Lords Sitting of 23 March 1988

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Manchester.
The Duke of Grafton—Took the Oath.

Nursery Education: Policy
Lord Dormand of Easington Lord Dormand of Easington asked Her Majesty's Government:
What is the level of nursery education provided by local education authorities and whether Her Majesty's Government propose to increase it.
The Earl of Arran: My Lords, both demand and provision are discretionary in nursery education and the Government have no plans to alter this. Most local education authorities are gradually increasing the level of nursery education they provide. Currently, 45 per cent. of all 3 and 4 year-olds, some 565,000 children, are in nursery or primary schools, as compared with only 39 per cent. a decade ago.
Lord Dormand of Easington: My Lords, does the Minister not agree that nursery education is important for all children and that in some cases it can be critically important? In view of the fact that compulsory provision is a long way off and in view of the fact that the Minister has just said that only 45 per cent. of our children have the benefit of nursery education, will the Government consider introducing an incentive scheme for those LEAs which are keen to expand their present nursery education?
The Earl of Arran: My Lords, education for under-5s is not a part of compulsory schooling. LEAs have a power but not a duty to provide it; demand for it is at the discretion of the parents. The Government accept that some pre-school experience is beneficial to under-5s both at the time and later on.
Baroness Faithfull: My Lords, does the Minister agree that there is a committee sitting in the House of Commons looking into education of children under 5 and that the Department of Health and Social Security has given money to the National Children's Bureau to look into the same subject?
The Earl of Arran: My Lords, I think that my noble friend is referring to ESAC, which is about to start a study of education for the under-5s. It has invited the DES to submit a memorandum of evidence. That is in active preparation.
Lord Parry: My Lords, does the Minister accept that there is already a very large body of evidence available, taken over the past 25 years, to the effect that the more deprived the environment in which the child is born, the more need there is for nursery education and the less likely there is to be demand
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from the parent? Do the Government accept the responsibility for doing something about that?
The Earl of Arran: My Lords, again I must repeat that education for the under-5s is not a part of compulsory schooling but it is up to the local education authority to decide what it wants to do in particular circumstances.
Lord Parry: My Lords, does the Minister accept that it sounds to the House as though he is hiding behind a traditional excuse?
The Earl of Arran: My Lords, no. I think that is unreasonable. The Government do not hide behind excuses.
Lord Mellish: My Lords, the Minister says it is up to local education authorities but is he aware that under the proposal of the Government at the moment ILEA will be abolished and this matter will be handed over to the London boroughs, some of which are so incompetent that we shall have no education at all?
The Earl of Arran: My Lords, I think that is perhaps another Question for another day.
Baroness David: My Lords, may I ask the Minister if it is still the Government's intention to fulfil what the Prime Minister expressed as her aim when she was Secretary of State for Education in the White Paper Expansion with Change? She hoped that 90 per cent. of 4 year-olds and 50 per cent of 3 year-olds would enjoy the benefit of nursery education. Is that still the Government's aim?
The Earl of Arran: My Lords, this objective, which was adopted in good faith in 1972, has long since been abandoned by successive governments, both Conservative and Labour, in the face of economic restraints.
Lord Dormand of Easington: My Lords, I think the Minister will realise that most of us know that nursery provision is not compulsory but my supplementary question was whether, in those circumstances and in view of the Minister having admitted that the Government feel that nursery education is a good thing, the Government are prepared to provide any kind of incentive to help those LEAs which are prepared to help themselves.
The Earl of Arran: My Lords, as regards resources that the Government give to the education authorities, they will continue to give the same resources in real terms.
Lord Mackie of Benshie: My Lords, is the Minister not aware that the Government have frequently stated that the period of economic restraint is over and that we are now in a period of unbounded prosperity?
The Earl of Arran: My Lords, if the noble Lord would like to become more involved in this particular

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point, it might be more appropriate to discuss it when the Education Reform Bill comes before your Lordships' House.
Lord Cledwyn of Penrhos: My Lords, the noble Earl has failed to answer the specific question put to him by my noble friend Lord Dormand. If he is unable—and the House will understand this —to give a direct answer on funding, would he give the House an undertaking that he will pass this request on to his right honourable friend?
The Earl of Arran: My Lords, of course I shall.
Baroness Sharples: My Lords, is my noble friend aware that there are a great number of private nursery schools which are contributed to by parents who may not have much money but who do nevertheless contribute? I dare say that these organisations help a great number of small children.
The Earl of Arran: My Lords, I am grateful for the point made by my noble friend.
Lord Glenamara: My Lords, is the noble Earl aware that there is a very simple way in which the Government could make an impact on this problem and that is by encouraging local authorities to admit children in the year in which their fifth birthday occurs? That would be better than nothing and, as there are many empty places in primary schools, it would make a big impact on the problem.
The Earl of Arran: My Lords, I take the point of the noble Lord. The Government have expressed concern that some of the provision may be inappropriate for 4 year-olds and they are watching the situation closely. Shortages of experienced teachers and appropriate equipment are the major constraints.

Diabetics: Blood Testing
2.43 p.m.
Baroness Lane-Fox Baroness Lane-Fox asked Her Majesty's Government:
When blood glucose testing strips will be available on prescription to diabetics.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Skelmersdale): From 1st June, my Lords.
Baroness Lane-Fox: My Lords, I thank my noble friend for that reply. Can he say how much the strips will cost the average sufferer?
Lord Skelmersdale: My Lords, they will cost them nothing. Insulin-dependent diabetics, who are likely to form the bulk of users of blood glucose testing strips, are exempt from prescription charges so the supply will be completely free.
Lord Ennals: My Lords, can the noble Lord say which types of strips will be available? I know that the British Diabetic Association is not certain. Will there by any training for people to use these strips? I know that that is another concern of the British Diabetic Association.
Lord Skelmersdale: My Lords, the answer to the second question is, yes, because they will be prescribed through the good offices of the sufferers' general practitioners, who will need to be assured that the strips are properly used.
As regards the types of strips, the reason for the delay is that it has been necessary to build up the necessary supplies. I understand that they are to be supplied by Boehringer, BCL, Ames and Hypoguard.
Lord Ennals: My Lords, I thank the noble Lord for that reply. Can he say when the advice to GPs will go out? I understand that it has not yet been sent to them.
Lord Skelmersdale: My Lords, I cannot give a date but certainly it will be in time.
Lord Winstanley: My Lords, the Minister has given the date of 1st June, which I warmly welcome, but it is earlier than the date of July given previously by the Minister. Does that mean that the Minister is assuming that the Health and Medicines Bill will have passed through its various stages in this House? Am I not right in thinking that the regulations depend on that Bill being enacted?
Lord Skelmersdale: My Lords, I have to admit that that is a fast ball from the noble Lord. My understanding is that the answer to the noble Lord is, no, because we can do this under existing regulations.

Iran-Iraq Conflict
2.45 p.m.
Lord Kennet Lord Kennet asked Her Majesty's Government:
Whether in the light of Lord Trefgarne's reply (Official Report, 3rd March 1988, col. 282) that there will be "formidable practical difficulties" in obtaining the agreement of the Security Council to the proposed creation of a United Nations naval force in the Gulf, they will state which members they expect to disagree with the proposal.
The Minister of State, Foreign and Commonwealth Office (Lord Glenarthur): My Lords, no properly formulated proposal has been submitted to the Security Council. However, those Western countries which already have a naval presence in the Gulf have given no indication of being willing to subsume their national efforts in a United Nations force.
Lord Kennet: My Lords, will the noble Lord confirm that the Soviet Union made a proposal through the mouth of its Foreign Minister to the Security Council on 25th September last for a United Nations naval force in the Gulf? Do not the Government think that this may be a good

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opportunity—the first in 25 years when the Soviet Union has been prepared to touch the United Nations with a bargepole—to see whether a true international effort may serve better to bring peace to the Gulf, or preserve what is left of it, than the present disjointed and unco-ordinated presence of various navies?
Lord Glenarthur: My Lords, perhaps I may first say to the noble Lord that certainly there is no question of a lack of co-ordination between those in the Gulf at the moment. We share the noble Lord's concern that the conflict should be brought to an end.
The Russians have put forward proposals, though they are vague and ill-thought-through proposals, in discussions among the five permanent members of the Security Council. I invite the noble Lord to consider that the proposals the Soviets have put forward may be aimed at reducing Western naval presence in the Gulf and increasing Soviet naval presence and hence influence.
Lord Cledwyn of Penrhos: My Lords, is it not the case that the Soviet Union said that it would be prepared to support a UN naval force in the Gulf on certain conditions? Can the noble Lord say what those conditions were? Were they related to the Russians imposing an arms embargo on Iran; that is, observing the United Nations resolution? What view do the Government take on that? Can the Minister elaborate on his reply? What were the uncertainties or the unsatisfactory aspects of the Soviet offer to which the Government objected?
Lord Glenarthur: My Lords, my understanding is that these proposals were put forward in a way which is by no means complete. I do not have a categorical list of the various proposals with me; nor do I have a list of the views expressed about them. In no sense are the proposals formal in the way that perhaps I may have indicated in my reply to the noble Lord, Lord Kennet.
The fact is that, added to the difficulties which these proposals would introduce, as I have described to the noble Lord, Lord Kennet, there are also serious practical difficulties involved with any UN naval force. My noble friend Lord Trefgarne has previously elaborated on them.
Lord Harmar-Nicholls: My Lords, does not my noble friend agree that the supplementary questions so far seem to bear no relation whatever to the Question on the Order Paper? As regards the Question itself, is it not highly dangerous to ask the Government to commit themselves on what another government may think in circumstances which cannot be identified?
Lord Glenarthur: My Lords, my noble friend is right in many ways. What we all want to see is a cessation of the conflict in the Gulf. Any ideas that can promote that and the implementation of Resolution 598 would be helpful.
Lord Cledwyn of Penrhos: My Lords, is the noble Lord aware that we on this side of the House would
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support any initiative by the Government to bring this dreadful and unnecessary war to a rapid conclusion? Is it not also fair to say that Her Majesty's Government and our allies should take steps to find out whether or not it is possible to come to some accommodation with the Soviet Union which would lead to a co-ordinated effort to bring the war to an end?
Lord Glenarthur: My Lords, it is important that we try to achieve that result. Exchanges among the Five in New York are continuing. It is certainly true that the Russians have dropped the link with the work on the arms embargo. Perhaps the linkage was self-seeking and to some extent unrealistic. As I said in my original Answer, the fact is that there are no properly formulated proposals on the table.
Lord Kennet: My Lords, is it not the case that at the end of the day the Soviet Union has crippled the United Nations through an entire generation by not paying its dues and by torpedoing all its projects? It is now the United States that will not pay its dues while the Soviet Union does so. It is now the United States and its allies who are torpedoing the projects of the United Nations.
Lord Glenarthur: My Lords, with respect, I believe that that is another and wider question.

Business
Viscount Davidson: My Lords, with the leave of the House, I should like to say a brief word about the length of speeches in today's debate standing in the name of the noble Lord, Lord Ennals, to which your Lordships have agreed to apply a five-hour time limit. On the principle that the mover is allowed approximately 20 minutes to open, and that the Minister should rise to reply not less than 25 minutes before the scheduled end of the debate, all other speeches should be limited to a strict upper limit of nine minutes. If any noble Lord should speak at greater length, he would be doing so at the expense of other speakers in the debate.

National Health Service
2.52 p.m.
Lord Ennals Lord Ennals rose to call attention to the state of the National Health Service; and to move for Papers.
The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper.
The date of 5th July 1988 is the 40th anniversary of the establishment of the National Health Service. It should be a time for celebration. The purpose of my introduction to this debate this afternoon is to make a plea to Her Majesty's Government for a generous birthday present to the National Health Service. I hope that the secrecy will be broken and that that will be announced in advance. I also hope that all noble Lords taking part in this debate will wish to endorse this plea to the Government.
Today there is great concern about the plight of the National Health Service. I believe that there is even greater concern about the future. When the presidents of the Royal medical colleges said that the hospital service had "almost reached breaking point" they spoke from the depth of their experience. That applies not only to the hospital service but also to the community care service. Sir Roy Griffiths' report was commissioned because of the growing pressure on the services for the elderly, the physically and mentally handicapped and the mentally ill. In his report he highlighted the gross inadequacies in care for these priority groups. He likened the task of the caring services to the Israelites faced with the task of making bricks without straw. His proposals for a transfer of responsibility to local authorities—with additional funds to enable them to fulfil their tasks—led the Government to publish his report in what I can only call a blaze of secrecy. They did it on Budget Day; they did it without comment. My first point is to ask the Minister to comment on the Government's reaction to this extremely important and carefully considered report.
Almost every day brings new evidence of the malaise in the National Health Service. On Saturday we learnt that not one of England's breast cancer screening centres will be fully operational by 1st April in contrast to a pre-election promise. On Monday we heard that almost 200 beds are to close at St. Thomas's Hospital, cancelling 2,100 admissions and shedding 300 staff. Surely these measures are being taken for financial reasons.
There is no public service more valued by our nation than the National Health Service; there is no group of workers more popular and held in higher public esteem than the nurses and the many other professional groups who work with them. Earlier this month, by a massive majority, five different opinion polls showed that the people asked were telling the Chancellor of the Exchequer that they would prefer to see additional funds going to the National Health Service as opposed to tax reliefs for the rich. They were asked about tax reliefs in general. The Chancellor of the Exchequer refused either to meet the needs of the National Health Service or to reflect the views of the general public.
Although there are party issues here, the issue of the National Health Service is not a party issue. Naturally, the Labour Party, with the feeling of parentage of 40 years ago, has a sense of pride as a result of that great achievement. I believe that that is natural. But tens of millions of people of all parties and none respect the National Health Service. They rely upon it and they want to see it strengthened and not weakened; and so do those people who work in the National Health Service. Whatever may be their positions of responsibility, there is a depth of commitment to the NHS.
I say that Ministers are deluding themselves if they think that those nurses who have been demonstrating up and down the country over these past weeks have been concerned just with their own pay. That is not so. They are concerned with the future of the National Health Service. Ministers would be
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deluding themselves even more if they seriously believed that the National Health Service is adequately funded. Everyone knows that that is not so. We are concerned not just with the present situation; we are concerned about the prospects for the future. Unless there is a change I believe those prospects to be very frightening. I am sure that the deep concern which I am expressing runs and is felt right across the spectrum of national life.
The all-party Select Committee on Social Services, with a preponderance of Conservative Members of Parliament, spoke very clearly and unanimously. Their concerns are shared by the British Medical Association, the Royal College of Nursing, the National Institute of Health Service Management, the National Association of Health Authorities, the King's Fund, and a very wide range of voluntary organisations concerned with different aspects of health to whom the National Health Service is pivotal.
The King's Fund has the same kind of allegiance as an independent body. I wish to quote some of its conclusions. These are views held by people from the Queen Mother right down to the mother-to-be who last week had to travel 75 miles to the 26th hospital on the list of those approached to provide two intensive baby care beds. Sadly, only one of those beds was needed because the other child died.
Perhaps I may quote four consultants. The chairman of the BMA's Central Committee for Hospital Medical Services, Dr. Paddy Ross, came to see me last week. He told me that a recent BMA survey showed that 3,100 beds had been closed in the last 12 months purely through funding shortages. He said that there were 80,000 more people on waiting lists than there were on the day that I left the DHSS. He said:
"If things are bad now, they are going to get significantly worse".
Forty per cent. of the consultants who responded to the survey (there was a big response) said that next year would be worse if urgent action was not taken very soon. Already up to 18,900 acute beds have been closed in the past nine years.
Another consultant wrote:
"We are an efficient hospital and we have recently been told 'you are too efficient', and we must cut our throughput."
That seems incredible. A Merseyside consultant has said:
"Our children's surgery ward is to be closed at weekends and in July our six theatres are to be reduced to two. Two theatres have already been mothballed".
A similar story comes from the Birmingham Children's Hospital where several children have already died.
The funding problems are not beyond the nation's ability to pay. It is not in doubt that Britain pays a much smaller proportion of its gross domestic product to fund health care than most other comparable countries—the United States, France, Germany, Sweden and the Netherlands. As the Minister himself has said, the fact that we do so well on a smaller proportion of our gross domestic product is a sign of the efficiency of the National Health Service. More patients are treated at a much lower cost. The unfunded gap is not unbridgeable.
There is no doubt of the accuracy of the facts published by the King's Fund, the National Association of Health Authorities and the three professional organisations to which I have referred. In order to avoid crisis the National Health Service needs an annual growth rate in real terms of 2 per cent.; first, to cover the growth of demand by our ageing population; secondly, to cover the increased costs of goods and services provided by the NHS. Those costs run at about twice the rate of the retail prices index. At the moment there is an annual increase of more than 8 per cent. Thirdly, to pay for the cost of medical advances. The health service needs 2 per cent. to stand still.
In the second half of the 1970s the growth rate, according to the King's Fund survey, was just under 3 per cent. From 1980–81 to 1987–88—a period of seven years—the King's Fund shows a growth rate of just over 0.5 per cent.; to be precise 0.6 per cent. At that rate it is not possible even to stand still. The consequence is underfunding and cuts in planned services. If these figures are wrong I am sure that the Minister will say so.
What about future prospects? According to the King's Fund survey of the 1988 Public Expenditure White Paper —and it has added on the additional £75 million announced to the House on 16th December, the separate funding for the waiting lists initiatives and the AIDS programme, and sums to ease the problems of central London—there will be:
"little—if any—growth in district budgets".
This "no growth pattern" is now even more serious as the Treasury has just stopped a concession which I wrung from it back in 1977 that there would be an end to the year-on-year carry over of 10 per cent. of capital and 1 per cent. of revenue to give some flexibility to health authorities. For some reason or other that has been cut, and I hope that the Minister will give some explanation as to why this flexibility has been removed from health authorities.
Thus the extent of the underfunding in the last financial year was £500 million, with a cumulative underfunding under the Government of £1,950 million according to the King's Fund survey. Interestingly, the House of Commons Select Committee produced a very similar figure of £1,896 million. Can the Minister say which figure is correct, although as the figures are so close perhaps it does not matter? However, surprise, surprise, £1,900 million is almost exactly the sum of the income tax concessions for very high earners in last week's Budget. If that money had been given the Chancellor would have been meeting the expressed wishes of those in the health service. I shall spare the House the hyperbole about the social injustice of the Chancellor's judgment. It has all been said. However, we can understand why John Biffen has announced that he will vote against this calculated decision to reward the top earners and deprive the National Health Service.
I am saying that the resources needed to stop the bleeding in the National Health Service and to bring about a modest rate of growth are not beyond the resources already available to the Government. I—and for that matter the Select Committee, the
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King's Fund Centre and the other published surveys which I have before me—am not calling for a massive injection of untargeted, uncalculated money to be thrown—to quote Mr. John Moore, the Secretary of State—at the National Health Service. The sums needed are most carefully calculated not to give rise to galloping growth but to stop the decline and to provide the modest prudent growth which has been made available by previous governments of all parties; and not even to catch up with the growth rate in other countries with which we have made comparisons, although that might well be an ultimate objective.
Inevitably we must ask ourselves this question. If the amount of money is not beyond the ability of the country to pay, if the needs of the National Health Service are known, if it reckoned that there is fair and effective control over its performance and that the level of efficiency is high, why have the Government decided to precipitate this crisis? It is a crisis of their own making. It is no accident that the health service is in crisis. There is no question of profligate, uncontrolled spending on the National Health Service. There is no question of irresponsible funding of an inefficient service.
Ministers accept that more patients are now being treated and that the NHS management costs are efficiently controlled and are on average lower than those of other countries. There is no pretence that the Chancellor does not have the resources effectively to cover this defined degree of underfunding. Why then have the Government created a crisis which is imperilling human life in some cases and engendering the greatest sense of crisis and of low morale in the National Health Service in the 40 years since it was created?
I have only one explanation to offer. The Government have decided deliberately to create the impression that the time has come for a root and branch reorganisation of the structure and financing of the health service. I cannot be wrong because the Prime Minister has announced that there will be such a review, though she has not announced its terms of reference or for that matter who will carry it out. It may well be that the Minister will be able to say something about that.
The review team set up very rapidly some weeks ago is now looking at a range of nostrums not one of which, being practised elsewhere, has produced results comparable to the efficient service provided by the National Health Service. I am not saying that there are not ways of increasing the efficiency of the health service. We could look at a whole range of issues: how we can more effectively produce a medical audit of doctors controlling their own expenditure more effectively; the work to be done in information retrieval and ensuring that information is effectively used by clinicians and others who control the use of scarce resources. We could look at the better use of operating theatres, of beds and of staff time. I should welcome experimentation in the internal market system to govern organisation and financial relationships between health authorities. It has been suggested that there should be such a survey in East Anglia. However, years of experience in Britain and abroad have led me and other people, including the

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Royal Commission on the National Health Service, to the view that a tax-funded service available to all without supplementary payment is the best, the fairest and the most cost-effective method of providing health care in this country.
If we look at the United States—the home of private health insurance—about 37 per cent. of the population do not have any form of health care; it also has a higher perinatal mortality rate than we have, with a lower life expectancy. The French system is complicated and costly as well as being inefficient with an excess of doctors and of hospital beds. Similarly, the German system encourages waste and unnecessary surgery at a higher cost.
The provision of health care is a matter of national interest, and I believe that now is not the time to make dramatic changes. Just a few days ago I attended a conference of professionals working in the National Health Service and the one message from them that was loud and clear was, "Please do not have another reorganisation of the health service." They have learnt of the consequences of other reorganisations in the past. They also said, "Let us have the opportunity to get on with our job." I believe that that is right. It would be quite wrong at present to plunge the National Health Service not only into a major funding crisis but into a crisis of its own organisation. I do not want to see—and I hope that noble Lords will likewise not wish to see—a root and branch reorganisation. I hope that the Government will see that the National Health Service urgently needs funds. And I say, as I said at the very beginning of my speech, my plea to them is that they should provide adequate resources to enable the National Health Service to fulfil the needs of the nation. I beg to move for Papers.
3.11 p.m.
Lord Skelmersdale: My Lords, the House will be more than grateful to the noble Lord, Lord Ennals, that at last, after all this time, we are debating a Motion to call attention to the state of the National Health Service. I do not know about other noble Lords, but I have been holding my breath all winter! I must hold it for a little while longer until I have heard the maiden speech of the right reverend Prelate the Bishop of Guildford to which we are all looking forward.
To judge from the tales of woe that we have just heard from the noble Lord opposite, a visitor from another planet could be forgiven for thinking that the National Health Service was on its knees and about to breathe its last. We have heard tales of ward closures, patients not treated and beds closed. But is it an accurate picture that the noble Lord has painted so eloquently?
I beg to suggest that it is not. The National Health Service is now better funded and has more trained staff than at any time in its history. Next year it will cost some £21·5 billion. That is an increase of over £1 billion on this year's allocation alone—an increase that is much more than the entire budget of the Department of Trade and Industry.
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Not surprisingly, the noble Lord sought to make much of the fact that the Chancellor's Budget Statement did not provide any additional resources for the NHS. The fact that the Government did not choose to use that occasion in that way does not mean that they will not make any additional resources available for the next financial year—they already have at least the £1 billion that I have mentioned. Indeed, even on current plans, every family in the land will pay some £31 a week towards it. Hardly peanuts, my Lords!
Our recent economic success makes us forget that only a sound and strong economy can produce the buoyant revenues necessary to finance expanding health and social services. We must not kill the goose that lays the golden eggs. We must continue with our programme to liberate the energies of the nation and to stimulate enterprise and initiative. If we do not, we shall return to the mediocre, low-wage, low productivity economy which we had in the 1960s and 1970s.
Let us also not forget what priority the Labour Party actually gave to the health service when it was last in office. The noble Lord, Lord Ennals, admitted that they spent a smaller proportion of the gross domestic product on health; namely, 4·8 per cent. as opposed to 5·5 per cent. today. Worse, their failed economic policies meant that their gross domestic product was also much smaller; in other words, they gave the NHS a smaller slice of a smaller cake. Indeed, this means that they would be spending a massive £2,900 million less a year on the NHS than we are.
The noble Lord mentioned the Royal Commission. It also said that we could easily spend the whole of the gross domestic product on the National Health Service—no government since that time have disagreed. Has the noble Lord, Lord Ennals, forgotten that in his tenure of office waiting lists rose? There were strikes by nurses and hospital porters and he received a letter from the presidents of the three medical royal colleges criticising underfunding in the NHS. It was that mess that this Government had to tidy up. It was achieved by getting a strong economy going and by using it to fund the health service at record levels.
So, in the NHS we have an undoubted success story on our hands, and yet, the noble Lord, Lord Ennals, has made the speech we have just heard. There is still a sense of dissatisfaction, a feeling that the NHS could and should do more. We all have the words of that magnificent hymn, Jerusalem, ringing in our ears:
"We will not, [we must not] cease from mental fight …"
So neither I, nor my fellow Ministers, are complacent. We recognise full well the pressures which face our health service; pressures which, in many ways, face every health system in every industrialised nation, pressures that arise for a number of reasons. First and foremost, there is the success of professional staff—the skilled and dedicated doctors and nurses in particular in increasing their productivity, ably and cheaply supported·here I agree with the noble Lord, Lord Ennals—by NHS managers. More and more patients

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are being treated for more and and more conditions, and in fewer beds. I stress that this higher productivity reduces the cost of each individual case (because the cheapest operations no longer use expensive overnight beds, and large amounts of operating time); but, by raising activity levels, it increases expenditure overall.
The Government have recognised the special difficulties in the current financial year when increased activity and the effects of local inflationary pressures have combined to put an unusual strain on health authorities. This was shown in the special allocation before Christmas of an extra £100 million for the United Kingdom as a whole, three-quarters of which was to help ride out those temporary difficulties.
Particular pressures need particular and targeted resources. I am very pleased to say that we are today announcing the distribution of £15 million to health authorities in London and the North West to help them meet the short-term costs of planned changes in the health service. That is the second slice of a special fund worth £30 million which is designed to help those regions that receive the lowest increases in funds under our formula for allocating resources know as RAWP. Most of the £15 million will go to inner-city areas. It will help to ensure that acute services in London and elsewhere are maintained.
So we recognise the pressures and are seeking to provide the tools whereby health authorities can cope with them. We want the NHS to continue to develop and to provide a quality service. In doing so, we shall ensure that the money spent is used to best effect; for example, the £30 million fund we have made available to tackle the problems of waiting lists and, in particular, excessive waiting times. This is so successful we intend to continue it for two years more than originally planned.
So we have a major and important programme in hand to ensure that the NHS gives good value for money and treats the maximum number of patients possible within the resources given to it. But, like any good business, we intend to couple this activity with a longer-term strategy. Accordingly we have initiated a wide-ranging review of the NHS, with particular emphasis on the hospital service where the pressures of medical advance and an ageing population fall most heavily. That review is now well under way. We are looking at any and every constructive idea to provide a sound and reliable health care system into the next century. I can assure your Lordships that the speeches in today's debate will be carefully scrutinised so that any ideas for taking the National Health Service forward can be fully considered in the context of that review.
Let me state, and state categorically, that the fundamental principle of the health service is not in question; access to medical care should not be dependent on the ability to pay. It has not been so since 1948, nor is it now, nor will it be in the future. Our concern is how to carry that principle forward in a society very different from that which saw the birth of the National Health Service.
The NHS is a remarkable institution. It provides a high level of care to many thousands of people every
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day and relieves pain, anxiety and suffering in so doing. This Government have shown through their actions that they fully support the health service and have committed a larger share of national wealth to that service than their predecessors. Indeed, they have increased spending on the NHS by twice the amount they have increased public expenditure overall. There could be no clearer sign of continuing commitment.
3.20 p.m.
Lord Winstanley: My Lords, it is inevitable that in a debate on this subject at this time, so eloquently opened by the noble Lord, Lord Ennals, we should appear to be preoccupied with funding. The Minister tempted us to remain on that road. I accept the figures that he gave us with regard to existing funding, and I was delighted to hear the hint which he appeared to give about possible additional funding in the future.
It would be regrettable if we wasted the debate by some 30 speakers all saying the same things, but I am certain that each and every one of those speakers awaits with interest the speech of the right reverend Prelate the Bishop of Guildford, because we know that the Church has always been committed to an efficient and comprehensive health service.
Many of the speeches that we shall make will be anecdotal, because noble Lords have a vast experience in this subject in different areas. All those anecdotes about inadequate funds will add up to a powerful case to which the Minister has promised to listen. I must stay on the question of funding. I shall remind noble Lords, in case any of them need reminding, that the National Health Service, in which I have worked for many years, has never been adequately funded. I was working as a general practitioner when it started on 5th July 1948, the so-called appointed day. It was not adequately funded then.
It got off to a splendid start. Why? It was because of the dedication and commitment of the people who were working in it and their determination to make it work. However, it was underfunded. The people working in it were underpaid. Noble Lords will remember that those general practitioners who were reluctant to enter the service were encouraged to do so by a promise that the pay would be decided independently. We went in on provisional pay, on an undertaking given by the then Minister, Nye Bevan, that the pay would be as recommended by the independent committee under Sir Will Spens; when the Spens Committee reported, we should be paid according to its recommendations.
When the Spens Committee reported some three or fours years later, the recommendations were accepted, but they were not backdated to 5th July, as they should have been. There was then an unholy dispute which finally went to arbitration before Mr. Justice Danckwerts, who in the end gave judgment wholly on the side of the doctors and wholly against the DHSS. As a result, I later received a cheque for what in those days was a substantial amount of money. It was pay right back to 5th July 1948. My children were brought up to go to sleep with the words, "And God bless Mr. Justice Danckwerts".

