefits for the long-term sick or disabled. Total expenditure on these benefits now stands at over £7·3 billion—a real-terms increase of £3·5 billion since 1979.
With that sort of success in mind I was therefore particularly glad that I was able to repeat to the House in the uprating statement that we should be providing £5 million and the banks a further £5 million to set up a trust fund to enable Motability to increase its help to disabled people to obtain vehicles.
Turning now to family credit, let me illustrate the effect that this will have from next April with the specific example of a hairdresser in my home town of Taunton with gross weekly earnings of £78.80. A family with just one child aged five would at present get family credit of about £23 a week and would still be entitled to about £28 under the new rates from next April. A family with three children aged eight, 11 and 15 would at present qualify for family credit of about £45 a week; under the increased rates from next April they will get about £54 a week, which is an increase of around £9 a week. So this benefit is not limited to the very poor. Many families on quite reasonable earnings can qualify for this extra help.
Perhaps I may just clear up some confusion that occurred the other day. Family credit payments are paid to the mother£a point on which your Lordships are very keen. Only in exceptional cases, for instance, when the children are living with the father or where the mother is unable to manage her own affairs, is the position different. Nonetheless, we are concerned to see that take-up of family credit has increased from its present level of recipients. I should say that the present level of expenditure is already at the level we expected when we introduced it.
The uprating package which my right honourable friend the Secretary of State has already announced can best be described as a package for poorer families. It combines with other measures we have introduced to focus help on those most in need. It does not spread the jam thinly across the population as a whole, as some would wish. Such targeting is an essential element in the Government's policy of concentrating help on those who need it most. To this end we are making additional resources available to children and young people through income support, housing benefit and family credit at a cost of £70 million. This will mean an increase in benefit which is substantially more than inflation. For example, the income support allowance for a child under 11 has gone up by no less than 9·3 per cent.
While the Government understand the argument for universal rather than targeted benefits, we believe that our priorities this year are right. We are concentrating help where it is most needed.
As already announced, we propose to uprate all income support rates by 4·7 per cent. This represents the September on September increase in the retail prices index less housing costs. It is right that we should use that index because it is the index that most accurately reflects the cost of living increases for income support recipients. We have also made a

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separate provision for the 20 per cent. compensation for the introduction of the community charge. The rates that we have announced more than meet the promise that income support personal allowances would include the average amount that recipients would have to pay. Indeed, the compensation is a generous one and will cost more than £500 million.
I believe that this is a generous uprating which directs massive resources to where they are most needed. It is a substantial increase to spending on a programme which is already the biggest in Government. We believe that our proposals strike a fair balance between protecting the interests of benefit recipients and the interests of those who pay for them. I commend both orders to the House.
Moved, That the draft order laid before the House on 7th December be approved [3rd Report from the Joint Committee.]—(Lord Skelmersdale.)
Baroness Jeger: My Lords, when I first heard that these Motions were to be taken today, I thought that it was a very bad day to discuss them. I had a vision of noble Lords departing from the House as early as possible for Christmas merriment and I thought that it would be rather hard to have to concentrate on complicated problems. Of course this is a bad day for many terrible reasons and it is difficult to have to pursue an argument at this time. I must congratulate the noble Lord on his powers of concentration which he focused on the detail of these orders.
In this connection I should like to say that I hope that support for all victims will be immediate and generous. The situation is complicated because these are more matters for the Secretary of State for Scotland. However, I hope that there will be consultations which will ensure that people who have lost their homes, possessions and in some cases their businesses will not have financial worries added to their grief and shock; and that the practical help will not come only from the account of the local authority in this stricken district. I trust that the Minister will somehow work out ways for the maximum amount of help.
I wish to raise one general point with the Minister. Have the Government given any thought to the possibility of shortening the time between the announcement and assessment of the ratings and their implementation? I seem to recollect that these upratings were based on an RPI increase of 5·9 per cent. However, as people will not receive this uprating until April, I also understand that it is likely that the increase in inflation by April will be between 6 and 7 per cent.
I do not know why there has to be about six months between the calculation and the implementation. When I was in another place we used to be told that it was because it took so long to prepare the new books. I had a vision of hundreds of clerks with quill pens writing copperplate entries in pension books. I am sure that that is not the case now. However, as a septuagenarian I have many elderly friends in differing financial situations. They all feel a great sense of unfairness that at this expensive time of the year we have to wait until April for that extra money. I do not expect the Minister to
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give me an answer this morning, but I leave that thought with him.
