Lords Sitting of 15 February 1989

Preamble
The House met at half-past two of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Southwark.

The Environment: Government Policy
Baroness Robson of Kiddington Baroness Robson of Kiddington asked Her Majesty's Government:
Whether they will publish a White Paper on the environment.
The Minister of State, Department of the Environment (The Earl of Caithness): No, my Lords. It is not the usual practice to issue White Papers unless they contain detailed legislative proposals. We are taking a number of initiatives which go much wider than what can be achieved through further legislation.
Baroness Robson of Kiddington: My Lords, I thank the Minister for his reply. But does he not agree that a White Paper is generally taken to be an account of government policy and does not necessarily always contain legislation? There is a precedent in the 1983 government response to the report on coal, which was a statement of policy without any legislation. Would not a White Paper be the perfect opportunity to state to the nation and to this House the environmental concerns that the Government express and the environmental questions that should be answered as regards the integration among environment policy, energy, transport and health? All those matters are integrated. Will the Government consider that?
The Earl of Caithness: My Lords, rather than a White Paper, I would prefer a Green Paper to answer the points made by the noble Baroness. Many of the matters that she raised were discussed in the debate that we had on pollution last week. The noble Baroness will know that a number of ministerial speeches have been made in the recent past. These have been converted into leaflets about the environment and the Government's policy. They will be available shortly.
Lord McIntosh of Haringey: My Lords, is there not some conflict between what the Minister has just said and what the Secretary of State said on a "Panorama" interview on 14th November when he described legislation as top priority? Even if the Minister does not agree with what the Secretary of State says, does he agree that there are some particularly urgent environmental matters, notably the extension of planning controls to cover agriculture and forestry, which should not be left without legislation any longer?
The Earl of Caithness: My Lords, the last point is a planning and not an environmental matter.
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However, there is no difference between what I said and what my right honourable friend the Secretary of State said. That was a specific point. I believe it probably related to waste. As the noble Lord will realise, there have been three consultation papers on waste. The consultation period on two of them has expired and we are still awaiting the results of the consultation on the third.
The Earl of Halsbury: My Lords 250 years of environmental indifference cannot be rectified or paid for overnight. Are there not dangers of raising false hopes in this context?
The Earl of Caithness: My Lords, we have an enormous programme of work that will affect the environment from the basics of litter and unleaded petrol right through to enormous expenditure on research on climate change and the CFC conference which my right honourable friend the Prime Minister will chair at the beginning of next month. A lot of what we are going to do costs an enormous amount of money. The noble Earl is quite right to say that it cannot all be done at once.
Lord Winstanley: My Lords, does the noble Earl accept that some of us would find his statement that no further legislation is contemplated a little more acceptable if the existing legislation were adequately enforced?
The Earl of Caithness: My Lords, I did not say that no further legislation was contemplated. I repeat that legislation is hoped for on waste and integrated pollution control. That is part of the consultation papers which have gone out. As soon as parliamentary time permits, a Bill will be brought before your Lordships.
Lord Hunt: My Lords, I wish to press the Minister a little further on the matter raised by my noble friend Lady Robson. Is he aware that, notwithstanding the Prime Minister's speech to the Royal Society on global environmental issues, which, vitally important as they are, mainly bear on the future, there is considerable concern among many members of the public about the Government's apparent ambivalence with regard to what one might call the more mundane environmental issues that exist in the here and now in this country? Such issues arise, for example, out of land disposals and the concern about continuing public access and enjoyment of the countryside. Is not a clear and comprehensive policy statement now called for from the Government about the environment in all its aspects and the setting up of a body to develop that policy as recommended by the noble Earl, Lord Cranbrook, in the debate on 1st February?
The Earl of Caithness: My Lords, I answered my noble friend. My suggestion was one that the noble Lord, Lord McIntosh of Haringey, did not take terribly kindly to at the time. I disagree with the noble Lord. There is no ambiguity in the Government's policy on the environment. We are taking a huge range of initiatives, many of which your Lordships and members of the public could take up by using

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more unleaded petrol, not dropping litter and making sure that our streets are clean. I do not believe that that needs a White Paper.

Rat Population: Control
2.44 p.m.
Baroness Masham of Ilton Baroness Masham of Ilton asked Her Majesty's Government:
Whether they are concerned about the increasing rat population throughout Great Britain, and the risk of diseases spread by rodents.
The Earl of Arran: My Lords, there is anecdotal evidence to support the view that rat populations are higher than average following two relatively mild winters. The main communicable disease associated with rats in this country is Weil's disease, which can be contracted by contact with water contaminated with their urine.
Baroness Masham of Ilton: My Lords, I thank the Minister for that rather vague Answer. Does he agree that there is great concern about rats among the public which has been handed down through history from the time of the plagues which swept through Asia and Europe? Can he give an assurance to the House that there are enough rat control officers throughout the country? If he cannot give that assurance can he get it from the Department of the Environment? It is not only Weil's disease which is carried by rats, but also hepatitis and salmonella, among many other diseases.
The Earl of Arran: My Lords, I have sympathy with the points made by my noble friend. Rats are extremely unattractive rodents. As regards their control, water authorities have responsibility for raw water control, and local authorities are responsible for public health and pest control. Expenditure specifically on the control of rats will vary from one local authority to another according to local conditions.
Lord Mellish: My Lords, is the Minister aware that the increase in the number of rats is due mainly to the very poor condition of sewers, particularly in London? Will the Minister say whether any money will be found for repairs to those sewers and to kill those bloody rats?
The Earl of Arran: My Lords, I can inform the noble Lord, Lord Mellish, that water authorities spent about £308 million in 1987–88 on building new sewers and rehabilitating the existing system. That is an increase of 30 per cent. in real terms over 1981–82. However, that is unlikely to have much direct effect on the rat population or the risks from leptospirosis.
Lord Harmar-Nicholls: My Lords, is my noble friend aware that his answers give the impression that one department is passing the buck to another as to the responsibility for doing something about keeping rats out of the sewers? Is there no way of coordinating action so that responsibility is truly recognised?
The Earl of Arran: My Lords, I do not accept that this is a matter of co-ordination. It is for each local authority to be aware of an increase in rats in its area, if that is the case, and to take the necessary action.
Lord Grimond: My Lords, can the Government either permit or encourage the manufacturers of rat poison to pep up their product? I have spent pounds and pounds on it and the Orkney rats simply love it. It is full of bran and what it needs is more poison.
The Earl of Arran: My Lords, regarding the point of the noble Lord, Lord Grimond, about rat poison, and in particular with regard to Warfarin, rats do not become immune in the medical sense of the word, but they inherit resistance. For the control of rats in sewers both fluoracetamide and brodifacoum are available for use. Where Warfarin resistance occurs, rats can be controlled by the second generation anticoagulant rodenticides: difenacoum, bromadiolone, brodifacoum and flocoumafen.
Baroness Strange: My Lords, is my noble friend the Minister aware that rats can pollute water in fish farm ponds and so could cause Weil's disease and possibly salmonella to be passed on via the fish to the unfortunate British eater?
The Earl of Arran: My Lords, there is no evidence that rats are a threat to the quality of the drinking water supply. As regards salmonella, the information that we have from this country, Australia, the Far East, the Middle East and the United States of America suggests that in general 5 per cent. of rodents are infected with salmonella. But it is the faeces rather than the urine which has been examined. There is little evidence that rats are a source of salmonella.
Viscount Massereene and Ferrard: My Lords, does my noble friend agree that we should bear in mind the mild winter, and that there are now far fewer predators to eat the rats, especially country rats? However, the really dangerous rat is the black rat which started the plague and is prevalent in sewers.
The Earl of Arran: My Lords, I think that I can only agree with my noble friend who is presumably a greater expert than I, particularly on the black rat.
Lord Prys-Davies: My Lords, will the Minister elaborate on the reply that he gave to the noble Lord, Lord Harmar-Nicholls? Will the risk of rats spreading salmonella and the lethal Weil's disease be tackled by the recently-announced inquiry under the Prime Minister's chairmanship into the whole question of food hygiene and public health? How quickly will that inquiry report? I have another question for the Minister: if it becomes necessary to find a pied piper to catch rats in order to protect public health, are the Government prepared to pay his bill or will they insist that it be paid by the consumer, by industry or by anybody other than Mrs. Thatcher's Government?
The Earl of Arran: My Lords, with great respect to the noble Lord, Lord Prys-Davies, I think that that

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question is somewhat wide of the subject. We shall have to wait until the inquiry has been completed.
Baroness David: My Lords, will the Minister say whether the Water Bill (which is being debated in Committee in another place) will address the matter of responsibility for rodent control? Will the water companies that are to be set up have that responsibility?
The Earl of Arran: My Lords, regarding the privatisation of water, any outside pollution will be very much taken into consideration.
Lord Swinfen: My Lords, will my noble friend tell the House how the increase in the rat population relates to the proliferation of plastic rubbish bags which have replaced the relatively rat-proof old-fashioned rubbish bins?
The Earl of Arran: My Lords, local authorities have the necessary powers to deal with rats: but prevention is better than cure. The Government cannot emphasise strongly enough the need for secure waste management practices by all sectors of society. Poor waste management, especially of food waste, attracts rats. Waste should be put into the proper, appropriate waste stream—refuse bags should be properly tied up, and litter bins made available, and so on—and not discarded indiscriminately, irresponsibly and illegally as litter/or dumping.
Lord John-Mackie: My Lords, is it possible to make the tenant or owner responsible for killing rats on his premises? Far too many people just ignore them. Surely we should make people legally responsible for killing rats on their own premises.
The Earl of Arran: My Lords, I was not quite sure whether the noble Lord said "legally responsible" or "illegally responsible".
Lord John-Mackie: My Lords, I said "legally responsible".
The Earl of Arran: My Lords, it is obviously the duty of the person whose premises are affected by rats to get in touch with his or her local authority.
Lord Winstanley: My Lords, does the noble Earl recollect that in the years immediately before the war there was an annual event in the calendar known as national rat week? Will the noble Earl look into the history of that event and see whether it is time that it was revived?
The Earl of Arran: My Lords, I shall certainly have a look at that event; but I cannot promise that it will be revived.

Mental Hospitals: Closure
2.52 p.m.
Lord Mottistone Lord Mottistone asked Her Majesty's Government:
Whether the ministerial statement in a Lords debate on 7th December 1988, that the
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Department of Health did not have forecasts for future closures of mental illness and mental handicap beds (Official Report, col. 655), took account of the South-East Thames Regional Health Authority statement in October last that its seven large mental illness hospitals, with 3,500 patients at the end of 1986, are being run down and closed over the next decade.
The Earl of Arran: My Lords, the Government do not formally collect statistics on potential closures, only on hospitals actually approved for closure. We are of course aware of long-term strategies which will involve closures, but these do not enable us to forecast accurately future bed closures.
Lord Mottistone: My Lords, I thank my noble friend for that Answer, which did not help us very much. Does he remember that he has said, among other things:
"We do not have forecasts for future closures."—[Official Report, 7/12/88; col. 655.]
Is he also aware that in September of last year, before he said that, the South-East Thames Regional Health Authority referred in its document Mental Illness Services to:
"seven large mental health illness hospitals which are being run down and closed over the next decade"?
Was my noble friend aware of that fact? 1f he was not aware of it, does he think that it would be a good thing if central government were aware of the comments of regional health authorities?
The Earl of Arran: My Lords, plans change and eventual outcomes do not always match initial proposals. In that context, it is quite reasonable to collect formal statistics only on hospitals approved for closure. We are at all times aware of future plans in a general sense through the normal planning and reporting processes such as short-term programmes and regional strategies.
Baroness Faithfull: My Lords, if mental hospitals are to be closed, what alternatives are there in the community for the patients? In addition, when will the Griffiths Report be implemented?
The Earl of Arran: My Lords, I shall take the second part of my noble friend's question first. I know of your Lordships' keenness and anxiety about the Griffiths Report. As my right honourable friend the Secretary of State has recently said in another place, proposals will be implemented in the near future. I shall now take the first part of my noble friend's question. The Government's long-standing policy is that people with mental illness should have access to all the services that they need as locally as possible. Our aim is to have a full range of local services such as in-patient and day hospital facilities, day centres, residential homes, hostels, sheltered accommodation, supported lodging or special fostering schemes, group homes, drop-in centres, sheltered workshops, social clubs and self-help groups, as well as education, training and employment services.
Lord Carter: My Lords, if we follow on from that last answer, is the Minister aware that implementation of Section 7 of the Disabled Persons (Services, Consultation and Representation) Act 1986 would go some way to removing many of the fears regarding the closure of hospitals for patients with mental illness or mental handicap? Does the Minister agree that implementation of Section 7 of the 1986 Act would make discharge without regard to the patient's requirements a thing of the past?
The Earl of Arran: My Lords, as part of the discussions on the implementation of the Act, officials from the department met with local authority representatives last November and a further meeting has been arranged for March this year. The timetable for implementation will depend upon the outcome of discussions with local authority and health authority representatives.
Lord Allen of Abbeydale: My Lords, will the Minister tell us whether there is a real prospect of this section being implemented before we reach the third anniversary of the date on which Royal Assent was given to the 1986 Act that— is, 8th July next?
The Earl of Arran: My Lords, I regret that I do not think that I can give the undertaking that the noble Lord seeks.
Lord Prys-Davies: My Lords, only about a year ago, the Department of Health said that 28 hospitals for the mentally handicapped were scheduled to close by 1990 and that 35 hospitals for the mentally ill were scheduled to close by 1995. Is that still the position? Will the Minister place in the Library a list of the hospitals for which a closure date has been agreed and a list of the hospitals for which a closure date is still subject to consultation? I believe that those lists would answer the request made by my noble friend Lord Carter in the debate on 7th December last.
The Earl of Arran: My Lords, as regards the closure of hospitals, I can place in the Library a list of the particular hospitals due for closure in the South-East Thames Regional Health Authority area. As regards the other part of the noble Lord's question, the department continues to emphasise that no closure of a mental hospital should proceed until a careful assessment of all existing patients' needs has been made and alternative services appropriate to those needs have been provided. As a consequence of the development of comprehensive locally based psychiatric services and only as better alternative services are provided will those mental illness hospitals close which are not needed as part of the developing pattern of district services. The closure of hospitals is not a primary aim.
Lord Mottistone: My Lords, do I gather from my noble friend that approval of the closure of mental hospitals is being slowed down compared with a year ago? Do I also gather that such closures will not be approved and those hospitals will not be closed down if facilities for the mentally ill and mentally handicapped people are not available in the community?
The Earl of Arran: My Lords, my noble friend is quite right. It is of prime importance to see that the services in the community are appropriate for those coming out of mental illness hospitals.
Lord Elwyn-Jones: My Lords, are not the voluntary organisations that are trying to fill the gap which now exists between closure and some provision in the community facing very grave difficulties? Are the Government prepared to assist the voluntary associations which are being impoverished by this burden?
The Earl of Arran: My Lords, the answer to that is not totally clear. It is a point on which I should wish to correspond with the noble and learned Lord.

Overseas Aid
3 p.m.
Lord Hatch of Lusby Lord Hatch of Lusby asked Her Majesty's Government:
Whether they plan to increase or decrease overseas aid in real terms in 1989–90.
The Minister of State, Foreign and Commonwealth Office (Lord Glenarthur): My Lords, compared with the original budget of £1,335 million for the current financial year, the aid programme in 1989–90 represents an increase of 1·9 per cent. in real terms.
Lord Hatch of Lusby: My Lords, is it correct that according to the official estimates of public expenditure published two weeks ago, the aid programme will be cut by I per cent. in 1989–90 compared with 1987–88? Does this not again also lower the percentage of GNP which this country is paying in overseas aid?
May I ask the noble Lord a question which I have asked him before and which he has never answered? Those of us who have been raising this question over the years have been told by the Government that the reduction in overseas aid, and in percentage of overseas aid, is due to the economic stringency in this country. Now that the Government have been professing for three years that we have a prosperous economy, why have the amount and percentage of overseas aid not been increased?
Lord Glenarthur: My Lords, I am not sure of the basis for the noble Lord's figure of a 1 per cent. decline. I suspect that it might have been from a quotation of figures that I saw in the Guardian. They included the superannuation vote, which is not part of the aid programme and is therefore not relevant to the comparison that the noble Lord seeks to make. I should remind him that the aid programme is now growing in real terms and, perhaps even more importantly, the quality of that programme is extremely high.
The Government accept the United Nations target in principle but, like previous administrations and many other major donors, are not able to set a date for achieving it. As the noble Lord will appreciate, progress towards the target must depend upon developments in the economy and other claims on our resources.
Lord Boyd-Carpenter: My Lords, in considering the quality of the aid programme to which my noble friend referred, do the Government take into account the fact that in certain countries the aid provided at the cost of the British taxpayer is wasted, notably in Ethiopia?
Lord Glenarthur: My Lords, it is extremely important, as my noble friend suggests, to ensure that the aid we provide is adequately and properly spent at the point of receipt. That is not always easy to achieve, but I can assure him that in every case we do our best to achieve it.
Baroness Seear: My Lords, will the Government consider additional aid to countries that are increasing or attempting to increase their family planning programmes in view of the close connection between dramatic increases in population and environmental issues?
Lord Glenarthur: My Lords, that is a very important point and one that is taken into account as we plan aid for the years ahead.
Lord Harmar-Nicholls: My Lords, following the question put by my noble friend Lord Boyd-Carpenter, what note has been taken of the sensible and practical speech made by Her Royal Highness the Princess Royal on the need to make certain that the aid, whatever its level, is properly used? What note has been made of the action that could be taken following that most informative and practical speech?
Lord Glenarthur: My Lords, great note is taken of those points, and indeed of the expertise which Her Royal Highness the Princess Royal shows in this field. The important factor is to try to ensure that the very high quality of aid which is available and which we provide is adequately looked after when it reaches the point of receipt. My noble friend will be aware that it is not always possible to achieve the aim in the way we should like, but we always strive to do precisely that.
Baroness Robson of Kiddington: My Lords, what percentage of aid is channelled through nongovernmental agencies, as it is generally accepted that that aid goes to the right people?
Lord Glenarthur: My Lords, I am afraid that I cannot give the noble Baroness the precise figure without notice. However, I shall certainly consider the matter and let her know.
Lord Oram: My Lords, does the Minister appreciate that the figure of increase that he gave in his original Answer is totally misleading because it goes back to a base line which is no longer relevant? Does he agree that in answer to my noble friend's Question, the comparison that must be made is between what is being disbursed in this current financial year and what the Government plan to disburse in the forthcoming year? If he looks at those figures in the public expenditure White Paper, he will find that the increase is only £43 million. That figure
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is far short of the amount which is needed to cope with the inflation of last year and very far from enough to meet the 7 per cent. inflation rate that the Chancellor of the Exchequer announced a few days ago.
Lord Glenarthur: My Lords, no. I am afraid that I do not agree with the noble Lord. It is misleading to try to compare outturn with planning figures, which is what he suggests that I do. It is not a valid comparison. Indeed the aid programme has increased by £50 million this year, and it could be accurately compared in the way that the noble Lord suggests only if we had not added that extra £50 million.
Lord Molloy: My Lords, in view of the appalling natural tragedies that have struck several parts of Africa, India and other parts of what may be termed the poorer world, notwithstanding the immediate aid that the Government have dispatched to these stricken areas, in order that they may rebuild themselves ought not the Government to increase aid now to those parts of the world and encourage the wealthier nations to do the same?
Lord Glenarthur: My Lords, certainly encouragement to other countries is an important factor. However, the tragedies are primarily a matter for humanitarian aid. I can assure the noble Lord that the Government have an extremely good record on that.
Baroness Ewart-Biggs: My Lords, will i he Minister confirm—if it is indeed a fact—that the level of British aid to sub—Saharan Africa in 1987 was 26 per cent. lower than that achieved in 1979 and that this brought a cumulative loss in real terms of as much as £600 million? In the light of the crippling debt burdens faced by most countries in this area, is he able to present new proposals for substantial new money to be invested in the part of the world where the people are suffering very great crises indeed?
Lord Glenarthur: My Lords, I cannot give the noble Baroness chapter and verse on sub-Saharan Africa. On debt burdens, my right honourable friend the Chancellor of the Exchequer introduced a debt initiative. It was a three point plan: first, the conversion of aid loans to grants; secondly, the extension of repayment and grace periods; and thirdly, lower interest rates on official debt rescheduled through the Paris club. Those are very positive developments and go a long way towards meeting the concern that the noble Baroness expressed.
Lord Hatch of Lusby: My Lords, is the noble Lord—
Lord Denham: My Lords, we have been—
Lord Hatch of Lusby: It is my Question.
Lord Denham: My Lords, if the noble Lord will give way for just a moment, he has no absolute right to ask the last question. If he wishes to ask another supplementary, perhaps I may humbly suggest that

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he should have done so a little earlier. I shall give way so that he may ask his question. When my noble friend has replied, perhaps then I may make my Business Statement.
Lord Hatch of Lusby: My Lords, I appreciate the courtesy of the noble Lord the Government Chief Whip. Is the Minister aware that last year 43 billion dollars were transferred from the third world to the developed world? When he speaks of progress towards the United Nations target of 0.7 per cent. of GNP in overseas aid, is he aware that many countries such as the Netherlands and Scandinavia have exceeded this figure, whereas under this Government the figure has steadily declined from 0.53 per cent. 10 years ago to the latest available figure of 0.28 per cent.? It is probably even lower this year.
Lord Glenarthur: My Lords, I dispute the figure to which the noble Lord has just referred. I would go further and say that it is perhaps not too wise to become fixed upon the GNP target, important though it may be, which would be easier to meet if we were prepared to mismanage the economy and reduce GNP.