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Another consequence of that occasion is that one never mentions arbitration to any DHSS Minister; they run a mile. They have been bitten once, but not again.
The service has always been underfunded, under both Labour and Tory governments. I hope that the noble Lord, Lord Ennals, will not mind my saying this, but way back in 1951, because of the shortage of money, the Labour Government had to introduce charges which, I admit, it was said would be temporary; but as so many temporary things do, they became relatively permanent. Mr. Nye Bevan resigned. The noble Lord will also remember that much later, in 1967, we had desperate financial difficulties, not due to the Labour Government, although they may have contributed to them, but due to the closure of the Suez Canal, as a result of the six-day war, and the seamen's strike. We then had the so-called July measures which, among other things, included prescription charges. That was to raise money for a service which was underfunded, and always has been underfunded.
What is the difference now? In the past those working in the service recognised that the nation did not have the money. The nurses, doctors and others carried on working. That was one of the differences. There was another difference. The administration was a bit different. We had people called matrons, but I will not go down that path. Things were different, but there was that commitment. There was an acceptance of the fact that the nation could not afford the money. We now have a government and a Prime Minister who tell us that money is pouring out of their ears. That is the difference. There is no longer an excuse for underfunding of the service. There may have been an excuse in the past.
There is a danger in the recent important campaign about the funding of the service. As it mounted, we all knew that it would not be successful. No government will capitulate in the face of a campaign. However, we all hope that the message has got through: that there are shortages and deficiencies which need to be rectified. We knew that they were not going to be rectified in the Budget. The Budget is not a time when the Chancellor dishes out money; it is a time when he collects money. What matters now is how much he has in his back pocket. It is my view that he has plenty. It is also my view that in the fullness of time some of it should go to the National Health Service.
One of the dangers of that campaign, which focused inevitably on anecdotal experiences about hospitals, the tragic deaths of children, and such matters, is that we have tended to forget about another part of our National Health Service; that is, the domiciliary service (the family practitioner service) which is unique among the nations of the world. We have a family doctor service in which one doctor is responsible for the whole of the patient, not as in the United States or the Soviet Union where there are a whole lot of doctors each responsible for different parts of the patient. Our family doctor system is unique. It must be preserved.
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The extent to which we have all concentrated on the plight of the hospitals has taken people's attention dangerously away from the needs of the domiciliary service. We now have Sir Roy Griffiths' report on community care. He has made it clear that we need additional funding for community care. His suggestion is that the service should go to local authorities with hypothecated money. Hypothecated money from central government is something against which, in the past, governments have always turned their backs. If they accept it for this purpose, they will be establishing a welcome precedent. Let us not forget the family doctor service.
Nor should we forget the dental service. When the National Health Service started, dental health in Britain was the worst in Europe. In time, it became almost the best. If we go ahead with plans for charging for dental inspections, I fear that we may slip back to the lowly place we occupied in the past.
There is another point about the domiciliary service and family doctors. What about all the homeless children, especially in London, who live in hotel accommodation, many of whom have never had any schooling, most of whom have never had any innoculations of any kind, and who never have any medical records and no regular general practitioner? There are desperate difficulties of that kind to be looked at.
We shall never have enough money to satisfy the doctors and nurses who work in the service. Sooner or later in medicine, an area in which new methods of treatment and diagnosis become more and more complex and more and more costly—a situation of ever-increasing expenses—we must at long last embark upon cost-effective studies in relation to medical procedures. That is something against which we have always turned our backs.
We are not talking about the raw materials of industry; we are talking about people's health and people's lives. We must see which investment brings the maximum return in terms of the relief of human suffering and the saving of human lives. I shall give an example. If we assumed that every man, woman and child who could conceivably benefit from a human organ transplant were entitled to it, the service would collapse overnight. Somehow we must do some cost-effective studies. They are complex. For example, if we have a middle-aged, healthy, manual worker with an irreducible inguinal hernia, which is not a life endangering matter but needs an operation, and he has to wait three years for his operation, the state has to keep him, his wife and children for three years while he waits for that operation.
That is one of the criteria which have to be considered when we are deciding about priorities. Sooner or later we shall have to embark on cost-effective studies in relation to medicine. When I said that years ago to Dr. David Owen, when he was Minister of Health, his words were, "I absolutely agree with you, but Barbara Castle won't have it". Sooner or later we must all have it.
Finally, I was delighted to hear the Minister's hint that when the Government have finished their inquiries which are going on, if they notice that there are real deficiencies they will make up those

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deficiencies. I hope I was right in reading that into the words he spoke to us earlier.
3.30 p.m.
The Lord Bishop of Guildford: My Lords, I speak as a consumer representative about the National Health Service because I am convinced that I and my family have received more from the National Health Service than we have ever contributed to it. I have no inside or expert knowledge. It is true that some years ago I was a part-time employee of a health authority because I was a part-time hospital chaplain, but I speak essentially as a patient and as a regular visitor to people in hospital.
I want to make three brief and, I trust, uncontroversial points, although this is a subject on which it is becoming increasingly difficult to be uncontroversial. First, I should like to express gratitude, admiration and appreciation to the staff of the National Health Service and confidence in them. In our current concern for the health service and our proper requirement for greater efficiency it seems easy to overlook the quality, the dedication and professionalism of those who are working in the National Health Service. My experience in visiting a variety of in-patients in hospital is that there is a widespread and unreserved appreciation of medical, nursing and ancillary staff.
I think morale is low in the National Health Service at the present time because of financial stringency and also because of uncertainty about the future. So I trust that this word of appreciation of the staff who are working in the service will be echoed throughout your Lordships' House. Sometimes National Health Service staff are working in buildings which look so drab and dreary that the buildings seem to be more in need of treatment than the patients. Sometimes the staff are working short of basic equipment. It is not many months ago that I was scooped up off the pavement in London and taken into the emergency and accident department of a London teaching hospital where they were unable to provide me with a pair of pyjamas, even though I was in a mixed ward. In some areas there is a shortage of staff which is throwing additional burdens on those who are dedicated to maintaining a high standard of public service.
However, in and through these difficulties the staff of the National Health Service display care, skill, commitment and professionalism of a high order which we can too readily take for granted. I for one would not wish our proper concern about the improvement of the National Health Service to obscure that personal dedication of the staff.
Secondly, I should like to follow what the noble Lord, Lord Winstanley, said about general practitioners because they seem to be an asset which is admired by visitors from overseas. Not all general practitioners are above criticism, but they provide a system of primary and local health care which is both valued and valuable. Because it is the general practitioners who refer people to hospitals, they are a crucial element in running a properly economic system. The evidence seems to be that in the United States where people can refer themselves to hospital, the rich sometimes buy themselves unnecessary care,
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while the poor are in danger of failing to get essential care. Our system of general practitioners seems to be a valuable part of our national health care and I wish to underline appreciation of their work.
My third point relates to the comprehensiveness of the health care that we have and which I hope can be maintained, no matter what changes may be forthcoming. Whatever new funding there may be, whatever developed partnership there may be between the public and the private sectors, surely the comprehensiveness of our health care is an asset to be sustained. Everyone should be sure of obtaining whatever he or she needs, and that provision is surely a community responsibility. Health is not a commodity which the fit provide for the sick, nor something which the rich give to the poor. Health is a quality of life which we make together.
In recent years we have come to recognise the positive contribution which handicapped people make to our corporate life. By their patience, their resilience and even by their existence they can enrich us and draw out qualities from us who call ourselves healthy. At the risk of being anecdotal, perhaps I may say that I speak as one who has learned that lesson grudgingly because I am married to someone who 10 years ago became partially handicapped, both mentally and physically, as a result of tubercular meningitis.
The handicapped are a continuing reminder of the hidden and vulnerable parts of ourselves. Living with the handicapped is demanding but it is also instructive and creative. So it is with the sick. They draw out of people a generosity of spirit, warm compassion and practical care beyond recount. The health of a society is made by the fit and the sick together. For that reason surely we must have a health care arrangement which ensures the comprehensiveness which we have at the present time. Through all the anxiety and criticism which currently surrounds the National Health Service, I hope that we can acknowledge and appreciate the professionalism of the present National Health Service staff and ensure an arrangement of health care which provides equally for all in our society.
3.37 p.m.
Lord Carter: My Lords, I have the great good fortune to be the first on behalf of the whole House to thank and congratulate the right reverend Prelate the Bishop of Guildford on his maiden speech. He spoke with all the lucidity and sincerity that we would expect from the Bishops' Bench and I know I speak for all noble Lords when I say that we shall look forward very much indeed to hearing him on many occasions in the future.
I begin by congratulating my noble friend Lord Ennals on putting down this Motion to enable us to debate this extremely important topic. I also apologise for my absence from the closing stages of the debate, owing to a previous engagement.
I do not propose to burden the House with statistics but rather I wish to concentrate on the hospital service and the experience of one particular children's hospital with which I am familiar because its experience seems to encapsulate the problems that

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we are discussing today. Before I do so, I should like to raise a particular point regarding the ambulance service. I know that the Minister is aware of the point and I should like him to comment on the proposal that the ambulance service, doctors and nurses should from 1st April next year be asked to pay the licence fees for the radio frequencies which they use for the emergency services and which in the past have been free. Perhaps the Minister could explain the rationale for this proposal. I shall not be present when he winds up so perhaps he will be good enough to write to me and to place a copy of his reply in the Library.
For five years from 1977 to 1982 as a family we had particular experience of one children's hospital. We cannot remember during that time the problems of ward closures, bed shortages and the difficulties over admissions which are now the familiar symptoms of the current crisis in the health service. It occurred to me to find out the present situation in that hospital which we came to know so very well. It is still situated in the same building, which is 120 years old. In the particular department of the hospital which we knew well, over just three days recently the consultants wished to admit 17 patients for urgent investigations. There were beds for only four. The doctors, technicians, nurses and porters still had to be paid and equipment costing in the order of £1 million was left idle.
The Christmas closure of beds was extended for a month. That saved 2 per cent. of expenditure and reduced the service by 25 per cent. Many patients have either been refused admission or sent to hospitals which are not equipped to deal with them.
No statistics are ever collected regarding the patients with acute medical or surgical conditions who are turned away. That hospital is now increasingly reliant upon voluntary efforts to raise funds for vital equipment and even for the replacement of bedsteads. New equipment is now virtually unobtainable from NHS funding. The major problem is actually to get the patients into the hospital. I quote from a member of the hospital staff:
"Once the patient is in, it is very difficult for the managers to prevent us giving appropriate treatment, although we are always being threatened with the dire consequences of exceeding our budgets."
I have one particular and recent case to relate. It seems to me to sum up the whole hospital sector problem. It concerns a young man of 19 who since he was 10 weeks old had been treated in this hospital for a complex cardiac condition. He became extremely ill and his GP tried to get him into the hospital which had treated him for 19 years. No beds were available and the doctor was told to ring back in a day or two. But the young man became seriously ill overnight and he was sent to the hospital with a note urgently requesting admission. He was kept waiting for six hours but there were still no beds and so he was sent to another hospital. That hospital was not equipped to deal with the complexities of his condition.
The doctors there spent over a week attempting to return him to the hospital which was equipped to deal with him and had the consultants who knew him. On the sixth day the young man was packed up in a
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wheelchair waiting for the ambulance to transfer him to the other hospital. A call was received to say that no bed was available as it had been used for another urgent case. After two more days the young man was actually in the ambulance awaiting transfer when a phone call again was received saying that no bed was available as it was needed for another urgent case. Eventually he was transferred, but by now his condition was very serious. He was rushed to the operating theatre but he died during the operation.
That is not an isolated case. For me it is a particularly poignant example because our son was rushed to that same hospital on many occasions in the late 1970s and early 1980s. Never once was there any delay. He was always in hospital receiving the care and attention that he needed within a few hours of the GP requesting admission.
In a caring and a civilised society and with an Exchequer that is awash with funds, no citizen should be treated in the way that that young man was treated. We would all agree that he deserved something much better in the last few weeks of his life.
The Prime Minister has a very rare political gift. She has the ability to turn the unthinkable into the commonplace. She has succeeded in doing this in whole areas of social policy and above all in the health service. I have to say with great sadness and after much reflection that this Prime Minister and this Government have caused and will cause more suffering and indignity to individual citizens of this country than any government since the war, and perhaps for even longer than that.
Medical students and newly qualified doctors used to be told that their job was: to cure, seldom; to relieve, often; and to comfort, always. I am afraid that under this Government that has now become: to cure, provided the funds are available; to relieve, if it does not involve additional expenditure; and not to bother to comfort, as it does not figure in the hospital statistics.
3.45 p.m.
Lord Nugent of Guildford: My Lords, I wish to start by thanking the noble Lord, Lord Ennals, for giving us the opportunity to discuss this vitally important matter today. I have to begin by making an apology because this debate coincides with the monthly board meeting of a private hospital in Guildford which belongs to the Congregation of Franciscan Sisters. As I am chairman of the board, I hope that I shall be excused if I have to leave to attend that meeting.
I wish to say a few words of congratulation to the right reverend Prelate the Bishop of Guildford. We Lords of Guildford, whether spiritual or secular, must stand together. I much enjoyed his speech and look forward to hearing many more.
Let me turn to the theme of the debate which was opened so cogently by the noble Lord, Lord Ennals. It is of course about the crisis in the health service, especially in the acute hospital sector. I wanted to follow the thought which the right reverend Prelate mentioned of congratulation to the health service because, even in the acute sector where we have such dreadful problems now, the increase of treatment for some major troubles such as coronary heart bypass

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means that three times as many of these cases have been treated as were treated 10 years ago. That is 86,000 more cases.
Kidney transplants have doubled in the past 10 years. In 1979 there were only three heart transplants, but last year there were 244. Those numbers are typical of the dramatic increases in acute surgery. Each one places a very heavy demand on resources. No one could say that it is a failed service. That would be a complete irony.
The fact is that the invention of further new surgical and medical techniques—especially in diagnosis—means that the demand is ever increasing. On top of that, as has been said, there is the ever-extending longevity of humanity. It is a fact that the number of over-75s in this country has doubled since 1951. The oldsters in the community today—those over 65—occupy over half of all the NHS beds. That gives us some idea of how this problem escalates all the time.
But the Government have provided a huge increase in funds. The funds have been increased by one-third in the past eight years. I thought that the noble Lord, Lord Carter, was a little less than generous in not acknowledging what has been done, nor the fact that the Government have promised a further £3·5 billion in the next two years. I quite agree that that is still not enough, however. The demand will continue to outstrip that.
The solution of the noble Lord, Lord Ennals, that there should be further increases from public funds is not the right answer. This Government have massively succeeded in their economic policy by their control of public spending. Personally, I trust the Government's judgment and I think that most of the country feels the same way.
In the present deadlock I believe that we must look for some further solution in the form of an outside source of finance to provide the extra money needed. The obvious solution is the private sector.
In other countries whose social and economic structure is comparable to our own the contribution from the private sector is considerably bigger than in this country. France has five times as large a private sector contribution as ours. We spend only about 0·5 per cent. of GDP here. France spends over 2·5 per cent. Canada spends over 2 per cent., Germany about 2 per cent.—four times as much as us—and Holland too about four times as much as us. I believe that we could benefit from their experience.
The private sector here caters now for about 4½ million people. It could cater for many more. There are various ways of doing that. I do not doubt that my noble friend, by means of the comprehensive review which is taking place in his department, is looking at all kinds of ways of doing that. I can only mention one briefly in the few minutes that I have remaining. The proposal to set up a national health insurance fund has been the subject of some discussion. Such a fund would finance the whole of the National Health Service except for charges. It would take the place of the national insurance fund. That would be abolished and the whole of the cost of social security would be funded out of general taxation, as half of it is now.
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All adults would pay a national health insurance levy but special classes of people which Parliament might designate, such as pensioners, the long-term disabled and the unemployed, would be excluded. The main exclusion would be for all those who had contracted for private health insurance and could produce a certificate from a recognised health care company such as BUPA or PPP. There could be further refinements of contracting out between the services as required.
There are three major advantages in such a scheme. The first is that it would attract more private money into health care without calling for more taxes. Secondly, it would give a straight choice between the National Health Service and the private sector on a comparable basis. At present, there is no comparable basis. Thirdly, there is a further advantage in that, as the National Health Service would be directly funded by a national health insurance fund levy, the nation would have an understandable choice of whether it wished a higher standard of service on payment of a higher annual levy. That would put financing of the National Health Service for the future, with its ever-increasing demands, on a sound and understandable basis. I believe that there would be a considerably expanded private sector which would make a substantial contribution to the total health care of the nation. I commend that solution to my noble friend.
3.50 p.m.
Lord Perry of Walton: My Lords, the National Health Service has not suddenly developed an acute illness; it has, as the noble Lord, Lord Winstanley, said, been chronically sick for years. Recent events represent only the worsening of the condition. There is no question that a shortage of money is a factor in causing the recent deterioration. However, shortage of money did not cause the disease; it merely aggravated the symptoms. Providing more money would improve the patient. However, that would be only symptomatic treatment. That is not to say that symptomatic treatment is not important. It is very important and more money is certainly needed. However, it would not provide a radical cure.
Before the National Health Service was started, the morale of those working in voluntary hospitals was very high. I know that because I was a junior hospital doctor in a voluntary hospital in 1944. When the NHS was started, there was a general euphoria and a great hope and faith that it would be one of the most successful social innovations of all time. And it was. It removed the fear of the economic consequences of being ill.
It is therefore tragic that over the 40 years of its life, the morale of those working in the NHS has gradually sunk lower and lower. Yet despite that, most patients—and I have been a patient—feel that the service has continued to provide care which has been deeply appreciated and has maintained a very high overall standard. As the right reverend Prelate the Bishop of Guildford said in his eloquent maiden speech, we must not stop being proud of those who work in the National Health Service.
I believe that morale in the NHS has sunk because the service has never had any leaders. There is no leadership at all. The enormous mistake which has

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been made in every reorganisation of the health service is to confuse management with leadership. In my experience, professional organisations can only be successfully led by professionals. In a professional organisation, administrators and accountants should be employed to do the jobs for which they were trained. The matter would be much clearer if those people were still called clerks and bookkeepers. Then there would be no temptation to put them into positions of power—power which they cannot really exert because the decisions that matter must rest with the professionals.
I suspect that most noble Lords who have been patients in hospitals would resent any suggestion that the consultant responsible for their treatment should not have authority over everything happening to them. Everyone working in a hospital—be it porter, nurse, doctor or ancillary—is there to help the consultant to look after the patient as well as he possibly can within the resources available to him. It therefore follows that the consultant ought to control the distribution of resources that are available and decide how they should be used, especially when they are scarce.
I have said all this many times before. In a speech in your Lordships' House on 11th April 1984, I went on to say that in many respects a large university is not unlike a hospital. Both are there to provide services, one to students and one to patients. They are both staffed multiprofessionally and depend on a large variety of craftsmen to help the professionals. Both expend large amounts of public money.
Like other vice-chancellors, I ran a large university. I was not a trained administrator. I do not think that I am a very good manager. All that I can claim to have done was to offer some leadership to the Open University. The qualities of leadership include picking first-class people to do jobs which you are not good at yourself. I was lucky in getting a first-class administrator to work for me. However, being a good administrator is not a guarantee of being able to provide leadership. Making the books balance and answering all letters by return post never fired the imagination of staff or raised their morale in times of trouble.
In a hospital, the only person who can command loyalty and respect from all the staff and provide leadership is one who is drawn from the ranks of senior consultants. Of course there are many consultants who would refuse the job of running a hospital. There are also many professors in universities who would refuse the job of being a vice-chancellor. However, there is never any shortage of applicants. Only one professor is needed to be a vice-chancellor; only one consultant is needed to be the director of a hospital. He must be given the necessary clerks and bookkeepers to do the routine chores and he must also be properly paid—not only his consultant's salary but also a distinction award and more.
I have so far looked at the microcosm of the situation in a hospital. The lack of leadership in a hospital is paralleled by a lack of leadership in the macrocosm of the service itself. The Griffiths Report,
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which led to the introduction of general managers in the last reorganisation, made the usual mistake of confusing management with leadership. However, it is impossible to manage, far less to provide leadership, for a service that has over 100 separate authorities.
If we conceive of an army commander having well over 100 lieutenants who are not responsible to him and not even employed by him but who are responsible instead to 100 different local committees, he will lose the war. I am in favour of delegation of authority. But in my book that means conferring decision-making power on individuals and retaining the right to relieve them of their responsibilities if you lose confidence in them. To delegate authority over a lieutenant to a group of people over whom you have no such power is a recipe for disaster. Yet the chairman of the board of managment of the National Health Service is in exactly that position.
In my view, it would be better if the service was an agency of government, headed by a professional. We should need someone like the Archangel Gabriel to do that successfully. However, I believe that the lieutenants of the service should replace the existing authorities and should have similar backgrounds and personalities. The authorities should be converted into strong local advisory committees.
I recognise that changes of that kind are iconoclastic and run against a further reorganisation of the service. I must admit that I have not wholly thought through all the implications, but I cannot see any other way of providing the leadership without which I do not believe the service can regain its morale. No other suggestion of a changed structure of the kinds that have been mooted in the newspapers will do anything to restore morale. I believe that consideration should be given to iconoclasm.
4 p.m.
Lord Hunter of Newington: My Lords, thinking back to 1948 when I joined the National Health Service, I remember that there was a general air of optimism in the medical profession and in Parliament, as well as in government. Why? There was a belief that by producing a National Health Service and attempting to make diagnosis and treatment available to all one would substantially improve the health of the nation, and it was hoped that demands on the NHS would fall as a result.
There were a number of important factors to support that optimism. Antibiotics had been introduced. Treatments were available for leprosy, tuberculosis, and venereal diseases, and it was the hope that the therapeutic side of medicine would continue to develop and increase in efficacy. What was forgotten in that optimism, by me and perhaps by others also, was that the cure and alleviation of a non-infectious disease does not reduce its frequency. The only thing that reduces its frequency is the elimination of its causative factors, many of which we now know lie outwith the province of the National Health Service and in some instances, such as smoking, are matters of individual responsibility.
As the demand for treatment of non-curable diseases increases, those who make the decisions have

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obviously been increasingly aware that improvement will only occur in many cases by the elimination of the disease. They are also aware that though the pharmaceutical industry has done wonders in introducing new remedies in the past 40 years, only a few are specific cures and the majority are symptomatic or temporary remedies, some of which however substantially increase the life expectancy of the sufferer.
What does one do? There must be an intense desire on all sides of the House not to see a return to the divide between the haves and the have-nots. I have no personal objection to private medicine; but as other noble Lords have said, it must not be practised in the inefficient way in which it has developed in the United States.
However, I believe that there are some services which are eminently suitable for private medicine. Perhaps routine abortion in early pregnancy or sterilisation operations could be done under contract with the National Health Service. This matter may be discussed on Friday when the report of the Select Committee on the Infant Life (Preservation) Bill will be before your Lordships' House. In the research field with regard to the NHS, priority must be given to those studies which will investigate some of the diagnostic and treatment problems.
Conditions continue to exist which produce increasing demands on the health service and the question arises as to what should be done to make the best possible use of always limited resources under those circumstances. How much should be spent on preventive medicine? How much should be spent on the hospital services? Does the present organisation of general practice—of which we are rightly proud and which has been referred to—offer the best kind of service to the patient for the future?
There are perhaps three solutions. One is to diversify funding. Another is to spend a greater share of the budget on the National Health Service. If one tries to diversify funding in some of the ways that have been suggested, with the greater use of private money or insurance, without attending to the radical needs of the health service, one can look forward with confidence to a rapidly increasing gap between the haves and the have-nots. In regard to the question of spending a greater share of the budget, I think that it is essential to justify it and to spend wisely, and therefore there must be a more sensitive medical management particularly in relation to the hospital service. That is the third and I believe the all-important solution.
It seems that the medical profession, aware of the problems facing the country, are prepared to cooperate in the whole matter of medical audit in a way that it has never been prepared to do before. I believe that the greatest single challenge facing this Government in this matter is to evolve with the medical profession the appropriate approach to the costing and evaluation of investigation and treatments and to agree on the proper way to initiate change and introduce new developments.
Perhaps I may summarise some of the things that might be considered: first, the need to recognise that improved treatments will not reduce the clinical
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workload until the causes of diseases are identified and controlled. Then there should be introduced an acceptable method of assessment to determine if the right people are being treated and managed properly. I suggest that there is an examination of the true financial cost of returning the handicapped to society because it is already evident that this is a very much greater cost than was ever anticipated and may be an extremely heavy burden on society. I suggest that there is a need for improved R&D in relation to this multi-million pound business and I am sure that the House will await the report of the Select Committee on Science and Technology on this matter with interest.
Consideration might be given to the introduction of contracts with the private sector in suitable areas, and I have already given the examples of abortion and sterilisation. We should decide on the proportion of NHS money which should be spent on prevention and health education and also consider whether RAWP—that lovely phrase, which is the allocation of resources in relation to numbers and not to need—has outlived its usefulness. Research was promised on this subject and has not yet appeared. Perhaps the Minister may be able to give us some information about the matter.
Some £250 million per annum—which is 17 per cent. of the drugs bill—is spent on drugs available across the counter that could be bought by individuals. Should prescribing of those drugs be stopped except for those on social security? I also suggest the promotion of sharing between authorities to ensure the maximum use of facilities, especially in London, and the provision of financial concessions to those who have to visit relatives who are being treated in another region. Finally, I recommend cooperation of a more effective degree with the charitable foundations which have revolutionised the aftercare of many diseases.
4.8 p.m.
Lord Dormand of Easington: My Lords, the nature of the crisis in the National Health Service at the present time is such that this debate is about the political philosophies of the Government and the Opposition. As I see it, that is at the very heart of our debate today.
When we on this side of the House complain about the problems in the health service we are deluged with statistics showing how much money has been put into the service. Statistics were given to us today by the Minister. I do not complain about that because it is an essential part of the debate. I also say that there is no doubt that there has been an increase in resources, although I also have to say that some of it has only come about because of pressure on the Government from outside. People in the country are not concerned about the barrage of figures. What matters to them are the things they see before their eyes: the closing of hospital wards and operating theatres and the long wait for operations and so on.
In his speech the Minister had a few words to say about the record of the Labour Government. Perhaps I may request him in his wind-up speech to provide the figures for the number of ward and operating theatre closures and if possible give the

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comparative lengths of time for waiting lists. We all have our own examples. In the newspaper which I have in my hand the headline reads "Man left blind by delay in surgery". That is not sensationalism; it happens to be true. The consultants involved, with whom I have discussed the case as well as others, have asked me to help in so far as I can. Obviously, we all do whatever we can in the circumstances but it is both tragic and scandalous that such a situation should ever be allowed to occur.
I readily admit to the Government that costs in the National Health Service are greater today. As at least two other noble Lords have observed, the population is growing older. A good illustration of that was given to the House by the noble Lord sitting opposite. There is also the much higher cost of the new technology. We all welcome the introduction of new technology into our hospitals. There are also other legitimate reasons for increased expenditure.
I am bound to point out that savings resulting from the exodus from the National Health Service of the 30,000 nurses who desert it every year must make an impact on the costs. We have also been told that the National Health Service could be made more efficient by cutting its administrative costs. The OECD figures for administrative costs are: Germany 9 per cent., France 12 per cent., the United States of America (rather surprisingly I think) 21 per cent., and the United Kingdom 6 per cent. There is not much room for saving there.
Still on the subject of the financial situation, the Government (and others) talk about income generation and lotteries. Many people and certainly those on this side of the House are opposed to such an important matter as the health of the nation being dependent upon lotteries. So far we have heard a number of proposals made about income generation, but they will not even begin to recognise the problem of financing the health service. Such suggestions are mere palliatives. In any case they do not provide the stability that is necessary for financing the health service. However, it is entirely proper that one should constantly be considering how money can legitimately be put to better use in the service.
Yet we are talking as though no additional finance were available. The recent Budget showed that there was a record amount of money for disposal. Both the Prime Minister and the Chancellor boasted about it. The noble Lord, Lord Winstanley, was extremely eloquent on this subject and no doubt we shall hear more about the matter from other noble Lords. But what happened? There was the obscene spectacle of huge handouts to the very rich.
There is one aspect of the Budget which puzzled me very much indeed. The Chancellor of the Exchequer is a man who obviously likes to be very popular. He had at his disposal a surplus of some £2 billion to allocate—I believe that my noble friend, Lord Ennals, mentioned a figure of £1·9 billion. The Chancellor had a sum of about £2 billion which he could have allocated to the National Health Service in addition to giving his tax handouts. That would have made him popular all round. It will not have escaped the notice of noble Lords opposite that a MORI poll issued this week revealed that 74 per cent.
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of Tory voters opposed the tax concession to the very rich and felt that at least some of the money should have been given to the National Health Service.
I should like to end with a few words about health education. So far I am the only speaker to have mentioned this topic but I hope that before the debate closes there will be others who also feel that health education and preventive medicine can make a contribution to the solution of the problems of the health service. I am sure that the Minister will agree that preventive action represents a net gain to the health service—and indeed, I am pleased to see his assent to that view.
The health education authority is doing a very good job. However, I should like an assurance from the Minister in his wind-up speech that its budget will be increased. Very properly it has to spend a great deal on the AIDS advertising campaign, but that should not be allowed to inhibit or reduce what has to be done for the majority of the population. There is a constant need to stress the importance of exercise, not smoking, a good diet, safeguarding against alcohol abuse, and so on. The health education authority is working on those issues with the encouragement of the Government, but there ought to be a continuing programme and we should not lose sight of it, regardless of any particular current problems.
Much has been accomplished in these matters in recent years but a great deal remains to be done. The matters that I have mentioned should form part of everyone's everyday thinking and we are a long way from that objective. I regard health education as one of the most important aspects of the nation's wellbeing and I hope that the Government will treat it with the urgency that it deserves. It will make its contribution to the more effective use of resources in our most vital of services.
At the beginning of my few remarks I said that in some ways this was a political debate. One of the most famous members of my party said that socialism is the language of priorities, and I think that that remark applies to the health of the nation more than to anything else. I suggest to the Government that they have failed in that respect and it is a matter which urgently deserves the utmost consideration.
4.17 p.m.
Lord Thorneycroft: My Lords, the great service that we debate today will, I think, always be coupled with the name of Aneurin Bevan. I remember Nye, as do some others in this House, with his unmistakable Welsh voice and the slight stammer that he adopted when in the grip of great emotion. The health service was a triumphant contribution to the welfare of the nation. Hundreds of thousands of men, women and children have cause to be grateful to him. It is a matter of honour for him and for the great party of which he was so notable a member.
Of course the situation has changed somewhat since then and expectations have also changed. At that time in the post-war period we all expected less. We were all very grateful for something which was more than we had before. Today we all expect miracles and, to the immense credit of the health service it delivers miracles. I think that everyone