I am sure that the Government know the Opposition's view about child benefit. I do not propose to go into that question fully today. I wish to ask the Minister whether he has had time to read the Statement made by the Minister in another place on 20th December (at col. 307 of Hansard). He said:
"My right honourable friend is under a duty year by year to review child benefit and to decide whether it should be uprated. It may be that next year or the year after it will be appropriate for child benefit to be increased and to be uprated in line with inflation, but this year we have decided to follow a different path".
Some of us welcomed that Statement because it seemed to differ from an earlier impression that the Government were thinking about letting child benefit wither on the vine. I should be glad if the Minister would confirm that it is the Government's intention to fulfil their statutory duty to review child benefit annually and that the Government have not taken a hard view against uprating.
The benefit for many families is that this income is regular and reliable. Of course it is part of the fiscal structure, and many of us believe that it should be linked more to taxation philosophy than to social security. I am not sure whether the Minister knows whether his hairdresser friend is claiming family income supplement. All we know is that more than half the people who are entitled to it are not claiming it. I agree that the Government have set themselves a difficult task in persuading people to apply. It is all very well to talk about targeting benefits, but families are moving targets. A father is in and out of work. A child becomes ill and a mother has therefore to stay away from work. There is short-time working for a few weeks and then perhaps suddenly some overtime. I know that this complicates the issue, but at least, whatever the circumstances, the child benefit is there, and there it must stay. We look forward very much to its uprating next year.
There is a great deal of anxiety about the next point that I wish to raise: it is the effect that the social security changes have had on homelessness. I am not sure whether the Minister was involved, but I understand that 23 voluntary organisations which work at the sharp end with homeless young people came to see one of the Ministers because of their anxiety about the increasing number of young people between 16 and 18 who are homeless in London, are in all kinds of danger and whom the voluntary organisations are finding it increasingly difficult to help. These representations have not come from political parties but from people who know what it is like to face the problem.
There must be something wrong with a social security system which increases the amount of homelessness. I read in Hansard on 81h November 1988 that in 1979 the Audit Commission reported that there were 56,750 families known to be homeless. In 1988 it is 112,730. There must be sorneting wrong with the housing benefit system, the general housing policy of the government and the social security arrangements.
Crisis at Christmas is certainly a non-political organisation. I know that many noble Lords support it. It has estimated that between 10,000 and 11,000

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people are sleeping rough in London alone. It expects the figure to double over the Christmas holidays. That is not an indication of a caring society.
I am very glad to know that the University of Surrey is trying to investigate this difficult question. There are many reasons why people are sleeping out of doors but one of them should not be that their social security is inadequate for them to find lodgings. When the University of Surrey sent some people round to try to find the extent of the problem, they counted 2,307 people in a total of 1·75 square miles, bounded by Vauxhall Bridge, Oxford Street, Blackfriars Bridge and the Thames. There were probably many more who were not visible to the people who were counting. I am leaving out the health questions and people being turned out of hospitals too quickly without proper support.
However, I feel that the social security policy ought to take more care of this. Even when young people are on YTS the average pay during the first year is £29. How can a young person find a home in London and support himself on £29 a week? Some of these young people are homeless through no fault of their own. They are not drop-outs; they are not meths drinkers. They are the young people who have come to look for work and who go on a scheme to try to make something of their lives.
These are the matters that worry us most at this season of the year. The Minister had to read out many figures. However, he will be glad to know that I shall not repeat them or put forward esoteric arithmetic about how much they should increase. We all agree that we have to do a great deal better. The increases are not sufficient to meet what we believe will be the rate of inflation next April. We shall therefore be returning to these complicated subjects at another time.
12.30 p.m.
Lord Banks: My Lords, I thank the noble Lord, Lord Skelmersdale, for his explanation of the purpose and content of the orders. We are approaching the first anniversary of the introduction of the new social security regime. When are we to have a report from the Government explaining exactly how the new scheme has worked out and who have been the gainers and the losers. We read alarming reports from some of the voluntary organisations and we like to be able to set against them what is revealed by the Government's monitoring.