Business
3.10 p.m.
Lord Denham: My Lords, after the end of the short debate on the case for increasing the use of the railways and before that on the case for more trained engineers and technicians, my noble friend Lord Hesketh will, with the leave of the House, repeat a Statement that is being made in another place on the phasing in of the new rates system for businesses.
I should also like to say a word about the arrangements for this afternoon's two short debates standing in the names of the noble Lord, Lord Somers, and the noble Viscount, Lord Hanworth. As is customary in short debates, the mover is allowed approximately 15 minutes and the Minister should rise to reply not less than 20 minutes before the scheduled end of the debate. In the case of the short debate in the name of the noble Lord, Lord Somers, all other speeches should be limited to a maximum of seven minutes. This means that noble Lords should sit down while the figure "six" is still standing on the clock. In the case of the noble Viscount's debate, however, the number of speakers is such that it is not necessary to propose any formal time limit, but I know that the House would appreciate it if noble Lords would keep the length of their speeches within limits equally compatible with the spirit of these short debates.
Lord McNair: My Lords, may I ask the Chief Whip a quick question? When we have this situation of one short debate being over-subscribed and the other being under-subscribed, does he not think that we might in the proper forum reconsider the proposal that time should be, as it were, borrowed from one debate and- lent to the other?
Lord Denham: My Lords, that is a matter for the Procedure Committee, but the whole point about these short debates is that speeches should be short. I do not ever remember hearing a 10-minute speech in your Lordships' House that would not have been vastly improved by being limited to seven minutes.

South Yorkshire Light Rail Transit Bill [H.L.]
3.12 p.m.
Bill read a second time, and committed to a Select Committee.

Hayle Harbour Bill [H.L.]
Bill read a second time, and referred to the Examiners.

Business of the House: Debate 1st March
3.13 p.m.
The Lord Privy Seal (Lord Belstead): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the debate on the Motion in the name of the Lord Gallacher set down for 1st March shall be limited to 5 hours and that Standing Order 35 and paragraphs 10 to 13 of the Rules for the Conduct of Short Debates shall apply to the debate with the substitution of "5 hours" for" V, hours" and "25 minutes" for "20 minutes".—(Lord Belstead.)
On Question, Motion agreed to.

Increasing the Use of the Railways
3.14 p.m.
Lord Somers Lord Somers rose to call attention to the case for increasing the use of the railways, and to possible means of doing so; and to move for Papers.
The noble Lord said: My Lords, anyone who looks at traffic on the roads today will be in no doubt that it is rapidly becoming an unbearable problem. The building of more roads is only a very partial solution. Driving today is no longer a pleasure; it is rapidly becoming an extremely nerve-wracking toil. What are we to do? Surely the answer lies in the railways. We already have a marvellous network of railways, a heritage from a great generation of engineers. There are very few parts of the country that are not within reach of a line. All that needs to be done is to persuade the public that rail travel is more agreeable and safer than road travel.
We have to overcome certain old and time worn prejudices. The motorist considers it far more pleasant to go from door to door, to start when he likes and to arrive when he can. He can choose what route he likes and stop on the way where he wishes. All that is true to a point; but it omits two very important factors. The first is that because of pressure of traffic, he may be forced to take some route other than the one he had planned. Secondly,

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and even more importantly, driving long distances on the roads today is very tiring and nerve-wracking. When one's nerves are stretched one's powers of concentration are weakened and one may do silly things, sometimes with disastrous consequences. That element of safety is the most important facet to remember in comparing the two methods of travel. Disasters such as Clapham are rare events, so rare that when they occur they occupy the largest headlines in every newspaper in the country. But road accidents have to be so severe that many lives are lost; otherwise they are simply not noticed.
I have no wish to decry the very important engineering work on the railways—the introduction of high speed trains, the building of new routes to relieve congestion and so on. I wish that work every 'success. But I do not feel, on the whole, that that is what the public wants. What the public wants is comfort, freedom from worry, and the feeling that people are being looked after and that there is somebody there in case they are needed. There should be more staff available to answer questions. It would be a good idea at large stations to have a man stationed in a kiosk within reach of platform entrances so that one did not have to walk half a mile to find him. Incidentally, he should be a man who really knows what he is doing. I have been disappointed so often by railway officials who say "I couldn't say. Look at the notice board", or something like that. There is no substitute for a real live man to supply information. The departure boards are all very well but they sometimes give the information you want only about two minutes before your train departs. Some people find difficulty in seeing them.
Why can we not re-introduce porters? It is no joke to arrive at one's destination with a load of heavy luggage. One knows that there are such things as luggage trolleys somewhere on the station. Must one leave one's luggage unattended while going to look for a trolley? I would think twice before leaving my luggage unattended these days. Porters are essential.
It is also desirable that there should be more comfortable waiting rooms. One often arrives about a quarter of an hour before one's train leaves. It is a little hard to have to sit on nothing but a bare wooden board—hard in more senses than one. I realise that one of the difficulties is vandalism. British Rail dare not equip waiting rooms with furniture for fear that it may be damaged. At my station in Epsom, which is being rebuilt, that problem has been overcome by an ingenious method. The waiting room has been turned into a buffet so that there is always someone in charge.
It is desirable too at larger stations to have as great a variety of shops as possible. I must tell your Lordships of an experience I had a few days ago at Waterloo Station. I arrived in good time to catch my train and realised that I had forgotten something I wanted from the post office. I thought that in a station of that size there must be a post office, so I looked around for someone to ask. I looked in vain. I was about to give up when suddenly along came a man driving a wagonload of trolleys. I stopped him and asked whether there was a post office at the
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station. He shook his head sadly and said, "No, there has not been one for years". That is not good enough.
Another important change is that we no longer have the punctual running of trains for which we were once famous. Your Lordships will have noted the hoots of laughter which greeted the Answer given by the noble Lord, Lord Brabazon, to a Question tabled by the noble Lord, Lord Moyne, about digital clocks. I am afraid that the punctual running of trains is something of the past.
I have discovered the reason why trains from Waterloo Station never leave on time. It is because there is no one to shut the gates on to the platforms. It is extraordinary, but the number of occasions on which I have seen the ticket inspectors' boxes empty cannot be counted.
I had intended to comment on the transport of goods. However, after discussing the subject with my noble friend Lord Greenhill, who knows far more about it, I have decided that as there are difficulties I shall leave it to him. I believe, however, that more can be achieved by the use of containers so that a single wagon can go straight to its destination. Perhaps we could also use the roll-on, roll-off system with lorries of limited size. Improvements can be made in that area.
The railways are the essential method of removing traffic from the roads. They are a great heritage, and it is up to us to make the most of them. I beg to move for Papers.
3.24 p.m.
Lord Moyne: My Lords, I have much sympathy with the far-ranging points made by the noble Lord, Lord Somers. I intend to speak briefly on a narrower field. Surely one way of increasing the use of the railways is by keeping down fares. Therefore it is essential that British Rail should not throw away money on unnecessary expenditure.
It was with such considerations in mind that I recently asked a Question about digital clocks. I sought to know the amount spent by British Rail throughout the country in 1988 and contemplated to be spent in 1989 and 1990. Our local newspaper in Andover had written to say that £1 million was being spent on digitalising the Southern. Region. Perhaps that is not considered as having a significant effect on fares. But is £1 million the right figure? My noble friend Lord Brabazon could give no figures. He simply mentioned an intention to install digital clocks in all stations in the South-Eastern network in order to make trains more punctual. The noble Lord, Lord Somers, reminded the House that this promoted laughter from your Lordships.
If British Rail was a private company, undoubtedly such questions would be answered by the chairman at a shareholders' meeting. When I was on the board of a public company, the airman had such figures in front of him together with a justification in case a shareholder asked a question. However, we have been given only the laughable justification of punctuality, but no figures. Surely that is putting a rather creaking cart in front of an invisible horse. Perhaps in his reply my noble friend will shed some light on the horse; that is I he national horse not only the South Eastern one.

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The shareholders in British Rail are the British people, and Parliament is the nearest body to a shareholders' meeting. We are entitled to know such figures, and there seems no other way of breaking through the secrecy in which British Rail evidently shrouds its financial planning. My suggestion of installing new dial clocks with sweep second hands was not taken up, and the possibility of repairing old clocks met with the suggestion of putting them into museums. Surely station clocks are not loved by the Muses; they are objects of utility rather than beauty. Of what use to travellers are clocks in glass cases which are situated behind walls?
Such considerations are trivial beside the fact, which has emerged, that a nationalised industry is being allowed to withhold the figures of its finances from the nation, and that vast sums may be in the course of commitment to unnecessary and extravagant expenditure.
I should like to turn from such major questions to a relatively minor one. Would it not be better if our railways put up the names of stations to face across the direction of trains instead of sideways? If my train is going fast enough, I often find that I have passed the noticeboard before I can read it, as indeed my few minutes of words are now past before the Government or British Rail will take them in or heed them.
3.28 p.m.
Lord Sefton of Garston: My Lords, when I added my name to the list of speakers I did not envisage that the debate would concentrate on knocking British Rail as it has until now. The noble Lord, Lord Somers, referred to our heritage from British Rail. He made no reference to the history of that heritage. There was a time when people could walk on to a railway station and find plenty of porters. There was a time when the different regions appeared to look after the customers. There was a time when the capitalisation of the railway system was so large that in Manchester the authorities could afford to build the longest railway station in the world because one line was competing with another for custom. At one time the authorities could even afford to build special railway stations for important people who owned land and who therefore formed an obstruction. There are several instances of that on Merseyside. Railway stations were deliberately built to serve one or two of the landed gentry.
It was the fight to join that investment in order to make money from which the problems of the present system stem. There was no competition. The motor engine had not been invented, road traffic was rudimentary and certainly did not compete with the railways, and so the industry could do what it liked. That was the heritage passed on to us.
Along with that, many restrictions were placed on railways. At one time railways had to be common carriers. They were compelled by government to carry any load in their wagons regardless of the cost. The same fee was charged for all sorts of loads even though it meant cleaning out railway wagons at an exhorbitant cost.
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The real problem began to be apparent to the country when the other competitors, the road services, came into operation. We then had a different ball game. Previously there had only been competition between different railway companies but that now became competition of a fiercer nature. Railways found their existence threatened. They met that first by mergers, and then it was revealed to the nation that if different railway companies with their different methods were allowed to handle the railway system, that would be a threat to the nation. Both in the First World War and in the Second World War a government which was certainly not a socialist government decided that there should be some control over transport. We then had a situation where the railways were controlled and practically owned by the nation.
However, that went further. There was a time—and a very sensible time from the transport point of view—when no two coalmen were allowed to take coal lorries into the same street. There was proper organisation to save fuel, costs and labour. That is the lesson we should learn.
I and every other noble Lord in this House can give 101 good, humanitarian reasons why we should move traffic off the roads and on to the railways, and why we should ensure that long distance freight should be carried on the railways. When we try to do that, what do we come up against? We come up against all the matters being propagated by this Government as a sensible way of organising national transport; that is, to split it into different organisations each bothered and concerned with itself. What sense is there in a so-called civilised society when somebody has to board a not very comfortable coach in Edinburgh or Inverness and fight his way to London along the motorways with all the attendant dangers? That is for one reason only; namely, that the motor company concerned shall make a profit.
Of course, there is no relationship between the transportation of people by road and the sensible transportation of people on long journeys by British Rail. Of course there is no connection because this Government have instituted a system where there will not he any nationally co-ordinated plan on transport. One cannot distinguish between the need for a proper rationalised railway system and the need for a proper rationalised organisation of road and rail transport; that is, transport as a whole.
Six minutes is all too short to go into the real problems. However, I appeal to the rest of the speakers in this debate not to concentrate on the question of what British Rail is doing right and wrong, but to look at the major problem of what the country is doing right andwrong. Did it take a war to make us realise that the only sensible, economical and humanitarian way of organising the transportation of our people and goods is to have control over the whole system? Do we have to learn the lesson of more deaths on the road before we realise that the sensible way to carry people from the north of Scotland to the south-east of England is to have a system whereby the cost is made equal? The cost of going from Edinburgh to London should be equal whether one travels by road or rail so that people have a free choice. The truth is that people do not have a free

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choice. Most people do not have a free choice of going by coach or rail on such long journeys. The only choice they have depends on how much they have in their pockets.
Until we institute a system whereby we look at transport in a proper rational way, as the Labour Government in 1945 and the coalition Government in 1940 tried to do, then we shall never get anywhere. I wish that we could again talk to Winston Churchill. I say that because of all the Conservatives that there are in this country, he was the only one who had any sensible idea on what to do about transport.
3.35 p.m.
Lord Ezra: My Lords, the fact that so many Peers wish to speak in this debate initiated by the noble Lord, Lord Somers, shows how important the issue is. In fact, transport has moved centre stage.
There is not the slightest doubt that the railways have achieved many successes in the recent past. Perusal of the last annual report shows that they earned a surplus in 1987–88 of nearly £300 million. Passenger volume was the highest for 27 years, rail freight was the best for 10 years and they earned a surplus on that traffic.
However, underlying the success story is the fact that there has been a very substantial growth in demand for railways and other forms of transport over the past three to four years—much greater than had been experienced in past years. That has led to congestion on the roads and overcrowding and delays on the railways. Furthermore, even on a moderate estimate of forward demand as contained in the Government's recently published Central London Rail Study, the demand for transport in the London area will grow by another 20 per cent. by the end of the century, and that could well be an underestimate as it is only based on lower employment projections.
The transport bottleneck which we have in the country as a whole is seriously impeding the prospect of further economic growth. Delays and congestion in transport are estimated by the CBI to cost the nation something over £3 billion per year in lost time and delays. There is no doubt that the railways could play a major role in overcoming that bottleneck. The question is whether under present arrangements for running and financing the railways, that can be achieved.
Perhaps I may say a few words about that in the time remaining. Even though there is a high level of investment put into the railways at present, which will rise again next year, the basic objective of that investment is to renew and replace existing assets. Very little investment is taking place in new capacity. Only the Channel Tunnel line and the cross-rail schemes as proposed in the Central London Rail Study are examples of new capacity. For the rest, investment replaces existing capacity.
Indeed, one fundamental objective of the railways as restated in the last annual report is a directive relating back to the Railways Act 1974 which states:
"the British Railways Board shall, from 1st January 1975, operate its railway passenger system so as to provide a public service which is comparable generally with that provided by the hoard at present".
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That is a static policy which suggests that what has to be done is to renew the existing capacity but not to add to it. We need a positive and dynamic policy for the railways. Are we able to achieve that? I do not believe that we can under the existing financial restraints within which they have to operate.
It is noticeable in the British Railways report for last year to which I have already referred that at the top of the list of achievements which they consider they have gained is that they kept well within the Government's external financing limit and also kept within the public service obligation grant. In other words, they seem to regard their first and overriding objective as being to keep within the financial limits set by the Treasury. They do not mention until much later the question of adequacy and quality of service and the necessity to meet the rapidly growing need for their services.
If one further examines the way that the railways are financed it is clear that it is difficult—though the Government talk a lot about it—for private sector money to come into railway schemes, for the simple reason that the famous Ryrie Rules of 1981 still apply. The concept underlying the rules is that if any private sector money comes into public sector investment the public sector quota has to be reduced accordingly. There is therefore absolutely no incentive for anyone in the public sector to seek private sector money.
Further, if any money is obtained from the European Community, from the social fund or the economic funds available, there is an automatic deduction of the government funds provided. Again, there is no incentive for people to seek more funds from these external sources.
Therefore, I believe that two things are required. First, the basic objectives under which the railways at present operate should be fundamentally changed. We should not be talking about simply maintaining the railway system at the same size that it was in 1975; we should be talking about building a rail system which meets the needs of the 1990s and beyond. That is what first needs to be done. Secondly, we need to adjust the financial constraints under which the railways are presently operating to enable them to achieve such a forward-looking objective.
3.42 p.m.
The Lord Bishop of Manchester: My Lords, during Monday's debate in another place Church leaders were exhorted to concentrate on matters spiritual and eternal and leave what is obviously temporal to others. Is rail use a temporal or a spiritual and eternal matter?
Perhaps I could give a small illustration of the bishop who, after a long and worthy life administering, arrived at the pearly gates and was stopped from entering by the guardian angel as a beautiful blonde swept by. When the bishop expostulated about this he was told by the guardian angel, "Bishop, you simply do not understand. When that young woman was on earth she owned a Jaguar and she put the fear of God into more people in a week than you did in a lifetime".

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The use of transport can perhaps therefore be considered an eternal matter. Sadly, when we look at what happens on our roads and in transport generally we are, I think, bound to say that the question of safety brings it very close to being both spiritual and eternal.
The noble Lord, Lord Somers, who initiated the debate mentioned that the safety record on the railways is very much higher than on the roads. I believe that there are about 15 times as many deaths on the roads as on rail. That may vary a little from year to year but the figures are of that order. For serious accidents the figure is at least double.
I am grateful to be following the noble Lord, Lord Ezra, because he made a cogent case for an integrated public transport policy, which is what we need in this country, that takes into account safety, social costs and benefits and tries to approach the matter as a whole. One is bound to say that successive governments have not over the years achieved that.
I listened with care to the noble Lord, Lord Sefton of Garston, about the efforts of governments in the past, but I do not think that we have ever achieved an integrated approach to transport. At the same time, the process of change and development is now so fast that we need a new approach altogether.
We need policies which will encourage public transport and move people out of their cars and on to public transport. Present policies are simply giving way to the private motorist. We all love our cars but one person's right to use a car is another person's congestion. I would not say for one moment that the motor car is not a great blessing. I think all of us experience this. We are grateful when others have the use of cars too. However, cars come within that class of goods which I think are known technically as positional goods where free use in the end is self-defeating.
The projections for car ownership in this country are simply frightening. We have had a radical change already. In 1969, which was the crucial turnabout year, we passed the figure of 50 per cent. of all households owning one car or more. The figure is now approximately 62 per cent. and rising rapidly all the time. At the same time there has been a sharp decline in the use of public transport as a whole. I know that what has been happening on the railways recently is encouraging. British Rail had a good year last year. Nevertheless, looked at overall, public transport has been declining sharply.
Those figures are reflected in local authority spending over the years. The five-year figure, ending I believe in 1985, shows a drop in spending on public transport by 39 per cent., while the corresponding figure of spending on roads rose by nearly 33 per cent. That simply does not make sense in the sort of situation into which we are moving.
One of the points that I hope comes out from this debate is a strong affirmation of the principle of cross-subsidy; in other words, if one is able to achieve savings at one point or obtain taxation from one source, that can be used in order to assist public transport and encourage people to use it. Social costs and benefits must surely be taken into account.
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When, as the noble Lord, Lord Ezra, indicated, the railways are being asked to work to certain financial restrictions and guidelines, why is that not costed in the same way as for roads? One is not comparing like with like.
The problem of efficiency in public transport will always be with us. I can see that there is wariness of open-ended subsidy. Nobody argues about that. There must be some financial disciplines. However, proper costing is needed and the ability for the railways to make their services even more attractive.
As regards privatisation, I cannot believe that it is right or wise to go down that road for the railways. There are other ways of achieving efficiency. As the noble Lord, Lord Sefton of Garston, indicated, in Manchester we suffer from the effects of having had different railway companies in the past. That is why we have been struggling with the Pic-Vic link, as it is known, or the new plans for rapid light transit across the centre of Manchester. It was because of the private railways that we have been landed with the situation.
There are radical plans for stopping people bringing cars into the centres of cities. I back those plans provided the money that is saved is used for social purposes. One social argument over transport which is of particular importance to the Churches is that it is essential to enable people who do not have access to a car to be able to participate in society to the full by having good access to facilities through an efficient public transport system. The reduction of that service is a gross injustice in our nation and must be remedied.
My final point is that there are many indications that other countries and other cities are doing better than we are in this regard. I end with a quotation from someone in Boston in the United States who during a visit to this country told the Greater Manchester Transportation Consultative Committee, "We had to stop certain major highway schemes and divert the money into public transport in order to prevent the build-up of constant traffic overload". The Americans are doing that, why not us?
3.49 p.m.
Lord Tanlaw: My Lords, I am sure that we are all grateful to the noble Lord, Lord Somers, for bringing our attention to the situation existing on the railways and. above all, for affording us the chance to try to obtain from Her Majesty's Government their attitude in general towards rail travel and the future of the rail system in this country.
I have to declare an interest in the railway industry. My companies provide current collection equipment to high-speed locomotives and light rail in Europe and the United States. As my work takes me to Europe I cannot help but make comparisons where the railways are used to the fullest extent by passengers in order to get from A to B. People come out of a town with the mayor and corporation to demonstrate when the railway does not go through their town. They feel left out. That is the difference. The noble Lord, Lord Ezra, spoke about bottlenecks. I can only report the absolute astonishment within

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the railway industry in Europe that we in the United Kingdom are only now at this late stage trying to establish a high speed route to the Channel Tunnel.
It is generally assumed—perhaps wrongly—that the only logical reason for this apparent oversight is that it has been part of Her Majesty's Government's policy on transport to ignore it. I believe that there is even quiet admiration that the traditional Conservative policy of laissez faire can be taken to such extremes when applied to the future development of the railways. As we are talking about attitudes, it would be most helpful if the noble Lord the Minister could confirm what is the present view on long-term policy for the railways and also the view of the right honourable lady the Prime Minister. I may be wrong but it has always appeared clear to me that she is hostile to the railways. She does not travel on them; she is not very interested in their future. Therefore would it not he helpful if the right honourable lady the Prime Minister's position was clarified unequivocally regarding the future of the railways in the same clear manner in which she has demonstrated her support for the protection of the environment?
Bearing this in mind, can the noble Lord the Minister confirm that British Rail will have adequate funding now to satisfy the essential environmental requirements of the residents of Kent who might be affected by the new rail route wherever it is eventually decided? The environmental aspects of light and heavy rail systems have been the subject of much debate in recent weeks—including today's debate. From what has been said it is clear that some interested parties of the visual aspects of the railways, whether they reside in Kent or elsewhere, may not be aware that it is now technically possible to offer both high level and low level current collection options to the railway operator at the same time.
This means that the unsightly overhead wires and the posts to support them which so many people quite righty dislike are no longer necessary except perhaps in those inner urban areas where pedestrians cannot be safely segregated from rail or tramway traffic. Put another way, a train or tram can be adapted to collect its power from an overhead catenary like British Rail or from a third rail like the Docklands Light Railway whichever is considered the most suitable for the local environment.
Trains using the Channel Tunnel will have to use both systems at very high speeds. There is no limitation on speed for low level systems of current collection. That fact is often not appreciated by potential customers or environmentalists in general. In fact it may be of interest to some noble Lords that the world speed record of over 300 miles per hour was achieved some 20 years ago by an electric locomotive with a linear motor collecting its current from a third-rail system. I have also heard it said by the Kentish lobby that speed is not important. Very high speed is esential if the success of this new generation of locomotives is to attract passengers away from the over-congested airways and motorways of Europe. Passengers can be attracted to use high-speed trains because they deposit them right into the city centres where it is possible to inter-connect on to other forms of transport to their ultimate destination.
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However, if there are no such interconnecting services, there is absolutely no point in establishing inter-city rail links with very high speed trains. It will still be cheaper and quicker door-to-door to take a car or a plane. I ask the noble Lord the Minister how many of our larger cities have a transport centre with inter-connecting services adjoining the main line stations? I seem to recall asking similar questions over the past 10 years or so. I have also given evidence and submitted written reports of a technical nature on integrated transport systems for our cities to special committees of this House, as have many other Peers, businessmen and operators connected with the railway industry. Presumably, all this documentation is left to gather dust in the Library alongside the Serpell Report. It appears to remain unread by those who have the power—that is, this Government, who have been in power for the past 10 years—to operate and design a proper rail transport system that is at least equal to what is available to people on the Continent of Europe.
The situation can only change if more enthusiasm is expressed for this ideal from the Prime Minister's office downwards. If such support is not forthcoming, then the rail system in this country will remain unused by passengers because it will remain under-capitalised, without direction or purpose, as part of Her Majesty's Government's laissez faire transport policy. Can the noble Lord the Minister say at this moment, and this is a very good opportunity to do so, whether he is able to persuade the right honourable lady the Prime Minister to give some form of statement on her personal views regarding the future of the railway system that her Government will soon follow?
3.55 p.m.
Earl Attlee: My Lords, I start by declaring an interest; namely, that in three or four years' time I shall be in receipt of a small pension from British Rail. I spent seven years of my life as the assistant public relations officer at Waterloo. At least the first two or three words spoken by the noble Lord, Lord Sefton of Garston, this afternoon pleased me. He said that he thought that we were going to do something constructive and all that we have been doing so far is attacking BR. That is what everyone seems to do. I could spend the whole of my seven minutes taking each argument against BR piece by piece and showing noble Lords where it is wrong.
The object of this debate is to call attention to the case for increasing the use of the railways and to possible means of doing so. With respect to most noble Lords, I do not believe that that has been done so far. I shall touch on two matters that were anti-BR. The first concerns the digital clocks at Waterloo and possibly other stations. The old cocks were unreliable and unsynchronised but with the modern digital clocks one sees the seconds tick away. There are large notices which state that the gates will be closed 30 seconds before the train departs or the departure time of the train. There is a very good reason. Otherwise people will continue crowding on and the trains will not depart on time. That is a positive factor.