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agrees, even if we do not agree about anything else, that the great centrepiece of the health service is that no man should be denied access to medical skills through his own lack of means. Whatever happens, we must hold firmly to that principle. I think that we should seek agreement in this area.
The noble Lord, Lord Ennals, said that the health service needed more money and I agree with him. I do not see why there should be a great argument about it. I should have thought that he was pushing at an open door. My agreement is perhaps not worth very much, but the Chief Secretary to the Treasury agrees with him. In the other place the other day the Chief Secretary to the Treasury said that there would be an extra £1 billion this year, an extra £1 billion next year and that he had just pencilled in —and when a Chief Secretary pencils something in it is quite a triumph—an extra £1 billion for the year after that. If these are birthday presents, they are not mean birthday presents that are being given out.
Noble Lords say that we are underfunded. We are; we are very likely to remain so. We were underfunded when I was Chancellor of the Exchequer 30 years ago. The health service was underfunded under Mr. Gaitskell. It was desperately underfunded under Denis Healey. They had to stop a great deal of hospital building and the queues were longer than they are today. We are still underfunded and I think that whatever we do we are likely to remain in some sense underfunded. If one has a service, free at the point of sale, with people getting older, new diseases developing and new cures developed, I can see no possibility of avoiding some measure of underfunding. I think it much better to accept that. It would be a pity if we were all to spend the rest of the century belabouring each other because a very obvious situation exists.
Perhaps I may offer a word of advice to those who ask for money. I have spent a lot of my life either asking governments for money or saying no. If one asks for money from a government it is terrribly important that one gives the government every possibility of help in seeing that it is well spent. I therefore ask noble Lords opposite to encourage the Government in their studies, to encourage a study of the role of health insurance. It has great problems. There are no easy solutions but at least let us study the possibilities.
It is no good striking because there is not enough money for the health service and then striking because you do not like contracting out. This makes no sense. Let us help and support the services in getting co-operation between the public and the private sector and, above all, in management. The health service employs 1 million people with tier after tier of administration with rather aggressive unions. I should not like to manage something like that. In one of his reports, Sir Roy Griffiths, who was referred to earlier in these discussions, said that if Florence Nightingale was met in one of the corridors of our great hospitals today carrying her lamp we know she would be looking for somebody in charge.
There is room for improvement in management. If you ask governments for money, give them all-out support in seeing that they know where it goes and
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what things cost. However, at the end of the day I agree that when we have made all those inquiries and explored all those avenues there will still be a great burden on the general body of taxation. At the end of the day the National Health Service will remain costly but infinitely worth while.
The best news for the National Health Service was the background to the Budget: that this nation was spending more, taxing less, paying debts and balancing the budget. That is the kind of country that is required in order to sustain great services such as this. This is not a crisis. This is a success. We ought to celebrate it. Let us take this great service, improve it, reform it, pay for it and build upon it.
4.25 p.m.
Lord Wallace of Coslany: My Lords, for well over 50 years I have been campaigning for and on behalf of a National Health Service and for a local hospital. One has had a great deal of experience of the National Health Service at first hand. For too long the National Health Service has been politically kicked around far too much. There have been three reorganisations under the present Government. The last one was the managerial revolution—expensive and chaotic. There are so many managers in our local hospital that I do not know who runs what. It is most difficult and frustrating.
I am grateful for what the noble Lord, Lord Thorneycroft, said about Aneurin Bevan. I have been associated with Queen Mary's Hospital, Sidcup, ever since Aneurin Bevan, after I approached him in a Division Lobby, gave us the old hutted hospital and 97 acres. Those were great days. Now the old has been replaced by the new with a fine modern hospital that the noble Lord, Lord Skelmersdale, visited recently when he opened an extended pathology department. He was very welcome. I do not wish to embarrass him but perhaps I may say that he did a good job.
This very successful and efficient hospital is expected to be underfinanced by at least £250,000 this year in spite of economies. A surgical ward once closed has been reopened due to the injection of new funds by the Government quite recently. But it is not enough, and due to the financial situation the ward is likely to be closed again. What on earth is the use of having fine pathology facilities if resources do not permit the early treatment of the diseases so revealed? Income generation schemes will not bridge the gap. The noble Baroness, Lady Lane-Fox, on 16th March referred to the scheme as exciting and promising. With all due respect to the noble Baroness, I find it pathetic.
There is one overdue way in which the Government can generate income from national health resources. According to the Secretary of State, each year 1,000 qualified nurses, many with post-qualification experience, leave the National Health Service for private hospitals. The cost of training these nurses at state expense over the years must run into millions of pounds. Why not recover at least some of this money by a levy on the private sector and overseas recruiting schemes? Why should the state subsidy the private sector when the public sector is in such a semi-bankrupt state?

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At the local hospital level, income generating schemes can cause problems and seriously interfere with voluntary effort. In advance of legislation action is already being taken at Queen Mary's where I am president of the League of Friends. The hospital manager is considering schemes such as car parking charges, a mini-supermarket, a flower shop, a newspaper shop, a semi-chemist shop with toiletries, and advertising on the patient hospital request radio. My mind boggles on that issue. I hope that they will not allow advertising for funeral directors because that would cut down the queue of patients considerably! However, my point is this. In a supplementary question I asked the noble Lord who will run the scheme. He said that somebody will have to be appointed. The point is that the hospital manager is carrying the can, and has quite enough on his plate already with regard to the health service.
The League of Friends runs two shops, an outpatients' canteen, trolley service, radio request programmes and many other activities which bring into the hospital around £28,000 to £30,000 a year, at no cost to the hospital. We meet our expenses. That is net profit going straight into the hospital. In the old days it was for the patients' comforts. Today we are desperately raising money to buy urgently needed equipment to be used in the hospital because it does not have the money. Naturally concern has been felt that this valuable, unpaid effort would be eroded by income generation schemes, and the future is faced with considerable concern. We have had a meeting with management, and management has agreed that some joint consultation should take place on the proposals put forward. However, we have no guarantee. The situation remains worrying to us and is gradually having adverse effects on the volunteers who help to run our service.
I am asking the Government to take into account the possible adverse effects of some of their schemes on the voluntary services. I am a firm advocate of voluntary service within a state organisation such as the National Health Service and I have always said so. It is a community service and people round the country take great pride in their local hospitals. Voluntary service and fund-raising appeals are vital to the National Health Service. As I have said, the local hospital is a valuable, vital part of the local community and voluntary service provides a vital link between a state-provided service and the community it serves. This itself provides the difference between the public and the private sector.
I have no objection to anyone using the private sector. It is a free country. Our people can go private if they so desire, but I am beginning to think that we are overprovided with private schemes and insufficiently provided with state schemes. I appeal to the Government. The Health and Medicines Bill is likely to be delayed, but we must pay close attention to the effect of some of its proposals on the fine voluntary work done throughout the country by people devoted to serving their fellow men.
4.32 p.m.
Baroness Cox: My Lords, I welcome this debate, for these are troubled times for the NHS. I believe
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that the NHS is one of the most humanitarian institutions the world has ever known. It has earned the loyalty and dedication of those who work in it and it is cherished by the public it serves, as the right reverend Prelate the Bishop of Guildford reminded us in his excellent maiden speech. It is therefore a matter of urgency that the problems of the NHS are addressed and resolved. I therefore welcome the fact that my right honourable friend the Prime Minister has undertaken to review the situation. I hope that this debate will help by providing constructive suggestions.
This afternoon I speak unashamedly as a nurse: unashamedly because I speak not from sectional interests but because, unless the problems confronting nursing are remedied, many of the current crises in the NHS will become worse. I also speak unashamedly as a nurse because the Royal College of Nursing—the largest body representing professional nurses—has set an example to the nation. Until now, college members have consistently refused to take any strike action, despite very unsatisfactory pay and conditions of service. They know that strike action would harm those in their care who are vulnerable. They have put the interests of those they serve before their own. They have paid a price for so doing. The time is overdue for radical and constructive changes in the nursing profession: in salary structures, conditions of professional practice and education.
It is a disgrace that even after previous increases awarded by the pay review body a ward sister or a charge nurse, who is the linchpin of hospital care, earns a meagre sum ranging from £9,000 to a ceiling of £12,000. A qualified staff nurse starts her career, often with heavy professional responsibilities in charge of seriously ill people, at a salary of £7,300, which rises over five years to a maximum of £8,600. By that time he or she will have worked in the NHS for eight years. Comparisons with other occupations highlight the outrageous level of nurses' salaries.
The total average gross weekly pay for policemen below sergeant level is £262; for secondary school teachers it is £235; for qualified nurses and midwives it is a mere £152·80. It is often said that nurses have been generously recompensed by the award of large percentage salary increases. But a large percentage of a small salary is still a small figure. I therefore hope passionately that the pay review body will support the recommendations of the Royal College of Nursing for an appropriate pay structure for nurses who wish to remain in the clinical field and will also reward those who take extra qualifications to enable them to work in specialist areas. Also, money must be made available for staff to take these specialist courses, both to allow for secondment and to pay for the courses. At present many nurses are often prevented from attending the courses because of lack of resources.
Student nurses are not like other students. In addition to their studies they work a full working week and often take heavy clinical responsibilities. Their salaries range from £4,540 to £5,170. Their responsibilities are often awesome. Where there are acute shortages of qualified nurses, students may be in charge of desperately ill people. I have recently

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seen an 18 year-old student nurse on her very first ward put in charge of a coronary care patient who had already had three cardiac arrests that morning. The strain nearly caused that student to resign and the situation was clearly far from ideal for the patient. I could give many other examples, but time does not permit. Small wonder that about one in five students leave nursing during training.
Apart from the personal individual costs of disappointment and sense of failure, the National Health Service cannot afford this mass exodus of students. Also, the dramatic drop in the birth rate some years ago is now affecting the number of school-leavers who are available to enter nursing. The poor prospects compared with other occupations mean that fewer of these are now choosing nursing. Numbers of entrants have dropped by nearly one-third, from 30,000 in 1982 to 21,000 in 1987. This year will probably see a further drop of about 3,000. These reductions, if not corrected, must affect the availability of qualified nurses for the next 30 to 40 years. We are building problems for the future which may exceed those of today unless we can encourage and enable those who are willing to consider entering this demanding profession to do so, and if they do so to remain.
We therefore hope very much that the Government will be giving good news soon in their response to the professions' recommendations for radical improvement of nursing education through Project 2000, which would enable student nurses to be genuine students and to have a better deal educationally and professionally.
I turn very briefly to conditions of service and to job satisfaction. Nurses know that they have to work long and and unsocial hours because people in need require round the clock care. But what demoralises them beyond endurance is the lack of resources to enable them to provide the quality of care they know they should and could be giving. Only yesterday I received a letter from a ward sister who was deeply distressed at having to refuse to undertake time-consuming treatment for a patient because she had insufficient senior nursing staff to provide it. She writes:
"So now I feel guilt at refusing but I had to act within my professional judgment that the time could not be made available because we are already seriously understaffed".
That is a tragic predicament for both nurse and patient.
I strongly urge any review of the National Health Service to look seriously and sympathetically at the predicament of nursing. It was the noble Lord, Lord Briggs, who called nursing the major caring profession; and rightly so, not because other professions do not care, but because nurses provide intimate personal care round the clock for the spectrum of human need from the highly technically sophisticated care of intensive care, coronary care and special care units to the different but equally demanding and challenging care of the mentally ill and handicapped and the growing number of infirm elderly in hospitals and in the community.
Nurses are also the major caring profession in terms of numbers. They constitute half the NHS workforce. Therefore, until the crises in nursing are
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recognised and remedied, the NHS will not be able to offer the quality of care which those who serve in it wish to provide and which the public deserve. Unless any review takes nursing problems seriously, we are in danger of seeing this most humanitarian institution of the National Health Service degenerate into further crisis,—indeed, potentially chaos in some places. Not only would that be a political disaster; much more importantly it would be a betrayal of the vision, the dedication and the compassion that the National Health Service has so magnificently enshrined.
4.41 p.m.
The Lord Bishop of Manchester: My Lords, the quality of some speeches that we have heard today is ample justification for this debate on the National Health Service. Without being invidious perhaps I may be allowed to say that I particularly appreciate those who speak with detailed knowledge of medical care, like the noble Baroness, Lady Cox.
In his introduction the noble Lord, Lord Ennals, drew attention to the crisis in the health service. I was encouraged to hear the Minister's response to the extent that he too expressed a robust defence of the vital importance of the NHS and the way in which it is regarded by the Government; expressions of the value of the NHS have come from all parts of the House today.
Two weeks ago I was invited to chair a very unusual meeting, which had been called by the three community health councils for Manchester North, Central and South. I call it unusual because the speakers were the general managers of the authorities. It is quite unusual for general managers to take such a role, sticking their necks out, so to speak. They did it, I think, because the situation is indeed critical. The letter of invitation to the meeting was introduced in this way:
"This year the NHS celebrates its 40th anniversary, but 1988 marks a period of crisis. Wards have had to be closed, redundancies have increased and this has inevitably led to a decline in standards of health care".
In Manchester the situation is precarious. We have heard outlined some of the obvious reasons why the situation has arisen—the increasing numbers of the elderly, the development of high-tech medicine and increasing demands. I should like to concentrate particularly on the situation in the older industrial areas of the country because I think that the state of the NHS and the way in which we are enabled to tackle the problems has a very intimate relationship with the new emphasis on tackling the problems of inner cities and urban priority areas.
Manchester and Salford are Lancashire towns within the diocese that I represent. During the Industrial Revolution this whole area saw the development of ways in which wealth for Britain was introduced. I think we all know that this was done at immense human cost. That cost is still with us today. Many studies have indicated why the older industrial areas suffer disproportionately from health problems. I refer to a document entitled "Health Inequalities and Manchester", produced by

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community physicians for the three authorities that I have mentioned. It states:
"National studies have shown the close links between low income and poor health compared with the country as a whole. Manchester's population contains very high proportions of groups likely to be experiencing poverty. These include the unemployed, those in unskilled jobs, those who have never had a job, lone parent households and lone pensioners".
It has been measured that there were one-third more deaths in recent years in Manchester than the national average of those under 65. In some of the most deprived wards—Hulme, Ardwick and Moss Side, for example—one finds that that figure rises to 80 per cent. above the national average. That is a measure of the problem that faces us in the older industrial areas.
The important report entitled "The Health Divide: Inequalities in Health in the 1980's", produced by the Health Education Council just before it went out of existence, said:
"Striking regional disparities in health can still be observed. From [recent] data, death rates were highest in Scotland, followed by the North and North West regions of England, and were lowest in the South East of England and East Anglia, confirming the long established North 'South gradient".
It is sometimes fashionable in the House to say that there is no such thing as the North-South divide. On this front the figures are against it. It is pointed out that many
pockets of this kind of deprivation exist alongside more affluent pockets within the areas of which I speak. Although such deprived areas can be found throughout the country, the North has a higher concentration than the South and the South East. It is noticeable that improvements in health have not been equally spread across the country. Non-manual groups experienced a much greater decline in death rates than manual groups; thus the gap between the two groups widened. It is for this reason that I say that the state of the National Health Service and the way in which its problems are tackled is a vital element in the campaign to do something about the older industrial areas of the country.
I noticed that the noble Lord, Lord Hunter of Newington, in a most interesting speech referred to matters of individual responsibility, such as smoking. He might have added misuse of alcohol or eating unsuitable foods. It is perfectly true that in areas like those of which I am speaking a high proportion of people suffer from ailments induced by these practices. However, they are not simply matters of individual responsibility; they have to do with social background and the cycle of deprivation. I believe that that needs to be clearly understood. I support entirely what the noble Lord said about the need for health education, but it should be seen as the function of deprivation in these areas. We must welcome the common desire that is now being voiced in many quarters, not least in government, to do something about the inner cities and urban priority areas. The state of the NHS is vitally linked to this. An improvement in its standard of care is related to whatever is done.
I turn to the question of what can be done about the funding of the NHS and the debate that is currently taking place. Perhaps I may sound a note of warning in response to the siren voice of the noble
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Lord, Lord Nugent of Guildford, in speaking of the need for more private health insurance. I believe that this is very dangerous because concentration of private health insurance will inevitably mean the development of differing standards of health care. Put at its crudest, why should people pay for private health insurance unless they will get something out of it that is more than the convenience of a private bed or there is to be some priority of health care? This surely is what we do not want to see from our health service today. I was most moved by the way in which the noble Lord, Lord Thorneycroft, took us right back to the start of the health service and paid great tribute to Aneurin Bevan, even though he was a member of another political party.
Private medicine would be a serious diversion from the resources of the NHS. This is contrary to what is popularly believed in certain quarters. For example, it can create double levels of pay for doctors, nurses and medical staff. As has already been said from the Opposition Benches, it can siphon off into private practice people who have been expensively trained at public expense. I do not believe that that is the road down which we should go.
Perhaps the Minister in summing up would like to comment on noises that sometimes come from Government sources which seem to cut across what he was saying earlier. For instance, I believe that Edwina Currie, a junior Minister of Health, said words something like this: we shall still need the NHS in the years ahead because of course an awful lot of people cannot afford to pay private insurance. If it is put in that form, I do not regard it as a declaration of firm conviction that the NHS is the best way forward in dealing with health care in the country.
I should like to end my remarks by coming back to what the noble Lord, Lord Thorneycroft, said about the recent Budget, because I should love to believe what he said about the increasing affluence in this country inevitably being good news for the National Health Service. That remains to be seen. Some may have heard the distinguished economist Mr. Galbraith on the radio commenting recently on the Budget and saying that the trouble with it is that it can easily bring us to the situation which he outlined in that famous book when he talked about private affluence and public squalor. It depends whether these benefits are ploughed back into our public services; such as, the National Health Service, education and social services. We shall all be watching with anxiety to see what happens in the time ahead.
4.51 p.m.
Lord Pitt of Hampstead: My Lords, I am sorry that I had to leave the Chamber for a while, because I seem to have missed some very good speeches and the speeches I have heard were very good indeed. I am sure we are all grateful to my noble friend Lord Ennals for introducing this debate. As I said, some of the speeches I have heard have pleased me very much—in particular those of the noble Lord, Lord Thorneycroft, and my colleague the noble Lord, Lord Winstanley. I was pleased to hear the Minister commit himself and the Government to the health service.

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The Minister said that the picture painted by my noble friend Lord Ennals was inaccurate. I cannot agree with that because I believe it was accurate. No one has doubted that the Government have spent and are spending billions of pounds on the National Health Service. However, the presidents of the Royal Colleges have referred to it as drip feeding and they are on the right lines. Your Lordships will remember that in a debate in 1985 I compared the problem to the problem that we faced in County Hall over the flooding of the Thames. We kept on building up the walls but that did not work and every year we grew more and more frightened. In the end we built the Thames Barrier. If I may go back to this analogy of drip feeding, while drip feeding can keep the patient alive, he or she needs solid sustenance in order to be strong; so does the National Health Service.
Failure to fulfil expectations, the gradual increase in in-patient waiting lists and the decline in public satisfaction with the National Health Service, in particular hospital in-patient and out-patient services, are reasons why increased resources have failed to yield corresponding improvements in the perceived level of services.
Demography, the underlying demand, the Resource Allocation Working Party formula and acute sector underfunding are the reasons that the moderate increase in real resources has not yielded the results that might have been expected. The point is that too little is always being contributed rather than the amount that is required. The demand for hospital and community health services and to a lesser extent family practitioner services with the growing number of births and very young children has increased the burden. I did not want to use the word "burden", however: it has increased the demand.
Because medical advances enable conditions which were hitherto incapable of treatment to be identified and treated, those surviving are increasingly dependent. Taking the NHS as a whole, the BMA states that demographic changes have increased demand over the past six years by 0·55 per cent. a year on average. On the basis of the Department of Health's calculations, demand will increase by 0·78 per cent. a year up to 1991–92. The long-term increase in hospital in-patient waiting lists and the fact that the United Kingdom has one of the lowest hospital admission rates suggests a substantial pool of unmet demand.
A further indication that there might be a pool of potential hospital in-patients is the fact that day surgery has tended not to replace in-patient surgery but rather to supplement it. Medical advances also further increase the size of the pool. The Resource Allocation Working Party formula is working in a climate for which it was not designed. When the allocation of health service resources by region according to population and morbidity was envisaged, it was seen as a progressive process to be achieved by differentially increasing growth rates. However, in the present climate of severely restricted growth, the losing regions are subject to real growth reductions. Your Lordships have heard me on more than one occasion attacking the Resource Allocation
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Working Party because in the present climate I believe it is doing more harm than good.
The BMA states that the formula is regarded by many as flawed and the problems would only increase if the formula was extended to the family practitioner services as is suggested. The noble Lord, Lord Ennals, has dealt with the questions of growth rates in the services, particularly the acute services, and how much less it is than what is required to keep pace with the need. Therefore, I shall not go into that matter. However, the BMA points out that in a climate of severely restricted resources, the problems of cutting back in the acute sector are now becoming obvious. I do not think it needs to say that: it has now become obvious on all sides.
The BMA have said all along that the Government should increase public expenditure on health relative to national income and that not to do so is a denial of consumer preference. Together with the Institute of Health Services Management and the Royal College of Nursing, the BMA proposes a formula whereby health spending would be increased in line with the gross domestic product, with separate provisions being made for demography, catastrophic occurrences and major pay restructuring. It is suggested that a further 15 per cent. should have been added to gross cash expenditure over the period 1981–89 and that, that not having been done, in 1981–89 it will be about 8 per cent. too low.
The BMA has asked for an immediate injection of £1,500 million to meet the present deficiency. That sum can easily be met by the Treasury. We have frequently been told—the Minister repeated it again today and the noble Lord, Lord Thorneycroft, also said it—that in order to be able to finance the National Health Service we need a bouyant economy. However, we are also being told that we now have a bouyant economy. Therefore, let us finance the National Health Service.
If I may go back to that speech of 1985 which was also made immediately after a Budget, I suggest a way in which we could raise £500 million for the National Health Service by a change in taxation. I shall now have another try, because the amount we need could have been obtained in the Budget without in any way changing the Budget strategy. What was required was an increase in the tax on cigarettes, spirits, beer and wine; and to vary the way by which the increases are made to obtain different amounts.
In addition, the Chancellor could have taken two actions. First, he could have limited the mortgage tax relief to the basic rate. Secondly, and the one point on which we can condemn him, is that he could have increased the level at which people pay national insurance contributions to the level at which he has brought the 25p band of income tax. What we now have are people earning up to £15,000 paying 34p in the pound (they pay the 25p and 9p national insurance) but people earnings between £15,000 and £19,000, which is the level at which the Chancellor has brought the band for the basic rate, only pay 25p in the pound.
That is the present situation. On my calculation that would have given about £790 million. Therefore, there should be no problem about meeting the needs

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of the health service. I gather from the hint given by the noble Lord, Lord Thorneycroft, that we shall probably get it from the Contingency Fund and I hope that we shall.
5.1. p.m.
Lord Trafford: My Lords, before making any remarks I should declare my interest. For the past 30 years I have worked in the National Health service and I think I am right in saying that at present I am the only actively practising hospital consultant in this House. That does not of course alter my personal commitment to the National Health Service and what it stands for; and we have heard a great deal about that today.
We have also heard much about funding, but slightly less about the function of the service. It seems to me that it is critical to know what one is trying to do before deciding how to cost it and then how to pay for it. We have never had that in the National Health Service. The recent report from the House of Commons Social Services Committee—and I quote from paragraph 6—said:
"Serious shortage and absence of data impedes a clear assessment of the adequacy of funding."
In other words, we do not know. From my own experience, I support that statement.
What we do have a lot of in the National Health Service is input statistics. We are told how much we spend and how much everything costs and the percentage of the GDP. However, we have very few outcome statistics which would tell us what we are actually achieving and, knowing the cost, whether or not it was valuable.
However, we do have some parameters of health care; for example, the nine nation OECD study suggested that there was not a close relationship between the percentage of gross domestic product that we devote to health and the results that are forthcoming, from whatever system of health care and funded in whatever way.
Indeed, there were some extraordinary anomalies. The lowest percentage spent in Europe, for example, is in Greece which has the highest male life expectancy. The highest percentage is in Ireland which has the lowest male life expectancy. Personally, I do not take too much note of that and I have no desire to live permanently in either country as some form of insurance. Nevertheless, what the study does suggest—and this is an important point—is that the actual calculation of figures and percentages of GDP, and bandying those figures about, does not in itself indicate whether or not one is achieving the right objectives in health care or the right level of funding.
I should point out that with a system of the complexity and size of the National Health Service I am astonished that we do not consistently receive complaints from one area or sector all the time. By any standards a £21 billion organisation is huge and if we did not have problem areas I should feel that we were not being told everything. In the field of health, which is so personal to everybody, it is even more surprising that we do not hear more.
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Most recent problems have arisen in the acute sector—the sector in which I happen to work. One of the reasons for that of course is that a certain amount of money has been diverted through what were, two or three years ago, regarded as priority areas; namely, community health, mental health and a certain amount for primary care. We have already heard that there is nothing new about the health service being underfunded. My noble friend Lord Thorneycroft and the noble Lord, Lord Winstanley, pointed out that year after year, ever since the National Health Service started, it has been declared to be underfunded and short of funds. Even the noble Lord, Lord Ennals, to whom we are grateful for introducing this debate, when he was Secretary of State was receiving letters from presidents of Royal colleges with criticisms of underfunding and asking why he was not spending more on this service or that service. There is nothing new about that.
I hope that when the reform group, if we may call it that, is looking at the health service it will remember, "function first, funding second". There are two fundamental decisions that the group will have to take. First, are we to continue the health service as a caring and curing service as well as a preventative service, plus all the fringes that are included? Or should we divide those functions as suggested in the recent report of Sir Roy Griffiths? It might be beneficial in the understanding of the relevant costs that we should do so.
Secondly, we have to understand the nature of the beast with which we are dealing. The National Health Service, in the hospital sector, is a huge and massive framework which is administered but not managed; and probably, in deference to the noble Lord, Lord Perry, it is not led. Certainly it is not managed. The level of demand is dictated by mavericks; that is, they have no necessary relationship to any plan, no necessary coherence in what they do and no necessary relationship in one activity or department to another. I am, of course, referring to the doctors. This is not a criticism of the doctors but a fact of life. The anecdote related by the noble Lord, Lord Carter, as an example, slightly unfairly, as it so happens was much more due to health service inefficiency than to underfunding.
The noble Lord's rude remark about the Prime Minister could also be answered by the story of a young girl whose education was being ruined by people who claimed that she was not fit to be given university education. It was only the intervention by the Prime Minister that enabled the girl to complete her education. In view of the rude remarks that are sometimes made, that sort of story could be more often repeated.
It is not right that I should merely comment on some of the outlines and problems without suggesting some answers. First, let us decide whether we are a curing or a caring service and what our function really is. Secondly, let us look very closely at the structure and function of primary care. That is the origin of most referrals through the health service. It is not a criticism of primary care, but we need to look at it. The department of general practice at the University of Manchester recently published a not very flattering picture of some of its efficiencies; but

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one might say that that is the primary origin from which all patients grow.
We should also examine the options among the hospital doctors—a prescription for the mavericks, so to speak. Unfortunately, again I am afraid I could not go along with the noble Lord because generally speaking it is the doctors who have resisted the idea of leaders in this particular field of resource management. We probably need departmental setups, cost centres and perhaps fiddling about with the consultants' contracts, and all the rest of it— whatever is necessary to achieve this type of control within the health service to test against proper outcome statistics.
We need to look at the internal market, which is perhaps best summed up as moving the money with the patient across boundaries and across health authorities, with all the difficulties that can administratively arise. We need to look carefully at reinforcing management, which I do not believe has moved in any way towards what Sir Roy Griffiths proposed in his previous incarnation and report in 1983.
There are some other ancillary actions we need to take. I suggest that we could reduce much of the wasteful non-contributory spending on the enormous planning departments that goes all the way down from the department of health, through the regional health authorities and the district health authorities and is duplicated over and over again. I believe that we should also look carefully at the composition and the function of regional and district health authorities. They are often only sources of delay, confusion and, very often, bad decisions. I shall not say anything about nurses because my noble friend Lady Cox has said everything. I yield to no one in my liking for nurses. I support what she said.
Finally, we should manage the capital programme which was £1 billion last year. That programme is badly managed and badly organised. It does not allow for proper costing and projects are geared to target costing. The programme does not use the most fundamental and elementary—I was going to say "elemental", which is the technical term—cost processes which it should use. I reckon that savings of up to 20 per cent. may be achieved.
I suggest that a health inspectorate is set up on the lines of the inspectorate of education. We should have a body which can report, monitor, evaluate and tell us the difference between what one authority and another may do—presuming that we keep the authorities—and whatever else may be considered appropriate for immediate rapid examination. The result will be that we shall have facts and not anecdotes and we shall talk about that which is really happening rather than that which is developed by rumour. I personally am committed to the principles and the ethos of the National Health Service. I hope that at the end of this review—with or without more funding—the National Health Service will continue to develop in terms of providing medical care and value for money for all the people of this country.
5.12 p.m.
The Countess of Mar: My Lords, I am very grateful to the noble Lord, Lord Ennals, for bringing this
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important subject before us for debate today. For months we have seen and heard dramatic scenes and statements about the crisis in the National Health Service. Thankfully, we have had a mild winter and the influenza epidemic which had been earlier forecast did not materialise. There must have been a great sigh of relief throughout Whitehall on the first day of spring. However, the influenza epidemic is expected to come this autumn and winter.
As yet there has been no real crisis but many health authorities are in considerable difficulty and patients are receiving a deteriorating standard of treatment as a result. Noble Lords, and the Minister in particular, will be aware of my interest in and concern for the state of the National Health Service in the West Midlands. I intend to restrict myself to this region today though I accept that it is by no means the only one under stress.
This region is home to one-tenth of the population of this country and it is very near the bottom of the list for funding. Since 1982 the five Birmingham district health authorities have been underfunded by £17 million. Until 1986–87 efficiency savings enabled the authorities to absorb the shortfall without affecting patient treatment. That is no longer the case. The community health councils in the city estimate that an extra £10 million will be necessary to restore the services to those which existed at the beginning of the 1987–88 financial year. Not only have pay awards and central government directives for such things as cervical and mammary screening and AIDS been underfunded. At the Queen Elizabeth Hospital, where drugs, medical and surgical expenditure amount to 52 per cent. of the annual non-pay expenditure, an additional 2·.3 per cent. for the last financial year was received when the actual increase had been 9·1 per cent. for drugs and 5·8 per cent. for medical and surgical equipment. The effect of that is a deficit of £297,000 for 1987–88. That applies to just one hospital.
What is the result of this strict financial management? We have heard about bed closures. In 1986–87 the Birmingham Children's Hospital had 222 beds available with funding for 199. Since May 1987 the number of beds actually open fluctuated between 146 and 159. For 1988–89 there is funding for only 119 beds—a loss of over 100 beds in two years. Is it any wonder that the waiting list for paediatric cases has increased so rapidly or that parents are so anxious about their sick children?
The shortage of nurses is the reason given, but I fear that the real reason is a shortage of foresight. When I was in hospital some four years ago I remember student nurses telling me that they did not know what they were going to do when they finished their training as the region had severely curtailed nursing appointments and there were few opportunities in other regions. Short-term measures such as these are bound to result in a scarcity of suitably qualified and experienced staff in the long term. These measures have a knock-on effect. There was a report a couple of weeks ago that newly-qualified nurses in Dudley cannot obtain posts in the district because wards have been closed due to the shortage of nurses.