One of the orders provides for the usual increases to allow for inflation. The Government praise themselves for meeting the cost of that rise but the higher the cost the more the Government should be condemned for having permitted the inflation in the first place.
I am glad that the mistake contained in the retail prices index has been rectified. It is encouraging to know that pensioners' total incomes, including their occupational pensions and savings, have grown on average by 23 per cent. since 1979. That was made clear in the uprating statement.
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That is good but there are some worrying features about the present pension scene. First, the oldest pensioners have the lowest state pension, whatever they may receive from other sources. Secondly, in terms of state pension, pensioners are receiving an increasingly lower share of the national income, because pensions are no longer linked to earnings and earnings have increased faster than prices.
The worst-off pensioners are the oldest and the poorest. They are those with little or no state earnings-related pension or no private means. It is now proposed to help those people by providing additional means-tested benefits during the lifetime of the present Government. However, we must not forget that they have two unhappy characteristics. First, they divide society into two: those who can look after themselves and the poor who are patronised. Secondly, they have a low take-up. Should we not be looking for a system of universal benefit, coupled with the operation of the tax system on the remaining taxable income? Should not our aim be to find a system which will allow a great reduction in all means-tested benefits while targeting its universal benefits on those who need them most by the means that I have outlined?
Those considerations apply to the conflict between child benefit and family credit where this year the real value of child benefit is being allowed to fall again. However, as the noble Baroness, Lady Jeger, explained, we must bear in mind the fact that child benefit replaced child income tax allowances. Therefore, when thinking of child benefit, we are concerned not only with the poor but with all those who have children. Child benefit should be increased in line with other personal allowances which give more to the better off whereas child benefit does not. If child benefit is not uprated the position of those people with children will continue to decline when compared with the rest of the community.
The take-up of family credit is so low. We understand that more than half of those entitled to receive it do not draw it. At Question Time last week the Minister agreed that those people suffer from the freezing of child benefit. In that respect I realise that I am talking to the converted because this House passed the amendment calling for an annual review of child benefit. That was a clear indication that the House wished child benefit to be uprated. However, we have yet to convert the Government to that point of view.
I turn to the Treasury supplement. During the lifetime of the Government it has been reduced from 18 per cent. of contributions to nothing. The final reduction made this year was from 5 per cent. to nil. The argument has been put forward that the rising cost of non-contributory benefits has meant that resources must be shifted. In effect, if not technically, the contributors have been asking to subsidise the recipients of non-contributory benefits. We believe that that is wrong and we wish to put that view firmly on the record.
Lord Kilmarnock: My Lords, we on these Benches should like to thank the noble Lord for explaining the orders with his usual lucidity. I have only three points to make. The first concerns the allocation to the

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National Health Service. The noble Lord told us that the percentage of Class 1 contributions which has been diverted to the National Health Service will rise from 0·95 per cent. to 1·5 per cent. from employees and from 0·8 per cent. to 0·9 per cent. from employers. The Minister said that it would amount to approximately £4 billion. Can he say whether it affects the sums allocated to the National Health Service in the Autumn Statement? The noble Lord will recall that the Secretary of State allocated important sums of money to the National Health Service at that time. Were they inclusive of the transfer from the National Insurance Fund?
Family credit has been mentioned by both the noble Baroness, Lady Jeger, and the noble Lord, Lord Banks. The Minister said that many families receiving reasonable e arnings can claim. As the noble Lord, Lord Banks, said, the take-up is relatively low. I also heard the Minister say that present expenditure is already at the level that the Government had expected. Does that mean that they had planned on low take-up?
In a recent Starred Question the noble Lord gave some raw figures on take-up but he did not give a percentage figure. Does he have a current percentage figure? Does he know what additional money will be required if take-up were 80, 90 or 100 per cent.? In those circumstances, what steps are the Government taking to improve take-up? Are they doing their best? That is an important test of the sincerity of their commitment to the benefit, particularly as they often quote it as compensation for not uprating child benefit.
Although there is little reference in the orders to the disabled, can the Minister say when the Government expect to reply to the report of the Social Security Advisory Committee entitled Benefits for Disabled People: Strategy for Change which was published on 29th November? The report included an interesting proposal of a new benefit on the lines of family credit which would supplement the incomes of disabled people who work but who cannot fully support themselves. It would therefore help them to become more independent.