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If one is to lambast British Rail for spending £1 million throughout the whole of the United Kingdom on installing digital clocks, one should consider the situation of BP, which spent dozens more millions than that changing its shield very slightly and putting a little wiggly line on it. Was that good? Everyone knows what the BP shield is. If one is to attack BR, surely one should attack BP even more, and to a lesser extent ICI, which had a great and wonderful marketing idea. It took out the wiggly line under ICI and took out the winks. It is crazy.
When people attack BR they normally say "They cram us into trains in conditions that would be illegal for cattle". BR has never crammed one person into any train. It is done in Japan, but it is not done in this country. It is the passengers who cram themselves into the trains. After the disaster at Clapham Junction people have been saying, "It is all BR's fault. It should not allow overcrowding". How does one stop it? My local station is Fleet in Hampshire. When a train to London comes in and one is on the up line, you can see how many people get off the train. You can say, "Now we have room for 50 second-class passengers and 40 first-class passengers". One allows them on the train. If you started at eight o'clock from Fleet, you would not get into Waterloo until about 11 o'clock. It is impossible.
What is the answer? The one matter that BR is brilliant at is cramming more trains on any given track than any other organisation in the world. People come from all over the world to see how BR manages to get so many people and so many trains into London in such a short space of time. This is the problem. One cannot put more trains on the track because there is not the room. It is no use having longer trains because if you did the rear carriage would be at one station and the engine at another.
There is only one answer. The working hours in the capital city must be staggered. Everyone wants to get in between 8 and 9.30 a.m. but it is impossible for British Rail to cope with that. Surely certain large employers of personnel should agree that some should start at 8.00 a.m., others at 8.30 a.m., some at 9.00 a.m. and others at 9.30 a.m. That would spread the load. More passengers could then travel into London on the existing services. This has always been the problem and will always be the problem.
Comparisons are made with the Continent. In France one can build a high speed railway line through virgin country in a straight line. That is fine. In France one can build nuclear power stations wherever one likes. No one ever complains. They have masses of land. We do not have masses of land. For the Channel Tunnel to be a success we must have a high speed link. The obvious route is through Kent. But wherever it goes people will complain and say, "We don't want it here". But Kent is the only logical place for the line.
If we do not get a high speed rail line we shall have at least two motorways to cope with the traffic. This will create fumes and pollute the atmosphere. High speed electric trains are safe, they do not create fumes and they are effective. I have made one or two suggestions. I hope that other noble Lords will come
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up with some more ideas. I have to disappear from the Chamber for three minutes but I shall be back.
4.2 p.m.
Lord Airedale: My Lords, I have always understood the longest platform in the country to be at Cambridge but the noble Lord, Lord Sefton of Garston, claims that Manchester has the longest. I was thinking of having a bet with him but I had better not. I nearly always lose.
My grandfather and great grandfather both built steam locomotives, some of which, I believe, are still working in various distant places. A slow revving engine well maintained will last almost for ever. My father was a director of the old Great Northern, so it would have been difficult for me to be brought up without taking an interest in the railways. I was always told that if only James Watt and George Stephenson had lived 50 years before their time land values in central London would not have prevented the London termini being located in a Piccadilly Grand Central. Instead, we have had 150 years of passengers crossing London in all weathers, in hansom cabs and growlers, taxis, buses and Underground trains. My noble friend Lord Amherst remembers the growlers. If noble Lords do not, perhaps I may explain that they were heavy, four-wheeled horse-drawn carriages, as opposed to the more elegant and more expensive two-wheeled hansoms.
In the past two or three weeks we have been promised at least the hope of an underground Piccadilly Grand Central or something of that kind. And this, coupled with the Channel Tunnel, will undoubtedly transform the use of British Rail. We must hope that that day will come. Whatever one may think of the modern car it is usually warm and comfortable. It behoves British Rail to consider the comfort of its passengers if it is seriously in competition with the modern car. I should like to give an example of a railway station looked at from the point of view of the comfort of the passenger.
The station I know best is Peterborough. I hope it is a fair example. It is a busy main line station, the first or last stop of most of the fast expresses into and out of King's Cross. Peterborough has been largely rebuilt since the last war. The arrangement of platforms is that the centre sections are covered but the ends are open to the elements. In a normal winter the elements in the East Midlands can be very severe. In the 125 trains the first-class accommodation is invariably at one or other end othe train. This means that when there is ice and snow on the platform at Peterborough it is the first-class passengers who are deposited with their luggage on that ice and snow.
The commuters for King's Cross on platform 2 are more fortunate. They can congregate in the centre section of the platform and wait for their trains. They may have to wait for some time because all kinds of things happen to trains from the north of England on their way to Peterborough. I wish I could say that commuters are able to wait in a comfortable waiting room until the train arrives; alas there is no waiting room. There is plenty of room to build one, and there are plenty of good waiting rooms on the other platforms—but not on platform 2 serving King's

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Cross. There is a sign which says "Waiting Room", but when one gets there one finds a snack bar and a cafeteria. if one tries to use that purely as a waiting room one feels that one is getting in the way of people taking refreshments; and one probably is.
The commuters congregate on the platform in the dry. At least they can board the train dry. The first-class passengers can make their way along the train past the second-class passengers and past the restaurant car into the first-class accommodation at the end of the train. Once there they are fairly sure of a warm, comfortable, swift journey to King's Cross. That is a happy note to conclude upon. I hope that my noble friend Lord Attlee does not think that I have lambasted the railway too much but I believe that the comfort of passengers is something about which the British Rail board should think very carefully indeed.
4.8 p.m.
Lord Dunleath: My Lords, I have often wondered why organ enthusiasts such as the noble Lord, Lord Somers, are also railway enthusiasts and are very likely to have an above-average understanding of architecture, to be discriminating about vintage wine and real beer, and probably be experts on the beautifully scripted titles of Victorian lavatories. I do not know whether the noble Lord includes those in his field of interest, but obviously this is an indication of civilisation. Perhaps when he replies to the debate with his final speech he will enlighten me as to why this should be the case.
The noble Lord has raised an important point. I am old enough, as I am sure is the noble Lord, Lord Somers, to be able to remember what things were like in the 1950s and 1960s. I can recall that in the 1950s, as wartime restrictions were gradually lifted, it became apparent that there would be a dramatic increase in the ownership of private cars. Parallel to that, the public were gradually becoming accustomed to domestic air flights: to the idea of travelling from London to Edinburgh or from London to Aberdeen by air rather than by train.
Therefore it was not entirely unreasonable to assume at that time that the era of the train was perhaps on the decline and that in order to frame our future transport policy what was needed was more motorways and more runways. But most unfortunately that particular expectation turned out to be flawed because western Europe is now facing a transportation crisis. The motorways have become clogged; for example, the M.25 (which was hailed as being the solution to Greater London's transportation problem) has now become notorious for its five-mile tailbacks. Moreover, together with that, there has been a deterioration in the environment with city centres—I am thinking especially of Liverpool—being gutted in the interests of the urban motorways and with valuable land being appropriated for car-parking space.
Further, the environment has not been improved by the increase in air traffic. Indeed, in my view, air traffic control is now on the margin of viability, especially during peak periods. I remember that in a previous debate a noble Lord asked what the difference was between a near miss and a near hit in
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the air. Well, whatever the difference is, I do not wish to be involved in either. But, irrespective of that fact, the increase in air traffic entails considerable delays at airports.
The Beeching axe in the 1960s was inevitable; but it is the inter-city passenger traffic and the freight traffic which needs to be attracted back to the railways. The question is: how should that be done? If I were on the board of British Railways, or a senior executive, I should reflect upon all the unpleasant aspects of other modes of travel. One aspect which has occurred to me is safety. It scares me out of my wits driving on a motorway if I am travelling at less than 70 miles an hour and there is a heavy lorry or an express coach within yards of the rear of the car. Similarly, with air traffic, especially in the light of the most tragic disasters which took place at Kegworth and at Lockerbie, many people are scared of flying. Therefore safety on the railways is extremely important.
Regarding signalling, it is my estimation that with modern technology, so long as one can have the wires fixed to the right terminals, there is no reason why there should be any accident—other than as a result of natural causes, such as a land slip or something of that nature. So that covers one aspect of the matter.
Another aspect is what I call "cattle-truck conditions", whereby at airports the waiting areas are one of the most uncongenial environments in which one could find oneself. One has to queue. Moreover, when aeroplanes are late, the departure seems to be delayed in intervals of 15 or 20 minutes, so that there is no opportunity for one to go off and do something else; one is just stuck there. British Rail ought to consider how it can make conditions more congenial for passengers so that they will contrast that factor in their minds with the strain of motorway driving and the uncivilised conditions in airport terminals with cafeteria food and continuous announcements—to which one must listen, otherwise one is afraid of missing a flight.
I should have thought that overcrowding on the railways was not necessary, because one of the advantages of a train is that one, two or three coaches can be added to it. That is something which cannot be done to an aeroplane, a bus or a ship. Therefore in my view British Rail ought to try to make rail travel as congenial, as civilised, as comfortable and as convenient as possible. Moreover, unlike the noble Lord, Lord Somers, I also say that speed is important in order that the railways can remain competitive. The railways still are competitive—though only just—with air and motorway travel.
4.15 p.m.
Lord Greenhill of Harrow: My Lords, although I abandoned a railway career nearly 50 years ago, I felt tempted to take part in the debate this afternoon and to thank the noble Lord, Lord Somers, for choosing such a timely subject. He put the question: how can increasing use be made of our extensive and, in many ways, admirable system, and how should British Rail attract more passengers and freight?
I should like first to deal with passenger traffic. I suggest that there are several ways to improve this, nearly all of which are being pursued by the present

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British Railways Board chaired by Sir Robert Reid who is, 1 believe, the first professional railwayman to hold that post. However, we must ask ourselves whether the plans of the board are being pursued with sufficient urgency and on a sufficient scale.
I should like to say here how very much I agree with the remarks made by the noble Lord, Lord Ezra, about the future of the railways; it is not a question of staying where we are, it is urgent that we should go forward. In my opinion, there are five ways in which additional passenger traffic can be attracted to the railways. First, there is the long overdue electrification of the east-coast line. That work must be pushed ahead as rapidly as possible. Indeed we shall have electric trains travelling to Leeds this year, and travelling to Newcastle and Scotland in 1991. Those developments will undoubtedly attract more passengers and relieve the traffic on the M.1 and other main trunk roads. But, with the exception of the Channel Tunnel and any works which may follow the Central London Railways Study, I do not see the possibility, or the need, for more major developments within the United Kingdom. However, the Minister may well have other views on the matter. It is of course inevitable that the successful operation of the Channel Tunnel after 1993 will increase the volume of passenger and freight traffic on our lines. I have not seen what the estimates are, but no doubt the Minister has them at his finger tips.
The second way to attract traffic back to the railways is the implementation of overdue and highly desirable plans involving a big programme of new passenger rolling stock. Once again, I think that one must ask oneself the question: is the programme big enough and is it being pushed ahead with the necessary money and with the necessary speed? The new rolling stock, especially that with air-cushion suspension running on welded rails, is extremely comfortable and extremely quiet. Moreover, the new commuter coaches are a marked improvement on the present ones.
The third way to attract passenger traffic is the expansion of cross-country services. There is great scope there for attracting additional passengers and providing a very necessary facility. Indeed, the board has done well in this connection and more use of what it calls the "sprinter trains" will greatly increase the cross-country traffic.
The fourth way to attract passengers is to introduce imaginative pricing for certain journeys and certain categories of people at selected times of the night and day—for example, old age pensioners, young people, members of the forces, and so on—and to organise excursion trains of a new kind at weekends which are both socially desirable and a great help to family parties.
The fifth way is to improve terminals and important junction stations; that is, not only the fabric of the buildings, but also the services provided in them. The sixth way would be to introduce better security, with radio connections to the crews of trains and telephones for passengers. Once again, I expect the Minister to say that that is being done, but not fast enough. Now is the right time for greater investment than is at present envisaged. It will also be
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a great encouragement to management and staff, at all levels, and restore pride to the industry.
As to the transfer of traffic from road to rail, I listened with interest to what the right reverend Prelate the Bishop of Manchester said. I believe that the scope for that transfer is somewhat exaggerated. The overwhelming convenience of road transport will always give the advantage to the road haulier.
If the system is to be privatised, and I see no particular reason why it should be, I sincerely hope that it will be done in one system and not broken up into independent regional groupings. Such a breakup will merely complicate the situation. The railways must be efficiently and profitably run; but their main purpose is to provide a service to the people of this country, and that can best be done by a unified system. If regional loyalties are developed, that will break up the system. It must be run as a whole. It would be wrong to put back the clock to 1923.
4.22 p.m.
Lord Grimond: My Lords, I wish to follow up some of the points which have already been raised in this admirable debate, for which we are much indebted to the noble Lord, Lord Somers. The first matter about which I wish to speak is the future control of the railways. Excellent as their performance has been, as was shown by the noble Lord, Lord Ezra, the uncertainty hanging over their future prevents the necessary investment and may have some effect upon morale.
Privatisation is eminently justified where the market is appropriate and competition can keep down prices and improve efficiency. Otherwise, the best way to run services such as the railways and water is as a public service directly under parliamentary control. However, there is a danger that the railways will become over-centralised. Although I appreciate that a return to the railway structure of the pre-nationalisation period is not possible, over-centralisation leads to the railways being less in touch with the passengers, as was illustrated by my noble friend Lord Airedale. That is so in small ways, and my noble friend mentioned some of them. For instance there has been the announcement that the railways will pay Saatchi Saatchi £3 million to try to boost the fast link to the coast. That is not tactful, at any rate in the commuters' view. Then there is a lamentable lack of seats at nearly all stations.
Also British Rail has destroyed some excellent station interiors for the sake of plastic travel centres. One horror that I always mention is the desecration of the view of St. Andrews, the finest golf course in the world, by the erection of a hideous hotel on the old station. If we are to assure the railways of a future, we must guarantee that they will not be pushed around here and there; and that investment will be made available for necessary improvements. In turn, they must find ways to deal with over-centralisation. Other services have succeeded in doing that. British Rail has to some extent hived off the restaurants. It might even hive off track maintenance. The Italian railway tracks are maintained under contract by an outside firm. There is a case for the state—it has often been suggested

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before—to make itself responsible for some of the tracks which will never pay.
I am told that the present state of the lines through Kent, which are hardly high speed lines, is largely due to the obsolescence of the track. Indeed, it is worthy of the smash, crash and turnover days of the Kentish railways. The trains rock, swing and bang in a most alarming manner. In such a situation the state should provide the capital to replace the tracks.
In this connection I also want to ask about the Government's intentions with regard to what has happened in Inverness. The cutting off of the whole system north of Inverness by the failure of the bridge is a serious matter for those areas. It is apparent that British Rail will not be able to replace that bridge without special assistance. If the collapse had happened during the war, a Bailey bridge which was capable of taking heavy tanks, if not trains, would have been erected within 24 hours. We cannot wait indefinitely, because traffic is disappearing all the time. For instance, the distilleries cannot obtain fuel. 1 hope that the Government are impressed by the need to mend that bridge as quickly as possible.
That line has great potential. It has been somewhat negleted. It will be finished altogether unless something is done pretty quickly. Over £25 million was given after the storm in the South-East of England. I understand that the Government intend to give something to Scotland, but for goodness sake let them do it quickly and get this line open again.
The last point I wish to make relates to what is to happen to the railway system north of London when the Channel Tunnel is open. There is a great deal of talk about the difficulties of travelling from Kent but I should like to know what will happen to the trains from Scotland, the north of England, Wales and so forth. Does the Channel Tunnel entail an immense new improvement programme, especially alterations to platforms? The gauge is the same but the height between the rails and the platforms is different. If that means a big programme, will the Government give the money to make it possible? Do the Government intend that trains will be run from Scotland, the north of England, Wales and so forth through the Channel Tunnel or will freight go entirely by container and will passengers be expected to get into a different train in London or somewhere else?
It is of great importance to the trade and general well-being of the North and the West that the Channel Tunnel should not result in the draining-off of still more of the country's economic power to the South East, and that they should also share in the advantages which it will no doubt bring.
I hope that we shall receive answers to those questions. In the meantime, I endorse what has been said. There are undoubtedly defects in the railway system and a loss of morale, especially at the top. However the railways have shown some good results, especially over the past year or so.
4.28 p.m.
Viscount Buckmaster: My Lords, my noble friend Lord Greenhill declared himself as a former railway employee. I declare myself, and the Minister has on one occasion so described me, as a railway buff. I shall try not to be too technical. Our railways have
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made tremendous strides since the noble Lord, Lord Somers, initiated his last debate on the subject, which I believe was about three years ago.
I remember that at that time I amused myself, and may even have amused some of your Lordships, by drawing comparisons between train timings in 1910 and now. The 1910 Bradshaw is still one of my favourite bedtime books. That has now all gone. With HSTs and so on we seem to be going faster and faster. We shall soon get within sight or a four-hour schedule to Edinburgh. Against that, I am afraid that one will find if one is, as I am, a regular reader of Railway Magazine, that for most travellers, especially cross-country travellers— the noble Lord, Lord Greenhill, pointed out the importance of cross-country travel—the late running is deplorable. I can use no other word.
I hope I shall not weary your Lordships if I give a brief quotation from Railway Magazine, describing a cross-country journey between Liverpool and Scarborough. I think it is appropriate. This is a journey which is undertaken on one of the two-coach "Sprinters" but it did not do very much sprinting on this occasion. If I may digress just for a minute, the problem with these is that they are two-coach units. And it is not so easy just to add on units as the noble Lord, Lord Dunleath, suggested. The man on this journey was travelling, let me remind your Lordships, from Liverpool to Scarborough, and he wrote this:
"Boarding at Liverpool, I was lucky enough to have a seat. At Manchester Victoria another two-car unit was added, but this was insufficient to cope comfortably with the crowds waiting to join the train. As we called at more stations, the story got worse: elderly people and families with young children had to fight their way on board and the carriage resounded with calls from anxious parents to each other and to their children."
A horrible scene.
For most who joined after Manchester there was; standing room only. I understand that it was a fair sample of the conditions on cross-country trains on Saturdays. Dare I hope that conditions improved for those poor souls who were travelling right through to Scarborough? On my next trip to York there will he no room for sentiment: I shall go by road."
I expect many of your Lordships will have experienced those kinds of conditions.
Another relevant point which I should like to mention and which has also been raised by the noble Lord, Lord Somers, concerns the courtesy of staff. I think many of the British Rail staff are discourteous, but on the other hand, one comes across little pockets of quite exceptional courtesy and consideration. Indeed, I heard only the other day from my nephew—this is scarcely believable, but it happened—that a porter on Swindon station gave a drink at the bar to a harassed lady travei.ler. If that is not a record for British Rail, I do not know what is.
A noble Lord: My Lords, it depends on the motive.
Viscount Buckmaster: My Lords, I have two other points to make. One is a technical one. and I hope your Lordships will forgive me for making it. It concerns electrification, which was mentioned by the noble Lord, Lord Tanlaw. Many of our lines are electrified now and many more will be electrified, but there is one little island on the Channel Tunnel journey which will remain unelectrified. I t is the short stretch—I think it is seven-and-a-half miles—from