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Other savings have been obtained by reducing medical and scientific equipment budgets. For example, East Birmingham Health Authority had a budget for 1985–86 of £120,000; for 1986–87 of £75,000 with an additional £60,000; and for 1987–88 the budget was £115,000, of which only £30,000 was honoured. This year an instruction has been issued by the West Midland Regional Health Authority to the effect that no new equipment is to be purchased and old or obsolete items may be replaced only if clinical services cannot continue without them. South Birmingham district needs £1.8 million simply to replace essential equipment which is over 10 years old. The Queen Elizabeth Hospital, which is a specialist cancer centre for the region, urgently needs two replacement megavoltage units. Their present ones are 12 years old. However, there is no prospect of these being obtained. When they finally break down replacements will take at least six months to order, design and install. What happens to patients in the meantime?
Other hospitals already have waiting lists. If the Birmingham West district was allowed to purchase an ultrasound machine for £30,000, clinicians would be able to avoid expensive hospital admissions for cardiac catheterisations. Where is the sense in this policy? Would the chairman of the West Midland Regional Health Authority run Ackers Jarrett Leasing Ltd. on this basis? The management changes introduced by Sir Roy Griffiths were meant to bring business-like methods into the National Health Service. No successful business could ever function on this hand-to-mouth basis.
The districts are unable to carry out basic maintenance of buildings. It is estimated that £88 million is needed by the five Birmingham districts to bring their hospitals up to grade B which is an acceptable standard. Beds cannot be used in the burns unit of the Birmingham accident hospital because there is a risk of plaster falling off the ceiling. In the south district 'M' block of the Selly Oak hospital has been condemned by the Health Advisory Service but staff and patients must continue to occupy appalling accommodation because funds to upgrade or replace the block are not available. The districts in the region are faced with many very old buildings which are rapidly deteriorating. There are no funds to upgrade them. New projects have been repeatedly put back and those which have been given a starting date have no date for completion. This cannot be an appropriate way to run a business. In the long run it must be wasteful, but without an allocation of funds the authorities are helpless. I have described very few of the problems encountered by the district health authorities in the West Midland region.
My chief concern is not with buildings, equipment, beds or figures, but with the people who are the staff and patients who work for or use the National Health Service. They have been given expectations and promises which are not materialising. The staff are told that they are wonderful. I have often seen nurses described as saints. They are given in return low pay and poor working conditions. Those factors cannot be compensated for by hollow words of praise.
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Government Ministers naturally look on the bright side, and the darker the clouds the more loudly they proclaim the odd flashes of brilliance. Patients expect that modern medical expertise will be available to them within a reasonable time. Instead they are faced with unbearable delays, early discharge from hospital and a lack of medical and social support in the community.
Perhaps I may read to your Lordships extracts from two letters that I have received recently from the mother of an old schoolfriend of my daughter who lives near Worcester. She puts things very much more clearly than I could ever do. She was telling me about her daughter who has heart problems. She says in her letter:
"It's our middle daughter Amanda who concerns us at the moment and her case highlights the deterioration in the National Health Service. Amanda was born with a constricted aortic valve in the heart. This was diagnosed when she was four and after examination by a specialist, she was put on a waiting list for surgery. She waited about four or five weeks and then was operated on at the Birmingham Children's Hospital in 1964. Late in 1979, it was decided to transplant a replacement heart valve. Amanda was examined by Professor Yacoub at Harefield Hospital during January 1980 and three to four weeks later was operated upon.
Now this valve is faulty and she has to have another. When she was examined at Harefield on 12th January and put on the waiting list, we were told it might be six weeks, six months or nine months before the operation can be done. Surely it is more cost-effective to operate while the patient is still reasonably well, thereby cutting down on recuperation time. The children who wait too long for their treatment at Birmingham don't always survive for very long after the operation. Isn't this a waste of time and money?
Amanda can't do much at the moment: she can't work so her career is jeopardised—this is not the way for a 27 year-old to live. Please feel free to quote our case if you need to—the more facts you have, the better, I should imagine".
That letter was written on 18th February. On 10th March I had another letter, which said:
"Many thanks for your letter, which arrived yesterday—on the same day as a telephone call from Harefield Hospital, asking Amanda to report today. We were amazed. On 1st March she was told the operation would not take place before 10th April as the lists were complete until that date. Yesterday, the hospital found they had a bed for her and she's there now, and the operation is scheduled for tomorrow unless there is an emergency".
That girl was sent home after 11 days in hospital and four cancellations of her operation. Is this really the way we should treat people? In any other context it would be regarded as torture to the parents and to the patients themselves.
I have run out of time. There is a great deal more I could say. I believe that we have to look at management as well as finance in the National Health Service.
5.21 p.m.
Lord Colwyn: My Lords, I have already sent my apologies to my noble friend on the Front Bench and to the noble Lord, Lord Ennals, for my late arrival this afternoon and also for the fact that, owing to a longstanding previous engagement, I shall have to leave at about seven o'clock. However, I shall read with great interest in Hansard tomorrow the speeches I miss and I apologise if anything I say has already been said.
It has always been of great concern to me that the subject of the National Health Service and the health of the nation has become such a contentious party political issue. My noble friend the Minister and

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those on this side of the House are continually accused of showing insensitivity to the health needs and wishes of the taxpayer and of continually underfunding the health service. The figures speak for themselves. I have said many times in the House and I repeat again this afternoon that it is an utter fallacy to believe that the injection of more cash to purchase more equipment and hospitals, to pay more staff and perhaps eventually to provide all the resources the health service wants would do anything at all to solve the problems.
This myth is totally unfounded. Until the Government realise this or have the courage to change their path, the problems we are seeing today, including the continued and unhelpful party political argument, will never come to an end. It may seem a strange thing to say, but I am of the opinion that modern medicine may well be a factor working against health. This is a serious charge. Yet the evidence exists to show that until we undertake fundamental shifts of emphasis in the approach to health and health care in this country there is unlikely to be any change.
I agree with the noble Lord, Lord Trafford. Things are getting worse. Between 1972 and 1980 the incidence of chronic illness rose from 20 per cent. to 29 per cent. in males and from 21 per cent. to 31 per cent. in females. This means that at any one time almost one-third of the adult population has a longstanding illness. As it has evolved the National Health Service has had very little to do with health and far too much to do with sickness. Rather than spend more money on measures designed to promote good health, it seems that we opted instead for the most inefficient course both in terms of finance and of health. For the most part, the National Health Service simply waits for people to fall ill before taking any action. Very little time is allocated to prevention and even less to active health promotion.
All this is taking place within the context of a general increase in the use of pharmaceutical drugs. Seventy-five per cent. of all visits to GPs end with the prescription of a synthetic drug. Eighteen per cent. of all men and 28 per cent. of all women—that is, about 15 million people—are constantly taking some form of prescribed medication. These facts are disturbing in themselves but they acquire an even more menacing nature when related to the growing extent of illnesses induced by these drugs. The assumption that the body can be regarded as a machine whose protection from disease and its effects depends primarily on internal intervention and the idea that illness can be classified into specific named diseases each of which has a single cause has led to indifference to, and disregard of, the external influences and personal behaviour which without doubt are the predominant determinants of health.
With our present attitudes to health, it is inconceivable to think that illness should be viewed as a helpful though often severe reminder that perhaps there is something at fault with one's life style or attitude. It is precisely because this possibility has been largely ignored that so little attention is being paid to the whole concept of health promotion. Health promotion is about the maintenance of good physical and mental health. It has very little to do
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with medicine and disease management and everything to do with the ways in which people live and the social and psychological environments in which they do it.
Millions of people in this country suffer unnecessarily simply because they are not being directed towards health promotion or perhaps towards the alternative therapies or natural medicines which are known to be safer, more therapeutic and usually much less expensive. An example is the work of the Bristol Cancer Help Centre whose encouraging results have yet to filter into NHS orthodoxy. Much less well known are the results now coming from the United States and from some centres in this country demonstrating that AIDS need not be a killer disease and that it is eminently manageable. Perhaps the main reason for this almost lack of publicity is the fact that these new approaches to AIDS and cancer tend to avoid synthetic drugs at the same time as breaking new ground in the doctor-patient relationship.
The time has come for a radical change in health policy in this country. Merely to increase funding for the health service, to make access to doctors or hospitals more equal or to encourage privatisation while leaving the question of what kind of medicine we receive is a recipe for disaster. Unless and until medicine itself undergoes a thorough overhaul the problems we are discussing this afternoon and the financial measures that are recommended will remain as mere palliatives and may even serve to increase the problem.
If I were to speak in a debate on the National Health Service without mentioning my own dental profession I should be in severe trouble with my professional colleagues. So I must make a few brief remarks about the planned change in patient charges for general dental services which will make it steadily more difficult to extend regular dental health to a wider public. My profession is united in believing that the Government's proposals to charge adult patients for dental examinations and to remove the community dental service's statutory duty to screen schoolchildren for dental disease will do serious damage to dental and general health.
I am aware that there is an argument between the department and the dental profession about the extent to which demand is disturbed when charges rise. But those of us who actually provide treatment know that charges to patients do hold back the demand for treatment. My noble friend the Minister will tell me that higher charges have no long-term effect on patient demand, but the profession believes that dental behaviour can be permanently damaged for some patients, especially those on modest incomes but above the official poverty line. It means that patients are not getting the treatment they need and that the National Health Service is getting worse value for money spent as direct charges rise.
The proposal to charge patients for advice is particularly deplored. We see this as totally inconsistent with the preventive philosophy generally adopted by the White Paper on primary health care. The recent improvement in dental health has allowed dentists to adopt a wait-and-watch approach to some aspects of treatment. However, this ability to defer

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active treatment relies on the dentist being confident that the patient will return for regular check-ups. Nevertheless, I look forward to discussing that topic in greater detail when we consider the Health and Medicines Bill after Easter. Finally, I ask my noble friend to point out to his right honourable friend the possible alternatives he could consider when examining the resources, state and management of the National Health Service.
I thank the noble Lord, Lord Ennals, for bringing the problems of the NHS to our attention. However, with the greatest respect to his experience, I ask him to consider closely the fact that he too may be heading in the wrong direction with his repeated pleas for more funding and his conversion of this vital national issue into a party political argument—which would certainly backfire on him should his party be in government again.
5.30 p.m.
Lord Monkswell: My Lords, I come to this debate as a member of the Manchester Family Practitioner Committee and therefore with some experience in the operation of the National Health Service. I am also the son of a family doctor. However, I am by profession an engineer. One lesson that engineers learn is that if one has a very efficient engine and one runs it on a very lean mixture, one will effectively destroy it. There should be widespread agreement that the National Health Service is one of the most, if not the most, efficient ways of delivering health care to the community.
If one looks at just about every other civilised country with an equivalent standard of living one can see that they spend more on their health care provision, although they do not receive that much more money than we do. Therefore we have a very efficient system of health care. However, if we continually underfund that system we will effectively destroy it. We will destroy it in the eyes of the people who use it, because it will not be satisfactory for their requirements.
Underfunding will ultimately lead to the disintegration of the National Health Service. Therefore we must ask the Government whether that is their intention, although it is true to say that they keep saying that it is not. Such a policy also brings with it a risk to ourselves. I am talking about direct personal risks.
A few years ago the requests made by the National Blood Transfusion Service for the capital to enable it to convert whole blood in order to provide Factor 8 in this country were not met by the Government. Their inability to fund that project, or lack of preparedness to do so, resulted in this country continuing to procure Factor 8 commercially from the United States—and with it, of course, the AIDS virus. That situation has resulted in the infection of a large proportion of haemophiliacs in this country with the virus. That, however, is just one of the results of underfunding.
It may be that most noble Lords will be able to purchase medical services to provide for their illness or mental handicap in old age; but we should not just
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think of ourselves. We should be thinking of our children and our grandchildren. How many of them will be able to purchase insurance to cover such illness? No insurance company will touch that type of infirmity. How many of our children or grandchildren will be able to pay for the provision of medical care when they are old and infirm or mentally handicapped? That is the type of problem that we should all be considering.
Underfunding by cash limits already operates in the hospital sector. That is the sector about which we have heard the most; for example, the operations that are not carried out in time and the surgical techniques that are not available for certain patients. If one were to approach a person and say, "Unless you hand over a chunk of money, I'll break your arm and you'll spend several months in pain but then you will recover", that would be classed as demanding money with menaces. Similarly, if one were to approach an old lady and say, "Yes, I can perform a hip operation which will alleviate the pain you are suffering from; under the National Health Service I can do it in six months or a year's time, but if you pay me I can do it tomorrow night", that again would surely be termed demanding money with menaces.
One of the problems we are faced with is that effectively the demand of money with menaces by the private sector is becoming institutionalised. We have now reached the stage where the National Health Service is being advised to buy private provision. I wonder what type of morality pushes that proposal forward.
I now turn to family practitioner services; that is, family doctors, dentists, pharmacists and opticians. At present those services are not cash limited, but their administration is. The problem that that situation creates is that there can be virtually no change in the administration or the way things are managed. This is at a time when the concept of care in the community is being pushed and when the closure of large mental institutions is being put forward with the idea of providing for patients in the community. Those are indeed very laudable aims, but unless we are prepared to change the mechanism of the service delivery and provide the funding for an improved service at community level we shall just make the situation worse for the mentally infirm and handicapped.
We are faced with the prospect of cash limiting the provision of care for the family practitioner services. I suggest to the Government that we are going in the wrong direction. Rather than saying to family doctors and chemists, "You must not provide medicines or services to the population once your cash limit has been exceeded", surely it would be much better to look at improved ways of providing medical treatment.
I shall give one example. It has recently been made known to the public that the use of tranquillisers can be addictive. This is a very serious problem indeed. I can remember, some 10 to 15 years ago, my father writing an enormous number of prescriptions for tranquillisers. He was approached by the medical establishments, who said that he was overprescribing. I asked him, "Why do you do it?" He replied, "It works". I then asked him what the alternatives were

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to such overprescribing and he said, "Improvement in housing, giving people jobs and alleviating poverty". So, as a socialist, as well as providing "mother's little helpers" he was also working to alleviate those problems.
However, I am sure that the medical profession will wish to join with the general public to ensure that it does not peddle addictive drugs. I hope that with the knowledge that we now have it will be looking for alternative methods of treatment. I further hope that part of its search for such alternative methods of treatment will lead it to believe that prevention is better than cure. Perhaps then it too will join the lobby to improve housing and employment prospects as well as to reduce poverty in this country.
I hope that the Government will listen to the debate. I know that the people of this country will listen to it, because they have the interests of the National Health Service very much at heart. I hope that the Government will take note of what has been said on both sides of the House about the most glorious socialist institution, the National Health Service.
5.40 p.m.
Lord Ferrier: My Lords, a good deal of water has flowed under the bridge since the noble Lord, Lord Ennals, put down this Motion and I tabled my Motion. The biggest factor has been the Budget. It was a momentous Budget. I wonder whether some of the people who have been moaning or wingeing—call it what one will—about the funding of the National Health Service are perhaps screaming before they are hurt. We must remember that the Prime Minister made it plain that the Budget is not concerned with paying out money. It has established that money is now available to provide substantial funding for the NHS. My noble friend the Minister said something about that at the beginning of the debate, and I hope that he will have more to say about it when he replies.
Now that the financial position has been established, resources are available. Of course the Government are aware of the needs of the NHS. Let us see what they do in the next few months. I was struck by the fact that a number of speeches appeared to confirm what some of us have said for some time. I put forward this suggestion tentatively, because it is not as easy as it sounds. The time may have come while we are at the beginning of an overdue overhaul for us to decide to separate the two departments of health and social security. It is a complex matter. It is possible, and I hope that the noble Baroness, Lady Cox, will bear me out, that the morale of the health service might be improved if it had its own Minister and was separate from a department of social security.
I may be wrong—noble Lords may agree—but we are not well served by television companies, broadcasts and sometimes the press. There is a constant repetition of pictures of demonstrations and processions. What about radio programmes such as "Any Questions?"? Only last Saturday there was an almost endless tirade against the Government about the NHS. Is the audience for "Any Questions?" packed? Are the questions vetted to prevent a tirade such as the one we heard? I think that the panels are
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often ill-balanced. Despite what its detractors say, the NHS is a valuable service as it stands.
Let there be separate Ministers. A separate department of health might contribute to an improvement in the morale of the service. It is manifest that the nation's needs have outrun its resources. I was greatly impressed by what my noble friend Lord Thorneycroft said. When we spend money, it is important that we should be sure that it is well spent.
On another tack, every effort must continue to be made to cut unnecessary expense That brings me to a point which I have made before, and which I believe is worth serious consideration if there is to be any recasting of the service. Has the time not come for Britain to catch up with the rest of the world by accepting manipulative therapy as part of the service? The savings that would accrue are important. They would not only be savings in money. There would be a reduction in the cost of drugs and a reduction in hospitalisation. Hospital beds would be set free. Serious losses which arise from sick leave could be avoided.
Has anyone registered in the past few weeks the fact that the much maligned pharmaceutical companies contribute large resources which are used in research and development? One company recently referred to spending £2 million a year.
Private medicine has not been mentioned. Private funds contribute vastly to the health of the nation. People do not grasp the fact that BUPA, PPP and the like make a massive contribution towards the health of the nation as a whole. Let us all pull together and trust that we can bring success to the NHS as it stands. I believe we can all do that by seeing that we do not eat, drink or smoke too much. If one must smoke cigarettes one should ensure that one does not inhale. Many savings could be made if people looked after their own health by the simplest possible means so, in Kipling's words,
"That we may make if need arise
No maimed or worthless sacrifice".
5.50 p.m.
Lord Kilmarnock: My Lords, in a debate on the National Health Service anecdotes seem to be in order. Recently I spent a brief spell in St. Thomas's Hospital as an NHS patient. The ward I was in had been re-opened for a couple of months, presumably with a small dollop of the Government's waiting list fund, in order to clear the backlog of operations. The man in the bed next to me had been waiting for two years; I was lucky, there was no such pressure on my specialty. The nurses all wore different coloured uniforms—white, green, cerise, very pretty—and when I asked the sister why, she said, "They are all agency nurses, wonderful girls but they don't know where anything is when they arrive". In two or three weeks they would be gone because the fund would have run out, the guillotine would fall and the ward would close again. There had not even been time to clean the windows so that the view across the river to this temple of wisdom which might have been some solace to the inmates was sadly blurred. I yield to no one in my admiration for British improvisation in times of crisis but it seems an odd way to run a health service in a period of prosperity and peace.

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Many noble Lords have pointed to under-funding as the root cause. That is not the whole story but it is the one that has most caught the public imagination in relation to the Budget. I know that the Budget is a tax-gathering time, as the noble Lord, Lord Winstanley, has said, but it turns people's minds to these things. I think that the time has come to end the long drawn-out guerilla war of statistics. The fact is that the Government have lost that war, because the public have refused to be lured into the thickets of cash increases, efficiency savings, sale of property, and so forth. They have judged, as one would expect, on what they can see with their own eyes—the ward closures, the failure to open up new wings, and waiting lists which have not diminished much as a result of the Government's cash injections, at least not so far.
It is the public perception which has forced on the Government a fundamental review of the service well before they were ready for it. I shall return to that a little later. First, however, I want to add my support to the voice of the social services committee of another place which asks for the service to be put on an even keel before it faces a scrutiny which may well profoundly change its character. That is only fair to the service and to those who have been waiting so long for their operations.
I know that the Chief Secretary has made guarded pronouncements leading one to think that the Government will fund the nurses' pay award. I hope that the noble Lord, Lord Skelmersdale, will make that a little more explicit. But there must also be some additional funding in 1988–89 and 1989–90 for the other factors to which the social services committee has drawn attention. I am bound to say that I see no reason for the Secretary of State's assertion that the Conservative-dominated committee have got their sums wrong. DHSS Ministers themselves have agreed that a 2 per cent. increase per annum in real terms is needed to keep up with democratic pressures, medical advance and the Government's own priority objectives.
With respect to the remarks of the noble Lord, Lord Thorneycroft, this will not be met by the £1 billion pencilled into the public expenditure plans by the Chief Secretary for the next two or three years for the simple reason that the DHSS's own estimate of the rate of health and community health service inflation is running in the region of 8 per cent. The social services committee therefore recommended an additional £½ billion a year over two years in partial recompense for the cumulative shortfall. This figure was backed by the SDP in its pre-Budget statement, and I shall be very surprised if the Government do not find themselves obliged by public opinion to move in that direction. The noble Lord, Lord Skelmersdale, gave a hint that this might well be the case in his opening speech; perhaps he will refer to it when he comes to wind up.
However, money is not everything and there are also the vital factors of management, organisation and particularly leadership to which my noble friend Lord Perry devoted much of his speech. I think that there is some evidence that the new line of management system devised by Sir Roy Griffiths is
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not sitting happily with the older structure of regional authorities and that some rationalisation will have to take place. I was in sympathy with what the noble Lord, Lord Trafford, was saying on that.
There is no time in this debate to go into details of how such a reformed system might operate. But I should like to probe the noble Lord, Lord Skelmersdale, a little on the so-called internal market mentioned by Lord Trafford which was advocated by our party at the last election. Essentially the idea is that under-bedded districts could buy services from over-bedded districts if, in their judgment, that was the way to get the best deal for their patients. Districts themselves buy and sell services from each other at the moment, but the system is fragmented and partial, and the delays in the recoupment of funds for cross-boundary flows, as they are called, between authorities are extremely long. The internal market would speed up and organise the trade on a much more rational basis which could include free trading with the private sector.
Now, as in all schemes devised by men, there are some drawbacks and these are analysed in a paper by Ray Robinson of the King's Fund Institute, which was published recently by the noble Lord, Lord Harris of High Cross's Institute of Economic Affairs health unit. I understand that he feels that he should not mention his own publications in a debate in your Lordships' House, but I have no doubt that he has sent a copy to the Minister and that the noble Lord is aware of its contents. Ray Robinson concluded that, despite the dismissal of this project as impractical by the DHSS in 1986, there is sufficient evidence to support the case for an experiment within a single region, either in terms of a single service or services in general. Perhaps the noble Lord could tell us whether the department is prepared to look at that again.
Finally, on the threshold of the fortieth birthday of the National Health Service—I think that the noble Lord, Lord Winstanley, gave us the date of 5th July 1948—I come to its future as a British institution. Routine reappraisal appropriate to such an anniversary has sadly become an agonising reappraisal, due to all the malfunctions to which much of this debate has been devoted. I believe that we are experiencing a genuine example of popular pressure disrupting the Government's programme and forcing the National Health Service to the top of the agenda.
My own instinct is that we should not depart from two of the basic principles of the National Health Service; namely, that it should be funded from taxation—whether from general taxation or from the earmarked National Insurance Fund is open for discussion; secondly, that it should be free at the point of use. I think that we have already heard the welcome affirmation of the noble Lord, Lord Skelmersdale. These two principles have served us well and I am not persuaded that we should shift to any of the rival systems which have caused escalating costs in other countries. But I am by no means an immobilist on the National Health Service and all the means of administration, organisation and delivery, as far as I am concerned, are open to debate with no holds barred.

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Here I think we are entitled to probe the Government on the nature and timing of the review which the Prime Minister has announced and on which there have been some rather conflicting signals from government sources. Given the urgency of the problems, I can understand the Prime Minister's reluctance to engage in the prolonged deliberation of a Royal Commission. But there is an equal and opposite danger that the review will be too narrow in the range of views canvassed and too hasty in its conclusions. If after the review we are to be offered a Green Paper with a short and perfunctory consultation period, followed quickly by a White Paper prior to legislation, if that is necesary, the Government will then justly, in my view, be accused of pre-empting the national debate which should take place on an issue of such overwhelming concern to a large majority of the British people.
During this review there are two very important considerations to bear in mind. I hope that the noble Lord will be able to say that the Government will do this. The first is that the Government have no mandate for a fundamental switch in the funding of the NHS and they cannot quote their manifesto as holy writ in this instance. That should make them particularly sensitive to public opinion on the whole issue. The second consideration is that the British empirical tradition is highly suspicious of ideological fixes. Before discarding our basic system in favour of others of dubious advantage we should consider how and where it can be improved. The social services committee has singled out:
"the hopeless inadequacy of output data and criteria for evaluating performance in the service."
It recommended:
"that urgent attention is paid to the development of improved measurements of the effectiveness of the National Health Service".
This was a point which I think was supported and touched on by the noble Lords, Lord Winstanley and Lord Hunter of Newington, who are both people with very great authority in this field, I think that it should be followed up at once and it could lead to much improved procedures within the existing framework.
At this point I should like to assure the noble Lord, Lord Winstanley, that Dr. David Owen has in fact escaped from the tutelage of Mrs. Barbara Castle and is now more inclined to consider these points than he was at the time to which the noble Lord referred. But improved efficiency and better use of resources cannot be built on exhaustion, disillusion and low morale. Induced crisis followed by drastic change or patient evolution starting from an adequate funding base are the two courses open to the Government. The public will be watching with the greatest interest to see which one the Government take.
6 p.m.
Lord Harris of High Cross: My Lords, among the many impressive speeches that we have had, following the spirited opening by the noble Lord, Lord Ennals, I am only sorry that I shall not have time to refer to more than three or four.
The noble Lord, Lord Winstanley, pointed out that the National Health Service had never been adequately funded. Then the noble Lord, Lord
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Thorneycroft, told us that it had nevertheless been a success. My observation is that those two statements are correct and can be reconciled if we allow for what I would call the constitutional deficiencies, which were hinted at by the noble Lord, Lord Trafford, among others, in the structure and form of the National Health Service.
Accordingly I shall overcome my modesty and follow the noble Lord, Lord Kilmarnock, in referring to another paper published by this remarkable Institute of Economic Affairs. It has special interest in that it was published more than a quarter of a century ago. I think that it was the first effort by a professional economist to subject the National Health Service to some basic economic analysis. The author of Health through Choice was Professor Dennis Lees. He set out clinically to diagnose what he concluded at the end of his analysis were the Congenital weaknesses of the National Health Service. He said they were:
"the dominance of political decisions, the absence of built-in forces making for improvement, and the removal of the test of the market."
I believe that he was right then and that his conclusions are right today. However in the prevailing collectivist climate of those days he came in for a good deal of criticism for daring to subject health to anything approaching a price tag. But it is clear that the National Health Service was not so much a free lunch as an unlimited free-for-all. That concept violated the fundamental precept of market economies which is: zero price—demand very large. I hope that in this at least the noble Lord, Lord Peston, might find some measure of agreement.
If we suspend pricing we are obliged to find other ways of rationing scarce supplies such as waiting lists, queueing, administrative discretion and other ways. Total reliance on public finance faces politicians inevitably with a question that they cannot answer. The question is: how much should the nation spend on medical care? Suppose we were asked: how much should the nation spend on food, clothing or holidays? We would rightly reply that that was an absurd question, although we might hazard a guess at the prudent minimum that an individual or family should spend on those things. Yet when asked how much to spend on health politicians, particularly those in Opposition, never have any hesitation in saying that we should spend more. Usually they mention a billion or two more.
Not being connected with the medical profession I have to say that much health care at any rate is not so very different from spending on food, clothing and holidays, and may indeed be less beneficial. It is customary to talk of medical care with bated breath as though it were all a matter of life or death. The truth is that much so-called medical care is more akin to other consumer goods and services that cater for comfort, convenience and subjective personal preferences. I was delighted to hear the noble Lord, Lord Trafford, as a medico point out that there was no clear correlation between national spending on medical care and various measures of different nations' health.
Therefore more spending does not necessarily guarantee better outcomes. Even for serious illnesses there is no single treatment, but a choice between