Lord Boyd-Carpenter: My Lords, I hope that the noble Baroness, Lady Jeger, will not think it offensive if I say that her speech has fairly accurate precedents in debates of this kind over the past 30 years. When proposals for uprating social security benefits are discussed in either House the Opposition always say that they are not good enough and do not go far enough and the Government say, on the contrary, that they represent a considerable improvement on the previous position. Therefore, I hope that the noble Baroness will not expect me to respond to her points because that is the job of the Minister.
However, in response to the noble Lord, Lord Kilmarnock, I should say that the low take-up of the benefits to which he referred is not new. I draw on recollection going back to the late 1950s when retirement pensioners who were better off very often refused to draw the pension. They thought that it was somehow demeaning. Your Lordships may be amused to know how I dealt with that. I persuaded
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the gallant Field Marshal Lord Montgomery of Alamein to allow himself to be photographed going into his local social security office to draw his retirement pension. The effect was enormous. People felt that if one of the great heroes of the war was happy to draw the benefit to which he was entitled, there was no reason for them to hang back.
Baroness Jeger: My Lords, perhaps the noble Lord will give way as he particularly referred to me. If Lord Montgomery had been means tested he might not have hurried to the post office so quickly.
Lord Boyd-Carpenter: My Lords, the noble Baroness has missed the point. The retirement pension has never been means tested. The point I am trying to make—and I am sorry if I did not make it with sufficient clarity, and I shall try again— is that even the retirement pension, a contributory benefit, was in that era regarded as something which better off people were slightly ashamed to claim, and I explained how that was dealt with.
I shall come to the means test, but equally with a means tested benefit it is very interesting that the take-up is so low. The reasons for that may be difficult to ascertain. In some cases it must be that people do not feel the need for this, because anyone who is really in need will not be deterred by such considerations from claiming a benefit to which Parliament has said they are entitled.
I then come to the means test point. Here there is a real difference of philosophy. if one is going to concentrate improvements, as this order does to a considerable degree, on the poorest and those who need them most, the only practical way to do so is to have a means test so that it is clear that I t is the people who are in need who will receive the benefit. I know that in the Labour Party the words "means test" evoke violent memories. In view of the way in which a means test was administered many years ago, I understand that. With modern techniques of social security administration I am sure it has lost that particularly harsh aspect.
We then come back to a dilemma. Some of your Lordships wish to see child benefit increased. In that case public money will be handed out to everybody, whether or not they need it. Alternatively, social security should be confined to contributory benefits and the additional benefits used to help the poorest should be on a basis which must be means tested. I believe that your Lordships must face the fact that if you want to concentrate on these people a not unlimited amount of financial resources—enormous though the amount now is, as my noble friend said—there has to be some form of means test. People have become accustomed to benefits which are means tested and now draw those benefits.
With the particular example given, I believe that it is a matter of time and of sensible and humane administration. The objection will be withdrawn just as the objection was withdrawn to fie retirement pension in the episode which I mentioned to your Lordships. Therefore, 1 welcome this order. I believe that it is following the right policy of the Government. I dislike the word "targeting", which

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has a slightly bellicose implication that I do not like, but I like the concept which lies behind it; that is, of concentrating benefit paid for by the taxpayer, not contributed to, on those who need it most. I hope that the Government will continue with a policy on those lines.
12.45 p.m.
Lord Stallard: My Lords, perhaps I may also thank the noble Lord for his concise explanation of the ora,:rs. I should also like to support my noble friend Lady Jeger when she mentioned the timing of the presentation of the orders, as well as the fact that the tragic disaster is on all our minds following last night's air crash. For many of us that makes it difficult to concentrate on the finer details of the orders.
At this point I do not intend to follow the noble Lord, Lord Boyd-Carpenter, who raised some extremely interesting philosophical points on the administration of social security. However, I hope that we shall be able to return to those discussions in more detail early in the New Year. I shall look forward to that debate because it is long overdue. I do not care if it has taken place every year for the past 100 years. There is still a need for this to be done as soon as possible so that we can get some more 20th century wisdom into how those matters should be dealt with.