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Clapham Junction to that delighfully named signal box North Pole Junction. If we were to electrify that we should have continuous electrification from Manchester to Marseilles, from Liverpool to Lyons and many other places. So I believe that is worth considering. No doubt the experts have thought of it already, but perhaps the Minister could jog their minds about it.
Another good development which has not been mentioned recently— no doubt the Minister will have news of it, and I found it out by looking at British Rail's latest rail map, showing all the commercial and goods lines as well as the passenger lines— is that something like 25 new stations are now being planned. That is a very important development.
Finally, may I make a plea? I made it in my Second Reading speech on the Channel Tunnel Bill. It is that we insist on a really prestigious portal. Is this not, after all, to be the longest tunnel in the world? Are we to be content with some puny little erection of ferroconcrete, or are we to have something great, grand, glorious and prestigious— something which will match those superb tunnelportals of the nineteenth century?
4.35 p.m.
Lord Mountevans: My Lords, I too am grateful to my noble friend Lord Somers for giving us the opportunity today to debate the use we are making of our railways. I feel that the number of speakers—the noble Lord, Lord Ezra, touched on this point—who are participating today, and the fact that there are some seven or eight rail-related Bills at various stages in your Lordships' House and another six presently before another place suggest that the environmental and economic benefits of railways are once again coming into their own and that the railways in general are moving gently towards another period of greatness.
Certainly my own feeling, when I go round judging the stations in the best-kept station contest—one hesitates to claim exclusivity but I suspect I am the only person in the Chamber today who travelled from Penzance to Wick last year over a period of a fortnight, judging some 50 or 60 stations—is that over the past five years the quality of the product British Rail offers in terms of cleanliness, punctuality, staff, stations and new rolling stock is improving very significantly.
How we can increase the use of rail is a wide topic and I should really like to concentrate on the freight side of the business and on steps which will need to be taken, sooner rather than later, to maximise the use of rail in terms of goods transport. The Channel Tunnel and the single european market both offer enormous opportunities. Although both are some time away, I feel that one must address the problems now because lead times in transportation are long.
At present some 50 per cent. of our trade is with our European partners, and I would expect that proportion to grow. Such growth will bring in its train saturation on our roads, as has been mentioned by several noble Lords, particularly in the South-East. To overcome the problem we have a blunt choice: more and bigger motorways or—and this is
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my preferred option—greater use of the existing rail network. I feel that the latter option has a crucial role to play, as has also been mentioned several times today, in spreading the economic benefits of the single european market and of the Channel Tunnel.
To enable the railways to meet their role in the future we must ensure that at least two interrelated facilities are readily available: inland freight terminals with fast access to the tunnel and the requisite Customs facilities on site in the regions. An example of what I have in mind is the unitised terminal presently being planned at Stourton, near Leeds. Here, British Rail, working in co-operation with the local authority, which has a major role to play in terms of local infrastructure, road access, the provision of utilities and planning, and private enterprise propose to build a major terminal.
One major problem—the noble Lord, Lord Ezra, also mentioned this point—is that when faced with these kinds of ventures British Rail has to invest along lines that are set down, first, to satisfy the Department of Transport and, if that hurdle can be cleared, the Treasury. If we are to make the best use of our railways, it seems to me that British Rail must be put in a position where it can invest in the face of risk and take commercial judgments. It seems to me that the present formula for approving British Rail investment plans through the investment panel itself, through the Department of Transport and through the Treasury, is a fairly positive argument for privatisation. That is something I am not at all averse to.
Privatisation is some way away and therefore it seems to me that one might hope the Government would perhaps encourage forms of private investment such as the way in which the Heathrow express link is being financed (80 per cent. private enterprise and 20 per cent. British Rail). Perhaps they would ensure that such arrangements are encouraged and are not—again I come back to the speech of the noble Lord, Lord Ezra—almost arbitrarily capped by the Treasury.
Stourton is only one of a network of terminals we need if we are to maximise the regional benefits arising out of 1992 in Europe and the tunnel in 1993. There could be a whole string of others, such as Cardiff, Manchester, Glasgow, Liverpool, Edinburgh and Tyneside. In fact, looking at the map, I suspect one might need 12 locations to give good coverage across the country. We must achieve this coverage. To do that we must ensure that Customs practices are modified so that the whole operation runs smoothly and is attractive to customers.
Her Majesty's Government and Excise at present requires all goods to be cleared at point of entry, generally a littoral port. The Ministry of Agriculture, Fisheries and Food requires similar treatment for all meat for human consumption and for practically all fruit and vegetables. Even now Dover is admitted to be getting close to saturation. In a longer debate I could discuss dreadful parallels at frontiers in Europe. I ration myself to one example. Last summer it was frequently the case that 40 freight trains were waiting for clearance at Chiasso in Italy, but were delayed for up to seven days because of the Customs bottleneck.

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British Rail and its partners have contracted for 30 freight paths every 24 hours through the Channel Tunnel. If these paths are to be properly exploited we must devise means of Customs clearance as close to the point of destination as possible. One possibility is a degree of pre-clearance at Frethune on the other side. After all, we have the ability now to pre-clear intercontinental passengers if the airlines so wish at their point of departure.
Another requirement is that local inland clearance must be available—not universally available on demand but available at regional centres such as Stourton. I appreciate that there will always be a need for Customs vigilance, not least because of the drugs problem. Similarily, the Excise department must exercise its VAT and Excise controls and its revenue-raising functions. However, if we are to make the most of 1992 and 1993 and the best use of our railways there will be a need to change Customs working practices.
4.43 p.m.
Lord Ross of Newport: My Lords, I add my thanks to the noble Lord, Lord Somers, for initiating this short but important debate. As one who in recent months has spent many long hours on cross-country routes—two in particular—I have some observations to make later that have been boiling up inside me for some months.
First, I assure the noble Earl, Lord Attlee, that I want to give a few bouquets to British Rail. I think that InterCity 125 is a magnificent service, though it is getting rather expensive. Why British Rail cannot guarantee a seat to everyone who buys a ticket I do not know. Far too many people have to stand in second-class accommodation. Nevertheless, it is a marvellous service.
British Rail has come to appreciate the vast development potential of its mainline stations. It took a long time to get there, but it is doing it now. Waterloo and Liverpool Street have been mentioned. What is happening there is magnificent. Crewe is an absolute transformation. To be stuck there in the old days was ghastly, but today it is quite pleasant. Multistorey car parks are being built at certain busy stations. Guildford is the latest. All this is very much to British Rail's credit. British Rail is also selling off vast tracts of surplus land. The property side is bringing in many millions to its coffers, and that is all to the good.
Network South-East seems to be trying hard, but is vastly lacking in investment. If one goes to Charing Cross one is likely to get into a compartment in a train without a corridor. This is dangerous, and women should not travel in such trains at night—though I appreciate that the compartments are separate. The stock should have been withdrawn years ago. Surburban stock is used too often on long-distance routes. The Portsmouth line is a poor relation which I know only too well. All too often 8-coach trains instead of 12-coach trains run on that line. At times of school holidays, half-terms and the November outings of pensioners there are still 8-coach trains only, and the train is full by the time it reaches Havant. I have raised the matter many times with British Rail, and am told that it is a
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money-saving operation. There are 12-coach trains morning and evening, but not in the daytime. However, our trains are now getting fuller in the daytime. It is all very well providing brand new stock in the Southampton-Weymouth line, but what about poor old Portsmouth? We are all customers and surely we deserve a little better. Too many trains are comprised of too few carriages.
While the Government boast that they have given great investment opportunities to British Rail, particularly on electrification, they have been too niggardly and too long in coming, so that there is an enormous backlog to be made up. What is more, as the noble Lord, Lord Ezra, said, this capital expenditure has to be paid for by British Rail. It is charged against its external debt. I suspect that that is why there are other cutbacks in staff and carriage use.
We live in a small, overcrowded island in which vast, attractive, clean, reasonably priced public transport—in particular rail—makes every sense. This is particularly so if our roads are not to become one eternal nightmare. In the Isle of Wight—I know that the Minister will agree—there is a terrible traffic problem. There were queues of cars at ten minutes to eight this morning trying to get into our principal town. We will not be able to continue putting more and more cars on to the roads of this country. The sooner that that is appreciated and the necessary funds provided the better.
Talk of any additional closures on British Rail should be abandoned. It has been rumoured that some few more of our country routes may be closed and replaced by bus routes. I hope that that will not happen and that a total stoppage is put to any further closures. A few routes could be reopened—indeed, one or two have been—to advantage. One should pay tribute here to the county councils and some PTEs which have spent precious resources on opening new stations and reopening others, including complete branch lines. Cardiff has been reopened largely due to local finance. Even the old Isle of Wight County Council found £80,000 to open the station at Lake, which did not come very easily to it. That is money well spent, but they cannot expect too many thanks from an Administration who seem hell bent on destroying local government altogether.
I support the trade unions in their present campaign which says that the customer deserves a better deal. The truth is that for the most part the customer is not getting a fair deal, as any London commuter can quickly confirm; but neither are the growing band of cross-country travellers, of whom I am one. I greatly welcome the introduction of Super Sprinters, the more frequent services and the imaginative new linking of different parts of the country.
The trip from Liverpool to Southport was described earlier. Noble Lords should try the journey from Portsmouth to Cardiff. By the time one gets to the town station the train is full. There are all the students from the technical college getting on with their big bags and things on their backs. l f a 20-stone bloke is trying to go through with refreshments, it is an impossible and dangerous situation. People are standing in those conditions right across to Bristol

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and beyond. It is not right, and should not be like that. Two-coach trains are wrong. At least 4-coach trains should be put on those services.
Why, I ask, does the Cardiff-Portsmouth harbour train always arrive two minutes after the boat has gone? That is the kind of time-tabling that goes on. I try to get into Shropshire and to use the Heart of Wales line, but BR's timing means that there is no way in which one can catch that train without waiting an hour or so on Shrewsbury station. Why does it not stop at Craven Arms so that one can get on to the connection? I do not know. These are questions that I put to the provincial boss. The line is threatened with closure, but it already carries a surprising number of local people.
I must draw to a conclusion. Vandalism is the other matter on which I should like to have some figures. It is costing British Rail huge sums of money. Why is it not keeping guards on the sidings at night to guard the rolling stock? That is where the vandalism must be taking place.
My recipe for increasing patronage is: expedite the rapid transit system, have a look at Canada, which I visited with a Select Committee (it is marvellous what has been done there); better rolling stock and longer trains; more sensible time-tabling in the rural areas; trained personnel capable of giving intelligent information, rather than the ones at Waterloo; reasonably priced fare structures; guaranteed seats on InterCity routes and adequate parking at stations. This, I believe, will bring the many frustrated car drivers back to rail. Regrettably they come back, try it out, get frustrated and go to back to their cars, and that does none of us any good.
4.50 p.m.
The Marquess of Aberdeen and Temair: My Lords, I have had a lifelong enthusiasm for the railways, although not being quite such a buff as the noble Viscount, Lord Buckmaster. Nevertheless I started with toy trains in the nursery and worked up through scale models. I would spend long vigils photographing those thumping great steam locomotives travelling at speed. Years later steam was replaced by diesel on the Great Western line, as I choose still to call it.
There was formed the Reading and District Commuters' Association. We had regular meetings with the divisional manager and his immediate staff. That give us the opportunity to criticise railway working in the light of specific observable cases. At the same time we learned of the less visible facts and problems from the management point of view and passed these on to fellow passengers. That leads me to the key of what I believe to be necessary for the railways—communications. I am very interested in that subject from top management down to the lowest grades of railway employees, on to the passengers and all the way back up to management.
When that communication is established, a great deal of the heat will be taken out of railway travel. Too often delays, failures, stoppages and cancellations go unexplained. Most passengers are dumb and stoical; some are angry and vocal. I am not ashamed to say that I am one of the vocal ones. The
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inspectors, guards and staff on stations on these occasions adopt a defensive attitude, frequently because they themselves do not know what is wrong. Incidentally, I notice that if I make it clear that I know something about railways, the staff immediately become more expansive. Several noble Lords have pointed out that staff on these occasions mention lack of finance for the railways and the lack of money to run them as efficiently as they themselves would like to see. I too have found that to be the case.
However, I have recently heard that on my line—I dare say this also applies to other lines—walkie-talkie radios are being issued. Paddington now has 25 among its staff; Reading has 15. Nothing mollifies intelligent passengers—some of them are intelligent—more than full, rapid and honest explanation of what went wrong, why it went wrong and what is being done about it.
One announcer at Reading went halfway towards this. She was unintentionally funny when apologising for the late running of the train in which I was travelling. It was, she explained, due to difficulties with the locomotive of the train in front. The phrase "a difficult locomotive" sounds as if Thomas the Tank engine is sulking, or even that a racehorse will not go into the starting box. But enough of the complaints! I am told that British Rail is expanding. Its commuter traffic is up by 10 per cent. and other passenger traffic is up by 15 per cent. To cope with this British Rail intends to have longer and faster trains and an improved system to control them.
My line, the one through to Swindon and all four-tracks, has to cope with running speeds of 125, 90 and 70 miles-per-hour and freight speeds. It is extremely difficult to fit those speeds into a timetable. Therefore when things go wrong they can go very wrong indeed.
It is all very well to get things right in theory. In practice, all railwaymen should be keen to ensure efficient working. There must be a willingness and even an ambition to do well. The junior grades, the troops in the field so to speak, perhaps have a cynical view of ambition. They are not paid very well; they do not have many opportunities. But, as the noble Lord, Lord Greenhill of Harrow, pointed out, the present chairman of British Rail started as a porter, albeit he had a distinguished father. He worked himself up through the grades by sheer merit right to the top.
The railways are a public service. They will only continue to attract custom if the whole workforce right the way through wills that to happen. The three vital needs are timekeeping, comfort and safety. I have talked to senior signalmen. They all say the same thing about safety. They would rather that passengers arrived safe and late than on time and at risk. They know of the occasional tragedies that occur when things go wrong with signalling.
British Rail has an enviable record on safety going back 150 years. Let that continue; and let us also hope that efficiency and communication between all people concerned with running the railways is improved. We shall then have less cluttered roads.
4.56 p.m.
Lord Underhill: My Lords, I shall endeavour not to repeat some of the things I said during the debate on rail privatisation on 21st December 1988. Sufficient

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has been said this afternoon for noble Lords to appreciate the problems that exist as regards overcrowded trains in many areas and our congested roads.
The noble Lord, Lord Ezra, referred to the possibility in the not too distant future of the number of travellers at peak times in London increasing by some 20 per cent. It has also been estimated that by the end of the century the number of cars will increase by at least 25 per cent. and lorry movements by 15 per cent. If all that occurs, the role of rail will become even more vital than some noble Lords may think it is at present.
I ask, in shorthand because of time, whether the Government have a co-ordinated transport policy. Do they have a firm attitude on what they believe should be the role of rail in a co-ordinated transport policy? The position on investment is vital. But, as noble Lords have stressed, investment for British Rail is constrained by such factors as its external financing limit.
But we must not overlook the importance of the terrible reduction that has taken place in the public service obligation grant. Just look at the current annual report of British Rail, where it is made quite clear that from a figure of some £1,080 million PSO grant in 1983, there will be a cut by 1992–93 and the figure will be reduced to £477 million. One cannot talk about passenger satisfaction without keeping in mind that terrible reduction in the PSO grant.
During the privatisation debate I referred to the rail unions' Better Rail Campaign. They recognise that passenger satisfaction is vital for the development of British Rail. They selected a few areas such as punctuality and reliability, overcrowding, cleaning standards, station services and service frequency. They commissioned a completely independent report which was published in March. A very detailed report came out as recently as November 1988 with statistical appendices to support it. In the report costs were broken down from each area. One-off payments and annual costs were broken down.
During the debate on 21st December I asked a question to which unfortunately the noble Lord, Lord Brabazon of Tara, was unable to reply. I ask it again now. What has happened to that report? It was compiled by people working in the industry as regards what they believed to be vital to get passenger satisfaction. Have there been consultations with the unions on that report, and if so with what results? There have been some improvements in recent years, particularly in Network SouthEast, but as most commuters would agree the problem remains.
The noble Lord, Lord Greenhill of Harrow, referred to the sprinter services on cross-country routes. They have been welcomed generally but much more needs to be done in that direction, particularly in the provision of more frequent services.
The noble Lord, Lord Ross of Newport, mentioned the support given by certain local authorities. Has sufficient recognition been given by the Government to the help provided by local authorities in the form of grants for certain rail developments, particularly the Section 20 grants
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made in the conurbations by the passenger transport authorities, without which some of the improvements would not have been achieved?
British Rail would like to have discussions with the Secretary of State on the possibility of modification of the Section 8 grants so as to increase the number of rail facilities. I cannot go into detail because I am speaking in shorthand against the clock.
Reference has been made to the Central London Rail Study, which deals with the development of British Rail and London Underground. In a preface to the study report the Secretary of State says:
"if there is to be new investment in transport in London, the passengers who will benefit should meet the cost of it through the fares they pay".
Surely such a policy would mean that even more people would switch to cars and we should have greater congestion on the roads. The Government must think the policy through again. If the major costs which are proposed in the Central London Rail Study are to be met by the passengers alone, I foresee increased congestion on London's roads.
The leader in The Times of 27th January this year said:
"The Central London Rail Study is only a transport study. It needs a companion picture of how the new routes will fit into the projected physical and economic development of the capital over the next few decades".
I wonder whether the Government are addressing themselves to that issue.
I believe that British Rail's long-term future, whatever might be done in the short term, lies in the Channel Tunnel development, particularly in respect of freight traffic, its environmental consequences and its economic importance to the regions. The first point I should like to raise in connection with the tunnel, speaking from an amateur point of view, concerns complaints from people in Kent about the fall in house prices which may occur and the noise of trains running at the speeds projected. It has been suggested to me that in view of the short distance from the Channel Tunnel to the London terminus an additional seven minutes on the journey time would reduce the noise to a level which was acceptable to many of the residents. Is that seven minutes something that must be saved in the light of the time that will be saved in the overall journey times from central London to Mid Europe?
On 7th February a Question was tabled concerning the Channel link and opposition from residents of Kent. On the same day there was a debate in the other place initiated by the opposition spokesman, Mr. John Prescott. He stated that he had written to the Secretary of State questioning whether the decision concerning the link route should be left entirely to British Rail. He urged that instead of leaving the rail link to a Private Bill committee to fight out line by line the Secretary of State should accept—as with the Central London Rail Study—that a study should be set up quickly to look into the environmental and regional consequences of the Channel link.
No comment was made on that suggestion by the Secretary of State in his speech immediately following that of Mr. Prescott. No comment was made by Mr. Portillo, the Minister for Public

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Transport, who closed the debate and had time to consider the question. I wonder whether the Minister can reply to that tonight.
We all want to obtain the best value for the nation from the Channel Tunnel project. Under Section 40 of the Channel Tunnel Act British Rail must submit its plans on international through trains by December this year. An inquiry of the type that I have suggested could meet that target. Let such an inquiry deal, with as much agreement as can possibly be secured, with the development of the rail link. Other matters which I believe such an inquiry should look into include British Rail's concern that HM Customs and Excise should be ready to service inland freight depots to meet customer demand. That was a point which was made repeatedly in our debates on the Channel Tunnel Bill and it is something that we must have. There must be no insistence on customs clearance at the tunnel or in North London. Also, as provided in Section 12 of the Channel Tunnel Act, international passenger trains must have customs and immigration controls without excessive costs being imposed on BR.
Those are the essential matters which will determine whether we get the maximum benefit from the Channel Tunnel project. I hope that the Minister will deal with those points in addition to the other points to which I have referred.
5.6 p.m.
The Parliamentary Under-Secretary of State, Department of Transport (Lord Brabazon of Tara): My Lords, it is nearly four years since I last thanked the noble Lord, Lord Somers, for initiating a stimulating debate on a very similar theme on the railways. I am glad to be able, as requested by the noble Lord, Lord Tanlaw, to restate the Government's belief in the importance of the railways and, with other noble Lords, to congratulate British Rail on its achievements.
There have been many changes in the railways during the last four years. Demand—the number of passenger miles travelled—has gone up by 11 per cent. and is now the highest for 27 years—that is, since before the Beeching cuts of the 1960s. Investment in BR's railways has gone up by 85 per cent. in real terms to a planned £560 million this year—the highest for 20 years. Over the next four years it will be another 35 per cent. higher at an average of £775 million at current prices. The whole country will benefit from the railway-based Channel Tunnel, the electrification of the East coast main line, new, comfortable and fast trains on local services all over Britain and many other improvements, including schemes designed to improve the already very high standards of safety on the railways.
That record of approving the biggest investment programme since the change from steam to diesel demonstrates the Government's faith in the railways. They have a very important role to play in the transport of the country. There are tasks which they do particularly well, such as commuter services, transporting heavy and bulky freight, including coal and minerals, and fast long distance passenger transport. However, our support, particularly
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financial support, for the railways is not and never could be unconditional. We must always remember that subsidy to the railways can only come from the taxpayer and that there are many taxpayers who earn less than the majority of rail users. Nor must we forget the reviving effects on the economy generally of reducing the tax burden. In addition, managers always need a good incentive to manage properly, and if the Government provided a bottomless purse for them to dip into they would have no incentive to make the railways as efficient and attractive as possible to their customers.
The Government want to see a modern, safe and efficient railway serving its customers well by providing the services they want at prices they can afford. Increasingly, that is what BR is doing. Its remarkably successful performance during the last few years has made investment on a huge scale both possible and sensible. Its group result last year was the highest ever achieved, and the railway operating profit of £109 million before interest but after grant was the best in the history of the board. This success was not confined to the passenger railway: Railfreight had its best results for a decade with an operating surplus before interest of £44 million.
One of the biggest changes of all has been in InterCity, which has been ineligible for grant since the beginning of this financial year. Last year InterCity received some £100 million of government grant, and we all recognised that making it profitable would take some time, but BR's latest corporate plan shows that InterCity should be out of the red by next year and making a sensible return on its assets by 1992–93. This has not been achieved by huge general fare increases, although sorting out some of the anomalies, such as the very low fares paid by a few long distance commuters in relation to other users of the same peak services, is a painful business.
InterCity's success illustrates an important maxim; that benefits to passengers do not necessarily increase in line with grant. Levels of grant to the railways rose sharply between 1978 and 1981, but were no obvious advantages for users. I do not believe that the fears of the noble Lord, Lord Underhill, about grant are justified. Since 1983 grant has fallen by 45 per cent. while usage has risen by over 12 per cent. and, despite many people's beliefs, overall quality of service has improved. I am not saying that in order to increase usage one must reduce grant, but it is certainly true that increases in usage, and thus fare revenue, combined with increased efficiency of operation mean that grant can be reduced without ill effects.
Despite the overall improvement in BR's quality of service, there are still undoubtedly many services which are not up to the standard that passengers are entitled to expect. Several noble Lords have drawn our attention to some of those this evening. BR has been almost too successful in attracting new business, as this has led to serious overcrowding in some places at certain times of the day, particularly on parts of Network SouthEast. This problem of success is being vigorously tackled. The Government have agreed a range of quality of service objectives with BR which cover punctuality, service provision and cleaning, as well as overcrowding on Network SouthEast. They