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alternatives with a wide range of costs. The most expensive or the most elaborate procedures often favoured by practitioners are not invariably the best. Even for surgeons in the same specialty there are wide differences in numbers of operations performed and in success rates. No one doubts that some surgeons have been known to overoperate, just as some keep patients in hospital longer than necessary in order to occupy their quota of beds.
In recent months by chance I have had the privilege of meeting many general managers, consultants and administrators working in the health service. I promise noble Lords that I have been quite astonished to hear district managers say that there is no new crisis and that apart from particular specialties in some areas there is no worse shortage of cash than in the past. Indeed, one manager in London privately and publicly praised the Government for keeping a cap on spending. He explained that pouring in money, as the noble Lord. Lord Ennals, earnestly desires, would have hindered his own efforts to get control of costs and to squeeze out waste and restrictive practices.
No one doubts that there is an acute problem which is aggravated by what the noble Lord, Lord Pitt of Hampstead, called the flawed RAWP formula. One symptom is the shortage of specialist nurses particularly in the South-East which frequently leads to operations being cancelled. One familiar reason that market economists understand and which the noble Baroness, Lady Cox, acknowledged, is the absurd national negotiation of pay so beloved by the trade unions which does not allow sufficient differentials where costs of living are high and labour markets are tight.
There remains the underlying chronic, continuing failure of a publicly-funded National Health Service to deal with waiting lists and less visible symptoms of consumer dissatisfaction. I wish that I had time to detail some of the ways in which we know that money is still being wasted.
The outcome of these observations is that I find myself in a position of congratulating the Government on standing firm against what is really a soft option of splashing out another billion or two. As long as funding is confined to the single channel of public finance the chronic debility of the NHS will never be remedied. We see in other countries a variety of methods including the health maintenance organisations by which private insurance can significantly add to the resources available, at the same time as containing costs and improving the delivery of medical care to match differing consumer preferences. One lesson from the USA that the noble Lord, Lord Trafford, might not wholly accept is that the restrictive practices of the medical profession are sometimes to be tackled as vigorously as the restrictive practices of less elevated trade unions.
At present the Government are getting the worst of both worlds. They impose taxes which so reduce take-home-pay that still only the better-off can easily afford private insurance. Yet at the same time they fail to provide a service that meets the rising aspirations in which most families increasingly indulge in their homes, leisure life and holidays. All
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of this was foreseen by a leading Labour statesman who held high office all too briefly after 1964 and who is now among the elders of your Lordships' House.
I shall therefore end by quoting my noble friend Lord Houghton of Sowerby from a paper published 20 years ago entitled Paying for the Social Services. In 1968 the noble Lord wrote:
"What is in doubt is whether we in Britain will ever give medicine the priority given to it in some other countries…so long as it is financed almost wholly out of taxation."
I commend those words to all parts of the House.
6.10 p.m.
Lord Peston: My Lords, we are all indebted to my noble friend Lord Ennals for introducing the debate. It is an extremely important subject and I was determined to take part. However, I shall not be able to stay to the end of the debate. I have apologised to the noble Lord, Lord Skelmersdale, for that and for the fact that I shall not be able to hear his reply. I look forward eagerly to reading it.
I have been reassured by the noble Lord, Lord Skelmersdale, as well as by other noble Lords opposite who have said that they are in favour of the National Health Service. Some said, to quote the old cliché, that it is safe in their hands. The reason I am reassured is that the National Health Service is essentially an egalitarian and socialist insitution. I am delighted that it is safe in their hands. The only noble Lord disagreeing with that proposition was the noble Lord, Lord Harris. He was almost the only noble Lord who was clearly not in favour of the National Health Service. I am delighted to discover that other noble Lords are in favour of it.
The National Health service is egalitarian; its values are social and compassionate; it provides a service to all; and, as I have argued before, its great service is reassurance. It is egalitarian at least in its intention to be particularly helpful to the very poor. It is also egalitarian because it is especially helpful to those who are sick and disabled.
To echo what has just been said, the very essence of the National Health Service is that it removes that service from the area of the market. The provision of a health service is not like the provision of other consumer goods and services. That is the whole point of this debate. Connected with that is a tradition of service. Again, those who participate in the National Health Service are not taking part in an activity which is akin to an ordinary business enterprise. I do not denigrate ordinary business enterprise in the vast numbers of areas where it is appropriate. However, it is not appropriate in the NHS.
Perhaps I may also echo some of the remarks made by the right reverend Prelate the Bishop of Guildford in his maiden speech. He referred to the people who work in the National Health Service and he paid tribute, as we all do, to doctors and nurses. However, we must also pay tribute to all the other staff in the service. We sometimes forget that consultants do not wheel patients into operating theatres. Porters provide that service. Other very low-level clerical staff provide patient records. In saying how well we are served, we should not underestimate how well we are

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served by staff who may be incredibly badly paid. Many of them are paid well below the acknowledged poverty line.
What is the point of a National Health Service and what are its criteria? Its criteria are that it is there when it is needed and that it is free at the point of application of the service. Many of your Lordships may have private health insurance in various forms. Nonetheless, if something dreadful were to happen to such noble Lords in your Lordships' House at this very moment, it would not be private health insurance which would deal with them. The National Health Service would deal with them either at Westminster Hospital or at St. Thomas's Hospital. Subsequently, they might go in for some of the comforts that follow from private insurance.
At no point do most people abstract themselves from the NHS, and quite rightly. It provides a service for all which is not provided as a function of ability to pay. It is not provided explicitly as a function of social class. More to the point, to those who are, for some misguided reason, envious of the American system, it does not provide a service which depends inversely on past medical history. You are not told that you will now get an inferior service because you have made use of the service in the past, and other such matters.
The National Health Service is a service in which efficiency is enormously important. I was very sympathetic to some of the remarks made by the noble Lord, Lord Trafford, on the question of management and efficiency. However, we have a paradox. By world standards the National Health Service is an outstandingly efficient service already. On all the cost studies which I have seen, it is immensely efficient and it is particularly efficient when compared to private insurance systems. That does not detract from the fact that all of us—and certainly those of us who are economists—believe that it should become more efficient. We are not saying that that is not important.
I was particularly intrigued by the suggestion that we might have an inspectorate of health and I should be keen to follow that up. However, it is an efficient service and we should not pretend that we can somehow solve its problems by arguing that there is a vast amount of fat and that if only the service were more efficient we would not have to raise more by way of public finance. Nothing could be further from the truth.
Because the service is efficient and meets the needs of the people, a case is thereby made for appropriate public finance. It is a service of which we can be proud. It is a service which uses resources relatively well. What it requires is considerably more in the way of resources. Perhaps I may say that I was disappointed to have both a lecture in elementary economics from the noble Lord, Lord Skelmersdale, and the standard cliché concerning the goose laying the golden egg. The point is that if the goose is laying the golden egg, we should like to have a bit of that egg for the National Health Service.
The essence of the matter in terms of government public expenditure is widely recognised and can be seen on the Government's own figures. One does not
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have to go to the King's Fund, excellent though its database may be. Even given the alleged £1 billion or so extra which is being provided, that still leaves a major deficiency. We are talking about a deficiency which is net of the Government's public expenditure figures and not gross of those figures. That is why more money is needed.
I therefore hope that we do not allow ourselves to be misled by going down the path of private health insurance. I also hope that we shall not delude ourselves into believing that there is an easy alternative way of fund-raising. I am not suggesting for a moment that our hospitals should not try to raise more in the way of funds, as they already are. It is amazing what bits and pieces are being financed in that way. However, those are trivial sums compared to what is required.
To return to the logic of my position, the essence of the National Health Service is that it is a publicly financed service. If Ministers opposite do not feel that they are able, following the line of the noble Lord, Lord Harris, to take the public finance decisions which are required, I can assure them that there are many others who will be quite capable of taking those decisions and who will be and are unafraid to argue that they believe in extra public expenditure and believe in paying the taxes which would be required.
I believe strongly that the Government must not be allowed to change the area of debate. The funds are there; they could be made available. If the Government do not wish to make them available, let them say so and we shall then disagree on the matter. But do not let us pretend, on the one hand, that the funds are not there and, on the other hand, that the funds are not needed.
In my view, the crisis in the National Health Service is of the Government's own making. Part of the crisis lies in the fact that the Government's approach to the matter seems to be ad hoc. We were all sitting in this Chamber a few weeks ago when the noble Lord announced additional funding. We are told that we can look forward to more ad hoc funding. I do not reject such funding if it is to be made available. However, what is required is a commitment and a long-range plan. We should not go from one crisis to another. We want to see an end to the crisis and we wish to see matters proceed systematically.
Lord Skelmersdale: My Lords, perhaps the noble Lord will give way for a moment. He has of course recognised that we have long-term plans for at least £1 billion next year, £1 billion the year after and £1 billion the year after that.
Lord Peston: My Lords, we shall return to that. However, as I argued earlier, when the noble Lord was not present in the Chamber, the additional funds needed are net of the funds which are in the public expenditure White Paper. The requirement is for a further £1 billion or so on top of those funds. I am not denying that there are additional nominal sums of money being put forward. They are nominal in terms of current prices rather than in the sense of being trivial.

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Perhaps I may conclude by saying that I regard the Government as the cause of the problem and the uncertainty. It is the Government who refuse to provide the appropriate finance.
6.10 p.m.
Lord Crickhowell: My Lords, I am surprised that the noble Lord, Lord Peston, in the course of his euology, failed to address the central flaw in the health service so vividly described by my noble friend Lord Harris. As a political candidate in 1968, I wrote a report on the health service in Wales and bullied the noble Lord, Lord Prys-Davies, who was then chairman of the Welsh Hospital Board. As Secretary of State, I was responsible for the health service in Wales for eight-and-a-half years. I am as aware as anyone of the very real problems that confront us, and I shall have something to say about that shortly. I also assert that over the 20 years since I prepared that report there has been a vast extension of health care. That is true, too, of the period since 1979 when I took office.
I am not very impressed by lectures from those who served in administrations which reduced the share of GDP spent on the health service. My noble friend Lord Skelmersdale was entitled to criticise the noble Lord, Lord Ennals, on that point. He might have added that at that time, through mismanagement of the economy, the then government had to slash the capital programme by about 30 per cent. And they allowed nurses' pay to fall by 21 per cent. in real terms.
I do not wish in any way to be complacent or smug; but I think I am entitled to say that I and my colleagues in the Welsh Office at least matched that performance when, during our period, we increased allocations to health authorities by a third in real terms. We dealt with an increase in in-patient numbers of almost a quarter up to 1986, and I suspect that there has been a further increase since. When I left there were some 300 more doctors and over 4,000 more nurses than when I entered the department. We had spent almost half a billion pounds on the largest capital programme ever undertaken in the health service. A whole range of new and improved services had been introduced—cardiac treatment, renal dialysis, bone marrow transplants and joint replacements to give just some examples. We had taken major initiatives for the care of mentally handicapped people and the elderly.
Against that background and the already announced increase in health spending in the United Kingdom of over £1 billion in the coming financial year, the language of the Government's critics often bears little relationship to reality.
It is equally clear that the health service is faced with immense problems. We can all point to specific examples. During my time as a Minister I had to undergo prolonged investigation and treatment. Like the right reverend Prelate, who made a notable maiden speech, I was able to observe at first hand the highly unsatisfactory conditions in some of our major London hospitals. The problems of old and unsuitable buildings have been made worse by the perfectly sensible policies pursued by successive
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governments of trying to reduce the scale of hospital facilities in areas where populations have declined and increasing health care in other regions of the country. Incidentally, that is something we were urged to do by the right reverend Prelate the Bishop of Manchester who pressed the case for improving health care in some of our deprived regions.
I do not doubt that more money should be spent. Indeed, we know that within weeks, on top of the £1.1 billion already allocated for 1988–89, the Government will have to find substantial sums from the reserves to meet the nurses' pay award. Any of us can pluck a figure from the air. Figures have been plucked in this debate—a billion pounds here, two billion pounds there. There is no doubt that such sums could mitigate the problems for a time—but only for a time. Just to allocate extra public money without reform will do nothing to solve the fundamental flaws in the structure of the service. Those flaws have been there from the start, as the noble Lord, Lord Winstanley, reminded us. Nowhere have they been more vividly described than in John Campbell's recent life of Nye Bevan. He writes that,
"the coming into operation of the NHS immediately exposed a miscalculation so fundamental that it virtually negated the central assumptions on which the Service had been set up … (They) comprehensively underestimated what it was going to cost … they entirely failed to foresee that, far from declining, the demand for treatment, once freed from financial constraint, would prove literally infinite, and the capacity of the medical profession to devise expensive new treatments scarcely less. Inconceivable though it seems, even the Treasury failed to spot the fact that it was being asked to underwrite an open-ended commitment … within a few months the Service was plunged into a crisis which seemed to threaten the very conception of the NHS as all parties had hitherto understood and accepted it".
That crisis has recurred cyclically every couple of years ever since. It is the situation that we face today. If an extra £1 billion were allocated tomorrow, the situation would still have to be faced in two or three years' time.
That is why I am thankful for two things; first, that we have a Government pursuing economic policies that create the wealth without which there can be no funding—that was the job splendidly performed in the Budget—and secondly, that the events of recent months have created a situation where all possible options can be put on the table and radical reforming policies can be considered.
From among all the varied possibilities, I pick just one central theme. Our objective here, as in so many other areas of need, must be to create a partnership between the public and private contributors. I do not want any more to be spent by the taxpayer unless it is combined with action to create a very large multiplier effect, both by encouraging the private sector to spend more and by getting better value for money through the process of choice and competition within the service.
When I was Secretary of State I began to introduce in Wales what the noble Lord, Lord Hunter of Newington, called contract partnership by establishing a network of renal dialysis units within the health service provided by the private sector with capital funded by the private sector. I also started to examine urgently the possibility that we provide cardiac surgery in North Wales from the three excellent private hospitals in close proximity to the

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area—a free service for health service patients but within private hospitals. I think we should go further down that road. I welcome the fact that Guys Hospital, on the other hand, has taken the initiative on the reverse side of the same partnership and is charging for the comprehensive service that it provides to patients outside the health service on commercial terms.
I conclude by saying that I do not believe that there is the smallest justification for the claim to moral superiority made by so many of the Government's critics. There is no moral virtue in advocating economic policies that, over a long period have failed to produce the resources generated by more successful nations. There is no moral superiority in advocating policies for the health service that have left it in recurring crisis for 40 years. I hope that the Government will be as radical and brave in their health reforms as they have been radical, brave and successful in their economic policies.
6.29 p.m.
Lord Rea: My Lords, I think that I am the seventh health professional to take part in the debate this afternoon and the third professional practising in the National Health Service. Therefore, we are seeing very much a "coalface" or face to face picture, particularly when one remembers that the rest of those who have spoken are on the other side and are customers of the National Health Service.
I am a general practitioner, a member of what I think is a good primary health care team. I am glad that the Government's White Paper on primary health care is basically a positive document looking forward to an increased role for doctors and others working with them in the community. So far, it is true, we have not been hit as hard as those working in the hospital service by the current constraints. That is not to say that we do not have some worries about the White Paper but we shall have an opportunity to debate it in more detail at a later stage.
However good primary health care is its effectiveness is very dependent upon the ready availability of good hospital services and the efficient functioning of community services. That is particularly true in regard to the policy of community care. Relevant to that is the very recent publication of the report by Sir Roy Griffiths, which has been mentioned by a number of speakers, entitled Community Care: Agenda for Action. As one might expect from Sir Roy, in that report he makes some important and practical suggestions. Both he and the Audit Commission are fully aware that things are not as they should be in community care. In the introduction he states that:
"many social services departments and voluntary groups grappling with the problems at local level certainly felt that the Israelites, faced with the requirement to make bricks without straw, had a comparatively routine and possible task".
I hope that his suggestions will lead to a little more straw for community care in the form of more personnel in places where they are needed and the finance to pay them a just reward.
With the decanting of populations from the large Cinderella institutions and the increasing number of
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people in the community who are aged 75 and over, current services are feeling overwhelmed. As many other speakers have pointed out, every year there is an increasing number of people in the community who are aged over 65 and especially over 75. As noble Lords are only too well aware, health problems become much more common after the age of 75.
For instance, if one looks at the services used by people over 65, according to the General Household Survey of those aged from 65 to 74 only 4 per cent. had used the home help services in the past month but nearly 20 per cent. of those over 75 and 31 per cent. of those over 85 used those services. The provisions of home helps for those aged 65 and over went up from six to seven per thousand between 1979 and 1985. For those over 75, the number decreased during the same period from 17 to just over 16 per thousand people.
I should like to turn to the wider aspect of this topic which has occupied most of the attention of your Lordships this evening; namely, the overall funding of the health service. I think that there is no better recent analysis of current problems than the House of Commons' Social Services Committee Report published on 24th February. At first the Government dismissed its findings out of hand but a more moderate line was taken by the noble Lord, Lord Skelmersdale, a week ago when he said that a more considered government response would be made. I invite him to make at least the beginnings of that response when he replies to this debate.
I shall only take up a few of the points that were made by the committee. Certainly it did not recommend simply "throwing money at the problem." Those were the words used by the Secretary of State for Social Services about one hour after the report was published. I shall mention only three of its recommendations. The committee pointed out, as have many noble Lords, that underfunding of past pay awards has been one of the main reasons for the present crisis. The committee:
"recommend that the Government … commits itself to fund fully all NHS pay awards in 1988–89 to which it has agreed".
That suggestion does not seem to me to be unreasonable, and I hope that the noble Lord will be able to say that he will follow it.
The committee considers that the £1 billion injection of new money that it says is urgently needed should be:
"allocated to specifically identified and costed priority developments, including information technology, putting right the maintenance backlog, replacing essential fabric and equipment and developing identified service priorities for care in the community".
That is certainly using money but it is not throwing money at the problem indiscriminately. It specifically targets money on areas which the committee felt were crucial to the operation of the National Health Service.
The committee further recommended that urgent attention be paid to the development of measurements of the effectiveness of the National Health Service. Surely that is sound advice. I think that the report is dignified and well thought out. It relies on a large body of evidence, and names 64 witnesses whose integrity, I should have thought, was beyond question. The committee itself had a majority of Conservative Members.

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Perhaps I may briefly look at the situation in other countries which again other noble Lords have mentioned. If one considers the health care systems in the OECD countries, practically all of them are more costly in terms of the proportion of GNP which they spend on health than is our National Health Service, as the noble Lord, Lord Trafford, and my noble friend Lord Ennals pointed out. We are practically at the bottom of the list. There is no relationship between more expenditure on health and better health status; in fact, rather the reverse is the case.
I am running short of time so I shall skip over part of the argument that I wanted to put forward. However, other noble Lords have suggested that the administrative costs of private health care are far higher than those funded from general taxation. Far more money is lost in overheads, and collecting and paying bills. Medical procedures also tend to multiply when they are accounted for separately.
Finally, I should like to suggest some lines on which the proposed inquiry into the National Health Service could proceed. First, it should be asked whether the present system of providing health care via increasing numbers of hospital admissions every year is the most appropriate way to cope with the problem of an ageing population. As the noble Lord, Lord Hunter, has said, the inquiry must look into the causes of ill health, taking account of the fact that more deprived sections of our community become sick more often and more seriously, die younger and make a disproportionate use of the hospital services. How far is the increasing expense of the National Health Service at least in part due to the fact that we are not paying sufficiently vigorous attention to avoiding those factors which we know cause ill health.
At this point I should briefly like to put on my hat as vice-chairman of the National Forum for Coronary Heart Disease Prevention and say, echoing the remarks of the right reverend Prelate the Bishop of Manchester, that smoking, drinking alcohol and faulty diet underlie much of the ill-health that is treated in the increasing number of hospital admissions and increasing number of outpatient appointments. I suggest that the inquiry pays attention to that much neglected report produced by Professor Douglas Black's working party on Inequalities in Health, which showed that the solution to health problems in this country is to be sought in eliminating unemployment, poverty and poor working conditions as well as by providing a health service which offers as good or better facilities for under-privileged people as it does for those who are better off.
6.39 p.m.
Baroness Lane-Fox: My Lords, I am grateful to the noble Lord, Lord Ennals, for providing this chance to look at today's National Health Service. I think back with personal shame to the very beginning. During the 18 years from 1930, when I was first immobilised, until the National Health Service was established in 1948 I cost my parents much more money than they could easily afford. That memory leaves me a loyal supporter of the National Health Service.
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Away from a ward of sick people it is hard to conjure up the intensity of dependence and the vulnerability of in-patients. Like many users of National Health Service hospitals, I am lost in admiration for the dedication of most doctors and nurses. It is nauseating when their salary scales become the subject of public debate. I asked the manager of a London teaching hospital yesterday what his chief worries were. He answered that it was having to change the goalposts half-way through the year through not knowing earlier what the level of pay awards will be. He added that the huge pressures on acute services, coupled with responsibility for priority care, create a situation where sometimes one needs to be able to say, "Enough is enough". In London, as has been said already, RAWP is not a popular word because London is a RAWP loser.
However, to turn from that uncomfortable subject to the community, the disabled consumers want especially a better means of useful information to get around to all of them. Many voluntary organisations have evolved methods to supply this information and some have developed computer systems with support from the Department of Trade and Industry and the DHSS. Thus a substantial quantity of information is held in computer databases, but the dissemination of that information is essential to improve the lot of disabled people. A co-ordinated method has been devised by the Disabled Living Foundation for a national disability information network. The DHSS, I am delighted to say to the Minister, has announced a commissioning of Coopers and Lybrand to undertake a two-stage feasibility study. The first stage is now in progress and I am told it looks very promising.
An authority that is seen as a very powerful ally for disabled people is the Disabled Services Authority, of which my noble friend Lord Holderness is chairman. One of its charges is wheelchairs, and it should be impressed on the DSA that in those cases where a severely disabled person depends on his or her wheelchair for all mobility he or she should be kitted out with whatever type and model of chair suits his or her needs. This is not a luxury; it is a necessity. I may say that the director of the DLF, Elizabeth Fanshaw, reminded me that without her wheelchair—and she is a very active person—she would be home-bound, and she rightly reminded me that I would probably be bed-bound. No doubt there are many others who could be mobilised and made partially a going concern if given the right chair.
Certainly much depends on family doctors, as was mentioned by the noble Lord, Lord Winstanley. It is encouraging that various moves are being made to bring them up to date with what are the real needs and prospects of severely disabled people. Such a pilot scheme is now in progress through the Prince of Wales's advisory group on disability and is being carried out among medical students through University College Hospital and Middlesex Medical School. This seems suitable, in particular on the eve of the Griffiths Report.
Finally, I have attempted to show in a very small way that the NHS may be going through a delicate time but there are plenty of lively, imaginative ideas for caring for the public and the community.
6.45 p.m.
Lord Tranmire: My Lords, this is not, as the noble Lord, Lord Ennals, rightly said, a party issue. Nor is it a national issue. When I was Minister of Health the first paper that came on my desk was the Guillebaud Report which lain Macleod had initiated. For the record it is interesting to remember the remit of the Guillebaud Report. It was:
"To review the present and prospective cost of the National Health Service; to suggest means, whether by modifications in organisation or otherwise, of ensuring the most effective control and efficient use of such Exchequer funds as may be made available; to advise how, in view of the burdens on the Exchequer, a rising charge upon it can be avoided while providing for the maintenance of an adequate Service",
tying it up very much with Exchequer funding, about which I had then, and have subsequently, grave doubts.
When one turns to the evidence that the committee was considering one finds that Professor Abel Smith—who has done invaluable work both in Britain and in Europe on these matters—has shown that the net cost of the health service as a percentage of the gross national product was highest in 1949–50 and became less in each successive five years. The report is also of great interest because Sir John Maude, who considered this and criticised the structure of the National Health Service, made a reservation pointing out how this was a most unusual way of financing public activity. He came, he said with hesitation, to the conclusion that only because the National Health Service at that time had been in operation for just seven years was he able to say that it should not be restructured then. Noble Lords will find that in the reservation. That was the considered judgment of the committee.
Having spent two and a half years receiving evidence on this, it came to the conclusion that it would be inadvisable at that time to make any considered judgment upon the matter. I have come to the conclusion that the way in which the health service is run—when the Minister of Health has to go cap in hand to the Chancellor of the Exchequer, and is regarded as a poor relation and rather like the importunate widow in the Bible—is not the most satisfactory way.
I was very interested in the reminder by the noble Lord, Lord Harris of High Cross, of the advice given by the noble Lord, Lord Houghton, earlier on the dangers that came from this method of financing. It is now not seven years after the inauguration of the health service; in July it will be 40 years. When shall we have a continuation of that examination that had to be stopped? I think that the noble Lord, Lord Houghton, was right. Perhaps I may quote one figure in Professor Abel Smith's recent publication. The years 1977 to 1982 are valuable because they cover the time when the noble Lord, Lord Ennals, was in charge; successive Ministers of another party were in charge after that. At that time the increase in the expenditure on hospitals in those five years in Britain, which came from Exchequer financing, was 7 per cent., in France it was 34 per cent., and in West Germany it was 45 per cent. So it does not look as if it is very productive basis for hospital financing. I believe that it requires looking at again.
It is late and I do not want to take up the time of the House, which wants to hear the Minister. But
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when he replies perhaps the Minister will tell us a little more about the inquiry that we shall have. Will it have the same remit as the Guillebaud Report, which was tied to this peculiar form of Exchequer financing or will it be wider than that? Will it be taking evidence or will there be another body to do that?
Finally, I should like to say how much I agreed with the suggestion of my noble friend Lord Nugent of Guildford that we ought to have a greater proportion of funding coming from the compulsory social insurance. He spoke about a national health insurance fund rather than it all coming from the Exchequer. I believe in that way that there would be less bitterness and disappointment. I believe that it would make for greater efficiency to have those two methods of funding running together, hearing in mind that in Europe, except for Italy which in 1979 changed its system of financing, all the other major countries are financed by some form of compulsory insurance. I think that it would be wise for us to do that. I hope that the suggestion made by my noble friend Lord Nugent will be considered.
6.53 p.m.
Lord Lovell-Davis: My Lords, I welcome for two reasons the initiative taken by my noble friend Lord Ennals in launching this debate. The first reason has clearly been stated by noble Lords from all parts of the House. There is grave concern about the state of what was once one of the brightest jewels in the crown of this society, our National Health Service. The second reason is that it gives me an opportunity to emphasises again the concern for child health services and the anxieties expressed by myself and other noble Lords during the short debate on this subject on 28th October last year.
At the end of this major debate I shall be brief, but I wish to repeat what I said then, that children need to be identified as a discrete group of health service clients with special needs. Until they are, we cannot know whether or not we are meeting their needs. Recent publicity has drawn attention to the need for children's intensive care nurses, but that shortage is part of a larger gap. What we need is a national strategy and funding for the recruitment, training and retention of registered sick children's nurses. This cannot be left to district health authorities; nor can they be expected to fund the training of nurses who will be working eventually in other districts. The lack of planning for this important client group—nearly one quarter of our population—is evident whenever an attempt is made to quantify the services for children.
How can we even tell if we are getting the value for money much vaunted by the present Government if we cannot identify what the services are? Children's services are submerged in the general health services—in the acute services and community services. The trend in the care of sick children is to hospitalise them for as short a time as possible; to treat them as day patients or outpatients. This means that the interface between hospital and community and the planning of services for the child at home need to be at the forefront of health authority thinking. For the well child the family practitioner's