The Minister gave some examples of income support and so on. He will have read the Official Report of the House of Commons on 20th December and have seen a number of other examples. I am sure that from this side we could give him further examples and match and outdo each other with examples if we stayed here for the rest of the day. I do not know what the score would be at the end but I believe that we should be hands-down winners if it came to that. However, I do not want to give further examples although I am happy to do so if necessary.
I should like to sketch in some background because it is necessary to understand what is happening. Let us look at the backcloth of this debate on the upratings and then we may understand it slightly better. At this time of the year it is customary to take stock. We look back over the year and look at the different aspects of various policies. If we look back at the working of the social security scheme we find a very sad picture indeed.
I have jotted down some matters which are immediately relevant to this discussion. We find that one in six of our fellow citizens is forced to get by at the official poverty level or below. The number of homeless people has doubled. My noble friend, the noble Lord, Lord Banks, and others mentioned the position of the homeless. That must be something at the forefront of all our minds particularly at this time. The voluntary organisations mentioned by the noble Lord, Lord Banks, and my noble friend are raising the issues so sharply just before Christmas and expressing fears that many hostels are on the verge of closure and collapse because of the new system.
If hostel residents are switched from board and lodging payments and personal allowances to
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housing benefit and income support, they will all receive less money. Figures clearly show—and it has been documented by all those organisations—that no one between the ages of 16 and 60 years if switched to housing benefit and income support will have enough money to pay for a hostel. Those facts cannot be disputed. It is a serious situation.
Before leaving the subject of homelessness, which is close to my heart, I ask the Minister to give the House an assurance that the Government will look at the present position and ensure that nothing will be done to worsen the crisis affecting hostels. I tabled a Written Question recently but the reply was very disappointing. It simply stated that the Government will be producing a statement on the future financial arrangements for these hostels, and so on, early in the new year. That means nothing to me. I do not know what early in the new year means. Something more specific is needed.
Hostels and the people involved need to plan ahead. They cannot plan on the basis of a statement being made early in the new year. They must plan now whether they will remain open, or close, and whether they can cope. They must make plans for the staff, and so on. Therefore, I shall be glad for some further information in that respect from the Minister.
The number of homeless people is growing. It has doubled and is getting worse. The number of longterm unemployed has trebled. Those people are in serious difficulty at this time. A report based on the World Health Organisation figures has condemned severe poverty and disadvantage among a substantial majority of pensioners as a result of these changes. It is not a joyful picture, and certainly does not give much scope for celebration for thousands of old people as we enter the Christmas season. They face a bleak Christmas.
The Citizens' Advice Bureau report—I am sure the Minister has read it—was dismissed too lightly by the spokesmen I have heard so far. It is a comprehensive report which goes into great detail. Statistics were obtained from bureaux all round the country in order to produce this report.
It states:
"The overriding impression of the April changeover from supplementary benefit to income support from the bureaux perspective has been the distress and lack of understanding caused by administrative confusion and poor communications. Nearly a third of bureau clients affected by the change were receiving less IS".
than they received under the old supplementary benefit system even though their circumstances had not changed. Only one-half had gained anything and only then because of transitional payments which we know will disappear eventually, if not next April. Therefore, the background against which we are discussing this order is a serious and sad situation.
I shall not go into detail on child benefit because that has already been mentioned. but a great deal of misunderstanding exists in that respect. I have heard people say, "Why should it go to the better off? Why should people have that benefit when they can afford to do without it?" This goes back to the example given by the noble Lord, Lord Boyd-Carpenter, of field marshals.

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I have always been conscious of the fact—I was very much involved at the time—that child benefit was increased to replace income tax allowance. We mounted a great campaign, which we won, thank God, that the child allowance should be paid to women because many of them were not receiving the tax benefit. There are still the same difficulties. The child benefit was, in effect, a tax allowance transferred from the husband to the wife.
The statistics show what has happened to tax allowances over the past eight or nine years compared to child allowance. All tax allowances have gone up by 20 per cent. but the benefit has gone down. There is no way one can justify a reduction in this child benefit, or tax allowance. It cannot be argued that it should not be paid to everyone who pays taxes, irrespective of whether or not they can afford it. If people pay taxes and have filled in the means test, or income tax, form and qualify for child allowance they should receive it, whether as a child tax allowance or benefit.