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have not all been met yet, but BR is working hard at the problems and hopes that the worst of them will be solved within a few years.
One of the problems in improving quality of service is the shortage of staff. BR faces particular problems of recruitment and retention of certain rail staff in some areas, especially London and the South-East. BR is tackling this problem in a number of ways. Last year's pay settlement increased London weighting and directed attention to raising the basic rates of the lowest paid staff. Special allowances have been introduced for certain staff working within a radius of 40 miles from central London. Other measures have included flexible manning and the extension of driver-only operation.
I entirely agree with the noble Lord, Lord Somers, and other noble Lords that punctuality should be improved. Network SouthEast's objective is 90 per cent. of trains arriving within five minutes of the right time. Last year, 92 per cent. of trains met that target. InterCity's objective is 90 per cent. of trains arriving within 10 minutes of the right itme. Its achievement was not as good; 87 per cent. met the target last year. Some lines are worse than others, but BR is working to improve them. That is why accurate clocks arc essential. I say that particularly to my noble friend Lord Moyne. It is British Rail—not the Government—which runs the railways. We set it objectives, including punctuality, and it is up to BR to work out how to achieve those objectives and to justify the costs. If we in the Government spent our time second-guessing it, we would spend a great deal of money for perhaps little purpose. Civil servants have no experience in running trains, but I can assure my noble friend that the cost of the new clocks is infinitesimal compared with the revenue of the railways and makes no practical difference to the fares.
British Rail is also paying considerable attention to the comfort and convenience of its passengers. For example, it has already begun a seven-year, £160 million programme to modernise every station in Network SouthEast. Stations will not only look better; they will be better lit and will have improved lavatories and more facilities for disabled passengers. New rolling stock is not only fast and efficient but in many cases has air-conditioning, improved ventilation and lighting and public address systems. Older rolling stock is also being refurbished to bring it up to the standards of comfort that passengers now expect. I hope that the noble Lord, Lord Somers, will agree that there have been notable improvements for the passenger since his last debate four years ago and that many of Network SouthEast's stations have been transformed by a simple coat of paint or by displays such as the daffodils now flowering at Waterloo, which I hope cheer up the noble Lord every morning.
However, cheerful stations, though important, are not nearly as important as a good service. There is at the moment a record amount of investment going ahead on London's railways to relieve congestion. We have approved over £100 million of investment to relieve congestion on the London Underground in little more than two years, not including the major upgrading of the Central Line costing over £700
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million. We have also approved investment of over —230 million in British Rail's Network SouthEast over the same period and British Rail has itself approved many other small schemes. The works being carried out vary between lines because of different constraints on practicality, but they include building more and higher capacity trains, lengthening some platforms—because the longer trains advocated by the noble Lord, Lord Dunleath, are of limited use if the platforms are too short—and investing to improve critical junctions and signalling.
The noble Lord, Lord Ezra, has perhaps not sufficiently appreciated how much that kind of investment increases the capacity of the system. Nevertheless, he is right in saying that renewal is not enough. We have also approved some small but useful new lines, such as the Stansted airport link, the Windsor link in Manchester and the new Thameslink.
Even this huge investment programme is not enough to cope with the recent and projected increases in demand. That is why my right honourable friend the Secretary of State for Transport, jointly with the chairmen of BR and LRT, set up the Central London Rail Study last March. The report was published on 26th. January. It recommended that as well as current and proposed plans for upgrading the existing lines, detailed work should be done on two alternative packages of new lines, each costing some £2 billion and each involving two brand new lines across London. Further analysis is now being carried out on the alternatives and we expect to make decisions later in the year.
Several noble Lords, notably the noble Lord, Lord Mountevans, have said, the Channel Tunnel is another major opportunity for British Rail to expand its business. When the tunnel is open, even with the existing tracks, passengers will be able to reach Paris in three hours and Brussels in two and three-guarter hours from London. With a new line journey times could be reduced by 30 minutes to as little as two and a half hours to Paris. The opportunities are also there for direct travel from other places in the United Kingdom to various continental destinations. BR is consulting with local interests all over the country so that it can plan the best services.
I say to the noble Lord, Lord Grimond, in particular that I understand that British Rail is confident that main lines north of London will be perfectly adequate to cope with the tunnel traffic for the foreseeable future. British Rail is considering carefully the scope for through passenger trains when the tunnel is open. We must make the best use of the paths through the tunnel. British Rail is well aware of the importance of that and is busy planning how to achieve the best results. It is consulting interested parties in all the United Kingdom regions with a view to producing a draft plan late this year which I cannot anticipate at this stage.
The noble Lord, Lord Underhill, asked whether there would an inquiry into the new proposed rail link to the Kent coast. We believe that the Private Bill procedure is the accepted procedure for the promotion of new railway works and objectors will have an opportunity to petition against the Bill. This is a substitute for the public inquiry process. My

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honourable friend the Minister of State in fact answered a question on that subject in another place last Monday.
Freight traffic by rail is also becoming more competitive and thus more able to meet the challenges presented by its rivals. An inevitable result of improving roads is that road transport often becomes more attractive than rail to consignors, particularly over shorter distances or when transfer from road to rail is needed. But Railfreight is fighting back with a highly competitive and innovative approach and its future is promising. Again the most exciting new prospect is the Channel Tunnel, which will allow rail to be competitive on long Continental hauls. Another development is in combined transport, which means carrying goods in the same box on both road and rail. We are familiar with containers, but containers need special equipment to get them on to and off railway wagons. Various new developments will allow the back half of an articulated lorry, complete with wheels, to be driven on to special wagons without heavy lifting gear, or mini-containers to be slid direct from a lorry on to a railway wagon.
British Rail's new Railfreight Distribution division, recently created from the merger of Freightliner and Speedlink, is planning to make the best use of these innovations to compete as a commercial business. The policy of successive governments has been that rail freight should compete with other modes of transport on as fair a basis as possible. That means that British Rail cannot take on unprofitable business just for the sake of moving freight by rail. Inevitably it also means the shedding of some loss-making businesses. The proof of how well this is working is last year's excellent result for Railfreight.
I should like just to refer to some remarks made by the noble Lord, Lord Ross of Newport. While it is clear that there are problems of lack of capacity in parts of the rail network, there are many other lines which have far more capacity than is used. It is up to BR to adapt its services to meet local demand and market them so as to create extra demand where that makes financial sense. Some lines have had a dramatic increase in use. For instance, since the Marches route, which goes from Cardiff via Crewe to Liverpool and Manchester, was given new Sprinters and an hourly service last May, passenger usage has risen by 49 per cent. There may however be cases in which lightly used rail services ought to be replaced by attractive, guaranteed bus services and we expect BR to consider the scope for doing that.
Lord Ross of Newport: My Lords, I hope the Minister will forgive me for interrupting but he referred to the Marches route, which I use. I can tell him that unfortunately on that service every so often there is only one coach and one has to stand all the way to Hereford. I hope that he will take that fact on board, because he may be considering further closures, and I am quite convinced that more can be done to keep some of our rural lines profitable.
Lord Brabazon of Tara: My Lords, I am sure that the noble Lord is right. I was giving just one example
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of a cross-country route where the use of new trains has greatly increased its popularity. And replying to the noble Viscount, Lord Buckmaster, I understand that there has been since 1983 a net increase of over 70 stations.
While we all, I think welcome increases in British Rail's use of lines with spare capacity where this can be achieved at reasonable cost, we must be quite clear on the limitations. Travel by rail is not intrinsically better, or worse, than travel by road or air, or even by water or on foot. It has advantages for the individual, including speed, the comfort of not having to drive or park and a much better safety record than road; but road too has its advantages, including convenience and the comfort of door-to-door transport, especially when it is raining. It is for the individual to decide which mode suits him best for a particular journey, not for a nannying government to influence his choice.
The right reverend Prelate the Bishop of Manchester referred to subsidy of the railway. The Government accept that there are circumstances in which it is right to subsidise rail services because of the benefit to the community. Last year we paid over £1 billion in grant to BR and to London Regional Transport. Grant helps to reduce traffic congestion on the roads, especially in peak commuting hours in urban areas, though as I said earlier the link between subsidy and congestion is by no means automatic. There may also be a case for maintaining local rail services which are relied on for essential local journeys or where the community is economically dependent on them. There may be land-use reasons why a particular project should be supported—the Docklands Light Railway was undertaken as much for developmental as for transport reasons.
There can also be environmental considerations. That is why we pay the freight facilities grant—or the Section 8 grant, as it is better known, to which the noble Lord, Lord Underhill, referred. It is not to subsidise private firms or British Rail but to remove heavy lorries from sensitive roads, such as those through small towns or through national parks. Grant is provided for facilities for handling rail freight in order to tip the balance in favour of rail in marginal cases where the correct commercial decision would otherwise be that the traffic should go by road. It would be entirely wrong to provide grant in cases where rail is commercially attractive in its own right.
Since the scheme began in 1974 the Government have awarded 188 grants in England, Scotland and Wales to a value of about £56 million. As a result, we estimate that over 3 million journeys by lorries are kept off unsuitable roads every year.
We must also bear in mind the relative shares in the market of road and rail. Rail takes only 7 per cent. of passenger mileage and 9 per cent. of freight tonne miles. Road takes 92 per cent. of passenger and 58 per cent. of freight tonne miles. That means that a very large increase in rail use would have a comparatively small effect on roads. Let us imagine that rail passenger mileage could double overnight to 14 per cent. of the total, with all the extra rail traffic transferred from roads. Road passenger traffic would go down by only 8 per cent.; which is the equivalent of two years' increase. If the pattern of rail traffic

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remained much the same as it is now, doubling demand would result in dreadful overcrowding on trains, which could be relieved only by building new lines, which can, as we are seeing, be just as controversial as new roads.
Another important factor is the purposes for which road and rail are used. With increasing wealth, more and more people have cars and want to use them. Unless they happen to be lucky enough to have both the starting place and the finishing place of their journey close to a railway station, there will be advantages in terms of convenience in doing the whole journey by car. Similar arguments apply to freight: if the journey has to include lorry collection or delivery, it may be more commercially sensible to use a lorry for the whole journey, particularly if most of the journey can be done by motorway. If the railheads are in urban areas, it may well make far more environmental sense to make the whole journey by motorway and feeder roads.
I can see that I am rapidly running out of time. However, the noble Lord, Lord Grimond, asked me in particular about the bridge at Inverness. I can assure him that British Rail has promised to rebuild it as soon as possible.
Finally, let me stress that while much of the railway may be able to operate on a commercial basis, the Government recognise that some parts will never be profitable—lightly used lines whose revenue meets only a small part of the costs. We fully accept that when these lines are needed for social reasons subsidies from the taxpayer should be made available; this will continue whatever the future pattern of BR ownership. But the future of the railways as a whole, whether or not they develop into a flourishing business providing the services that their customers want at the right prices, ultimately depends on the board and all its employees, not on the Government. We will give them all the encouragement we can, but we will not go back to the arid and depressing business of giving them as much of other people's money as they ask for, whether or not they provide useful services. If money is always available, there is no incentive for managers of the railways to manage and to find more efficient ways of operating or of marketing. They would be demoralised with no worthwhile goals, and the taxpayer and passenger would end up with a worse service at much greater cost. We could never allow that.
I should like once more to thank the noble Lord, Lord Somers, for having initiated this debate.
Lord Underhill: My Lords, I do not want to delay the business of the House, and the Statement in particular, but before the Minister sits down perhaps I may remind him that this will be the second debate in less than two months in which I have asked about the unions' Better Rail Campaign. Will there be or has there been consultation with the unions? If so, what are the results?
Lord Brabazon of Tara: My Lords, I apologise. I must have overlooked the point that the noble Lord raised on the last occasion. I therefore have not come armed with the information this afternoon. I shall look into the matter as soon as I possibly can.
Lord Somers: My Lords, I thank all noble Lords who have taken part in this debate. I do not say that in the conventional way. I feel that some constructive points have been made. I should like to thank the noble Lord, Lord Brabazon, for what I feel was a very encouraging answer. I should also 'ike to remind the noble Lord, Lord Dunleath, that the most uncomfortable place that I can remember waiting in was the organ loft. I beg leave to withdraw the Motion for Papers.
Motion for Papers, by leave, withdrawn.

Business Rate
5.30 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment (Lord Hesketh): My Lords, with the leave of the House I shall now repeat a Statement made in another place by my right honourable friend the Secretary of State for the Environment about business rates.
"The Local Government Finance Act 1988 provides for a uniform business rate in England and in Wales and for a revalual ion of non-domestic property. These changes will take effect on 1st April 1990. The new arrangements will mean the end of wide variations in rate poundages between different areas; and rateable values will be brought up to date to reflect accurately the relative benefits of different types of property in different locations. This will provide a welcome incentive for businesses to expand in the currently less economically buoyant areas.
"My right honourable friend the Secretary of State for Wales and I have considered the Inland Revenue's preliminary sample survey of the likely combined effects of the 1990 revaluation and the introductuon of the uniform business rate. The results of the survey must be interpreted with caution: they give only a general indication of possible changes in rate bills from 1990. Subject to that important qualification, the survey suggests that rateable values will increase from 1973 levels by around seven and a half times on average in England and by around eight times on average in Wales.
"It is our intention to fix the business rate poundage in 1990–91 so as to raise in real terms broadly the same amount of rates from private business and nationalised industries as in 1989–90. So this increase in rateable values by seven to eight times does not mean that rate bills will go up by seven or eight times. That is because, to secure the same overall yield as in 1989–90, the rate in the pound will fall to between one-seventh and one-eighth of the present national average poundage. On this basis the poundage would be in the 30 to 35 pence range if the business rate were introduced today. This means that the average rate bill payable by businesses will be the same as before the change in real terms. But there will of course be wide variations in actual bills depending upon how the rateable value of the particular property changes relative to the average and whether the present local rate poundage is above or below the average.

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"The survey suggests that the broad effects of the uniform business rate and the revaluation taken together will be that businesses in the North and the Midlands will tend to pay less and businesses in southern England will generally face increases. As a general rule, factories and warehouses will tend to pay less, while shops and offices will pay more. Overall, business in the North and Midlands is projected to enjoy rate reductions of some £800 million once the transition is complete. In Wales, businesses in the Valleys will tend to gain, but the shift in burden between the Valleys and the rest of Wales will not be very large.
"To give businesses time to adjust to their new rate bills, we are proposing transitional arrangements to introduce the changes gradually. These arrangements will be self-financing. There will be limits on the percentage by which the rate bill for any property may change from one year to the next, for the first five years of the new system at least. For properties in England and Wales facing increases the limit will be 20 per cent. generally but to help smaller businesses there will be a lower limit of 15 per cent. for small properties. That is, those with new rateable values below £7,500 in London and £5,000 elsewhere. Arrangements in Scotland are of course a matter for my right honourable friend, but he proposes comparable protections for business ratepayers facing increases in rates as a result of the revaluation in Scotland in 1990.
"For properties in England due to benefit from rate reductions I shall decide finally on the percentages by which changes will be phased when 1 have fuller information in the summer. But present projections imply that limits on annual reductions of 15 per cent. for small properties and 10 per cent. for large would offset the cost of the protection for losers. My right honourable friend will similarly base his final decision on phasing of reductions for Welsh ratepayers on later information; but present projections indicate slightly higher limits would be sufficient in Wales to offset the cost of protection for losers.
"Compared with present rate bills, the percentage increase for losers is greater than the percentage reduction for the gainers because the losers as a group have substantially lower rate bills at present. All these limits are net of the annual change in the rate poundage resulting from the link to the retail prices index; and they are compound, in that after the first year the maximum percentage increase or decrease would be calculated from the rate bill in the preceding year.
"We wish to give the highest possible priority to preparing fully and promptly for the new business rating system and have therefore concluded that it would be right to reduce the incentive for business ratepayers to propose changes in the old 1973 rating list if the sole purpose is to secure a slightly better position under the transitional arrangements. We therefore propose that in 1990–91 the base liability to which the transitional limits will be applied should be calculated using the rateable value in the list today, adjusted only for
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changes resulting from ratepayer proposals to amend the value received by the Valuation Office by yesterday. Ratepayer proposals to amend the 1973 list received by the Valuation Office today or in the future, including those posted before today but not received until today, will not be reflected in the transition. Any changes in rateable values in the 1973 list resulting from existing or future proposals made by the Valuation Office will however be taken into account in the transition.
"Ratepayers will still have the right to propose changes to the 1973 list and, if such proposals lead to reductions in value, will get the benefit until March 1990 but not thereafter. They will also of course have the right to make proposals in relation to the 1990 list.
"We believe business ratepayers as a whole will welcome our intention to concentrate on getting the new system right and thus to discourage further attempts to change rateable values which have stood for up to 16 years.
"The powers in the 1988 Act to make regulations are inadequate to facilitate transitional arrangements of the kind I have described. We shall therefore propose amendments to the 1988 Act in the Local Government and Housing Bill. In order to give businesses and local authorities as much certainty about the transition as possible, it is our intention after consultation to bring forward amendments setting out the arrangements in the Bill itself rather than in subsequent regulations.
"We are today issuing and placing in the Library a consultation paper, which includes the results of the Inland Revenue survey referred to earlier, setting out the details of the transitional arrangements and inviting comments".
My Lords, that concludes the Statement.
5.37 p.m.
Lord McIntosh of Haringey: My Lords, the House will be grateful to the Minister for repeating the Statement made in another place earlier this afternoon. It is, however, peculiarly unhelpful. For all the assurance it gives to occupiers of business premises as to what their future business rates are likely to be, it could as well have been issued not only before Christmas but at the time when the Local Government Finance Bill was enacted. We have no indication whatever of the likely effect on any individual businesses, group of businesses or type of businesses. The most broad indications are given in the Statement about regional differences but nothing else to help businessmen assess their likely rate obligations.
The consultation paper to which the noble Lord referred is not available in the Library of your Lordships' House, I asked only a few minutes ago. It is therefore peculiarly difficult for us to make any rational assessment of the Statement, or indeed to have any indication of what effect it will have. Would it not have been possible for the Government to ensure that the consultation paper was available to us, as the Statement is being repeated a long time—two hours—after it was made in another place?

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The indication of the likely effect on individual businesses becomes very clear when one looks at the provision for transitional payments. The Statement tells us that transitional relief will be self-financing. The figure was 20 per cent. compound for larger businesses over a period of at least five years. That means that the Government are already envisaging increases for individual premises of something considerably over 100 per cent. Does not the inadequacy of the 1988 Act, which was referred to in the Statement, mean that those increases could be very much higher than that?
As we understand it, the intention is that the 1988 Act is to be amended to increase the legal powers to bring in transitional schemes. What that presumably means is that the transitional arrangement can go on for longer than five years, even substantially longer than five years. The Secretary of State said that it could be a second quinquennium, or a third or a fourth. What does that mean in terms of the ultimate effect on individual business premises of the unified business rate? Can the noble Lord tell us whether there will be any ultimate limit or is he saying, as appears from the Statement, that it is not just more than 100 per cent. but that 200, 300 or even 400 per cent. might be possible?
The national business tax or, as the Government choose to call it, the unified business rate, was brought in on the basis that it was supposed to be a promise to business people that they would have a fairer rating system. Can that argument now be sustained? The same amount is to be raised from the business community, but it will just be raised in a way that will be arbitrarily different. The effect on local authorities will be even more arbitrarily different because what they get from the unified business rate will not be based on commercial or business activity in their area. It will now be based simply on a head count, the size of the population.
When I was involved in local government we believed that it was good to encourage business in our area because that gave us a higher rateable value. That incentive to local authorities to encourage business and commerce no longer exists. The unified business rate is not as effective a democratic procedure as it was in the past. It is simply another example of central government extending their powers further and further into every reach of our national life at the expense of local government and at the expense of local democracy.
Lord Ross of Newport: My Lords, I am sure that the Minister will agree that this is a long Statement which takes time to assimilate. As he will be aware, we are opposed to the uniform business rate for reasons similar to those which have just been expressed—that it takes total local control from authorities and it is purely arbitrary now as to what the Government decide to distribute to local authorities. One has the impression when talking about the 15 to 20 per cent. phased increases that in some cases these sums could be very substantial, particularly for the smaller businessmen. Coming on top of what undoubtedly are to be sharply rising water charges and electricity charges and 15 per cent. on VAT on new building, the business community should be warned about what is likely to happen over
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the next two or three years. I hope that the Government will look again, if they insist on bringing this procedure in, to decide whether to phase it in over a much longer period.
Is it not somewhat novel to say that those people who are entitled to decreases—lower rates to pay—will have that limited to 15 per cent.? That seems to be a fairly novel idea to me. But they will not have the advantage of that in one go. They will have to pay for the increases or to marry the two and will not get their full allowances except ever the same five-year period. That seems to be a fairly novel idea and one which I am sure will lead to some comment.
Lord Hesketh: My Lords, I assure the noble Lord, Lord McIntosh of Haringey, that immediately on leaving your Lordships' House I shall inquire about the consultation document.
I first refer to the large increases which the noble Lord mentioned. I am sure that all in your Lordships' House arc well aware that in the last 16 years, particularly in the South-East of England, there have been enormous structural changes and vast changes in value. Because of that there will be cases where there will be substantial increases in the rateable values of property. The other factor to remember is that those businesses have in many cases benefited because of there being no rerating for 16 years, a considerable period of time.
Lord McIntosh of Haringey: My Lords, I am grateful to the noble Lord, but I was not referring to increases in rateable value. We all know that there have to be increases in rateable value. What the transitional arrangements are about is not increases in rateable value but increases in the amount of rates paid.
Lord Hesketh: My Lords, I wanted to move on to that, having made my first point. Because there are to be substantial changes, the Government are committed to the transitional period so that a balance can be made. The noble Lord, Lord Ross of Newport, drew your Lordships' attention to the phased reduction of payments. What we are hoping to do is to make this self-financing and balanced so that there will not be a tremendous shock. The purpose is for us to have an orderly transfer to the new system.
The noble Lord also referred to the phased reductions for small businesses. We have a high rate for reduction for small businesses and a lower rate for increase for small businesses and have taken into account in our calculations the extra needs of small businesses. The noble Lord, Lord McIntosh, also mentioned the possibility of a second quinquennium or even a third. I have not heard of the third quinquennium, but I believe he is correct that if an increase was to be above 149 per cent. we would have to go to a second quinquennium. He is entirely correct.
5.45 p.m.
Lord Boyd-Carpenter: My Lords, can my noble friend confirm that where a business desires to appeal against the valuation of its premises in the 1990 list, the procedure for appealing will be the same as at

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present? While I am on my feet may I say that I support what was said by the noble Lord, Lord McIntosh of Haringey, about the consultation document. It should be possible when a Statement is repeated an hour or two after it has been made in the Commons for the consultation document to be available here. It is a help not only to noble Lords opposite but to those on this side of the House. Perhaps he would look into that with a view to the future.
Lord Hesketh: My Lords, I take my noble friend's last point very much to heart.
A proposal with regard to an appeal after 1st April 1990 can be made to the valuation office to charge a rateable value within six months of 1st April 1990 and in limited circumstances thereafter. If this is not agreed, the proposal becomes an appeal to the local valuation and community charge tribunal, which will replace the existing local valuation court.
Lord Harmar-Nicholls: My Lords, the point that strikes me is rather different. It is not to do with the details of the Statement. As was said, it is so intricate and detailed that we shall want to study it before we can draw any worthwhile conclusions from it. Will my noble friend see that his right honourable friend is fully aware of the possible electoral consequences that can flow from the Statement. I am perhaps focused on that because I discovered that my last election was my 18th. I doubt whether many in your Lordships' House or in the other place have gone through that litmus paper test in that way before.
The point I want to make to my noble friend and to his right honourable friend is that when we examine the details behind this Statement, if it looks as though in order to alleviate the impost of the poll tax more is being put on the business contribution, the electoral consequences could be pretty tough. If it is felt that more people would be paying the poll tax than would be paying the business tax, and therefore if we are to be reasonably kind and generous, we had better favour the bigger crowd, the poll tax payers, and extra can be put on to the business group, no greater mistake could be made.
I have vivid remembrances of our losing an election when the Conservative Government intervened on the issue of retail price maintenance. If by being unfair to alleviate a problem in another direction we put unnecessary imposts upon the business community—who are the bedrock of the Conservative base, if ever we want to keep in mind a Conservative point of view—its consequences in electoral terms will be very real. I do not believe that today one has the same access to ensuring that one's personal point of view is taken into account, as was the case a few years ago. Perhaps that is sad, or it may be wise that a few holes have been stopped which allowed people to be troublesome.
We are far enough away from the details which must be applied but if the Government believe that advantages will be produced by marginally alleviating the poll tax and adding it to the business tax, I suggest that as concerns this side of the House, they will not be good advantages.
Lord McIntosh of Haringey: Touche!
Lord Hesketh: My Lords, as always, I am grateful for my noble friend's remarks. I assure him that with my best endeavour I shall draw anything that he says to the attention of those to whom I have access.
The gross sum of money about which we are talking, £8·8 billion, is based on the figure for 1989–90 which will be raised during the last year of the existing rating system on the list.