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responsibility is paramount in surveillance, keeping a child free from illness and identifying early any handicap. But how many authorities are planning this kind of integrated care? Very, very few; one could probably count them on one hand.
The way in which the Government could encourage this much needed thought and planning is by ensuring—as I recommended during our recent debate—that in the regional review children's services are on the agenda and are reported upon. I asked for this in our debate last October, but the reply was inconclusive. I ask the Government again to put children on the agenda of the regional review. It is simple enough, inexpensive and it could have far-reaching effects.
One reply I received from the noble Lord, Lord Skelmersdale, in correspondence following the debate, was an assurance that children's services are a priority for the Government. If that is so, can it be proclaimed from the rooftops, or from Richmond House at least, so that health authorities may know it and recognise children as vitally important members of our society on whose health we all depend for our future?
6.58 p.m.
Lord Auckland: My Lords, as for 34 years I have been resident in the diocese of Guildford, I hope it will be in order for me to add to the congratulations given to the right reverend Prelate the Bishop of Guildford on his very compassionate and impressive maiden speech.
The House will be indebted to the noble Lord, Lord Ennals, for initiating the debate. I have already apologised to the noble Lord that due to an important engagement with the Commonwealth Parliamentary Association I missed the first few moments of his speech.
The subject of the National Health Service is hardly out of the public ear at present—in either House of Parliament, among the media or people throughout the country. That is a very good thing because there is no doubt about the fact that there is general concern about the National Health Service which transcends party barriers.
In 1946 these words were spoken:
"Now we have come to Third Reading, and what we hope now is to leave controversy behind us, and to get the cooperation of the great medical profession, and of all health workers in the country; because without that cooperation this scheme is bound to fail. The House of Commons only passes Bills; but it is the men and women outside who can make them living realities".—[Official Report, Commons, 26/7/1946 cols. 473–74.]
Those words were spoken by the late lamented Aneurin Bevan in moving the Third Reading of the National Health Service Bill. It is a rather interesting commentary on our times when, so far as I can ascertain, the Third Reading came only three weeks after the Second Reading. How parliamentary times have changed! It so happened that at that time my uncle was secretary of Kingston Hospital in Surrey. Mr. Bevan came to see the doctors there and fairly put the wind up them. A short time later he returned to the meeting in the boardroom of the hospital and apologised if he had been rather abrasive. He spoke
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the same words that he spoke in the Third Reading debate. I believe that that is the kind of spirit that is needed now.
As your Lordships know—and I am not alone in the Chamber in this respect—I have a family in the National Health Service. My younger daughter has just returned to part-time nursing at Queen Mary's Hospital, Roehampton, after bearing three children. Can my noble friend the Minister—if he is unable to reply now, perhaps he will write to me—say what incentives are being given to former nurses returning to their profession? I believe that this is very important, particularly in intensive care and in such marvellous hospitals as Great Ormond Street Hospital. There is a need for the drain on experienced nurses to be countermanded. However, I shall not go into the reasons in this short debate.
I turn briefly to the pay review body. The Minister cannot comment much on that now, of course; it will be the end of April before we know his decision. I hope that, whatever is funded, it will be a net fund and will not come out of regional health authority funds. Last night I attended a meeting of my local district hospital in Surrey where for three years I have been president of the friends. The head of nursing services there and others present asked me to raise the point—and I believe that it is endemic in the hospital profession—that whatever is recommended should be a net recommendation. It ought to be earmarked not necessarily for nurses' pay only but for accommodation and other needs of nurses and perhaps the needs of other workers in the health service such as speech therapists and occupational therapists, who are paid hardly generous sums in comparison with many other members of the community. While it has to be said that they do not work the same long hours that nurses and junior doctors do, one must not forget them.
Whenever I go abroad, whether on parliamentary or on ordinary business, I always seek to visit a hospital if I possibly can to gain comparisons between the health service in this country and those in other countries. Comparisons are of course odious. We care for 50 million people in this country. In Finland—a country that I know quite well and where I have visited several hospitals, as I have mentioned to your Lordships on other occasions—there are 4 million people and four university hospitals but still there are waiting lists. We are not the only country faced with a problem.
One has to accept that high-tech is now an essential part of the National Health Service. When I had my gall bladder removed two years ago I was in hospital for nine days. I could not have received finer treatment. Under the health service 20 years ago it might well have been four weeks. The message is that bed space is an important consideration.
This has been a valuable debate. When the pay review body reports and the money that has been promised for the National Health Service is made available, one hopes that some problems will be solved. In the funding of the National Health Service, as Mr. Newton said on television a few weeks ago, the problem is that no amount of money can ever be too much in an ideal world.
7.6 p.m.
Lord Prys-Davies: My Lords, first, I wish to thank the right reverend Prelate the Bishop of Guildford for his contribution to the debate. We are grateful for his expression of appreciation of the commitment of health workers and for his unqualified support for the principles of the National Health Service. I trust that noble Lords on the Government Front Bench will heed the right reverend Prelate's warning that he finds evidence of falling morale in the NHS. Those are his measured words.
The debate, although focused on the National Health Service, has concentrated on the hospital service and, in particular, acute hospitals. There is agreement on both sides of the House that all the demands on the NHS are not being met. I was delighted too that there is agreement—according to my count, from four dissenting voices, apart,— that the NHS is underfunded. I suggest that those are the two main conclusions to emerge from the debate.
Although some noble Lords on the Government Benches accept that the NHS is underfunded, they seem to do so with a degree of complacency, pointing out that ever since the setting up of the NHS there has been a measure of underfunding. However, there is this difference: it appears to people throughout the country that today's underfunding is more real, more widespread and more serious than the underfunding of the past. That is why it dominates the radio programmes from time to time.
The Government are reviewing the position. I was much encouraged by the Minister's assurance that the fundamental principle of the National Health Service is not in question. Perhaps I may press him a little further. Can he confirm that the Government accept that the role of the private sector in the NHS is marginal at best? I think that the Government would be gravely mistaken if they were to think that the immediate difficulties cannot be overcome without a substantial additional injection of funds into the NHS. It is required to bring about improved performance and also to oil the changes which are required. I believe that changes are required. Indeed, the main changes which are required have been referred to in a number of speeches in the course of this debate and in particular in speeches delivered by three members of the medical profession. I should have thought that the Government will take note of their contribution.
First, there is certainly a need in the acute hospitals—and this may not apply to the care hospitals—for clinicians to accept the need for stricter self-regulation. There must be greater willingness on their part to set performance norms for their individual departments, to monitor behaviour, to evaluate performance, to question practices and assumptions and to take remedial action when necessary.
This is how Professor Alan Maynard, the Director of the Centre for Health Economics at the University of York, put the matter in one of his informative and polished articles in the Health Service Journal on 25th February:
"The failure of the medical profession—with some notable recent exceptions— to monitor its members' performance is a grave defect in need of urgent remedial action.".
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I found it encouraging that three of the doctors who have spoken in this debate this afternoon have strongly advocated self-regulation by the professions. That was the message of the noble Lords, Lord Hunter, Lord Winstanley and Lord Trafford. I have a feeling that if Aneurin Bevan had been alive today, that would be one of his messages to the doctors in the NHS.
It has not gone without notice on these Benches that the noble Lord, Lord Trafford, went further. He suggested that there might be a case for an inspectorate to guide the development of what is required in the acute services. We shall have to study the words of the noble Lord, Lord Trafford, very carefully but that is something new and has not been heard before in your Lordships' House.
Secondly, urgent steps need to be taken to resolve the nursing crisis which is due to the decline in the birthrate and the reduction in the number of school-leavers seeking a career in nursing and to a disgracefully low salary structure. The noble Baroness, Lady Cox, from the Government Benches, has spelt out the case for a radical improvement of the nursing structure and the pay of the nurses, and that has been supported by our side of the House.
In addition, more flexible working conditions may be part of the answer. Again, some of the caring tasks now performed by highly skilled nurses could possibly be delegated to less skilled personnel. On the other hand, skills of a very high order are demanded in some sectors of the service and they should be recognised. For example, the skills demanded of a nurse in a perinatal unit in keeping a premature baby alive and well are of a very high order indeed. A lapse on her part which deprived the premature baby of oxygen could lead to permanent brain damage and heavy compensation if negligence could be proved.
Thirdly, the DHSS must now put considerable effort into developing measures of output to assess not just efficiency but the quality of a particular therapy in altering the history of a particular disease for the better. That need is not at all inconsistent with the plea that the sick should receive the treatment which they need. I first learnt about the need to evaluate therapy when I read the book of Professor Archie Cochrane on the MRC at Cardiff—his classic, Effectiveness and Efficiency, which was published over 16 years ago. It is only when these indicators of the value of therapy have been developed that the department and Ministers can genuinely speak about value for money in the acute services. Again, it has been noticed that the noble Lords, Lord Hunter, Lord Winstanley and Lord Trafford, spoke in support of the department now proceeding in this direction.
I come to the fourth and last point that I wish to make. There is need for another push in the various preventive fields. This is not just a matter for the DHSS; it involves other departments of state. In general, the results are not likely to be immediate because attitudes and habits are to a large extent formed in childhood. Prevention is better than cure. In the case of children that obviously has very long-term benefits. By contrast, I am told that the average life expectancy of patients admitted to hospitals—other than children and expectant

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mothers—is only about five years. However, the life expectancy of a child could be 70 years or more. I therefore urge the Government, as we did in the child health care debate in October last, and as my noble friend Lord Lovell-Davies urged this evening, to give to child health care the priority which it deserves.
I am very conscious that there are issues which we have not touched upon. We have not touched upon the problems of the unmarried mother and her health problems in the large cities of our country. In conclusion, it seems to me that the NHS is facing both a short and long-term problem. In the short-term additional funds are required to improve performance and also to oil the changes which are required to meet the long-term policies and to deliver the health service which our people ought to be able to command.
7.19 p.m.
Lord Skelmersdale: My Lords, one thing certain in this debate is that I regret there is absolutely no way I can take on board every point that has been made. Therefore, I shall be writing a lot of letters. In spite of, or perhaps because of, the initial sparring between the noble Lord, Lord Ennals, and myself, the debate has been thoughtful, as was only to be expected from an impressive list of speakers. I have found fascinating, and so, clearly, has my noble friend Lord Crickhowell, that practically the only solution of noble Lords opposite to the problems we face is constantly changing amounts of money. It is not that which worries me so much as the fact that they do not say on what the money is to be spent.
We must not forget that when Beveridge wrote his famous report he calculated that the service would cost £70 million and that this would go down as the nation became healthier. He forgot about the enormous increase in medical science and medical ability to treat more and more people—even in Birmingham, It simply has not happened as Beveridge suggested it would. Therefore, I was struck by the stunningly complementary speeches of the noble Lord, Lord Winstanley, and my noble friend Lord Thorneycroft to whom I am most grateful. The noble Lord, Lord Perry, hit the nail on the head when he said that the current problems are not caused but aggravated by the cash available. We need to find a cure. I can tell my noble friend Lord Tranmire that that is what the review is all about. Nonetheless, money is what makes the world go round. Therefore, I agree with the noble Lord, Lord Harris of High Cross, that the private sector has an important role in partnership with, not in substitution for, the National Health Service.
However, we remain committed to securing good health care for all who need it as the fundamental principle of the National Health Service, as I said in my opening speech. That is why we have made large increases in the resources available to our National Health Service. The Government have never said that 2 per cent. extra cash over and above inflation is needed just to stand still. To do so would be to ignore the contribution which improvements in efficiency can make.
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Money may or may not be coming out of the Government's ears. But, as my noble friend Lord Thorneycroft said, we should consider carefully all the options for improving value for money and for finding yet more resources for the health service. I say again that we must know what we are paying for. It is one example of targeting, and it works very well.
I agree with much of what my noble friend Lord Crickhowell said about the private sector. The Government welcome the contribution made by it to the provision of health care. The private sector already provides a valuable supplement to the NHS. It adds to the total resources devoted to health care and creates additional flexibility in services. And it increases consumer choice. The question we must ask ourselves is whether it would be right that it should do more.
In speaking of extra money, may I mildly remind the House that there is no guarantee that initial planned spending will be the same as the out-turn figure. This is rather the reverse of what I said in my opening speech, but I hope it is just as clear. The Government have increased health authority spending in England in 1987–88 by some £400 million more than originally planned. Plans in the public expenditure White Paper make further provision in total for the NHS in Great Britain.
Next year, health authorities should have an additional 1 per cent. or so in real terms with which to finance extra service developments. That is in terms of extra pounds in their pockets; in other words, what the £1,000 million will pay for. On top of that (a fact conveniently forgotten by some noble Lords who have spoken today) they will have the benefit of the successful cost improvement programme and any schemes to generate additional income. Together, these should be worth another 1·5 per cent. of authorities' revenue spending. Therefore, we are not very different from the 1·6 per cent. real and total increase to which one noble Lord referred. I believe that that is hardly the spending record of a government supposedly opposed to the whole concept of the National Health Service.
Several noble Lords, sparked off, I think, by the noble Lord, Lord Hunter, referred to RAWP. First, may I say that the review's programme of analysis and research is now complete. Any recommendations which may emerge will be carefully considered. I do not think that the House will have to wait very long.
My noble friend Lady Lane-Fox spoke of London as a RAWP loser. Yes, in generic terms she is right. Between 1978–79 and 1986–87, inner London's resources have, in spite of this, gone up by 7·4 per cent. in real terms. Over the same period, Greater London's resources have risen by 11 per cent.; so it is not as great a loser as is sometimes assumed.
The noble Lord, Lord Ennals, and many other noble Lords on the Opposition Benches, asked: why close beds? Until we all understand that in some places services grew before the cash became available we will not get much further in this particular debate. I believe that one of the things we are seeing now—I would not say that it was a total analysis of the problem—is a correction of this position.

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My noble friend Lord Thorneycroft said, if I may paraphrase him, that the issue is not about cuts but how far services can grow. Hospital and community health spending in England has grown by 27 per cent. in real terms during the lifetime of this Government.
The noble Lord, Lord Dormand, spoke about the number of wards and of operating theatre costs. Again, between 1974 and 1979 a total of 270 hospitals were approved for closure; in other words, 54 a year. Between 1979 and 1986 a total of 284 hospitals were approved for closure; in other words, 38 a year. Although these are very useful statistics, I do not believe that one can draw any reasonable conclusions from them.
The noble Lord, Lord Wallace of Coslany—and I was grateful to him—referred to my appearance recently at the very impressive new path lab at Queen Mary's Hospital, Sidcup. I am pleased to be able to inform the noble Lord, that the allocation to the special bridging fund announced today, to which I referred in my opening speech, includes £25,000 for Bexley Health Authority. Over the past four years Bexley's revenue has gone up by 4.4 per cent. in real terms; in-patient cases have risen by 16.5 per cent; and day cases by nearly 35 per cent. On 31st March 1987 there were no urgent cases on the in-patient waiting lists for longer than one month. That is my description of a very efficient hospital indeed. I wish they were all like that.
Against that, we have to consider another point made today—the vast increase in patient treatments, which have to come from somewhere. I agree that some would not have become patients before new techniques and technologies were introduced to treat them. When we remember that, on average, each person aged 75 or over consumes nearly £1,500 in health service charges annually, compared with £190 spent on those aged between 16 and 64, one obtains a good idea of the demands which increasing numbers of old people place on the National Health Service.
Moreover, as we all know, the number of elderly people is rising inexorably. I have to say again—I really do—that it is patients who matter, not beds. The fact that this Government have seen rather fewer beds per year close than did the last Labour Government is, again, neither here nor there. I can tell the noble Lord, Lord Dormand, however, that the latest figures show 688,000 people on the inpatient waiting list. That figure is 64,000 lower than at March 1979 when the list stood at a record high.
Lord Lanais: My Lords, the noble Lord has chosen a figure relating to the middle of industrial action. Will he make a fair comparison and give figures relating to the industrial action from which his department has also suffered?
Lord Skelmersdale: My Lords, until we have the up-to-date figures for the winter, which I think would be a valid comparison in terms of historical base (which we will, of course, obtain from the Körner figures which are due to be issued shortly), I am afraid I cannot give the noble Lord the answer he requests. However, the figures will become available—that I can assure him.
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In my opening speech I was pleased to announce the special RAWP bridging fund money. This means that £500,000 has been allocated today to the West Lambeth Health Authority. We shall have to see what effect this has on the threat to close 200 beds at St. Thomas's. Another point that I should like to make regarding St. Thomas's is that a major redevelopment of facilities is taking place there, as the House knows well.
At Birmingham Children's Hospital activity has increased substantially in recent years. Between 1979 and 1986 the number of in-patient cases rose by 15 per cent.; the number of out-patient cases by 16 per cent.; and the number of day cases by a staggering 121 per cent. Within those figures is a significant rise in the number of high technology specialist treatments that were not available even a few years ago—a point made by one of my noble friends on the Benches behind me. Therefore, I must say to the noble Countess, Lady Mar, that although we all appreciate the very great difficulties that Birmingham has been experiencing and we all understand the worries and fears, particularly of the parents of those children over the years, that particular problem arises for a two-fold reason. One reason is that management is not quite as good as many of us would like to see. That is a point that the noble Countess made and the noble Lord, Lord Winstanley, mentioned it the other day. The other point upon which I have addressed the noble Countess before is that there is a distinct shortage of paediatric nurses in that part of the world. As the noble Countess knows well, that area is seeking to do something about that in the very near future.
I turn to the National Health Service review and the various and very useful proposals which have been made upon it from all sides of the House. At this early stage we are not ruling out any proposals for reform, but neither are we ruling anything in. That is why this particular debate has come at such a timely moment. I agree with the right reverend Prelate the Bishop of Manchester; namely, that the issue is not whether we need a National Health Service but whether we can fund it entirely from the public purse in future years. The point surely is: where is the noble Lord, Lord Pitt's solid sustenance to come from?
The noble Lord, Lord Hunter of Newington, talked about the contractual arrangements between the district health authorities and the private sector. Health authorities are already encouraged to consider contractual arrangements with the private sector. My noble friend Lord Trafford and others brought this matter out; namely, how far can or should we reasonably go in this regard? The noble Lord, Lord Perry, asked who should provide leadership in district health authorities and hospitals. It is the responsibility of general managers to lead colleagues from all disciplines in searching out new ways in which to use resources more effectively and to improve the delivery of care to patients. Matrons used to do part of this work in the old days. I understand the feelings of large sectors of the population which believes that reintroducing matrons today may provide what my noble friend Lord Trafford sometimes calls "a cheer".

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What is fascinating to me is the letters I have been receiving recently from nurses and consultants, to say nothing of those from managers. I do not say: "They would say that, wouldn't they?", and that is why I am ignoring the managers. The letters tell me "re-introduce matrons at your peril".
I agree with the right reverend Prelate the Bishop of Guildford who said in what I can only describe as the very model of a model maiden speech, that comprehensive health care is absolutely vital. If one part of the health service—whether in the acute services (as at the moment) or the general practitioner service; the health education authority, care in the community and the pathology services or what ever—gets out of phase with the others, the whole will suffer. I hope that we will hear from him again both soon and often. Several noble and medical Lords have talked about the strength of the general practitioner service. We need a strong family practitioner service because when it is working properly it helps to keep patients out of hospital. Oh yes, I certainly agree with that! At the moment 90 per cent. of patients go no further than their GP. Of the remaining 10 per cent. half never get onto a waiting list at all. That is precisely why this Government have increased expenditure by 43 per cent. on those services since they came into office.
Not content with that, we are proposing to increase spending by 11 per cent. in real terms over the next three years. I do not know if we shall have a debate on primary health care in the near future, but I certainly hope so. That would be the moment upon which to develop the arguments on that particular sector of the health service.
I was asked by the noble Lord, Lord Dormand, whether we shall continue to increase the funding of the Health Education Authority. This will be considered in the normal way. The funding of this authority and its predecessor, the Health Education Council, has been consistently increased since its inception. I believe that when the noble Lord studies the figures for this year—I agree that they have been given large amounts of extra money for taking on the AIDS portfolio as it were—he will agree with my analysis.
My noble friend Lady Cox calls it a disgrace that the salaries of nurses are what they are. I remind her that it was this Government that set up the nurses' and midwives' salary review body and they have accepted every one of the recommendations made by that body. The result has been a 30 per cent. increase in pay since 1978–1979. However, I take her point that 30 per cent. of nothing is nothing. No government can enter into an open-ended commitment to fund all possible demands. In the same way the Government would be totally irresponsible if they wrote blank cheques for pay awards such as that pending for the nurses.
Nevertheless, the House should recognise that over 90 per cent. of the cost of review body awards has been directly funded by the Government. We do not yet know the outcome of the deliberations of the 1988 review body. My right honourable friend the Chief Secretary to the Treasury has said in another place that he hopes decisions will be taken by the end of
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April. In the meantime, it would be premature for decisons to be taken which adversely affect patient services because of anxiety and uncertainty for the future.
I note the forceful words of my noble friend Lord Auckland about the need that whatever the Government decides, that provision should be directly funded from extra money. I am not in a position to make any comment upon that. As regards nurses generally, I am answering a Starred Question tomorrow from my noble friend Lady Young. Perhaps it will be appropriate to go into this matter in rather more depth at that time. I shall be perfectly happy to refer to Project 2000 and any other subject that noble Lords would wish to raise as supplementary questions.
The noble Lord, Lord Kilmarnock, spoke about an internal market experiment. I shall certainly consider very carefully what the noble Lord has said as regards the internal market model. It comes as a slight embarrassment to learn that his party and mine, now that we have both finally sorted out our structure, look as though we are agreeing with each other at this early stage. I will live with that embarrassment and I hope the noble Lord will, too.
Lord Kilmarnock: If the noble Lord will allow me perhaps I may point out to him that parties from all sides of the political spectrum have taken ideas which have been previously advanced by the Alliance Party. It makes very good sense to do so.
Lord Skelmersdale: My Lords, that is why we make political progress in this country in a zig-zag fashion. We all know that happens.
The right reverend Prelate the Bishop of Manchester spoke about health inequalities. Social inequalities in health have to be seen in the context of general improvements in national health which this country has enjoyed. That is a point that we have all accepted today. The RAWP formula for allocating resources to the health authorities takes account of social deprivation. I should like to put the noble Lord's remarks in a different context, especially those concerned with the North-South divide. A few weeks ago, in a national paper, it was said that the morale of nurses at the Hammersmith Hospital was so low that they spoke to the Guardian. In the same newspaper today I saw a letter which said:
"As I write this, uniformed receptionists are smoothly conducting patients through our smart and well-maintained NHS waiting area. They are seen and treated rapidly and courteously by real nurses and consultants. Many of the sick are old and black; we do not regard this as reflecting upon the service.
Despite the importance we attach to the hotel aspects of our service, and notwithstanding current stringencies, we are able to place paramount emphasis upon clinical excellence".
The letter continues. However, I note that that comes from the Dudley Health Authority.
The noble Lord, Lord Pitt, was absolutely right. What the issue is all about is patient satisfaction. I note that a recent poll showed that 88 per cent. of those who had visited hospital as a patient in the past two years were satisfied with their treatment. That is a marvellous record; but I should like to know what the other 12 per cent. thought so that we can do something about it.

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One thing we have been able to provide immediately is the second tranche of the 100 new consultant posts which were outlined in the document on hospital medical staffing, Achieving a Balance, published last year. I am pleased to say that today we have announced the allocation of 55 new consultant posts to regional health authorities. I am sure that the noble Countess, Lady Mar, will be delighted to hear that seven new consultant posts have been allocated to the West Midlands region. These posts will receive some central funding for the first three years. They will help to solve some longstanding problems in the medical career structure, particularly career blockages among junior hospital doctors.
I would summarise the Government's position in the following terms. We are devoting and will continue to devote very substantial amounts of taxpayers' money to the health service. Plans in the recent public expenditure White Paper provide for total National Health Service spending in the United Kingdom to rise by an extra £3.5 billion by 1990–91. Coupled with that is our relentless search for improved value for money so that each pound spent buys more health care. We are also looking to the future to ensure that our health care system can face up to the challenges in the rest of this century and into the next.
Our announcements today show that when we know exactly what we are getting we provide the extra funds for the health service. This is a sound and sensible way forward. It faces up to the pressures of today and looks ahead to tomorrow. In so doing, it reflects the Government's commitment to the best possible health care for the people of this country. In the vernacular: watch this space!
7.42 p.m.
Lord Ennals: My Lords, I thank the Minister for his detailed reply and for the pieces of good information which he gave. I should also like to thank all who participated in the debate. The list includes a professor of medicine, a professor of pharmacology, a working consultant, a nurse, two GPs and a dentist. The dentist was the one who thought that medicine is working against health. However, one would not find in the other place a better representation of those who work in the service. I should like to thank most warmly the right reverend Prelate the Bishop of Guildford for an outstanding and humanitarian speech. He spoke from personal and family experience. His compassion shone through all that he said. I look forward immensely to his further contributions to our debates, and not just on the health service.
I welcome the broad support for the principles of the National Health Service. I especially welcome the restatement by the Minister and the noble Lord, Lord Thorneycroft, of the principle that access to health care should not be dependent on ability to pay. That is an important principle. Both the Minister and the noble Lord, Lord Thorneycroft, are in positions of great influence and I hope that they will stand firmly by those principles when the review team reports. That will be the time for the great debate.
I welcome the additional £15 million for districts affected adversely by RAWP and the additional
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information which the Minister gave the House. I welcome the generous tribute to Aneurin Bevan from the noble Lord, Lord Thorneycroft, which was referred to by the noble Lord, Lord Auckland. When one hears such tributes one cannot forget the fact that it was the Conservative Party which voted at Second Reading against the National Health Service Bill. It must have taken only a very short period of time to convince them of the great merits of Aneurin Bevan.
There was a second notable contribution from the Bishops' Bench by the right reverend Prelate the Bishop of Manchester who is always a clear voice when pointing out the areas of deprivation in our society. He referred this time to the message of the Black Report on inequalities in health. One trend that concerns me out of so much that is encouraging is the underfunding of the National Health Service. Of course it is true that no government have ever given the health service the money that it would like. That is absolutely true. We cannot escape the fact that the cuts in wards and beds and the lengthening waiting lists have created a crisis.
That leads us to the question of which the Minister and the noble Lord, Lord Thorneycroft, gave us a hint. It may be that the Government are planning shortly to put additional funds into the National Health Service. I say from this Bench that if they decide to do so, I hope that they will do so quickly. They will then get a warm welcome from this side of the House. That was precisely the reason why, with the support of my noble friends, I tabled the Motion before the House. It was not because we want to jeer but because we want to cheer when the good news comes. One does not get good news unless one asks for it.
I thank all those who have taken part in the debate. I must say to the Minister that it is not true that we do not know how additional funds should be spent. In the short-term I agree entirely with the quite specific proposals of the Select Committee of the House of Commons and the joint proposals of the British Medical Association, the Royal College of Nursing and the Institute of Health Services Management. I am sorry that in a sense the debate has been limited. It was my fault that it was limited to funding. I am grateful to noble Lords, including the noble Lord, Lord Hunter, and my noble friend, for broadening the debate to deal with a range of issues. I hope that it will not be long before we debate primary health care, community care, preventive medicine, alternative medicine, medical research and a whole range of other issues on which I did not touch. I am grateful to all noble Lords who have taken part in this constructive debate. My Lords, I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

General Assistance Grants (Abolition) (Northern Ireland) Order 1988
7.47 p.m.
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Lyell)The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Lyell) rose to move, That the draft order laid before the House on 1st March be approved.
The noble Lord said: My Lords, this order is laid before the House under the Northern Ireland Act 1974. The purpose of the draft order is to abolish the standard capital grants scheme by the repeal of Part IV of the Industrial Development (Northern Ireland) Order 1982. Under that order, grants are payable towards new fixed asset investment undertaken by businesses engaged in qualifying activities—in practice most manufacturing sectors—in Northern Ireland.
The standard capital grants scheme is similar although not identical to the regional development grants scheme in Great Britain. As announced in the recent Department of Trade and Industry White Paper, the regional development grants scheme will also be abolished and indeed the Regional Development Grants (Termination) Bill received its Third Reading in another place on 10th March. Under the provisions contained in that Bill, no new applications for regional development grant will be accepted after 31st March 1988. Similarly, the draft order presently before this House provides that standard capital grants will not be payable in respect of expenditure incurred after 31st March 1988.
We have been concerned for some time about the effectiveness of the standard capital grants scheme as a means of assisting industry in Northern Ireland. Indeed, significant changes to the scheme were announced in 1985 and it was made clear at that time that those amendments marked only the beginning of a change in emphasis in the form of support to industry in Northern Ireland. The concerns related to the high degree of deadweight and displacement which we saw in the scheme, to evidence of deliberate abuse from some quarters and to the fact that the legislation for the scheme restricted its application to manufacturing industry in a rigid manner which took no account of the increasing difficulty of distinguishing between manufacturing and service activities.
A consultancy survey of standard and capital grant recipients was therefore commissioned to assess the awareness of the scheme and to obtain more detailed information about the nature, objectives and impact of the investments being assisted. That survey showed that some 70 per cent. of assisted projects would have proceeded in the absence of standard capital grant. It further revealed that the grant has largely aided Northern Ireland companies to compete against each other in a limited local market rather than encouraging them to compete in markets outside the Province.
Those findings together with the fact that the grant is not job-related, demonstrated that the standard capital grant scheme is no longer an effective means of stimulating the Northern Ireland economy and therefore does not make the best use of scarce public resources.
While there are several differences in form and effect between the standard capital grant scheme in Northern Ireland and the regional development grant scheme in Great Britain, the decision to end the regional development grant scheme was based on similar conclusions about its effectiveness. That reflects an international trend away from automatic
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and poorly targeted capital grants. On 12th January this year the Government announced their intention to close the standard capital grants scheme in respect of capital expenditure incurred after 31st March, subject to parliamentary approval of the draft order presently before your Lordships' House.
Northern Ireland, like its competitor regions, will concentrate increasingly on assisting strategic business developments which help companies to perform more successfully in national and international markets. The assistance will go beyond aid for capital investment and will develop the human capital of business through, for example, marketing, management and product quality development. Together with the existing selective assistance from the Industrial Development Board and the Local Enterprise Development Unit, the new forms of assistance will ensure that business in Northern Ireland continues to have the most comprehensive system of support to industry and enterprise in the United Kingdom. Public funds will be used more effectively on strategic business developments and on those firms which can compete with producers outside Northern Ireland
Many companies which would otherwise have claimed standard capital grant will now turn to the Industrial Development Board or LEDU for assistance, and those good projects which would not go ahead without assistance from the Government will be eligible for consideration. We are convinced that the revised framework for assistance will strengthen industry and enterprise in Northern Ireland. I beg to move.
Moved, That the draft order laid before the House on 1st March be approved.—(Lord Lyell.)
Lord Prys-Davies: My Lords, the purpose of this short order is to abolish the standard capital grants scheme in Northern Ireland which is, as the noble Lord, Lord Lyell, pointed out similar to the regional development grant in the rest of the United Kingdom and is also in the process of being abolished by the Regional Development Grants (Termination) Bill which will receive its Second Reading in this House tomorrow.
On listening to the Minister's introduction to the order, one may be forgiven for believing that the termination of the standard capital grants scheme is a matter of great rejoicing in Northern Ireland. However, according to the evidence that has reached me, many business people are saddened that the Government have decided to bring this grant scheme to an end; a scheme which has been of considerable assistance to the Province in the past.
The grant was introduced in 1982 to assist investment by manufacturing business. I understand it has injected about £250 million into the Province. That is a substantial investment. Can the Minister tell the House how many jobs have been created, or preserved, by this investment since that time?
The Minister told the House that a consultancy survey, carried out on behalf of the department, showed that about 70 per cent. of the projects which have been assisted by the grant would have proceeded even in the absence of such a grant; the Minister made a lot of that point. When the Minister comes to reply,

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will he also confirm that the CBI are insisting that it has evidence which points to a different conclusion from that arrived at by the department's consultants. Can he further tell the House how the CBI in Northern Ireland has responded to the order?
Considering that unemployment in the province is appallingly high, the Government should proceed with the utmost caution before they decide to abolish a grant such as the capital grants scheme. It is a standard rate grant which is easily understood by industry, and it is automatic in its application; they are great virtues. The question arises as to whether the Government should have retained the standard capital grant for those businesses—the 30 per cent.—which on the Government's own evidence could not have proceeded without its help. I noticed that when introducing the order the noble Lord said that alternative financial assistance will be available to that 30 per cent. which require help and that it will be available through LEDU or through the IDB.
However, are we comparing like with like? I submit that we are not. Is it not the case that the alternative financial assistance will be discretionary? Of course a great deal turns on that aspect. For example, a company applying for assistance will not know with any certainty whether it is going to receive assistance or how much assistance it will receive. I shall be glad if the Minister will explain to the House what the basic criteria are that a company which wishes to apply for alternative financial assistance will have to satisfy. Presumably it will have to satisfy LEDU or the IDB that the project is viable but that the company itself is in need of assistance. How easy or how difficult will it be to satisfy those two criteria pointing, as they do, in different directions? If the company is in need of assistance, can the Minister tell the House what forward trading forecast will have to be prepared to satisfy LEDU or the IDB? Furthermore, how long will it take to process that application? Predictability will give way to uncertainty. Will that he helpful to industry?
I am also wondering whether there is another important difference between the standard capital grant, which is tonight being abolished, and the alternative financial assistance. Will the Minister tell the House how the new assistance will be treated for income tax purposes? I have understood—the Minister will correct me if I am wrong—that the standard capital grant, as its name implies, is a capital grant and is therefore free from income tax. I do not see why the alternative financial assitance should be treated any differently. However, will the Minister tell us whether for income tax purposes it will be treated as capital which is not taxable or as income which is. There is of course a world of difference between the two, is there not?
Should it be the case that the new assistance will not be tax free, then it seems to me that the total budget available for this type of assistance should be increased by 35 per cent. to ensure that there will be no reduction in real terms in the support budget. It is only if we can have firm assurance from the Minister that the totality of the support budget in real terms will not be reduced that we, from these Benches, can support the order. However, if such assurance is
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forthcoming, then I believe the order could be supported on the ground that a more selective targeting of the funds could prove more beneficial in the long term to the Northern Ireland economy.
8 p.m.
Lord Monkswell: My Lords, when we discuss anything to do with Northern Ireland we should recognise that that part of the United Kingdom is significantly different from other parts of the United Kingdom. I stress two particular differences. The first is the horrendous nature of the unemployment problem and the poverty that exist in Northern Ireland. The second, which is unfortunate but is one which we must appreciate, is the nature of the sectarian divide that exists in Northern Ireland.
I have two questions for the Minister. The first is: will the net financial benefit to Northern Ireland from the national Exchequer be unchanged after the introduction of the order? The Government have said that they will provide financial support in different ways. They have said that they will target it. Will the total amount of financial support be at least as much as is provided now?
My second question is: what mechanisms will the Government institute to ensure that there will be no perception of sectarian preference when money is disbursed under whatever new arrangements are made? There should be no perception of preference. I hope that the Government will never show any sectarian preference, but it is important that the scheme should be perceived to be fair by the people in Northern Ireland. I hope that the Minister can answer those two questions, which I believe are important.
Lord Lyell: My Lords, I am grateful for the close attention that has been paid to the order by the noble Lord, Lord Prys-Davies, and his noble friend Lord Monkswell. As the noble Lord, Lord Prys-Davies, suggested, the order is something of a new departure, and yet it relates to capital grants which are of course part of the GB scene. The noble Lord rightly stressed that since 1982 approximately £250 million has been spent through the scheme. I have the exact figures year by year, but I hope that the noble Lord will accept that the figure tailed off considerably during the last financial year. I hope he will also accept that that was in no way due to the foreseen change in the existing scheme.
The Government are committed to capital assistance to manufacturing and service firms in Northern Ireland. As I said when I opened my presentation of the order, we believe that the financial assistance should be more effectively targeted upon certain areas and certain firms.
The noble Lord asked how many jobs had been created through the scheme. The noble Lord and the noble Lord, Lord Monkswell, may know that the scheme is not job-related, and therefore I cannot state that figure with any accuracy this evening; nor would I, without undue research, be able to write to the noble Lord, Lord Prys-Davies, to tell him how many jobs, within thousands, had been created by the standard capital grants scheme.