If one says that the better off should not get child benefit then one must reintroduce the tax allowance to replace child benefit. If not, one is not beginning to understand the situation. I do not want to go further than that at this stage.
The order provides that pensions will be increased by 5·9 per cent. in April. But does anyone really believe that inflation will be only 5·9 per cent. next April? 1 understand that it will be around 7 per cent. Pensioners are on a loser from the start, and that is if we ignore what has happened since the last increase. Since then, electricity has been increased by 9 per cent. and is due for a further increase of 6 per cent. in April. Water rates have increased by 10 per cent., and in preparation for privatisation we are told that they will increase by another 10 per cent. by next April. Rents have increased by 12 per cent. since last April and will increase by a further 10 per cent. next April.
Against those figures, an increase or uprating of anything less than inflation will not be looked at with too much joy by claimants who are already in considerable difficulty. As I said, further hardship will follow the end of the transitional payments to claimants next year.
Before I conclude I should like to say a few words on the housing benefit situation, as this also worries me. I welcomed the advantages of the new housing benefit scheme on a unified calculation whereby those whose income is at or below income support level should generally receive maximum assistance with rates and rent. That ended the old distinction between the standard and the certificated claimants. I welcomed what I thought was a genuine step forward, which it was.
However, since then all housing benefit recipients are to pay 20 per cent. of their rates themselves. That measure was designed to save £350 million at their expense. Changes to the tapers of the housing benefit meant that people with incomes above income support lose housing benefit at a faster rate. For every £1 that their income exceeds income support level they lose 85 pence. That saves £150 million. When the capital cut-off was introduced at £6,000 it
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was estimated that 350,000 people lost all their benefits altogether. After nation-wide protest it was raised to £8,000 but it still cuts out an awful lot of people who deserve benefit. In all, £640 million was cut from housing benefit. As I said, although I welcomed the step forward to the new single unification method of calculation it is apparent that the resources put into that new structure were grossly inadequate and certainly do not meet the bill.
I shall not give too many figures, but the CAB points out that 88 per cent. of all people on these benefits lost money. Fifty-six per cent. of them lost up to £5; 22 per cent. lost between £5 and £10 and 23 per cent. lost over £10. What will the new rating and uprating do for those people? I suggest that it will do very little. There must be a great deal of fear and worry. From my own personal contacts I know that people are scared out of' their wits about 1989 with the threat of the poll tax hanging over them, with the changes that the Housing Bill will bring and the possibility of new landlords, rents being doubled or trebled, and so on. All sorts of fears are bedevilling ordinary people who did not think that in the latter years of their lives they would have to face such troubles and fears.
This new uprating will not allay those fears. It is sad that the debate should be timed at the beginning of the season of goodwill and show so little goodwill to thousands, even millions, of people who are struggling to cope with the existing system, let alone pile on this additional difficulty, before it is functioning in any way properly. I hope that the Minister and his colleagues will have another think about this between now and April and make the necessary adjustments which we will be happy to discuss with them as soon as possible in the new year.
1 p.m.
Lord Skelmersdale: My Lords, 1 have listened with great interest—and to an extent with great appreciation—to the points made by noble Lords on both sides of the House. Like my noble friend Lord Boyd-Carpenter, I was not surprised by many of the points made by noble Lords opposite. On many occasions they have been made before and have been replied to before. Therefore 1 do not intend to follow all the points made this morning. My noble friend Lord Boyd-Carpenter has clearly not forgotten the record of the last Labour Government whose inflationary policies did so much damage to pensioners and others on fixed incomes.
I begin by agreeing with the noble Baroness, Lady Jeger, that this is indeed a bad day upon which to be debating these orders for many terrible reasons. Such support as we give both in Scotland and from headquarters in London will be as immediate as possible. However, I wish to make the point that social security officers should not under any circumstances interfere in grief. In my ministerial portfolio, I am responsible for policy on widows' payments and pensions. Following upon the other recent terrible train disaster at Clapham, I made inquiries. I made it absolutely clear that I wanted payments to be made as rapidly as possible. As I said, in many cases these payments have to he applied for,

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and one cannot put pressure upon people who are suffering in these terrible circumstances.