Trained Engineers and Technicians
5.51 p.m.
Viscount Hanworth Viscount Hanworth rose to call attention to the case for more trained engineers and technicians and to the steps which should be taken to achieve this aim; and to move for Papers.
The noble Viscount said: My Lords, all noble Lords will be sorry that some Members of this House who have great experience in the engineering field and who would like to speak tonight are unable to do so.
The wealth and influence of this country in the 19th century was founded and produced by its engineers. Somewhere along the line that has been forgotten. It was never a gentleman's profession and, in spite of the respect accorded to such engineers as Brunel and others, the "muck and brass" image prevailed, deterring all except the most dedicated from our universities joining the profession. Even during my time as an officer in the Royal Engineers a long civil engineering course was quite desirable for promotion. That was not so in respect of an electrical and mechanical course. In those days it was "mud pies, yes; oily hands, no".
Today in England an engineering background is not the best route to the boardroom. For accountants, marketing men and even scientists, yes; for engineers, it is still difficult. On the Continent, particularly in France, almost the reverse is the case. Their grandes écoles, which were created outside the traditional university stream, concentrate on engineering, applied science and management studies. Their prestige is immense. Those who can gain a place and become qualified are almost assured of high positions in industry later.
From that observation we can draw at least one useful conclusion. All university engineering courses and most courses at polytechnics should include management studies, an appreciation of accountancy and so forth. Already, there is a severe shortage of able and highly qualified persons in several disciplines required by the engineering profession. The recent fall in the birth rate means that in the 1990s there will be approximately 25 per cent. fewer young people from whom engineers can be recruited.
If noble Lords agree that there is a problem, it must be considered from two angles which are of course interrelated. First, we must try to raise the status of engineers in everyone's view. Only then can we expect to recruit into the profession the young at A-level standard and below. I shall not mince my words: our

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greatest need is to attract more of the really able people into the profession, particularly from universities. Quality is even more vital than quantity.
In that respect we should consider the unexploited numbers of really able girls. In many respects engineering today is well suited to female talent. It does not require an amazon to work on design, computers, administration and much else. Unfortunately, some firms put unnecessary obstacles in the way of young women who might decide on an engineering profession. Such obstacles include working in a hostile environment and the rigidity of employment conditions.
What can be done further? In the short term firms must try to raise the status and salaries of their engineers and give those capable of filling higher management positions an opportunity to attend business staff college courses, so enabling them to make good any business skills they may have been unable to acquire earlier. Salaries are not comparable with those in Germany—according to one analysis, by a factor of two. I hesitate to think what may happen if we start to lose to the Continent those with high qualifications whom we may at last have managed to recruit.
The Engineering Council and the Engineering Industry Training Board, to mention only two organisations, are doing everything they can to help. I wonder however whether bodies such as the CBI could do more. It must know the importance of engineering. I quote two statistics. In 1987 the industry provided 11 per cent. of our GNP; but over 50 per cent. of all our exports are manufactured goods. We are not balancing our export-import budget. With decreasing oil and gas production the situation will soon become critical.
The attitude of the public is important. Parents can have an influence on the subjects their children study and the careers they follow. In spite of all that modern technology gives us, somehow the glamour of engineering has not come across. For example, do we produce enough good videos and ensure that they are shown to the right audiences? A dull title, such as "A Career in Engineering", could at once limit the audience. A more subtle approach may be needed.
I turn to the second area; our schools. In the longer term they are vital. The overriding problem is the present and what will become even greater shortage of maths and science teachers. It has been estimated that at best by 1995 there will be a shortage of over 4,000 teachers in those subjects. A more pessimistic view quotes a catastrophic shortfall of over 12,000. Inevitably, the shortage, even if partially met, is likely to reduce the time allocated for teaching maths and science. What a frightening prospect that is in this technological age.
What can be done to alleviate the situation? The Engineering Council makes a number of suggestions, such as developing the use of learning systems and providing financial incentives for those actually entering the classroom rather than those undertaking post-graduate studies, desirable as the latter may be. Once again, there is surely an untapped resource of women who have left the profession but who could return at least part-time if the terms were
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more attractive and took into account their particular needs.
The situation is potentially so serious that if the Government cannot raise teachers' pay to adequate levels all round they must make the invidious decision of giving additional pay to maths and science teachers or accept those without full teaching qualifications. Bearing in mind some of the very unpopular measures the Government have recently taken for what many consider to be only political motives, they should not shrink from such action where the nation's very future is at stake.
I have said that more must be done to convince children at school that engineering is the exciting and challenging profession which it surely is. I believe that our engineering firms could do much more. Apart from videos, provided free, they should arrange more visits to their premises both during term time and in holiday periods for parties accompanied by teachers. There remains some prejudice against engineering as a career, certainly among art teachers. I vividly remember when I was 15 or younger being invited to the London Hospital and being shown round for most of the day. The idea was to recruit young people to the medical profession. That would have had a profound effect on me had I had any idea of going in for medicine.
Nowadays many organisations have ways of attracting schoolchildren. For example, I believe that banking houses run clubs for quite young children so that they will be thinking along what are, to those banks, the right lines. Do engineering firms promote their industry in that way? I agree that they make enormous efforts to attract first class graduates from the universities, usually just before they leave. It may be even more useful if they do the same for younger persons. To a great degree they should also support relevant courses in higher education.
Of course, I am aware that many useful steps are being taken to help. I should like to believe that previous inertia is being overcome and that the stone is starting to move. However, it is not yet rolling. More effort is required and time is not on our side. Let us remember 1992. I beg to move for Papers.
6.2 p.m.
Lord Orr-Ewing: My Lords, I believe we owe a debt of gratitude to the noble Viscount, Lord Hanworth, for raising this subject. I cannot help but be interested in the vast number of people the railway debate attracted. They were limited to seven minutes each. We have rather more time to develop our arguments and more time for intervention and the courtesies of debate in this House, which I believe is desirable on a subject of this sort.
I agree with so much that the noble Viscount said and I liked his courtesy in sending me a copy outlining what he would say to help me to reply. I am a member of the Institute of Electrical Engineers as a chartered engineer but I am also grateful to other institutions because they have provided very valuable information to help all of us in this debate, particularly the Institute of Mechanical Engineers.
I very much agree with one point made by the noble Viscount, Lord Hanworth. Time must be made

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in the curricula of scientists, engineers and mathematicians for management of people and management studies. After all, by the time the students are 27 they will probably have three junior engineers and six technologists under their supervision all helping as a team under their leadership. Therefore, it is not too early to start in the first year of the degree course or at the polytechnics learning the fundamentals of man management and to gain some experience, because that will be needed very early in their careers. I also make the point that they should learn to speak. It is no good being an extremely good engineer and producing abstruse papers if one cannot argue one's case. It is the persuasive people who can persuade others to take up the issue who will win out. I should like to see speaking as one art which needs to be developed by engineers.
In a short debate one has to pick out one or two aspects of the problem. First, I cover Britain's need and something about the progress of our competitors. Secondly, I should like to say something about our schools and the need to provide incentives to attract teachers who will motivate and inspire children from the ages of seven and eight upwards. Lastly, I should like to speak about some tax incentives which I hope may be included in the forthcoming Budget and which could play a useful part in stimulating the growth of engineering.
Perhaps I may turn to the need. I take Japan as an example because very soon after the war it understood the need to produce engineering graduates and to attract them into industry. One can see the immense progress made with its exports in almost every field and the ability and flexibility it had to expand the whole of the huge shipbuilding industry. When that collapsed it happened without much trauma when Japan had to hand over the leadership first to Formosa and then to South Korea and others. However, it has an amazing ability and built-in flexibility which one must admire. That does not mean that I am in any way complacent because I believe that we are a long way behind Japan; but we are also a long way behind West Germany, France, Switzerland and the like who are now our major trading partners.
An independent survey—I believe that this is the same survey mentioned by the noble Viscount—showed that the extra number of teachers needed by 1995 is 2,300 physicists and 4,400 maths teachers. That means that it is not too early to start recruiting now, seven years before they are needed in our schools and universities. Those extra teachers need to be caught now because we should remember that there is also a diminishing population problem. There are a million fewer people in our schools than there were ten years ago.
In regard to students who become graduates or gain polytechnic qualifications, a study was carried out by the Institute of Manpower Studies at Sussex University. It alarmed me considerably. It said that an additional 140,000 scientists and engineers were needed by 1995 to make up past losses and the like. As regards teachers, those figures do not allow for teachers re-entering the profession, which one hopes
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will be encouraged to a maximum degree. That source may assist in solving some of the problems.
I now turn to incentives. First, I make the point made by the noble Viscount, Lord Hanworth, that prestige and rewards are equally important. Japan is now attracting and producing on a per capita basis two and a half times the number of engineering graduates that we produce in this country. In Japan the principal requirement for gaining the most senior management positions in major companies is to have been educated as an engineer and not as an accountant, a lawyer, in a finance house or even a bank. Engineers are needed to head their companies. Industry must surely pay proven, qualified and experienced engineers more generously than it does today. That must be a leading need, particularly in a diminishing population.
Perhaps I may turn to schools, where it all begins. In the teachers' pay award in 1987 there was a massive reward for teachers and in the agreement eventually reached there was an allowance for an extra incentive to be provided in shortage subjects. Those subjects obviously include science, physics and mathematics. Therefore, one can reward those who are so badly needed more generously than others.
The Interim Advisory Committee for Schoolteachers' Pay has been instructed to look at this problem immediately. Perhaps the Minister can tell the House when we may expect this report. It will then be up to local education authorities. They must be convinced that that is where some of the money must be diverted. That is where the local education authorities must take steps to achieve results and have all the encouragement available.
Industry is making valiant efforts, but to some extent the National Union of Teachers has been a little slow to accept the flexibility and incentives necessary to attract teachers needed for these subjects. I hope that teachers will not continue to take a Luddite attitude because that would be absolutely devastating to the future of our country.
Incentives for teachers in shortage subjects must be a priority. Rapid pay increases for proven engineers are necessary. Incidentally, they are necessary for proven teachers as well because, after all, it is the teachers who start selling the subject, attracting students, and lighting up people with the imagination they can bring to teaching. It is desperately important that they should encourage and inspire their pupils.
What should the Government do? I hope to be constructive. First, I see no reason—the DTI is always launching campaigns—why the department should not, as part of its 1992 preparation programmes, launch an awareness campaign which will extol the virtues of the many schemes started by various sectors of our engineering and other industries. Secondly, could not tax allowances be more generous and be introduced for continuing education? When individual engineers pay for their own attendance at education conferences and seminars they are funding the cost from their net salaries, after tax. They have to pay out of their own pockets. In contrast, employers can set such costs against corporation tax. We know how important is the growth of small companies. Surely one should

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encourage people to go on refresher courses as new technologies develop. To that end, tax allowances should be available.
Thirdly, there should be financial support for activities introducing schoolchildren to engineering. The noble Viscount referred to being taken round hospitals. I know that people are hunting graduates from both the independent and the state sectors and seek to attract them. I was impressed by the Institute of Mechanical Engineers' scheme called the Leonardo da Vinci series of lectures. Until recently it ran a teacher fellowship scheme. Under the scheme individual teachers spent periods of three months in industry, working alongside professional engineers.
I have always wished that we had sufficient stretch in our elastic to allow people, before becoming teachers, to spend at least a year working in industry instead of staying in the education cycle from the age of five so that the whole of their lives is spent in education. Teaching must increasingly grow closer to local industry and to industry in general. That was an imaginative scheme. The experience periods were preceded by an induction course and at the conclusion of their term in industry each teacher fellow was required to report on the experience and state how he or she would introduce engineering-related subjects into his or her school.
All that seemed to be running well but after 10 years of operation the scheme was dropped through lack of funds. It needed funds to provide for supply teachers in LEAs to take the place of the teachers while they were away on the course. It is a shame that the Government could not find some money to bridge the gap and encourage such schemes.
I have sought to draw attention to one or two areas where I believe the Government could and should move. Unless we go on hammering away at this subject and unless, as grandparents and parents, we sow the seeds of enthusiasm among the young with whom we talk and play we will never get the recruits who are so badly needed to maintain standards and support our balance of payments as the oil begins to run down.
6.15 p.m.
Lord Dean of Beswick: My Lords, first I join the preceding speaker, the noble Lord, Lord Orr-Ewing, in expressing appreciation to the noble Viscount, Lord Hanworth, for introducing this subject for debate in your Lordships' House. It is relevant to our survival as a manufacturing nation, which is the historic basis for all our wealth. If we fail in this facet we fail for all time.
Of course, we have been subjected to changing patterns. There are now identifiable skill shortages. The nature of skills and of shortages has changed since the 1970s when the difficulties of most firms lay in recruiting traditional engineering craft workers and draughtsmen or draughtswomen. Craft and technician skill shortages are still reported in some areas. However, the engineering industry's most serious recruitment difficulties now concern professional engineers, scientists, technologists and computing specialists.
Demand for graduate level knowledge and skills in engineering and computing has sharply increased
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in recent years as a result of both technical change and rapid output growth in sectors which have always been leading employers of graduates; in particular, electronic data processing equipment, telecommunication equipment, electrical instruments and control systems and electric consumer goods. Shortages of graduates, particularly experienced graduates, is an unwelcome constraint not just on output in these sectors but also in research and development and the ability of companies to undertake new capital investment.
The negative effect of skill shortages should not be underestimated. Even if they do not lead to actual loss of output, firms may incur extra costs as a result of paying for additional overtime work, for subcontracting work to outside organisations or, one could say, on contract work where penalty clauses apply. In the long term skill shortage constraints on innovation and the rapid development of new products and processes may cause British companies to lose market share to foreign competitors.
Present shortages at craft and technician level can be largely explained by cutbacks in apprentice recruitment in the early 1980s. However, shortfalls at graduate level reflect the inability of the education system to date to increase the supply of engineering graduates in line with the increased demand for high level engineering skills both within and outside engineering.
That of course deals mainly with what we call the trained engineer; the higher level person coming from the universities, colleges and so on. But there is another side. In engineering they are the people who will extend the frontiers. However, we have to recruit an army as well in order to carry out some of the functions and processes to make them increasingly available so that we can retain or increase our share of the world markets.
I was interested to hear the noble Viscount, Lord Hanworth, say that firms should be encouraging school children to visit factories to see what engineering is all about. I can recall just after the war when I had become a skilled engineer being periodically involved with youngsters coming round our factory to see what was happening. Sad to say, there has been a diminution of such visits. Often, if the children visit factories they are not conducted properly. Full explanation is not given and some of what they see happening can well frighten them off.
I go down to the bottom end and explain what I mean. During my stewardship as a Member of Parliament for West Leeds a few years ago, I had occasion to visit a factory in my area. It was busy because it was involved in producing a speciality commodity—ornamental drainpipes. Why was it so special? The reason was that money was being found to refurbish some of the historic buildings in London and various other parts of the country. The manager said to me: "I have vacancies for eight to 10 boys. But they come in, have a look round and then go away". I said: "With all due respect to the way the factory is organised and what it looks like, it is the worst looking foundry I have ever seen. It is worse than the pre-war ones that I used to go into to bring work out for the machines. Would you expect a son or a daughter of yours to want to learn an engineering

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skill in such a place.?" He had to say no. That is perhaps the extreme of the argument but it is very often indicative of what can take place.
I was interested to hear the noble Lord, Lord Orr-Ewing, speak about people from the universities and colleges going into management and so on and being acclimatised and made familiar with management in the factories. I had first-hand experience of this some years ago when I worked at Trafford Park. It became the vogue to bring in highly qualified people from the universities and to introduce them at a rather high management level, but they had no practical experience whatever. It was a total disaster because they could not talk the same industrial language as the foreman or the chargehand upon whom very often a company depended. If these people do not operate efficiently, do not know the job and cannot guide people, the whole business is a failure. No matter how clever the engineer, the draughtsman, the technician or the research people, the organisation will fail if things breaks down at that point.
Lord Orr-Ewing: My Lords, I so much agree with what the noble Lord is saying. But is it not true that the sandwich courses overcome this difficulty? I know of a number of companies that take only sandwich courses. They overcome the difficulty and they know where to slot in a person when he comes back to the company.
Lord Dean of Beswick: My Lords, I totally agree with that practice, and also the training of apprentices to go into skilled trades in a factory. There is no substitute for at least a considerable part of training being on site in the factory learning the skills and having them instilled into people. People have to earn a living; no one owes them one. All my life I worked on piece work and I made a reasonable living because I made sure than I knew the job and could carry out the various functions. It is essential in the interests of the operative even at factory level that he is trained in the best skills. That should reflect itself in the wage packet; otherwise the system will not work.
In some of the larger companies a young boy can go in as an apprentice and get right to the top. I believe that we have an example in your Lordships' House—the noble Lord, Lord Gregson. I think that he started as a boy at Fairey Aviation and became an internationally known figure in certain sections of engineering. Such achievements can happen.
What saddens me is the devastation that has taken place over the years. I am not going to make a political point because the process has been going on since 1967–68. In my trade union, the AEU, at that time its list of craftsmen was 700,753 and 123,319 apprentices. I am not going back just to 1979 to suit my argument because it was happening before that under a variety of governments. That part of it is not a political argument.
I got in touch with the AEU today to ask what the present figure is when industry is supposed to be on the upswing. A percentage of the kids now coming in through the training schemes will, we hope, be the managers, technicians and research people of
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industry in only a few years' time. For the year 1987–88 the figure for craftsmen was 318,711 as against over 700,000 in 1967–68. That is an absolutely tremendous and appalling drop. The AEU figure for the total number in training in industry is 32,500, compared with the 1967-68 figure of 123,319 apprentices. They are not all apprentices. I hazarded a guess and asked, "Would it be reasonable if I used a figure of 30,000?" The AEU said "Yes, that is about the figure".
At present we are training only a quarter of the number that we were in 1967–68 and that gives room for some very serious thought. In the past there have been debates in your Lordships' House where from all sides of the Chamber it has been said that we were destroying our seedcorn. It is a phrase that I and other noble Lords have used. It is sad that that is so. A previous speaker mentioned the rate of training in Japan, which is about five to one in comparison with what we are doing.
I can remember about 12 to 13 years ago going on a visit to Venezuela in a parliamentary delegation led by the noble Lord, Lord Mellish. As noble Lords know, that is a country which is sitting on a mountain of wealth. It has so much oil that it does not know what to do with it; it has so much coal that it is hardly using it; and it has the biggest iron ore deposits in the world. When we spoke to the equivalent of our Cabinet Ministers, who were young men, they did not talk about producing lawyers and economists; they spoke about producing engineers and builders. They said, "Those are the people we want; we do not want people to lecture us on the arts. That is no good to us at our stage of development". That is the kind of competition that we have to deal with.
Attracting young people into engineering has to be undertaken as a public relations exercise. I do not know whether any of your Lordships has time to watch the quiz programmes on television where the participants are young men and women of 16 to 18. Often the person controlling the show will ask of a competitor, "What do you hope to be?" I have never yet heard one say that he or she wishes to be an engineer. Something is wrong. I am speaking of women as well. During the war women were recruited into factories in large numbers and they were employed not only in repetitive work. Some of them developed skills equivalent to those of fully skilled men. I believe that there is room for encouragement to make the career attractive.
Once again I do not wish to make a political point. But because of the way our economy is run, very often in the private sector when a company hits a bad spell it cannot be cushioned against the future, and it may pick up in two or three years' time. The company has to unload the very people that it should be retaining. There have been numerous such cases. I do not wish to quote particular ones, but there have been special design teams working on certain products which have been broken up. They cannot be replaced. I believe that some of the points made by the noble Viscount, Lord Hanworth, in his opening speech and by the noble Lord, Lord Orr-Ewing, need looking into. We cannot rely only on training in our manufacturing industry such as it is. That is what we are talking about. We cannot rely simply on market forces.