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The noble Lord asked me about the income tax treatment of the new capital grants. I am afraid that I shall have to write to him on that point. As he will appreciate, we have just had a Budget, and I have no instructions that any of these payments will be treated in any way differently from the previous capital grant. Any assistance given by the IDB and LEDU in substitution for the standard capital grants will be treated as capital. If I am wrong, I shall explain the position in the letter that the noble Lord will receive from me as soon as possible.
The noble Lord, Lord Prys-Davies, also asked me about consultations and the views of the CBI in Northern Ireland. On 12th January this year Mr. Alasdair McLachlan, the director of the CBI in Northern Ireland, commented on the Government's proposal to abolish the scheme which had been communicated to him and his organisation. He said:
"The changes at national level represent a bold shift in the way the Department of Trade and Industry supports industry in Great Britain. In many respects however the IDB, the LEDU and the DED"—
in this dreadful game of acronyms the DED is the Department of Economic Development—
"are ahead of the game".
That was the director's comment about the new scheme that we are discussing.
The noble Lord asked me what would replace the scheme that we have had for the past five years. The IDB and LEDU already operate selective financial assistance schemes in various different forms. We think that they are better equipped to contribute to the economic and employment benefit of Northern Ireland by stimulating new developments. They are doing something that I stressed in my opening remarks. They are promoting competition and, above all, helping industry to improve not just its design but its quality and marketing. I do not think that I can assist the noble Lord a great deal further tonight. I promise that I shall write to him about his tax query with all the detail that I can muster.
The noble Lord, Lord Monskswell, was kind enough to stay to listen to my presentation of the order. So far as I am aware, the measures contained in the order will result in no major change to the Government's net financial contribution to Northern Ireland. If there is any shift in that, and I am wrong, I undertake to write to him briefly with any figures that I can obtain which are relevant to the order.
Lord Prys-Davies: My Lords, will the Minister confirm that his reply to that question depends to a considerable extent upon whether the assistance will be treated as capital or as revenue?
Lord Lyell: My Lords, it will be treated in the same way as it is in the United Kingdom. If it varies greatly from the planned amount I shall write to the noble Lord. I shall attempt to answer the query about tax treatment raised by the noble Lord. He will appreciate that to a large extent the schemes which will be in the hands of the IDB and LEDU are demand-led. He will appreciate what that means, and that we would not necessarily know. I will write to the noble Lord about the tax treatment of the grants. I do not think that it will be significantly different from
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what it is at the moment. The Government certainly do not wish to place firms in Northern Ireland in any way at a disadvantage compared with their present position, let alone compared with the rest of the United Kingdom.
The noble Lord, Lord Monkswell, asked a second question about what he called the sectarian perception. I state quite definitely from the Front Bench that the IDB and the local enterprise development unit, would never take any decision on a sectarian basis. It will take its decisions on a purely commercial basis. The offices and services are open to every single business all over Northern Ireland. We shall take every step we can to see that the services available from the IDB and the LEDU, as well as from the Department of Economic Development which is looked after by my honourable friend Mr. Viggers, are widely known throughout Northern Ireland.
I hope that I have given noble Lords a brief foretaste of what might happen over the order this evening. I hope that the noble Lord, Lord Prys-Davies, as a Welshman will accept this, just as I do as a keen Scot. The order which I have presented to noble Lords will ensure that Northern Ireland will have the most comprehensive system of support to industry and commerce in the United Kingdom. I stress that we believe that the funds will be used more effectively than before because they will be concentrated and targeted on measures to strengthen the Northern Ireland economy. Above all, they will secure employment and the social benefits that come from a flourishing enterprise community which is what all noble Lords want. With that and with the guarantee that I shall be writing to the noble Lords, Lord Prys-Davies and Lord Monkswell, I commend the order to the House.
On Question, Motion agreed to.

Berkshire Structure Plan
8.12 p.m.
Lord Stoddart of Swindon Lord Stoddart of Swindon rose to ask Her Majesty's Government what weight they will give to the views of Berkshire residents and their elected representatives when making their decision on the revised Berkshire structure plan.
The noble Lord said: My Lords, in asking this Question this evening I have to tell the House that I have been a resident of Berkshire for most of my life. Certainly I have resided in the county for most of the last 50 years and have in one way or another participated in the public life of the county. Therefore I have not only been concerned about developments in the past but I am concerned, as are many thousands of other people, about the developments in the future. I am glad to have the opportunity to raise this question of the decision of the Secretary of State to modify Berkshire's structure plan. It is a privilege to be able to raise it in your Lordships' House. I am very pleased that other noble Lords have decided to take part in the debate tonight and I am grateful for their interest.
My Question asks Her Majesty's Government what weight they will give to the views of Berkshire residents and their elected representatives when

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coming to a final decision on the structure plan. Naturally, I shall look forward to a helpful and encouraging reply from the noble Lord, Lord Hesketh, when he replies to this debate later on. The House is renowned for its interest in matters of planning and the environment and I shall be most interested to hear the views and comments of other noble Lords.
As most noble Lords will know, the matter was raised in another place on 11th February and was ably debated by Mr. John Redwood, the Member of Parliament for Wokingham, who initiated the debate on the Adjournment and by other Berkshire Members of Parliament. The debate tonight will, I hope, serve to support and reinforce the case made by Mr. Redwood and his colleagues against the proposed revisions to Berkshire's structure plan. I also hope that our debate will give encouragement to those residents' groups—of which there are many—which have been in the forefront of the battle to save Berkshire from the ravages of over-development as well as to the county council and their "Battle for Berkshire" campaign. Only this morning the Berkshire joint groups launched their campaign in Westminster itself. The joint group consists of the Berkshire Association of Local Councils, the CPRE, the Wokingham, Newbury and Bracknell district councils and 35 other groups. That is a very significant number which shows the strength of feeling in the county against the Secretary of State's decision to add to the development proposed by the county council. A petition will be presented to the Secretary of State next week.
It will be clear from what I have already said that there is no party political axe to grind in this matter. Almost uniquely, not only are the political parties united against the modifications proposed by the Secretary of State but also the electors are at one with their elected representatives. That does not always happen, as I certainly know. Furthermore, people living in town and countryside alike feel threatened by the proposals.
Before I refer to the detailed modifications to the structure plan proposed by the Secretary of State, I must make it clear that the Berkshire County Council, in preparing its structure plan, recognised the need to continue development in the county. Consequently, it made provision for 36,500 new houses to be built between 1984 and 1996. It took account of inward migration and also of internally generated housing demand. I believe that the Secretary of State has taken insufficient account of the extent to which the Berkshire County Council has itself made adequate provision. In practice, the county's policy implied a reduction in the rate of building from 5,000 houses per year at present to 1,600 houses per year between 1991 and 1996.
The proposals of the Secretary of State to increase the rate of house building to 3,000 a year during the period 1991 to 1996 will undoubtedly have a serious effect on the environment in sensitive areas of the county and the ability of the county council and other bodies to provide the additional services implicit in the increased population. It has to be said that some people believe that the county council has been too generous in its provision for housing and employment. However, most people accept that the
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county council's proposals represented the uppermost limit of whatever further development should be permitted in Berkshire up to 1996.
Having adopted such a responsible and constructive approach to preparing the structure plan, Berkshire County Council is entitled to feel aggrieved that the Secretary of State, completely disregarding his own dictum that local people are the best people to make decisions about their own area, decided to accept the view of the panel. After all that panel had much less experience than the county council and has no responsibility for dealing with the consequences of its recommendations. The additional 7,000 houses on large sites which the panel and the Secretary of State wish to impose on Berkshire will create serious infrastructure and environmental problems for a county which is already beset with seemingly insoluble problems in relation to traffic and the provision of adequate services of all kinds for a growing population. Indeed, the CPRE in a most excellent critique of the panel's report describes it as thoroughly flawed. The CPRE also says that it is appalled by the quality of the report, which it says is ill-argued and gives no weight to views other than those in the building industry.
Those are strong words but they are backed up by detailed and thorough examination of the panel's proposals in the CPRE's own submission against those proposals. In my view the Secretary of State should give great weight to the CPRE's submissions, which deal not only with the local problem in Berkshire but also with the strategic implications involved.
I now come to the specific proposals. I can only comment briefly in the limited time available. I wish to refer to the 2,750 houses in the Wokingham district which are proposed for that district south of the M.4 motorway. This is probably the most damaging of all the proposals. It is a breach of a policy that the limit of southward expansion from Reading was the M.4 and that Reading would not progress southwards across the M.4.
Once that policy is breached, in my view the floodgates of development will be opened. There will be nothing to stop Reading, Wokingham and Bracknell from merging into one huge conurbation. Indeed, there is nothing to stop the southward development towards the north Hampshire border. That must be a serious consideration which the Secretary of State should take into account. Already in Lower Earley where 5,000 of 6,250 houses have been completed—and there are some more in the pipeline—enormous traffic problems have been caused by this development. The infrastructure simply cannot cope with the additional traffic and the additional population. The services are creaking under the weight of the pressure put upon them.
In the morning peak Reading, as I know very well, is just one huge traffic jam. All the motorway junctions are seized up. Every road into the town is seized up. Sometimes it takes 50 minutes to travel a mile. I just wish that the Secretary of State would get in a helicopter one morning and have a look below him over Reading. He would see the impossibility of imposing additional development over and above what Berkshire County Council has proposed.
What is more, Reading has to deal with these problems and the people of Reading have to suffer them. The council in Reading would like to be able to deal with some of the problems when the A.33 relief road is completed. But if that road is to take the additional traffic from the development south of the M.4 the council will not be able to introduce the traffic management schemes which would relieve the heavily congested area of south Reading.
I turn now to north Bracknell. The panel rightly drew attention to the charm and character of the area where it proposes that a further 2,500 houses should be built over and above those already provided for by the county council in its structure plan. The panel recognises that if the new development merged with existing settlements much of the charm and character would be lost. But the panel gives no assurances that its proposals will not result in a loss of what is at present a charming rural part of Berkshire.
The loss of such a pleasant archetypal part of rural England would be an act of vandalism for which the Secretary of State, if he agrees to it, will not easily be forgiven. There is probably a further implication regarding this particular proposal to which the panel gave no attention at all. That concerns the northern circuit of the distributor road which is yet to be completed. Pressure will certainly grow for further development north of the new section of the distributor road when it is completed and the panel's proposals may very well make it impossible to resist that pressure.
There is one further point to be made about Bracknell, which is that there is an image perpetuated that it has a reasonable road system and can accommodate additional traffic. That is basically a false image because routes to the east to Ascot and beyond and to the north to Holyport, Maidenhead and Windsor are already heavily congested. Indeed, they are approaching saturation point and are dangerous. Clearly further development to the extent proposed can only exacerbate an already chaotic situation in the area.
Then there are the proposals for Newbury and Thatcham. I know that area reasonably well because I twice fought the parliamentary seat of Newbury, though not successfully. Once again, there is pressure on already overstretched services and an inadequate road system. There is the danger of Thatcham and Newbury merging, whereas I remember Thatcham as a nice little village. Again, the proposals to add another 950 houses in this area will cause severe difficulties not only roadwise but in many other respects too. I hope that other noble Lords will talk about Newbury in particular.
It is clear that the modifications of the Secretary of State will impose substantial infrastructure costs on the county council. Services are already at full stretch and need additional resources. In particular, the main trunk roads in Berkshire, the M.4 and the M.3, are completely saturated and the rate of traffic accidents is increasing in the county whereas in the rest of the country it is decreasing.
The financial implications for the county council are extremely serious, especially in the present financial climate and restrictions on council
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spending. Where, we may ask in Berkshire, will the money come from? The county council, rightly in my view, provided in its draft replacement structure plan a specific policy to ensure that the development industry accepted its fair share of the infrastructure requirements generated by major development.
The aim of that policy was to protect existing residents and businesses from the serious ill-effects of development running even further ahead of infrastructure provision. The Secretary of State proposes to remove this policy from the structure plan. One is really bound to ask where the money for the additional infrastructure costs is to come from. Perhaps we could be told whether there will be additional government grants. I doubt that. However, I shall listen to the Minister with great interest.
Perhaps we could also be told what is intended as regards the provision of new trunk roads to relieve the overloaded M.3 and M.4. The county council certainly cannot provide the money needed from its own resources. Although it may appear that the county council is a rich county council because it has a high rateable value, because it is in the South and because of the nature of the county the expenses are also high. The county council needs assistance in exactly the same way as anybody else.
Finally, I wish to say a few brief words about the broader aspects of this matter. I understand the difficulties of the Secretary of State and recognise that in matters of planning he has to have an overview of the whole national interest. No doubt it was that overview which prompted Mr. Heseltine in 1980 to force upon central Berkshire an additional 8,000 houses which became known as Heseltown. Mr. Heseltine has now had a welcome conversion. He sees things differently from the Back-Benches and has realised the error of his former ways. He is now joining the host of opinion calling for a limit on development in the South-East. In his typically forthright way Mr. Heseltine has told Mr. Ridley to,
"stop tearing the South-East apart".
I think that that is unfair to Mr. Ridley who is my old constituency neighbour.
I hope that his slight disagreement with his right honourable friend will not distract him from making a good and sensible decision in favour of Berkshire. To concede Berkshire's case against the structure plan modifications would be in line with government policy—a policy to redevelop and invigorate inner cities and attract new industries to the region. That is where unemployment is highest and where people have not had a fair share of the country's wealth over a long period of time.
We need to halt the drift of population in other regions to the South-East and hopefully reverse it. That will not be achieved so long as the Government give in to pressure for further expansion and further building in the South-East, particularly in areas like Berkshire which have long since reached saturation point. I hope that the Secretary of State will take particular note of what Mr. Redwood said in his Adjournment debate in another place on 11th February. His arguments were not only utterly apposite but also completely irresistible, given the declared policies of the Government.
In conclusion, I hope that the Secretary of State will look long and hard at the revised proposals. They will do considerable damage. On this occasion let him listen to the advice of Berkshire, which says loudly and clearly: "So far and no further".
8.32 p.m.
Lord Norrie: My Lords, I rise to register my total disapproval of the modifications proposed for inclusion in the revised Berkshire structure plan. How can it be that the people of Berkshire, with their elected Members of Parliament and elected local authorities of parish, district and county, all recommend one course of action and yet the examining panel appointed by the Secretary of State recommends another?
I have lived in Berkshire for over 30 years. I have watched its rapid overdevelopment. It is bulging at the seams and will soon become little more than a suburb crammed with all that is bad and unsympathetic in modern planning. What was once a green and pleasant shire has become a battleground on which the sleek and the avaricious squabble like vultures tearing at a corpse.
Berkshire's problems started with the coming of the M.4 in 1971. Motorways have opened up the countryside. As new roads improved communication and transport, industry soon began to look hungrily at inexpensive greenfield sites in the Home Counties. Willing and co-operative local authorities waited to welcome developers and to make things easy for them. Planning problems were carefully discussed.
The new industries brought prosperity and wealth to towns along the motorways. The motorways were a new experience for the planners. The embarrassing problems of sprawl and expert soft-soaping by the developers were uncharted territories to the vulnerable politicians and planning staffs at Reading's Shire Hall.
Reading continues to grow at an alarming rate. While growth is restricted by the Oxfordshire county border to the north and by the North Wessex Downs to the west, to the east expansion is approaching the towns of Wokingham and Bracknell. To the south there has at last occurred the great leap for which the developers have been waiting. The modification of the new structure plan by the Secretary of State accepts proposals for a new settlement of 2,750 houses south of the M.4, probably at Grazeley. That has been mentioned by the noble Lord, Lord Stoddart. In their application, the developers claimed that the new town would be self-contained. However, even the Government's examining panel admitted that that was not true and that Grazeley would be an extension of Reading. They said that it was "a radical step" and then went on to recommend it. The Secretary of State naturally concurred.
The Government's green light to development south of the motorway is significant. It means that the M.4, previously defined as a natural barrier to the growth of Reading in the south, would be breached. In other words, the motorway would go through Reading and not round it.
Large tracts of countryside would become vulnerable to development overnight. In view of their
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pious sentiments about protecting the countryside beyond the green belt, it is astonishing that the Government are happy to inflict such damage to a once beautiful landscape. By their willingness to allow almost unfettered development in the area, they have abandoned any pretence of caring for the countryside and have demonstrated a disregard for public opinion which clearly favours a restricted policy in central Berkshire. A peaceful demonstration outside your Lordships' House last week by the Northern Parishes Action Group, who represent 7,000 Berkshire residents, was followed by the villagers of Warfield proving by their road block that the road network in the villages north of Bracknell was unsuited to take on the extra traffic predicted. The "Battle for Berkshire" campaign launched today will trigger further howls of protest at the proposals.
In its submission to the Secretary of State prior to the publication of the new structure plan, the county council called for a slowing down in the development of the past few years. It argued simply that the people of Berkshire had had enough and felt that the time had come to strengthen the physical and social facilities in the county and to improve the road network, the health services and the services provided by the local authorities. We already boast the largest housing estate in Europe at Lower Earley in Reading. From 1976 to 1986, Berkshire's percentage increase in dwelling stock was a close second in the league to its sister county of Buckinghamshire, which includes Milton Keynes. Yet, according to the current South-East regional policy, Berkshire is in a restraint area. It may be that the noble Lord, Lord Sandford, will confirm that.
As the noble Lord, Lord Stoddart, has said, between 1984 and 1996 the council strategy allows for a total of 36,500 houses. It calls for no more large greenfield settlements, for a halt to the runaway growth of towns like Wokingham and Bracknell and for boundaries to be created to restrict their growth. It asks the Secretary of State to protect the county against urban sprawl by continuing to respect the M.4 as a natural barrier to the growth of Reading and it asks him to confirm the Government's commitment to the conservation of the character of rural areas.
The Secretary of State's response has been to ignore virtually everything for which the county council asked. He has called for an increase of 20 per cent. in the housing allocation which will inflate the total burden by 7,000 to 43,500. Bracknell, already bursting, has been presented with an extra 2,500, making a total of 4,000 to be crammed in north of the town and against the fringe of the green belt. The Secretary of State has not included in his land calculations any small sites which have or will have planning consent. That is a point on which the noble Lord, Lord Orr-Ewing, will comment.
Let us travel westward to Newbury, which sits beneath the crossroads of the M.4 and the A.35. It is the link between the French coast, Southampton, Portsmouth and the industrial Midlands. The highway infrastructure is already in a state of collapse. The notorious Robin Hood roundabout, which joins six busy roads including the A.34 and the A.4, brings traffic to a standstill not only at rush hour but often on Thursdays and Saturdays —our market days. On top of that, Newbury has been allocated 950

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more houses, which will put at grave risk the preservation of the green break between Newbury and Thatcham, about which the Newbury District Council feels so strongly—and rightly so.
Developers, with their professional, full-time planning lawyers, have been able to exert tremendous pressure on small communities such as Newbury. An example is a superstore in Pinchington Lane. The application to build the huge retail store to the south-east of the town centre came with the attractive inducement of £1 million of infrastructure to be paid for by the developers. The problem for the Newbury District Council was whether the money would still be forthcoming if it refused and its decision was overturned on appeal. My Lords, what do you think?
Newbury is now in such a mess that it is probably beyond saving. The town must be bypassed to stop the appalling traffic problems caused by allowing a small market town to grow too fast. Because nothing was done about it until too late, work will not start until the 1990s when all the inquiries and appeals have been heard.
Our late Poet Laureate, Sir John Betjeman, once wrote in a moment of despair:
"Come, friendly bombs, and fall on Slough
It isn't fit for humans now
There isn't grass to graze a cow".
What was written of Slough 40 years ago could now be said of Reading, Bracknell, Wokingham, Newbury and Thatcham.
For some of our communities in Berkshire it is not too late. But let it not be said in 40 years' time that we missed a rare and valuable opportunity to save our Royal county.
8.41 p.m.
The Earl of Shannon: My Lords, we must be most grateful to the noble Lord, Lord Stoddart, for raising in your Lordships' House this evening the matter of the M.4 ribbon development scheme which is sponsored and encouraged by the Department of the Environment. About the only difference between that and the highly despised and discredited schemes of the early 1930s is that this is more in-depth. That just means a wider ribbon.
At this point I must declare my interest. I live in Berkshire, although I must admit I am not a resident of anything like the antiquity or the eminence of the two previous speakers. I speak from knowledge of what is going on on the ground. I do not speak on the basis of pontificating from Marsham Street supported by a whole lot of pseudo-scientific twaddle in the form of a numbers game, regional strategic guidance, structure plans and everything else designed to baffle everyone with science and which succeeds only in bamboozling the department itself and its own Ministers.
Planning implies some form of forethought. How wrong this has been shown to be in this case. Say what they may now, the proof of the pudding being in the eating, the authorities have got it tragically wrong. If you do not believe me, please go and see for yourselves. Is this really a case of "Don't do as Nanny does but you must do as Nanny says"? We are all exhorted to prepare environmental impact
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assessments. Did they prepare one for the existing overdevelopment of Berkshire and many of the other southern counties? I think not. Or if they did, the authorities have only to go and see for themselves exactly what a mess they made of their assessment. Not only have they got it disastrously wrong in the past, the department is now trying to make confusion worse confounded with its proposals.
I appreciate that the pressure is on. There appears to be some archaic scheme of quota by geographical county. In Berkshire large areas are unavailable, being either green belt or of great natural beauty. So the whole quota has to be satisfied by a narrow area in between. On the one hand I understand that the Secretary of State appreciates that Berkshire is no longer to be regarded as a major growth area although this does not mean a climate of general restraint in the area. What a classic example of muddled thinking when you appreciate one thing and then propose almost exactly the opposite!
The already overloaded area is not
"to be considered as immune from the possibility of development"
and
"a higher rate of house-building is required to meet the needs of the indigenous population".
What utter balderdash! The indigenous population was quite happy as it was. The extra housing is to meet the needs of the extra population that it is desired to force into the area.
Of course if we have a Government which to a man—or a woman—fall flat on their face and worship anyone who suggests building a factory in the area and assures them of all the planning permission they want, plus housing for all the attendant high tech electronic yuppies that this will entail, what can you expect?
Then we have the nonsense of the positioning of one of the major developments. Most of the factories and office developments are north of Exit 11 on the M.4. But the present proposals are for housing development ribboned along the A.33, just south of that exit. It already takes some three-quarters of an hour at most times of the day to cross over or to enter the motorway at that point. Now it is proposed to plant a major development right on top of it.
The Government are rightly concerned about the economic situation and unemployment. But, please, let us not recreate the undesirable results of the last Industrial Revolution. Berkshire does not have a serious unemployment problem. Everyone who wants to work can. There is already enough industry for the economic viability of the area. What about directing that industrial development into areas which badly need it instead of pandering to those industrialists who want to follow like sheep into this area?
Secondly, pressure comes from the developers. Do not underestimate the power of good hard cash on departments and Ministers. Get-Rich-Quick Developments Limited—or plc—has already made a killing out of this area. It has the funds to appeal, resubmit and reappeal until by sheer attrition it gets its way for another killing. Many such companies, in order to hide the unacceptable face of their activities, attach the word "Homes" to the name of their

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company in an effort to improve their image. I view any company called this, that or the other Homes Limited with the greatest suspicion.
Lord Graham of Edmonton: That is ideal.
The Earl of Shannon: Thirdly, pressure comes from greedy farmers who after nearly half a century of feather-bedding are most dismayed to find that their particular gravy train has finally hit the buffers. No doubt, under a new policy of set-aside for their land from producing grain, beef, butter and milk mountains and lakes, they are clamouring to reap the most profitable crop of all from their land, namely houses. They do not want to be left out of the killing either.
I disagree totally with Berkshire County Council in that it wants to tone down the future excessive development. I think that it should stop totally for a period. As we have heard, the infrastructure clearly cannot cope with what is there already. And it is not very clever to pile more in while making weak comments about trying to close the gap.
For the past year hardly a road near my home in south Berkshire has been without single-line traffic and traffic lights every few miles while the poor utilities have been hastily and busily digging up the road to repair their services damaged by the incessant pounding of excessive traffic and the extra demands made upon them. My own previously quiet little country lane is now a rat run for traffic desperately trying to find a way round the worst jams, resulting in no less than five burst water mains in under a mile last year.
In conclusion, one can only say to the Secretary of State that, first, he should give planning permission for factories and the attendant houses where it is needed and not where it is not required. Secondly, it is supreme arrogance, based on ignorance, to end the power of local authorities to refuse planning permission on highway grounds. The noble Lord, Lord Stoddart, is far too kind to the Secretary of State. Give him a helicopter? No! I say let us dump the Secretary of State in a regular one-hour traffic jam around Exit 11 to convince him of the error of his ways. That should get through to him if nothing else does.
Thirdly, he should allow the local authorities time to upgrade the infrastructure to cope with their existing difficulties and not permit any subjective inquiries related to appeals which are merely a front to allow the Secretary of State to approve developments which he has decided to allow anyway. Fourthly, there should be no further development of agricultural land.
If I appear to have been unduly hard on the Secretary of State, I hope that he will forgive me. I appreciate his difficulties. We have all seen what happens to Ministers who do not do what they are told. They receive a short sharp sack from No. 10. I suppose that he will want to keep his job, so I expect that he will just go on doing as he is told, regardless.
8.51 p.m.
Lord Graham of Edmonton: My Lords, I have thoroughly enjoyed the past 40 minutes, and not least
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the contribution of the noble Earl, Lord Shannon. Like all noble Lords, I am grateful for the opportunity given to us by the noble Lord, Lord Stoddart, to discuss this matter. We are grateful for his initiative, which we have all exploited this evening. The vigorous manner in which he has put forward a case on behalf of the people among whom he has lived and worked for all his adult life is also much appreciated. We are deeply grateful for the care that he has taken in raising this Question this evening. To some extent we all have a vested interest in matters of this kind. There is indeed no better or more proper interest than that of representing the people of the community in which one lives and works.
I have thoroughly enjoyed listening to the speeches that have already been made, and I know that after I have sat down the views of the noble Lord. Lord Sandford, will broaden the issue and certainly be of interest to the House. Certainly I anticipate what the noble Lord, Lord Orr-Ewing, with his primarily residential or community knowledge, will be able to tell the House.
I support the general premise and thesis of the debate; namely, that the advice taken by the Minister—and I do not reproach him with any malicious or malevolent intent—will visit upon one part of our country conditions which are not only unacceptable but also based upon a wrong premise. As a Londoner (I was born in Newcastle upon Tyne but have lived in London for the past 35 years) I must declare an interest in that I have represented the people living in a part of London. Moreover, I am president of the Association of London Authorities. I have my own experience and view of London and the South-East.
I should like to put forward an idea of political alliances. I think that there is a great opportunity for alliances between Berkshire and Brixton, Ascot and Hammersmith, Bracknell and Bermondsey, Newbury and New Ham, Wokingham and Waltham Forest and certainly Harwell, Haringey and Hackney. Certainly there may be cause to keep politics out of the issue, but I am certain that the people who live in the areas I have just mentioned will want not only to say to the Minister that he should not take such a decision but also that if the Government are concerned about housing more people they should consider places other than Berkshire which would benefit from their support. I plead with as much conviction and passion as I can that there are places in London to be considered.
I travel to work in Westminster every day from Edmonton. I pass through Tottenham, Finsbury Park, a little part of Clapton, Hackney, Islington and Camden. I am reminded by the environment and the communities there of the bleakness of life and the deprivation that exists in the places covered by my short journey. We talk in terms of wanting to make life better for people, and I am sure there is nothing other than that same desire on the part of the Secretary of State, but I believe that there is in this case a mismatch. He has resources to put at the disposal of the people of this country, and in my view he is using them in the wrong way.
Noble Lords will know that many major housing problems need to be tackled. The Minister has