The noble Baroness, Lady Jeger, wondered about the statutory duty of my right honourable friend to review the rate of child benefit each year. He has the statutory duty and he has no intention to depart from it. What that review does to the level of child benefit at any particular time depends upon economic circumstances and all kinds of other matters including social policy. Therefore I am unable to say what conditions will pertain at any particular time. Several noble Lords mentioned the extent of homelessness. This is a far wider problem than social security benefits. My department has been keeping closely in touch with organisations representing homeless people. This is continuing and it helps us to keep in touch with developments. By the very nature of the group of homeless or potentially homeless people—for example, because of mobility and the lack of accommodation—it is very difficult to keep track of what is happening to them. However, the two specialist offices dealing with homeless people in London have seen no increase in the number of homeless claimants.
The noble Lord, Lord Banks, asked a detailed question on the Treasury supplement. We shall be discussing this at great length in the future social security Bill that will be coming before this House in due course. I shall certainly write to the noble Lord before then; but I feel it appropriate if I do not respond now to his question. I know that the noble Lord is very keen on the idea that income tax and employees' national insurance charges should be integrated. One of his concerns today was for pensioners and low-income older pensioners. Before any concertinering of income tax and national insurance charges is decided upon, I believe that we should take note of the fact that elderly taxpayers will pay more from a combined tax and national insurance charge since those over pensionable age do not at present pay any national insurance charges. To exempt the elderly from the combined tax and national insurance charges would introduce all kinds of further difficulties.
We are monitoring the effects of social security reforms, and we shall continue to do so. We are aware that there may still be areas where the shoe pinches. The monitoring that we are undertaking mainly consists of using statistical data such as that submitted by local offices, expenditure out-turn and the annual statistical inquiry. There are plans for two research projects. One has been commissioned for later in the year on the customer's perception of income support. The other is scheduled to take place some time next year on earnings' disregards and expenses connected with work.
I do not believe that inflation is out of control. What has happened is it has been very difficult to bring it back under control. The Government are still resolved to fight inflation. In order to control prices. action has been taken to increase interest rates and this is in line with good, tight monetary control. I can tell the noble Lord, Lord Kilmarnock, that the increase in the National Health Service allocation alters the balance of National Health Service
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expenditure that is paid for by the contributor. It does not affect the planned level of expenditure on the NHS, but alters the share of its costs between the contributor and the taxpayer.
Turning to the question of family credit, the cost of any increased take-up will depend upon the average level of the award. I make the point, as I did in my opening speech, that the amount of money being paid out on family credit is as high as we estimated for the full 450,000 take-up. This indicates that people claiming at the highest rate are getting it. I agree with my noble friend Lord Boyd-Carpenter that one assumes that those are the people who are most in need of extra income from the Government. Families with children, like taxpayers generally, have benefited from a reduced rate of tax and higher personal allowances under this Government. Child benefit has been in its present form for nine years and it must now be judged in terms of its effectiveness as a benefit.
I am well aware that there are several points that I have been unable to answer in these few words. I shall read Hansard very carefully and write to the noble Lords concerned. This up-rating adds some £2 billion to the staggering social security budget of nearly £50 billion each year which is one-third of all public expenditure. It reflects the success of our policies which we have achieved without placing an excessive burden on contributors and taxpayers and the higher earnings brackets. It has reduced the burden of national insurance contributions for some lower-paid workers and their employers.
On Question, Motion agreed to.

Social Security (Contributions and Allocation of Contributions) (Re-rating) Order 1988
Lord Skelmersdale: I beg to move the second Motion standing in my name.
Moved, That the draft order laid before the House on 7th December be approved. [3rd Report from the Joint Committee.]£(Lord Skelmersdale.)
On Question, Motion agreed to.

Motion for the Adjournment
1.9 p.m.
Lord Denham: My Lords, in moving the Adjournment of the House ,on behalf of all my noble friends on these Benches I should like to wish noble Lords in all other parts of the House a happy and restful Christmas. I believe that I can claim on behalf of the whole House to wish the same to the staff in all departments and to thank them for the kindness they have shown.