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The noble Lord, Lord Orr-Ewing, mentioned Japan. In certain countries cheap labour is available, for instance, South Korea. We shall never be able to compete with those countries. They are even undercutting the Japanese. If we compare like with like in relation to our competitors in Europe we will find that we are at the bottom of the league. We are well down on France, Germany and perhaps even Italy. If the economy is to pick up—and it is doing so—and we are to make the advances into the sunrise industries that we have to, it is essential that somebody grasps the nettle. It cannot be left completely to the firms.
I do not know what form of encouragement can be given, but if we do not do something the upswing being enjoyed by our competitors will not take place here. In 1992 there will be a market of more than 300 million people. It will be the largest single market in the world. Unless we solve the problem, we shall miss that opportunity. I am glad that I have had the opportunity to speak and I should like once again to thank the noble Viscount who initiated the debate.
6.30 p.m.
Lord Rochester: My Lords, the case for increasing the quantity and quality of trained engineers and technicians has been so well presented already that there is no need for me to dwell on it for long. The most serious aspect of the shortage is the effect it is having on the capacity of an increasing number of companies to develop new products and to raise manufacturing output. Demand for graduates in engineering industries and other sectors is, I am told, on a strong upward trend. On the supply side, the outlook is worrying. Additional places provided on engineering courses are not being filled. Applications for them have been going down and wastage from some university courses has been estimated at 20 per cent. or more, twice the average for university courses generally.
The shortage of technicians is equally serious. The Institute of Employment Research has forecast that demand for technicians will increase to such an extent over the next five or six years that the present level of recruitment will clearly not suffice to meet future needs. Overall, the problem looks like getting worse, as a result, as has been said, of the scarcity of maths and physics teachers in schools and especially of the forthcoming decline in the number of school leavers. This will bring a corresponding increase in competition between employers to recruit the most able and the best qualified of those young people.
The reasons for the sorry state in which we find ourselves are many and varied. They lie deep-seated in the history of the past 150 years, in popular attitudes and misconceptions, in ecological and even ethical constraints and in an education system that is still less closely linked to industry than the systems in, say, France or Germany. The most fundamental factor is the relatively low esteem in which industry in general and engineering in particular continue to be held in society as a whole and especially among students. For me this is all the more disturbing because I recall from first hand experience that industry in fact provides opportunities for trained engineers to apply their skills and knowledge in
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complex situations involving human relations and interaction between technical, financial and commercial considerations.
That is enough from me about the problem and its causes. The question that matters most is what is to be done about it. I should like first to pay tribute to the action that has already been taken by bodies such as the Engineering Employers Federation and the Engineering Industry Training Board. These two organisations together with the Department of Education and Science have launched simultaneously two surveys designed to help explain the shortfall of young people qualifying as engineers. One is looking at the factors which influence young people studying for or holding maths and physics A-levels in deciding whether or not to study engineering. The second is inquiring into why so many engineering students in higher education—up to 20 per cent. or more—fail to complete their courses.
The results of the surveys should be available this summer, and in my view they cannot come too soon. I am told too that to alleviate the shortage of maths and physics teachers the Engineering Industry Training Board has initiated a bursary scheme. It is aimed both at increasing the number of teachers and at establishing working links between the teacher under training and a local engineering firm. The teacher is thus able to see for himself or herself what is actually being done in industry to maintain the link. He or she can thus give students real examples of the use of maths in practice.
The board also recognises the significance of the increasing proportion of women in the labour market and the consequent need to attract more of them to engineering jobs and to encourage firms to employ them. A relevant project is the Technician Engineering Scholarship Scheme, aimed at 18 to 25-year old women and now successfully established at five colleges. This is a good example of a course which combines academic education with on-the-job industrial training. Apparently, it has an excellent record in placing women in jobs where their skills are needed.
The chemical industry, in which I once worked, is also playing a leading part in seeking to recruit more women. For example, one major chemical company has introduced a comprehensive policy which includes provision of career breaks, improved maternity leave arrangements and a female support network. So far, so good, but clearly much more needs to be done. I was once responsible for training, including management training, in a large industrial organisation. At this point I should like to say how much I agree with what the noble Viscount, Lord Hanworth, and the noble Lord, Lord Orr-Ewing, said on the importance of that subject in the education and training of engineers. The best definition of management I have ever heard is "getting things done through people". 1 t cannot be put better than that. Because of my experience in that field it is on the subject of training that l should like to concentrate in the rest of what I have to say.
Whatever may be thought of the Government's White Paper Employment for the 1990s—I know there is to be a fuller opportunity next week to debate the White Paper—it is encouraging at least that in the

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preface to the document the Secretary of State for Employment has written:
"Above all, we must invest in the skills and knowledge of our people and build up industry's skill base through a strategy of training for life".
I am sure he was right to add that the prime responsibility for this investment lies with employers. That being so, it is cheering also that the Director General of the CBI said recently that training must be at the top of the agenda for all businesses.
The question remains whether the new framework for training envisaged by the Government in the White Paper will in practice achieve its purpose. The Government's declared aim is to establish the system in a new partnership with employers. Because in my experience training is best done where it is work based, I am all in favour of involving employers to the maximum extent possible. However, I am sorry that in seeking to establish such a partnership the Government have been so dismissive of other interests having a stake in the enterprise.
The new framework is to operate on three levels: national—to develop policy and promote training; industry—to set standards and monitor the quality of training; and local—to ensure that employers' training is of the scale and quality to meet the needs of the local labour market. At the same time the seven remaining industrial training boards have been told to plan to become independent non-statutory training organisations as soon as possible. As such, they will no longer be empowered to raise levies, but will instead be free to obtain income from charges for services. I only hope that that policy will work because, before their jobs were brought to an end last year, the chairmen of what was the Manpower Services Commission and then became the Training Commission expressed concern about the performance of many of the non-statutory organisations that were established in sectors where training boards were abolished in 1981.
The Engineering Training Board is concerned that the benefit to engineering of widely understood common training standards is threatened by the Government's proposals. It advocates that the non-statutory successor to that board should be enabled to provide a service of standard-setting and qualification across all sectors employing engineering skills. It feels that there is otherwise likely to be fragmentation of the existing system among different sectors and a reduction in training for core engineering skills with consequent damage to labour mobility, particularly in craft and technician occupations. On this point I should be grateful if the noble Earl, Lord Dundee, could provide the engineering industry with any reassurance when he winds up the debate. I must confess that I failed to give the noble Earl notice that I was going to make that point and therefore I shall understand if he is able to give only limited information in reply.
At local level the White Paper contemplates the establishment of training and enterprise councils to meet local skill needs. I am sure that that is the right approach, but in my view it is vital that under those arrangements there should be adequate crosssectoral links. That is because in practice the needs of
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local labour markets apply across sectors rather than being identifiable only in respect of individual industries.
If, for better or worse, so much responsibility for training is now to be vested in employers alone, there seems to me to be a stronger case than ever for providing more incentives to employers than there are at present, so as to encourage them to give the training throughout working life that it is the Government's aim to achieve.
I very much agree with the remarks made by the noble Lord, Lord Orr-Ewing, about the present contrast between individual engineers who have to pay for their own attendance at educational conferences and seminars, with funding coming from net salary after tax, and employers who can set such costs against corporation tax. Clearly the noble Earl cannot commit the Government on that point at present. However, I hope that he will at least undertake to pass on to his right honourable friend the Chancellor of the Exchequer the suggestion made by the Institute of Mechanical Engineers—to which the noble Lord, Lord Orr-Ewing, also referred—that individuals attending conferences and seminars which are run by professional institutions should be allowed to set the costs of such attendances against their personal tax demands.
I have spoken for long enough, but there is one last point I should like to make. I speak as someone who was, until recently, chairman of a university council. I must say that I strongly support the reaction of the Committee of Vice-Chancellors and Principals to yesterday's announcement about the grants which universities are to receive next year from central government. The committee is reported to have said:
"It is very hard to imagine what the education Ministers must be thinking when they say they would like to see an increase in the number of graduates, but cut our budgets".
I welcome the Motion which the noble Viscount, Lord Hanworth, has introduced today in such a timely way and I trust that in some measure it may help to solve the problem to which he has so rightly drawn our attention.
6.45 p.m.
Lord Lucas of Chilworth: My Lords, I greatly admire the persistence of the noble Viscount, Lord Hanworth, in this subject area; but I have a feeling of déjàvu,. 1 have not prepared a speech, but I have read in Hansard the report of the debate which took place on 27th February 1980 in your Lordships' House. On that occasion we discussed engineering and the Finniston Report and we took five-and-a-half hours to discuss the matter. Indeed, the noble Lord, Lord Howie of Troon, was a member of Sir Monty Finniston's committee. I must say that if I were to précis the report of those proceedings to, say, three hours and rewrite it, we would then have a rehearsal for tonight's debate because, essentially, nothing very much has changed.
In his report, Sir Monty Finniston emphasised the need for an engineering authority. However, that concept did not quite get off the ground. Incidentally, it is interesting to observe, as did the noble Lord, Lord Gregson, in the 1980 debate, that:
"We cannot have an increased engineering dimension in industry without somebody paying for it, and at a time, as the report points

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out, when industrial profitability is at an extremely low level, and from the squeeze of 18 per cent. inflation and 20 per cent. interest rate, and the very high exchange rate, profitability is being squeezed even smaller".—[0fficial Report, 27/2/80; col. 1350.]
He wondered how we would pay for what we want. However, things have changed an awful lot in that regard.
My noble friend Lord Orr-Ewing said that he wanted to point out some of the things which the Government should do. Indeed, other noble Lords have also suggested what the Government should do. I start by asking: what is industry doing? Why should it he the Government? Perhaps I may return to that point in a moment.
From the great idea of the engineering authority, we ended up with the Engineering Council. That was supposed to draw together all institutions. But the institutions have boldly sat down in the street, as learned institutions, paying lip-service to the idea of the principle of engineers and engineering being the keystone of our prosperity. When the council started, it was funded by the Government. That lasted for three years; it is no longer the case. However, the council is rich. I ask again: what is the council doing about it? Why do we keep asking what the Government are doing about more funding in universities, in schooling, and so on? The question is: what is industry doing about it?
I recently visited a factory which, 10 or 12 years ago, took in 600 apprentices. Last year's intake was 25. However, they are there: these are boys and girls wanting apprenticeships. I believe that the Engineering Council could and should do more. It is up to industry, which now funds it, to ensure that the council does more in that area.
Perhaps I may quote from the maiden speech of the noble Lord, Lord Scanlon, in February 1980. At the time he was chairman of the Engineering Industry Training Board. 1 shall select just one or two sentences, although I would have liked to have read the speech in its entirety. It merits re-reading. The noble Lord said:
"We must not consider the training of professional engineers in the abstract".
and referred to,
"the need for academic training to be associated with practical training".
He then talked about general education and the three "Rs". My right honourable friend the Secretary of State for Education and Science has dealt with the three "Rs" in the new core curriculum and syllabus. I congratulate him. We start from a good sound basis at an early age.
The noble Lord, Lord Scanlon, was talking about the three "Rs". He went to a further "R"—the question of resources. I wish to turn to his last "R". He said, at col. 1364:
"My final 'R' is on the question of remuneration; and here I wish not so much to make a reservation, but to put forward a reminder of what Finniston had to say about remuneration or rewards. I quote from the report itself: 'Industry must establish the rewards and prospects for good engineers which will attract more of the country's most able young people into a lengthy and demanding engineering formation and thence into manufacturing industry'.".
The Government, universities and schools cannot do that.
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I recall my time as a junior Minister in the Department of Trade and Industry. We had the 1986 Industry Year. I went around the country every week talking about the need for industry to persuade young people and teachers, in a variety of ways, that engineering was a good thing to come into. My noble friend Lord Orr-Ewing and the noble Lord, Lord Dean of Beswick, asked, as everyone asks, "Why don't they come in?" We had a survey during Industry Year. Engineers came bottom of, "The job that I should like to come into when I grow up". Surprisingly, teachers came high. Politicians came higher than engineers. How odd! Engineering is much more fun than being a politician, and it is better remunerated, if I may say so. We do not have that part of it right. The Government can do little more than set parameters. Taxation is one element, but industry is making good profits. It must fund its own investment in people.
In higher education we have Cranfield Institute of Technology linked with the University of Compiegne in a dual degree, mostly of course for first and second degree postgraduates, where it is mandatory to take an arts course so that one is a more com olete person. I like to claim that I am an engineer, although I admit that I am not chartered and do not belong to those institutions to which some of my noble friends and noble Lords opposite belong. One can join a company and be a good engineer. One begins to move, but to reach the highest echelons one has virtually to abandon one's craft and move to another—management, finance and so forth. But the fundamental difference is that an accountant or lawyer going into industry advances until he reaches the top, still practising commercial law and accountancy. Engineers have to abandon engineering.
The chap at the beginning of his career says, "Well, look, there is a block at about age 37. I am not going to get to £30,000 a year. That is not for me. I shall go into accountancy or law and do company accounts". That deals with that type of person. There is another type of person, the type about whom the noble Lord, Lord Dean of Beswick, was talking. I know that he has a great deal of affection for them. They are those who are perhaps more blessed with being able to do things with their hands to expand their minds rather those who have broad minds and who then make their hands do things. I am talking about the average apprentice. Why does he not come into the engineering business? He does not see a great deal of future in it. The RSA and the Government put some millions of pounds into Industry Year and made some impact. What has industry done since then? It has done a lot, but not nearly enough.
We must look much wider to harness the talents and to bring boys and girls and men and women into engineering. If industry knew what it wanted and talked more generally with education, the courses and the basic teaching could be designed o meet that need. Again I ask; does industry know what it wants or does it just say, "I do not have enough engineers"?
I cannot disagree with anything that has been said. The noble Lord, Lord Rochester, talked about esteem. The noble Viscount, Lord Hanworth, mentioned status. My noble friend Lord Orr-Ewing

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talked about the prestige of the engineer. It does not matter what word we use. It will not come like the rain in winter or the sun in summer, it has to be earned. But it must be earned within an environment that industry itself provides for its expression and then for its reward to filter down. Notwithstanding the demographic situation in 10 years' time, we shall be able to face the problem and make so much better use of that human resource if we treat it properly from the beginning. That is the way that I should like to see industry start.
6.57 p.m.
Lord Howie of Troon: My Lords, I must join other noble Lords in thanking the noble Viscount, Lord Hanworth, for giving us the opportunity to discuss this important subject. There is something which he and others might have said but did not say. It is that engineering is difficult. It is as demanding and as intellectual a discipline as any. The mathematics and physics necessary for engineering are complex. They must be allied to organisational and management skills of a fairly high order. Because of the difficulty and off-putting nature of mathematics and physics—the point has been made over and over again during the debate—something must be done to secure a higher level of teaching of maths and physics in the schools. There is no question about that. It is the most important thing we can say tonight. It is the aspect which the Government should do most about to overcome the shortage of engineers.
The paradox about engineering skills is that they underpin the kind of industrial society in which we live. A modern industrial society is an engineering society. It is not an accounting society or a lawyers' society or an actors' society; it is an engineering society. The physical infrastructure in which we live and which we see every day—the roads, the railways, the harbours, the airports, the canals, the buildings, the sewerage systems, water supplies, electricity and communications are all aspects of engineering —seems to pass unnoticed by the public eye. Almost everything that we see is an aspect of engineering with, possibly, a little help from architects and in the country from farmers, foresters, and perhaps landscape environmentalists.
This is little understood in society and in the media. Engineers, quite rightly I think, become irked and irritated when, for example, they land a man on the moon and find that that is described as a wonder of science. It is not a wonder of science at all: it is an engineering feat. Then there was the good designer who was responsible for designing the nose of the 125—what Peter Parker calls "the nose job"—and who was described as the designer of the whole train, though we know that he designed the bit that you see at the front and engineers designed the rest of it.
It is little wonder that engineers get a bit irritated. In fairness, though, I must say that that designer tries to put the record straight whenever he gets an opportunity. In the face of that kind of lack of recognition and lack of appreciation, allied to the relatively low salaries which engineers command—that was mentioned earlier—and the difficulties of the discipline itself, it is not surprising, at any rate to me, that there is a shortage of engineers.
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What can be done to reduce that shortage? Nothing can be done to make engineering easier: if anything, it will get more difficult. However, it is not as difficult as all that because quite a few of us have managed to handle it reasonably well; but there are difficulties. The Government have done something about recognition in a minor but quite important way. During the passage of the copyright Bill the Government agreed that the author of a building could be not only an architect but an engineer. That is a piece of public recognition, which, if engineers use it properly, should bring a certain amount of honour to the profession. So that is a small step but a step in the right direction.
However, if the Government deserve praise for that modest step, I do not think they deserve any praise in relation to salaries—not that engineering salaries are the Government's direct business. However, there is little doubt that the Government's policies in relation to fee competition in consultancies will have the effect of reducing the incomes of consultants and consequently the salaries of the staff they employ. So the Government's policies will have an ill effect on salaries which are already too low.
It is the employers, of course, who are responsible for salaries, and the message to engineering employers is really quite simple. They should pay more, and if they have to charge more they should charge more. The employers will argue that they pay what the market demands they pay, but they should realise their responsibility to raise the level and quality of the staff they employ. They can only do that by attracting people into the profession by paying them properly.
Despite what the noble Lord, Lord Lucas, said a Moment ago, I think the Government should be brought into this at least as much as industry. There is one thing the Government can and should do—and in this comment I am really following what was said by the noble Lord, Lord Lucas. The Government should reread the Finniston Report. It was perhaps before the day of the noble Earl who is to reply to this debate, because it was published nine years ago last month and I question whether he would remember it in great detail. Indeed, I will not ask him to reply in detail.
In the report Sir Monty Finniston and his committee wrote the following—and I fear that this quotation is quite a lengthy one:
"Among those manufacturers in this country and overseas who have prospered in world markets, we found a common characteristic in the way they had built upon excellent engineering, integrated into enterprising and forward-looking market and product strategies. Management in these companies clearly regarded engineering as the common factor linking the inputs of the various specialist functions within the organisation to its overall objectives. Engineers were involved in each stage of the manufacturing process, from the technical appraisal of world market opportunities and the translation of those appraisals to the design of products and systems to exploit the opportunities through to the development, manufacture, sale, delivery and service of the products. There was thus achieved a continuous interplay between marketing, design, research, manufacturing and selling, with all concerned seeking to ensure that the company's products met the demands of world markets".
The committee said a little later in its report:
"To convey the interaction of engineering with non-engineering factors in determining manufacturing performance, and to emphasise the importance of considering the whole manufacturing system and not just aspects of it, we have adopted the concept of the 'engineering dimension'."