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decided to deal with the problem of a potential shortage of housing and a desire to encourage people to move to other areas. When one compares London with other parts of the South-East, the conditions to which I have listened with great respect and which I completely accept mirror life in that part of the country—namely, Berkshire—bear no comparison with the conditions in which the people whom I seek to represent are living.
No one has mentioned the number of homeless families in Berkshire. I am sure that there are some homeless families, but the problem is nothing like the same size as it is in London. Berkshire has nothing like the problems which land on the desks of the Islingtons, the Camdens, the Brixtons and the other local authorities in London.
There are more than 30,000 homeless families and more than 20,000 homeless people in bed and breakfast accommodation in London. Even in Enfield, which is one of the leafier and perhaps more wealthy boroughs of London and in which I live, tonight there are registered as homeless 300 families who are in bed and breakfast accommodation. Living conditions in an area like Berkshire may be difficult but we should be concerned about people who are living in unsafe, unclean, unhealthy and too small accommodation. We are looking at the question of the number of people who may be waiting to go into Berkshire and find accommodation in a lovely part of the country. I know some parts of it, even if not as well as others.
There are so many people on housing waiting lists throughout the country. There are half a million people on waiting lists in London. I ask the Government: where are your priorities? I say to Members on the other side of the House that they can do a great service tonight not only for the cause of Berkshire but for the people of inner London. Noble Lords opposite must recognise what the Minister needs to be told. They have more political clout than we have or than I have. The Minister is of a political colour and persuasion that ensure he will listen to Members opposite, if he listens to anybody at all.
I believe that there is a great opportunity here. I can envisage what will happen if this plan gets off the ground. We are not speaking of building new houses or repairing old ones; we are talking in terms of the increasing value of houses.
One of the obscenities that Members of this House ought to consider is the quite outrageous way in which house prices have risen. This House should contemplate the type of people who will benefit from those increases—the term "Yuppies" has been used—who can look forward to living and working in a lovely part of the country like Berkshire. I am as concerned as the next man that people should live well. I stand by the principle that everyone in this country is entitled to live in satisfactory accommodation at a price that he or she can afford. So I part company with the Minister on grounds different from those put forward by other noble Lords who have spoken this evening. I believe that there are people who need his support and that of his Government far more than others to whom he gives support in other ways.
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I look at the resources that will be deployed. The noble Earl, Lord Shannon, quite fairly indicated to us that there are people with money, power and resources who will push on in order to get what they consider to be their rightful reward; namely, more and more profit. So fewer and fewer people will become richer and richer. I cannot help but blanch at the penalty which the same Minister and his Government have laid upon government in London.
The amount of housing investment programme allocations which London has been denied over the past few years is £1,000 million. The amount of rate support grant that London has been denied is over £2,000 million. There is ample use for the national resources that the Minister is entitled to say he has to redistribute. However, as demonstrated in the Budget last week, the Minister is part of a government which have a wrong concept of what is needed in order to relieve the social and environmental problems of the people in this country.
I look forward very much to hearing what hope the Minister has to offer me, and others such as the noble Lord, Lord Stoddart, who are affronted at the cavalier treatment of the views of local people and their representatives. It is not just the councillors who represent the people. We all represent people, and those views are being ignored. I hope that the Minister will still have time to reflect that the councillors in Berkshire know best fo the people in Berkshire, as do the Members of Parliament who represent them. I have read the debate in another place. Those Members know better than the Minister. There is a great opportunity for the people of Berkshire and in such places as those that I seek to represent to say to the Minister, "By all means build more houses. By all means encourage more work to be created, but consider those who are in desperate circumstances." I believe that we can do well not only for the people in Berkshire but for the people of Brixton and Bermondsey also.
9.3 p.m.
Lord Orr-Ewing: My Lords, I also owe a debt of gratitude to the noble Lord, Lord Stoddart, for raising this matter. It is a matter of considerable urgency. I wish in my speech to concentrate on the Newbury-Thatcham area. I have not lived there as long as my noble friend Lord Norrie who has lived there for 30 years. I have lived in the area for three years. I bought his house so I have an affiliation of interest.
I see all around me a reflection of the popularity of this area, not just because there is wonderful country to the south, but because there are cherished areas to the north of outstanding natural beauty. Those are being preserved. Therefore the development is being crowded into rather small areas and they are now becoming increasingly overloaded.
It is also attractive not only for the beauty, but for the communications. It has fast communications via the M.4 and the A.4 to the east of London, and to the west to Bristol and South Wales. The area is also on the crossroads that run northwards through Oxford up to the West Midlands and southwards down to

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Southampton. It is therefore a natural place for many people who wish to site their factories, warehouses and resultant houses in that area.
All this is recognised by the Berkshire County Council, which acknowledges the demand for houses. However, it strongly recommends that the number of houses is reined back while the infrastructure is given time and money to catch up. It is no good building even more houses, unmatched by the public provision of schools, hospitals, shops, and above all, roads. In fixing the target of the number of houses, the Minister seems anxious to abolish the difference between large and small housing sites. I think that this is a mistake. He does not seem to have taken into account the very large number of small housing sites that have been utilised in recent years.
Certainly in believing that the county can absorb many more houses, he has not reckoned with the considerable number—1,300 new houses—that have been put on small sites and villages. They are not taken into account. He is now trying to superimpose, as my noble friend Lord Stoddart said, 950 extra new houses on top of the 8,650 recommended by the local authorities and by the county council. Does he realise that these small sites are 20 to 33 per cent. of the total? One cannot disregard them; they are extremely important.
In Berkshire as a whole the small sites—these 1,300 extra which are not taken into account in the Minister's calculations—provide 4,000 extra people. Four thousand extra people are an extra strain on the infrastructure, and nowhere more so than on the roads. Recent surveys on road traffic make all the previous estimates nonsense. People have to allow two and a half cars for each house now being built. When one adds to that the increasing number of industrial sites and industrial warehouses with the ever larger number of lorries which are daily coming out of these sites, then the strain on our roads is very considerable. I should like to mention what others have said. One has only to try to get into Newbury, and to cross the Robin Hood roundabout. One is jammed for two miles back in every direction in order to get into Newbury. It is a lovely old county town. It needs to be preserved. But at the present rate the approved by-pass to Newbury to the west will not be completed until at the earliest 1996 even if it is begun straightaway; and the money has not yet been forthcoming. I shall speak on this later.
Does the Secretary of State acknowledge that virtually all those in touch with the problems—the parish councils, the district councils, the Berkshire County Council—are pleading with him, as are the Members of Parliament, and as are Members of your Lordships' House? I cannot say that Members of this House are elected; but members of the councils and Members of Parliament are. They are close to the problem and they get the message loud and clear.
I hope that the Minister will reconsider the question and will allow the infrastructure time to catch up. Up until now we have been prevented from investing in infrastructure through lack of capital assets. The money comes from four sources. It is worth just mentioning these. Most of these sources are under some kind of government approval or control. It is therefore up to the Minister to make sure
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that these are not held back any longer. The county council can borrow on the market but only with the approval of the Minister of State. This is a little old-fashioned now. This is because of a public sector borrowing requirement. But that is a negative attitude. We have just had it in the Budget. It is no longer a burden. If people want to borrow, why not let them? Let them get on with the infrastructure. That, incidentally, provides about £18 million a year towards the cost of capital construction.
Secondly, the council can use money from the capital assets which they are selling off, but even that is controlled by the Minister. He has to give his approval. That also runs at the rate of £18 million a year. One has to recognise that as this property is sold off, it produces a diminishing amount until the year 2001, which is the timescale that we are considering. That, incidentally, also provides about £18 million a year.
The third source is the transport supplement. One would think that with all the transport problems in that area it might be a considerable sum, but it is a measly little sum of £2.7 million a year. One has to remember that at the moment Reading is absorbing a tremendous amount of money with all its by-passes, and understandably so. What is left over for Newbury and other places is minimal.
Lastly, there is the developers' contribution. I, like my noble friend Lord Shannon, am a little suspicious of these developers' contributions: "If I am allowed to build 1,000 houses, then I will spend £1 million on roads to get to and from those houses". That does not seem the right way to make a plan.
I suggest to the Minister that he considers all these problems to see where he or his honourable friends in the Ministry of Transport might be a little more lenient and forthcoming to help us with the roads. We have all read these figures and they have been bandied about during the debate, but I make the point that they are not cast in tablets of stone. They are flexible.
I remind my noble friends, after the debate we have had on the health service, that the forecast cost of the health service was £70 million in 1945. It was said that that figure would fall steadily because the nation would get so much healthier that there would be no need for any hospitals to go to. I mention that forecast only because it shows how enormously wrong they were. So the forecasts about development, housing and our roads are all wrong. I am glad to quote the Secretary of State because this gives him a way out:
"I strongly emphasise that these figures should be regarded as neither prescriptive nor inflexible and that they remain to be tested and revised in the process of Structure Plan reviews and in the light of circumstances which obtain at that time".
I ask the Secretary of State to think again, find a compromise—taking into account the small sites, allowing of course for some housing development—closer to the figures put forward by parish, district, county council, Members of Parliament and also Members in this House. In the meantime I ask him to do everything possible to accelerate the provision of infrastructure, be more generous with grants, and allow the county council to spend the money which they have, but which is controlled at present by the Government.
9.11 p.m.
Lord Sandford: My Lords, I cannot help being struck by the impressive way in which the lively campaign initiated by the Royal County of Berkshire has developed over the last month. On 11th February, as the noble Lord, Lord Stoddart, said, there was an Adjournment Debate in another place with three Tory Members of Parliament taking part. Now we have another debate here well furnished by residents from Berkshire, but also by no fewer than three Labour Front Bench spokesmen, albeit spokesmen who disappear to the other Benches to speak. I shall be interested to hear what the noble Lord, Lord McIntosh, will say—
Lord Stoddart of Swindon: My Lords, it is two Front Bench spokesmen. I ceased to be a Front Bench spokesman a fortnight ago when I resigned my duties.
Lord Sandford: My Lords, I apologise for not keeping myself up to date with the movements in the party opposite.
My interest in these matters is not as a Front Bench spokesman or as a Berkshire resident, but as the chairman of the South East Regional Planning Conference, which the noble Earl, Lord Shannon, dislikes so much, which deals with regional strategy and regional guidance which he also dislikes. Nonetheless, the Home Counties and the London boroughs have for some 20 or 30 years found it convenient to concert their affairs in a number of fields—not least in strategic planning. Some five or six years ago they elected me as their chairman. I can therefore hardly forbear to take part in a debate such as this. I shall probably end by sharing a number of the sentiments which have already been expressed by noble Lords. But I first proceed in almost the opposite direction because I start by welcoming the adherence of the Secretary of State to the regional guidance. I welcome what he has done in the modifications he has proposed for Berkshire and in following so closely the advice of the panel which examined the replacement structure plan in public. By way of correction, perhaps I should say that whereas several noble Lords on both sides of the House have sought to criticise the Secretary of State for what he is imposing on Berkshire, the situation is rather the other way round: the regional strategy was devised by the Home Counties themselves three years ago in 1985. When they had agreed it—this included Berkshire—it was submitted to the Secretary of State for his endorsement. After minor alterations, he was glad to do so and sent the endorsement to me as chairman of Serplan in the form of "regional guidance". That guidance covers all the implications of the regional strategy. The regional strategy is acceptance of the role of the South East (the Home Counties and the London boroughs) as the main economic base for the entire kingdom. It is the place where the economy is booming; the greater part of the economic prosperity of the country starts here. There is acceptance of that.
It is acceptance of a policy that rigorously conserves the countryside—notably, the metropolitan green belt and the areas of outstanding natural beauty, of which there are several in the
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region. And thirdly, the strategy also seeks to do what several noble Lords have suggested: to divert economic growth into other areas that could very well do with more of it. Those three strands of policy all have their implications. The one about which I wish to speak is the most significant among the Secretary of State's proposals; that is, housing.
The strategy agreed among all 12 Home Counties includes the provision of a total regional figure for housing divided up into allocations county by county. A report was compiled in July 1987 indicating the progress that was being made in meeting these agreed county allocations. In six counties, Buckinghamshire, East Sussex, Essex, Hertfordshire, Oxfordshire and West Sussex, the five-year provision in 1991–96 was between 60 and 70 per cent. of the 10 year guidance figures. Hampshire was slightly above half the guidance. Bedfordshire had well exceeded it. In Kent the proposals would provide 80 per cent. of the guidance figures in the first five years. In only three counties are the five-year proposals below half the 10 years' guidance figures. One is the Isle of Wight, which is at 47 per cent.; another Surrey at 43 per cent.; and Berkshire, at 31 per cent., easily the furthest behind of all the 12 Home Counties in providing the housing that it had undertaken to provide.
Lord Orr-Ewing: My Lords, this is where there seems to be a difference of opinion. Can my noble friend quote to which years that applies? My figures show that, apart from Buckingham with the Milton Keynes development, Berkshire is the second biggest growth over the past 10 years. That is why it needs to catch up with its infrastructure. Can my noble friend try to correlate the differences of opinion?
Lord Sandford: My Lords, of course. I was coming to that.
I wish to do it by quoting from the document to which Berkshire has contributed. I refer to a paragraph drafted by Berkshire explaining the figure that I have given. In Berkshire, although structure plan proposals were already in the pipeline when the regional guidance was issued, the implications of the guidance were known and considered at the time of examination in public in July 1986. It is the county council's view (expressed in July 1978) that the gap between the housing provision in the replacement structure plan 1991–96 and the guidance figures will be less significant than initially thought because a substantial part of that gap is likely to be covered by development of unspecified sites coming forward in line with policy but not included in the structure plan figures. If that is what the county council thought as recently as last July 1987, I cannot for the life of me see what all the fuss is about. The Secretary of State has merely included in the modification the requirement to meet the figures the county says it is going to meet in any case.
Coming to the point raised by my noble friend Lord Orr-Ewing, the position is that in the strategy originated by the Home Counties, including Berkshire, and endorsed by the Secretary of State, the county council has been set an annual rate of building of 2,500 a year throughout the whole decade from 1991 to 2001. It proposed 1600 a year for the first five years of this decade and the Secretary of State is

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proposing to modify that to 3,000 a year. That is what the argument is all about and a balance has to be struck somewhere.
It is certainly true that there is a measure of sympathy among all the other Home Counties and generally with Berkshire because of the very rapid growth that has occurred there over the past 20 years. However, the Secretary of State is not asking for anything like the rate of house building that has applied; heretofore it has been 4,900 a year and he is now asking for 3,000. In the paragraph I have just read it says that something like that can be expected to come forward anyway. The sympathy is there, but I do not believe it is unlimited, and I do not see why it should be because the other 12 Home Counties are grappling with similar problems and, as that report indicated, are doing rather better.
It would be a mistake to throttle right back the chance of growth that there is over much of London and the Home Counties. A balance has to be struck. I entirely agree with the noble Lord, Lord Stoddart—and this is expressed in the regional strategy—that part of the objective of the strategy is to secure and promote this growth in those parts of this region which at present lack it. The noble Lord, Lord Graham, mentioned Newham. There is also Barking and Dagenham; Greenwich and Lewisham and all the way down the Thames estuary, downstream of the Docklands. Those areas could all benefit from this economic growth. We have done a study in Serplan to see what the potential is there and what more needs to be done to release it. If Berkshire wants some of this growth off their backs then the best thing it can do is to support further efforts to get more growth in the Thames Estuary.
Of course, another objective is to have economic growth in other regions of the United Kingdom. But however strenuously that is done, it is impossible so far as one can see to choke off all further growth in the Home Counties. My view is that Berkshire is only being asked to shoulder its fair share.
9.23 p.m.
Lord McIntosh of Haringey: My Lords, I yield to all noble Lords who have spoken in this most interesting debate, for which we are grateful to my noble friend Lord Stoddart, in detailed knowledge of the transport, housing and other conditions in the Royal County of Berkshire. Even my noble friend Lord Graham seems to have acquired a litany of Berkshire placenames as part of his preparation for this evening's debate, although his litany of London placenames is slightly less accurate than one would wish.
We find ourselves with very conflicting views from people who, on the face of it, ought to be saying the same thing. I find that puzzling and I want to explore that a little before drawing some wider conclusions from it. The Berkshire County Council, and we are told all the district councils and parish councils—and we know from the debate in another place the MPs representing the area—all feel that the Secretary of State has gone too far in his modifications to the Berkshire Structure Plan.
I shall not in any way attempt to repeat the arguments which have been put forward about
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congestion or the beauty of the countryside; but it seems to me that a very cogent point has been made by Berkshire County Council which has not in any way been answered by the Secretary of State or indeed, if I may say so, by the noble Lord, Lord Sandford, in his capacity as the chairman of Serplan. The point is that the infrastructure of the county of Berkshire is inadequate to sustain the sort of growth in house building which the Secretary of State now wishes to see.
It is not just a question of how long it takes to provide that infrastructure. I take it that we are not just talking about road development but also about the provision of schools, health services, all the social services and the provision of public transport as well as provision for the private car. It is not just a question of the time it takes but of the money that is made available to the local authorities, both county council and district council, to make that provision. As far as we can understand the position, the grant-related expenditure assessments have not and, indeed, by their nature, could not take account of the planned growth in house building and the planned growth in population. Therefore, there is bound to be—unless there is specific financial provision made for the county of Berkshire—a grave imbalance between the infrastructure and the population to take it up.
This must also be true of the rate demands—or perhaps, in the future, the community charge demands—on the people of Berkshire. They will have to make that provision and to pay for it before anyone else is around to help them do so. I should be interested to learn what proposals the Government have—not just for Berkshire but for anywhere else where this sort of development is proposed—to relieve the burden which may be temporary but which could be extremely severe on the population of the area.
We have the views of the Secretary of State which in some respects seem to pay lip service to the views of local people as well as to the views of Serplan, but which do not seem to come to the same conclusions. The Secretary of State speaks about planning area No. 8. I find that an extremely offensive way of referring to what is, in fact, a large part of central Berkshire. Planning area No. 8 is no longer to be regarded as a major growth area, but at the same time the Secretary of State envisages that the area must catch up on the physical and social facilities which are necessary for the population—and that, I understand, is what the county council is saying—and that any development there must grow at a pace which has sensible regard to environmental and infrastructure considerations.
So far, so good. We seem to be in agreement, in objective, between the Secretary of State and the structure plan. But, no, the Secretary of State then goes on to say that he does not propose a climate of general restraint. How that can be reconciled with growth at a pace which has "sensible regard to environmental and infrastructure considerations" I simply do not know. The two seem to be in total conflict. Unless there is a adequate provision made for the infrastructure, both in terms of the space and facilities required and in terms of the capital and authorisation for local authority expenditure

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required, then we have what seems to be an irreconcilable conflict between what the Secretary of State appears to want and what he is in fact allowing in his modifications to the structure plan.
I do not go along entirely with other noble Lords in their fears about the planning procedure. The noble Earl, Lord Shannon, said that planning implies forethought, and that indeed must be correct. The noble Lord, Lord Orr-Ewing, cast some doubt on the validity of forecasts in the planning area by analogy with the health service. The two are not so far apart. Robert Graves said in Non Coqunt Astra:
"Come, live in now, and occupy it well;
Prediction's no alternative to forethought."
However, he was only partly right. Forethought requires a sensible evaluation of the facts available to us and the opportunities open to us. If we do not turn those into thoughtful forecasts, if I may put it that way, we are not doing our job properly and we ought not to be making generalised judgments about the future structure of our country.
I do not wish to say anything more about the detail of the position in Berkshire. Other noble Lords have said it far more eloquently than I ever could. However, I wish to say something about the national implications of the conflict that we have had expressed tonight. My noble friend Lord Graham has made it very clear that there are opportunities in London. The noble Lord, Lord Sandford, made the same point. There are opportunities for development for the deprived areas of this country, whether they be those in inner London, the inner cities or the other deprived areas of the Midlands and the North.
The trend of thinking in government is again somewhat contradictory. They appear to think and to claim that vast resources are going into the inner cities. I should like to believe that that is so. I believe the intention behind that wish is generous and it is in the right direction. It cannot be held sincerely at the same time as a view that there should be—again to quote the Secretary of State—no climate of general restraint in other areas of the country. The two do not go together.
If we seriously mean that not simply money but decent employment and decent housing are to go into the inner cities of our country and that these advantages are to go to the Midlands and the North, which are areas where levels of unemployment are much higher and the physical standards of the environment are much worse in many cases, it is not enough simply to put money into those areas even if the Government were doing enough in that direction. The policy must be carried along together with a general climate of restraint in other areas. I do not see how anyone can talk their way around that problem. It is not enough to make indicative plans about the development of the South-East. There must be actual priority, a combination of stick and carrot, in order to achieve the objectives that we all want for the regeneration of our inner cities and of the more deprived areas of the country.
We have a curious alliance. We have the highly Conservative county of Berkshire. All of its MPs and district councils are Conservative. They are putting forward a view which supports indicative and positive planning. At the same time I hope and
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believe we have a Labour Party really wanting to do more for the inner cities, the Midlands and the North. As my noble friend Lord Graham said, this alliance is the right and correct alliance. It is the alliance of interest on both sides that ought to lead the Government to the conclusion that the Berkshire structure plan should not be modified.
9.33 p.m.
Lord Hesketh: My Lords, we have had a most interesting and in some ways a riveting debate. At the start I should like to make two short comments. In some areas we have covered a rather broader area than the Question on the Order Paper. We have also touched upon some important aspects of philosophy in a way which suggests that we may have another and longer debate in the future in your Lordships' House.
The noble Lord, Lord Stoddart, and other noble Lords who have an interest in preserving the character and environment and indeed the heritage of Berkshire have ably and courteously set out their concern for the future of the county. They are anxious about the quality of life and about the maintenance of essential services which they see threatened if development in the county, in particular house building, is not reduced sharply. The focus for that concern is the modifications which the Secretary of State has proposed to make to Berkshire County Council's draft replacement structure plan, and the feeling among many people in the county that the Secretary of State has disregarded their views.
The Question raised tonight is about how far the Government take account of local opinion in the matters, and I shall turn to that presently. I must explain that I am limited in the response I can make to specific points raised in this debate about the proposed modifications. The period in which objections or representations can be made to the Secretary of State runs to the end of this month. It will be necessary to consider together all objections and representations received before any decisions are reached. To comment now on points, without considering all the representations put to the Secretary of State, could prejudice his position. A number of points have been raised, in particular by the noble Lord, Lord Norrie, the noble Earl, Lord Shannon, and the noble Lord, Lord Orr-Ewing and Lord McIntosh of Haringey, about the need to reduce house building, about damage to the countryside, about the pressures on infrastructure and services and about the problems for local authorities which are faced with further substantial growth. I have noted all these points.
Reference has also been made to extra land for housing which has come forward since Berkshire County Council started to prepare its replacement plan in 1984, as was pointed out by my noble friend Lord Orr-Ewing. That is information about which, I do not doubt, the county council will be writing to the Secretary of State in detail when it makes its comments on the proposed modifications. It is a point which I can assure your Lordships the Secretary of State will consider very carefully. However, for the reasons I have already given, the House will understand that I cannot take the matter further in this debate. I want, however, to give an

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undertaking on behalf of the Secretary of State that all the views that have been expressed in this debate have been noted, and in so far as they relate to the proposed modifications they will be taken into account.
Turning to the theme of the Unstarred Question about the weight given to the views of local people in deciding structure plan proposals, I must explain something of the various processes of consultation to which structure plan proposals are subject, first, in their formulation by the county council and then after the proposals are submitted to the Secretary of State. When Berkshire County Council decided to replace its existing three structure plans with a single up-to-date plan, it was under a statutory obligation to carry out a detailed public consultation into its proposals. The Secretary of State had to be satisfied that the county council had properly met its obligation or he could have sent the plan back to it to undertake further consultation. Next, when the county council submitted its draft replacement plan to the Secretary of State, a period of six weeks was given for objections and representations to be made to the Secretary of State. This is also a statutory requirement, as is the requirement to allow a six-week period for public response to the Secretary of State's proposed modifications to the plan. As I have said, we are still in that second six-week period.
The important point to which I wish to draw your Lordships' attention is that public consultation and participation in the structure plan process is built into the statutes, is well established in practice and is effective in shaping policy, even though I know the noble Earl, Lord Shannon, disagreed strongly on this point. In fact, we know that Berkshire County Council revised its draft replacement plan twice as a direct result of public reaction to its proposals. It will be seen therefore that the whole structure plan process is geared to allowing opportunity for views to be expressed and properly considered in the decision process. The net effect of all this is that the process tends to be a very long one, but the Government take the view that public participation is an essential element of the process, and although the Government's proposals for changes to the development plan system would streamline the process they would retain full public involvement.
Coming back to the Berkshire proposals, all the objections and representations made to the Secretary of State about Berkshire County Council's submitted replacement plan were fully and carefully considered and in addition an examination in public was arranged to obtain further information about particular issues. The advantage of an examination in public is that it is not confined to experts arguing technical points against each other. The examination is conducted as an informal but thorough debate, and as well as county and district councils and developers a number of bodies representing groups of local residents were also invited and participated fully in the discussions before the panel. In addition, three honourable friends from another place addressed the panel.
One of the main issues discussed at the examination in public was about housing provision. This was debated for six out of the 11½ days on which the examination took place. The views of local
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residents were very clearly expressed in those discussions, and now, I need hardly say, the public consultation on the Secretary of State's proposed modifications is providing further evidence of public opinion in Berkshire on this subject.
I can assure the House that the Government are fully aware that many people in Berkshire are deeply concerned about the amount of development that has taken place in the county. Over the past few years there has been substantial correspondence with the department about those matters. There have been questions and debates in another place as well as deputations to several Ministers in addition to the specific representations made in the submitted replacement structure plan and the proposed modifications.
I am not sure if the Question of the noble Lord, Lord Stoddart, assumes that the views of Berkshire's residents and their elected representatives are unanimously in support of the county council's proposals and against the Secretary of State's proposals. The fact is that other views have been expressed as they were this evening by the noble Lord, Lord Stoddart. Some within the county would welcome additional development to meet particular local needs.
The house-building industry has argued very cogently for a much greater increase in the level of housing provision in the plan than the Secretary of State has actually proposed. In general it would like to continue at past average rates of building which, if he had agreed, would have required the Secretary of State to propose an increase of over 22,000 houses. The Secretary of State has not done that but the house-builders and others who sought more development had important points to make and those had to be given due consideration.
There seems in much that has been said both in this debate and in the reaction which the Government have received following publication of the Secretary of State's proposed modifications an assumption that because a substantial number of local people do not want something —in this case more housing development—that view should take precedence. The weight attached to any argument is dependent on the cogency rather than the frequency of the argument.
There are those who say the Secretary of State has not taken adequate account either of the impact of the additional housing on the environment of the county or of the problems which it is said will result in terms of increases in traffic and demands on essential services. What this boils down to is a genuine difference of view about the need for, and the likely consequences of, more development. The Secretary of State, before proposing his modifications, had to consider all the arguments and exercise his judgment. But the Secretary of State was not left entirely on his own to ponder those difficult problems.
I have already mentioned the examination in public. The report of the panel that held the examination very clearly identifies the conflicting arguments put to it about development in Berkshire. Indeed, the report contains a summary of all the discussions, and the Government reject any suggestion that the panel did not take full acount of the evidence put to it. Members of the panel not only

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had the benefit of reading all the evidence and hearing the arguments at first hand; they also toured the county extensively and tested for themselves the evidence about traffic and environmental impact. In other words, they did get out of their helicopter.
The fact of the matter is that they agreed with the county council that the rate of house building should be reduced. To the extent that the Secretary of State accepted that view, he has clearly given more weight to the arguments for a reduction in the rate of house building than to the arguments advanced for maintaining previous levels of development.
The issue now, in essence, is whether the decrease in the rate of house building implied in the proposed modifications is appropriate. I will not repeat here the arguments which led to the panel's recommendations. Those are set out in the report. However, in accepting those recommendations the Secretary of State, in his proposed modifications, is giving effect to the regional strategic guidance which he published in June 1986 in a letter to the noble Lord, Lord Sandford, in his position as chairman of the London and South-East Regional Planning Conference. Government policy no longer encourages major growth in Berkshire and, indeed, under the proposed modifications the rate of house building in the county should come down by 2,000 dwellings a year from past levels. This is a significant change in Berkshire from the position which resulted from past decisions taken by a right honourable friend in another place, who appears retrospectively to be resconsidering his policies—as the noble Lord, Lord Stoddart, brought to our attention. I hope he will approve of those changes, which reflect the Government's understanding of the problems of continuing high rates of growth in the county.
Concern has also been expressed about the effect of development allowed as a result of planning appeals. This represents a very small proportion of the housing development in Berkshire, and the Government have given an assurance that all such development will not be additional to whatever figures are set for the housing provision in the replacement structure plan.
I also want to give the House an assurance that the Government remain committed to preserving the
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green belt and areas of outstanding natural beauty, which between them account for almost 60 per cent of the total land area of Berkshire, as the noble Earl, Lord Shannon, pointed out. The Secretary of State has not sought to remove any of the county council's policies for the protection of the environment. Landscape and amenity considerations will continue to be an important factor in determining planning applications.
The Government's policies and expenditure programmes are already designed to promote development on urban and derelict land and their success is supported by the fact that nearly half of the land required for house building is now coming from sites in urban areas. But we must recognise that development pressures follow from economic and social demands which cannot simply be willed away. Much of the demand comes from people and businesses already in the areas concerned, and the problem remains that the potential for development in the inner cities, which the noble Lords, Lord Stoddart, Lord Graham and Lord McIntosh brought to your Lordships' attention, and through the use of urban land and the re-use of derelict land, will not meet all of the future housing and other development needs arising from the existing populations of counties in the South-East.
This is not a problem we can run away from. While we are pursuing policies to encourage growth elsewhere and to minimise the need for development which affects the countryside, sensible ways have to be found of accommodating the growth which is going to occur in the South-East. This is a matter on which the department is currently receiving much advice in the context of the replacement structure plan for Berkshire, and all the views expressed about the proposed modifications will, I can absolutely assure your Lordships, be taken fully into account.
What I cannot say now, and no Minister could say in advance of considering all the representations made, is that more weight will be given to one point of view than another. All the points made will be considered carefully and the decision will be taken after weighing all the facts and arguments and exercising judgment on them.
House adjourned at fourteen minutes before ten o'clock.