Those whose faces we see regularly show constant cheerfulness under the dreadful pressure that we are inclined to inflict upon them. This makes life so much easier for us all. There are also those in other parts of the House whom we do not see so often. Their job is just as important. Their help, work and service is indispensable to the running of this House. We thank them too. Finally, I do not believe that we should let this moment go by without saying a word of

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appreciation to the Yeoman Usher of the Black Rod, Brigadier David Stileman, who over the years has given such marvellous service to this House, and who in a moment or two will be taking the Mace out of your Lordships' House for his last time. I believe that I speak for the whole House when I say to Brigadier and Mrs. Stileman, both of whom have been such friends and who have become such friends of us all, that we wish them a very happy and well-earned retirement.
Noble Lords: Hear, hear.
Lord Ponsonby of Shulbrede: My Lords, on this sombre day I wish to echo everything the noble Lord the Government Chief Whip said and join him in sending best wishes to fellow Members of the House for a happy Christmas break. I should like to join especially in his remarks about the staff in all parts of the House, particularly those in the Refreshment Department, who I understand will be working this evening as well as at lunchtime today. We should like to thank them for everything they have done.
As the noble Lord said, the Yeoman Usher of the Black Rod, Brigadier Stileman, will shortly carry out the Mace for the last time, an action superbly captured in a cartoon by Nuttall which was presented to him yesterday. All those who saw the cartoon will know how well it reflected that duty. We shall especially remember the friendship and help so willingly given by the Brigadier to all Peers during his 10 years of office. He displayed, to use one of his favourite expressions, a gutty approach to his duties. He was able to tackle and would willingly tackle any problem which others might hesitate to tackle.
The State Opening of Parliament was an annual challenge for him. The arrangements on the day required split-second timing. He had to ensure that the procession which he had to lead into this Chamber through the Royal Gallery did not clash with another procession being led by the Lord Chancellor in the opposite direction at almost the same time. These duties he carried out superbly with that split-second timing. He ensured that all the arrangements behind the scenes went smoothly. We all wish him and his wife Barbie a pleasant and happy retirement in their leafy Wimbledon home.
Lord Tordoff: My Lords, from these Benches I should like to join in wishing Members on all sides of the House a very happy Christmas and a better New Year than this one has been in many ways. As the House will remember, I was on my feet earlier today on a much more sombre note. It is perhaps wise to remember that this great Christian festival brings with it a feeling of hope. That message could well go out to those who are bereaved at the moment. It may not comfort them today but I hope that in the future it will do so. It is certainly a comfort to people to know that the birth of Christ offers hope to all who are bereaved.
I should like to join the words of thanks and good wishes to Brigadier Stileman. He has always been most helpful to members of all parties. He undertook the most difficult and the most simple tasks at any time and gave one the feeling that it was a privilege
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for him to have done so. He somehow anticipated every request in a way which always brought with it a cheerful response. We shall miss him but we hope that, as he goes to join the Wombles, he and his wife will have a very happy retirement.
I hope that next year is a happier year than this one. It will no doubt be as busy for the staff as well as for Members of the House. I join in thanking the Refreshment Department in particular because for them it has been a trying year. It started with upset stomachs in May from which some people, I understand, have not completely recovered. We thank the department for the hard work it has put in. To all the Clerks and Servants of the House who keep the business moving so smoothly throughout the year and to those who look after our security we owe an immense debt of gratitude. But above all, a very happy Christmas to us all.
Lord Kilmarnock: My Lords, from this Bench we should like to be associated with the remarks made by the noble Lord the Government Chief Whip and the other noble Lords who have spoken. We much appreciate the noble Lord's good wishes to his political opponents, which we warmly reciprocate for the period of the truce before us. We should like to be especially associated with the words of appreciation for our staff, without whom we could not function, and we thank them for their tremendous long-suffering patience with us. Finally, we should like to express our great appreciation for the work done by the Yeoman Usher of the Black Rod. He has been in post for 10 years and we shall certainly miss him sorely.
Baroness Hylton-Foster: My Lords, we on the Cross-Benches would like to join in the tributes to the Yeoman Usher of the Black Rod. We wish him and his wife a very happy and busy retirement. His unpretentious manner has made it easy for unpopular decisions to be accepted and as a result of that he has endeared himself to so many of us.
We should like to express our thanks and good wishes to our always cheerful and hard working staff. We hope that, despite the fact that there are only two and a half days left to Christmas, they will have an enjoyable day. We look forward to the new year.
House adjourned for the Christmas Recess at seventeen minutes past one o'clock until Monday, 16th January next.