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The committee went on to say this:
"The engineering dimension is understood and well developed in successful manufacturing companies, but there are too few such companies in the UK to produce sufficient wealth to match the social and economic expectations of the nation".
In order to attempt to galvanise the economy and the engineering profession into an understanding and an application of the engineering dimension the committee said:
"Our most important single recommendation"—
I emphasise that—
"linked to very many other proposals in various sections of the report is that the Government should establish a new statutory organisation —a national Engineering Authority—with powers granted to it by Parliament to advance the engineering dimension in national economic life and particularly in manufacturing".
That report was debated in February 1980, as the noble Lord, Lord Lucas, has said. I cannot remember whether I spoke in that debate, so little has changed; but if I did I could probably have made the same speech again tonight—and perhaps I am making the same speech, for all I know. The Government did not implement that recommendation. Instead they set up the Engineering Council without statutory powers, and left it in a somewhat uneasy relationship with the great engineering institutions. The great weakness was to set it up without statutory powers. That is an unsatisfactory state of affairs, since the work of the council and the institutions often overlaps and their ambitions are not always the same. Nevertheless, they have both done a good deal in their respective ways, especially in relation to raising standards of engineering training and education. I think it is fair to say that the Institution of Civil Engineers, of which I am a fellow, is in the lead in this respect, but the others are not far behind and neither is the Engineering Council.
Can the Government help? Yes, they can. In a statement last year the Engineering Council commented on the need for a core curriculum at the upper end of school education. It said:
"The Scottish system and the International and European Baccalaureates, where a core of compulsory subject areas is prescribed, provide valuable models".
The Government are going some way in that direction. That is to be welcomed, but are they going far enough? Are they going as far as the Scottish system and as far as the international baccalaureate? I do not think that they are. They should listen to the Engineering Council's advice and follow it more closely than they have.
The Government could do something else: they could fund the Engineering Council. I know that the noble Lord, Lord Lucas of Chilworth, was not too keen on that when he spoke. He thought that industry should help, as indeed it should. When the Engineering Council was founded in 1981 it was given a three-year start up grant, which it no longer has. A good deal of the effort, activities and energies of the chairman of the council, Sir William Barlow, are devoted to trying to drum up funds. I am not sure that that is the best use that could be made of the chairman of the Engineering Council.
The fact that the council has no government financial support is all the more startling when one considers that the Design Council has. If the Design Council is supported in its funding by the
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Government—it is in part, though I believe that the funding has been reduced lately—why is not the Engineering Council also? After all, a large part of the design profession's work is related to engineering. Without an engineering profession there would be little for designers to design except T sh. rts, corporate identities and suchlike, at which it is very good.
Talking of the design profession reminds me that there is something else the Government could do. They could promote engineering in the same way as they deliberately and energetically promoted design. There was a period of a year or two—and still, in fact—when one could never attend. any design function without a Minister being present. Whether the function was in London or Aspen in Colorado, the Minister would be present extolling British design and saying how important the design profession is. One result is that, from having been a fairly obscure profession a few years ago, the design profession is now a notable one. Therefore, the Government could exercise their energies in talking up the engineering profession in the same way as they talked up the design one.
Engineers could do a lot more for themselves. It is not enough just to ask the Government to do it for them. They could speak up for themselves a bit. I was interested in the comments made earlier by the noble Lord, Lord Orr-Ewing, when he spoke of engineers learning how to speak and then getting up on their hind legs and speaking about the profession and promoting it themselves. They could go into politics, for instance. There are quite a few engineers in this House, but I can remember a time 20 years ago when the noble Lord, Lord Orr-Ewing, and I were part of a tiny group of six chartered engineers. I think that there are only three in the other House. One has retired as a chartered engineer and is the Secretary of State for the Environment, so there is little engineering to be got out of him. Engineers could do a good deal for themselves along the lines suggested by the noble Lord, Lord Orr-Ewing.
This has been a most interesting subject to discuss, if only to remind us how little has been done on the ground—though something has been done—since the Finniston Report was published nine years ago. 1 am grateful to the noble Viscount, Lord Hanworth, for giving us this opportunity.
7.14 p.m.
The Earl of Halsbury: My Lords, I start with an apology, in that I had to leave the House at six o'clock for an urgent engagement in the Peers Guest Room, a fact of which I warned my one time noble friend Lord Hanworth. I was not indulging in the pleasures of entertainment but I was receiving highly technical briefing in the complexities of the Water Bill, which will come before your Lordships' House in due course.
With that by way of apology to the noble Viscount, I turn to the question of engineering supply and demand. Education ought to be a lifetime process that goes on indefinitely. It is true that much is concentrated into one's formative years. After 15 years in retirement I cannot address your Lordships' House without preparatory work that contributes to my self-education in later years. I have never found

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employers reluctant to release me for the purpose of attending super-specialised courses in my own specialised subject. For many years I was an executive director of Joseph Lucas and its subsidiary companies. When anyone looked like a high flier at middle management level, we sent him off to the Harvard Business School to learn what it had to teach, and he came back a better man for it. A lot of what he learnt rubbed off on his colleagues. Therefore, there are enlightened employers. I have been lucky to have worked for a number of them in the course of my career—Lever Brothers, Thomas Firth and John Brown, Joseph Lucas, the Distillers Company and, in partnership, with BP.
When people are crying stinking fish about the levels of management and expertise in management in British industry, I sometimes ask myself where I have been all my life because I have never come across this at all. If we could adjust the average to the level of the best, as in so many other contexts, we should be very well managed.
There is much abuse of this word engineer. Etymologically it means the exercise of ingenuity. It started in the military context of those who built mines and saps to blow up other people's fortifications or raised fortifications that could not be blown up or sapped. When the canal building boom came in the 18th century and later in the railway age it was felt that transferees from the military engineering side, the Royal Engineers, were not really the right men for building canals on that sort of scale. Therefore, the Institution of Civil Engineers came into being; after that came the mechanical engineers and then any number of institutions of engineering, with the result that the engineering industry is very much fragmented between the chemical engineers, the mechanical engineers—but I will not go through the whole lot, there are too many of them. Every time any one of them tried to get a new chartered status all the others had to be circulated by the Privy Council, because their name contained the word engineer, to find out whether there was any objection. Sometimes they had and sometimes they had not. In the latter case a new chartererd body was brought into existence; in the former case it was not. The Engineering Council was brought in as a sort of godmother for all new institutions that came into existence.
When I was a boy the locomotive engine driver wiping his hands with an oily rag was known as the engineer. This of course was entirely a misapplication of the term. The engineer is the man who designs the locomotive. The engineering technician is the chap who knows how to manipulate it, knows his signal lamps and so on.
In this context I remind your Lordships of an experience I once had as a member of the Council of the National Engineering Laboratory in East Kilbride. We always had an annual meeting up in East Kilbride followed by a lunch in one of the hotels in Glasgow. On one occasion the lift stopped between floors. After pressing all the buttons and finding ourselves unable to get the lift working again we pressed the emergency button and picked up the telephone. In due course we got in touch with the general manager of the hotel, who said that he could
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do nothing until he got an engineer. Here was the cream of the engineering profession—modesty requires me to say, with the possible exception of myself—imprisoned in the lift. The trouble was that, although he needed an engineer, as he thought, they were inside the lift, not outside. What he really wanted was an electrician—the man who knows which fuse has blown and where it can be replaced—and he is a technician.
This is reinforced by the brief of the Engineering Employers Federation on this debate, which says that the shortage of engineers, both chartered and incorporated, is exacerbated and made worse by the long-standing shortage of technicians. The technician is the man who manipulates what the engineer has designed. Design is always a team effort. Someone has to make a scrutiny of possible alternative starting points for a given design and a decision has to be taken. In the context of nuclear engineering, one possibility is to take a nuclear boiler and put the whole thing inside a huge ferro-concrete and steel barrel with tension rods inside it to hold the whole thing together. But one still has to decide whether one is going to put the barrel on its side or on its end. If one decides to put it on its side, one gets Trawsfynydd, and if one puts it on its end one gets Hunterston-B, Torness and others. Someone has to take that decision and that person must be a man of very great experience.
The status of the chartered engineer is that of someone who, irrespective of which branch of engineering he is in, has taken a three-year degree course, served a two-year graduate apprenticeship and then has two-years' experience in employment. He is then qualified to be an associate, but not a full member of his particular specialised institution. After joining the ranks of management, he can become a full member and put the initials CE, which stand for Chartered Engineer, after his name. It should be the proper ambition of every young engineer to acquire Chartered Engineering Institution status and to take his place not with the man who wipes his hands with an oily rag, but with people such as Sir Tom Sopwith, the late Lord Baker, Sir Richard Southwell, Sir Barnes Wallis, Sir G. I. Taylor and Sir Frank Whittle. Those men gilded everything they touched with the inspiration of their thought.
Incorporated engineers differ only from chartered engineers in so far as they have attended a polytechnic and have acquired an HNC in engineering rather than having attended a university and acquired a degree. But there is nothing to stop the incorporated engineer going on further and taking the examinations of the chartered institute and being qualified to put the initials CE after his name. Let us not in any way depreciate incorporated engineers as second-rate citizens. The designer of the redesigned particle accelerator at CERN built it for very much less than its original redesign cost. That designer was an HNC man who stood beside the giants of the engineering industry.
If we compare the qualifications required of an engineer in this country with those required in France or Germany, we find that they are very much on a parity if we are thinking in terms of the French word "instruction". But our qualifications are somewhat

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below par if we are thinking in terms of the French word "éducation". The latter word deals with one's general cultural background. French and German engineers would be much better at manipulating their mother tongue than the average graduate engineer in this country. That is entirely due to our habit of premature overspecialisation. I hope that the core curriculum to be introduced under the new Education Reform Act will do a lot to correct that.
There are disciplines auxiliary to engineering. There is applied mathematics, for example, and there is metallurgy. An applied mathematician must know how to turn a differential equation into a finite difference equation ready for computerisation after he has inserted the boundary conditions. He then has to evaluate the stress concentration on things like pipes and flanges and interpret the results in terms of plastic theory and fatigue theory. That is, practically speaking, the whole of chemical engineering, apart from a little thermodynamics, which is really quite kid's stuff for the most part. There is also the design of heat exchangers and fractionating columns.
What is the specification of what we want? Do we want more engineers? The Engineering Council and the Fellowship of Engineers, to which I have the honour to belong, have not yet decided on exactly how many more engineers, if any, we need. However the Engineering Employers Federation says that we need a lot more engineers. It says the situation has been exacerbated by a shortage of technicians.
I have two points of principle here. One of the points is an assertion that I cannot buttress with evidence. But I believe that if we sought the evidence we should find it. All professions in the UK are underpaid compared with their opposite numbers on the Continent. One can compare doctors, engineers or lawyers for example; they are all underpaid compared with their Continental counterparts. Unless we do something about that I can foresee that in 1992 there will be a massive brain drain to Europe. As I have said, that is an impression I have received following remarks I have heard. I cannot lay proof before your Lordships' House.
My next point is that good physicists and mathematicians command a high price in industry. The salaries in industry are higher than the egalitarian salaries paid in schools. The result is that educational establishments only manage to recruit not the best but the second line, as it were, of people available for employment. Those people are less inspiring to children than their high-powered counterparts in industry who earn a premium. However, I hope again that the Education Reform Act will alleviate the problem to some extent.
Let us compare the arts man with the engineer. I shall take as an example an historian. There is only a small amount of employment for historians, as historians, outside universities. They may, of course, go into industry and, being educated men, they will probably do better than uneducated men. But there is nowhere where they can get a premium on employment just because they are historians. The result is that schools can recruit good arts men on that basis. My conclusion is—I am sorry if some people may not like this, but I believe the Front Bench may approve of what I am going to say—that
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the market mechanism must solve the problem. Let us reject egalitarianism in schools. Let us recruit physicists and mathematicians at the going rate in industry. Engineering will not be taught in schools because it is not a subject that can be taught in schools. But that component common to engineering and physics which is known as mechanics and includes statics, dynamics and mathematics will predispose students to consider studying engineering at university if those subjects are well taught in school. I believe that would be the ultimate solution to the difficulties which the Engineering Employers Federation have put before me.
7.28 p.m.
Lord Whaddon: My Lords, my noble friend Lord Hanworth put his finger on one of the great debilitating diseases in British industry—the low status of engineers, which leads to poor recruitment and indifferent performance, which in its turn leads to poor recruitment again. Britain has a particularly depressing record in this regard, but we are not the only ones who suffer to some extent from this disease. The United States has shown some symptoms. Forty to 50 years ago the production engineer of the United States was king. Yankee know-how was famous throughout the world.
But then there came a time when the engineer was taken more for granted in the United States and the salesman became the important figure in a company. In more recent years as the huge conglomerates were built the accountant became king. By then the performance of US engineers had begun, if anything, to decline. It had become all too common to tolerate 1, 2 or 3 per cent. rejection in production lines. Those levels are completely unacceptable in Japan. Recently America has begun to feel the effects of that in a dramatic drop in its balance of payments position.
It is noticeable that recently the Americans have begun to pull up their socks. In advertisements companies are offering to pay engineers far more and they are recruiting to higher positions, including board level, those production engineers whose reputation had declined. They are taking some action to put the position right.
Many references have been made during the course of this afternoon's debate to the deplorable position of engineers in the United Kingdom. My experience has been in the chemical industry and my acquaintances among engineers are almost exclusively chemical engineers. I must say that they do not appear to have anything like such a depressing record as mechanical and electrical engineers. British chemical engineers are among the world's finest. They are well paid in comparison with their colleagues in mechanical and electrical engineering. It is common for the boards of chemical firms and engineering companies to recruit chemical engineers to the highest positions on their boards. As a result the British chemical industry as a whole is one of the great success stories of this country.
Why is there that difference? Why is it that chemical engineers seem to do so much better than their colleagues in mechanical and electrical engineering? One of the explanations is that the chemical engineer has a broadly based education.

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The noble Earl referred to the broad cultural base to be found among engineers in Germany and on the Continent. I believe that chemical engineers in this country receive a broad scientific basis to their training including not only chemistry but also physics, biology and the philosophy of science. That produces a rounded figure who can hold his own as an educated man with anyone in the world.
The Earl of Halsbury: My Lords, perhaps the noble Lord will forgive me. if an engineer cannot write good English prose, he will have a problem in expounding his theories to third parties.
Lord Whaddon: I thank the noble Earl.
In addition it is very common for chemical engineers, as soon as they are recruited, to find themselves in an international and cosmopolitan environment. Somebody recruited to a chemical engineering firm is more likely to find himself sent to Venezuela than to Birmingham or to Glasgow.
I wonder whether there is anything to be learnt from that experience which could be of advantage to the other branches of engineering. Should we be thinking of a broader based education for electrical and mechanical engineers, including not only mechanical skills but also management training, some knowledge of finance and accountancy and the wider world of business? We should make sure that they are sent out to visit the customers to whom their products will be sold. Surely it is also essential, since our products must be sold worldwide, that the engineers themselves must have experience of other countries. In the course of his training it should be normal for an engineer to be sent on exchange visits to companies in Japan and America to learn how our competitors abroad cope with problems.
I suggest that if we can introduce a little more glamour into engineering, which it has tended to lack, that would not do any harm in stimulating the prestige of the engineer and the recruitment of the best brains, which we so desperately need.
7.35 p.m.
Lord Peston: My Lords, in his excellent introduction to this extremely interesting debate the noble Viscount, Lord Hanworth, referred to history. It is true that we have all been around this course many times before. I hope that noble Lords will forgive me if I offer the following quotation from a lecture on technical education. Reference was made to:
"the panic cry that this county is losing her position among the manufacturing nations. I believe this cry to be true and that the industrial supremacy of England is endangered for lack of knowledge, in spite of the practical aptitudes of her people".
I could quote much more from that lecture on technical education. It was given by Lyon Playfair in 1870, at about the time of the introduction of the 1870 Education Act. This is not a new problem, as noble Lords have reminded us.
The problem was brought to our attention again at a critical time by the Finniston Report. When preparing for today's debate I looked back at the Finniston Report and was depressed, and even shocked. In those days it seemed that we were
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optimistic that something would happen. It seems odd that today's debate is not about all the great achievements resulting from the Finniston Report. It seems instead that many people have forgotten the Finniston Report.
The problem is not new, but that does not mean that it is not of overwhelming importance. My contribution to the debate can only be to add a little gloss to all the points that have already been made. I think that it would be virtually impossible for me to add anything new. I hope that noble Lords will therefore forgive me if I do not repeat everything they have said, merely adding that I agree with them, as I do.
The tone of the debate kept changing. We are asked to draw attention to the case for more trained engineers and technicians. I do not want to bandy words about as to what is an engineer and what is a technician, but I must emphasise that the issue relates to skills at all levels. Noble Lords have gone into those aspects of the subject which interest them most, but we ought to recognise that the future of our country depends on the value of improved training from the top—the graduate engineer—to the lower level—the technican.
As a university teacher I do not like to see too rigid a separation made between what is called education and what is called training. I think that they go hand in hand, both in terms of activities but also in terms of relevant institutions. I also believe that there is no substitute for appropriately high academic standards. I should take a very dim view of the lowering of standards at the graduate level. I also strongly believe that one of the errors in this country is to assume that we can train technicians through technical apprenticeships based on the learning of manipulative skills without also offering a scientific and theoretical underpinning. I think that technicians need an appropriate underpinning to what they do, even though their activities may be of a more directly practical nature than those of graduate engineers. They all need an appropriate understanding of the nature of the tasks they are engaged in.
One of our great mistakes in this country over the past century has been to underestimate the value of that fundamental underpinning. We have assumed that we could get by on the practical aptitudes of our people. That is mistaken. Our foreign competitors have demonstrated that many times over.
My noble friend Lord Dean of Beswick referred to apprenticeship schemes. I do not want to decry such schemes; apprenticeship is enormously important. It is a great sadness to us that the number of apprenticeships has dropped so much in recent years. In my view, on the basis of a great deal of research evidence, much of what passed as apprenticeships in the old days was the repetition of inefficiency and obsolete skills. We require, and I hope that we will find a new approach to apprenticeships based on proper, advanced, modern ideas and on a combination—this is my next main point—of the business community, or the firm, and the education sector. The two must go hand in hand. We therefore need to go back to apprenticeships. There must be a close connection between what happens in the firm and what happens in the further education college,

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just as at graduate level the best courses are the sandwich degree courses. If I had my way, there would only be such graduate courses. That approach brings together the practical and the academic experience that we need.
The education sector has a large role to play in developing general education and training skills. That is also where the Government's role and the use of public money become very important. Equally, however, the individual enterprise has its role as regards firm specific skills. The main point that I wish to make to your Lordships is that we can discuss to some extent where we draw the line, but it is a cooperative effort between the government or education sector and the firm, involving both public and private money. We may differ a little about where we draw the line, but the notion that we should go to one or other extreme is entirely mistaken; it requires a balanced approach.
I cannot resist making the point that, if one looks at the latest public expenditure White Paper, it is disappointing to note that there is a cut in the nominal sum of money available for work-related further education. That is a serious mistake on the Government's part which I hope the Minister will draw to the attention of his ministerial colleagues. It is a serious mistake to cut expenditure in that area when we require expansion.
On the question of skill shortages it is clear that, as the CBI and most other surveys tell us, there are genuine skill shortages in our economy at this time. That is the short-term problem. The noble Lord, Lord Rochester, and other noble Lords referred to 1992, but the time for preparing for 1992 is gone. Nothing we can now do will prepare us for 1992. It might prepare us for 2002, but there is nothing that anyone can do to deal with the lack of skills in the near future. After all—I hate to remind noble Lords—1992 is only four years away. I say that as an economist; an engineer might give a more accurate estimate. The idea that we can do anything for 1992 is simply an error. That does not mean that we should not act, but it emphasises our delay in getting ready.
Our responsibilities do not just concern the relatively short-term future; they concern very much the long-term future. The long-term skill shortages must be rectified. They will place a serious limitation on the scale and quality of any growth in the long run, and on the kind of sectors in which we will find ourselves. I and other noble Lords have emphasised that point on many occasions. I stand second to no one in emphasising that the engineer has a central role to play in rectifying those long-term skill shortages. I say that, although I do not speak as an engineer.
We are told that labour will be scarce over the next relevant growth period. That refers simply to numbers, but numbers do not matter. What matters when numbers are scarce is that we increase the rate of our capital investment to offset that shortage. There must be an increase both in physical capital and in human capital; in other words, there must be investment in people. All those people who despair and say that we have a major shortage of skilled workers do not understand the economics of the problem. It is a great opportunity and the problem is
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clearly solvable. We must invest in skills, and the sooner we do so the better. I cannot see how the quality of the growth that we require can be achieved unless something drastic is done about engineering education and training at all levels.
In that regard, I must raise a slightly controversial matter. We have mentioned engineering salaries and status, but reference was also made to what I believe is called the market mechanism. There is a paradox here because, if one believes in the market mechanism—in which I do not believe à outrance; I believe that it has its place, but the notion that it is perfect is quite preposterous—one must accept that the present status and salaries of engineers, are exactly right and that the present demand for and supply of engineers is right. The only basis for a debate is to say that the market fails. I do not believe that the market fails in the sense that we should abolish it and adopt a totalitarian system, but those who say that we can rely on the market mechanism to solve this problem have misunderstood the problem. The mechanism is part of the problem.
People say that we need to enhance the position of engineers. We must persuade those who operate the market—the decisionmakers—to raise their own expectations of what can be done. On the basis of those expectations, they may then perceive the value of engineers to be higher and may therefore offer them higher salaries. I simply throw in that idea. It is a standard economist's point, but it is not a trivial one. It takes me back to my central point of the combination of government and private enterprise action and my true belief in the mixed economy.
However, I do not believe that the market mechanism has no role to play; quite the contrary. We must produce engineers that industry can use and, equally, we must persuade industry to use them. As we have been round this course before, I am in one sense quite pessimistic because there is nothing new. The noble Lord, Lord Lucas of Chilworth, pointed out that there was nothing new. One might say that, if we have known about the problem for so long and have done nothing about it, why should we believe that we will do anything about it now? Nonetheless, many noble Lords have pointed out what we can do to solve this engineering problem. We can specify the problem clearly—this takes us back to Finniston again—and we and others have said a great deal about possible solutions.
Perhaps I may refer to one or two of those solutions. I agree with all noble Lords about the importance of the schools in this matter, but we should not underestimate how difficult it is to change the atmosphere in schools. Mention has been made of the aspirations of young people. Certainly, when I was at school, I do not think that I knew anyone who would have owned up to wanting to be an engineer. As I understand it, that still seems to be the case. The obvious reason is that most young people base their expectations and aspirations on the people. who teach them, though of course there are not many people in schools teaching them. Even if, as the noble Lord, Lord Orr-Ewing, and others have said, we employ physicists and mathematicians, we shall still not have engineers teaching in schools. That is a great pity.

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Another point that has often troubled me is that we find in our schools people who have left industry. However, I am not sure whether they are the best ambassadors for industry or engineering because they will have often left industry, having become disaffected as it were, and they will not do the job that we want.
The schools have an important role to play, but we must realise that this will be a slow and difficult task. Nevertheless, it is a task with which we must proceed. I believe that the national curriculum helps to some extent in this regard. I belonged to the school of thought that would have had only a core curriculum, but my wish was defeated during debate on the Education Bill. Nonetheless, the national curriculum compulsorily includes science and technology. What worries some of us a little is that there are already signs that it may not be quite as compulsory for most people as we were originally led to believe. Again, that would be a great pity. I believe that it is enormously important.
Let me say a little about the curriculum. Of course I accept the importance attached to the ability to communicate. There seems to be a correlation between the success of those who do relatively well in the world and the ability to communicate. I stand second to none in seeking to enlarge the educational experience of young people who take up engineering but I hope that it would never be to the detriment of the academic quality of work within their own field. That would be a great pity. One hopes that the two aims are not in competition with each other.
Equally, I should certainly like to see included in the course a management element—this important point has already been raised, though I do not for the moment remember the name of the noble Lord who mentioned it—which would also cover management of personnel. I believe that room to do that can be found for engineers.
Again, I do not think that this element should be so expanded as to detract from the fundamental work. Noble Lords will recall the old joke, though it never applied to me as an economist. When a bridge is built I like to believe as I drive over it that it has been built properly by an engineer and that it is safe. In my own field one is never put to the test of having to do anything to make sure that something works. Clearly we want all engineering work to be of high quality. I believe, however, that within that discipline we can enlarge the range of experience offered to engineers in the field of English language, management, and so on.
The time I have to speak is running out. On such subjects one can speak for a long time, but I promise noble Lords that I shall not go on and on. However, I must say a few words about the role of women. The fact that we do not train women engineers on the scale that we need clearly has nothing to do with the intrinsic abilities of women but is entirely a sociological and socio-psychological phenomenon. But it is a problem that can be solved, and we are beginning to see signs of a solution.
The Equal Opportunities Commission takes an interest in this matter and there have been many initiatives undertaken in this area. We return to the
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point about governments and statutory bodies at least beginning to give a lead to others in determining the values that are possible. Women are an untapped well of ability in this area. In these days engineering is not about lifting heavy objects; it is not about performing crude tasks; it comprises serious analytical work. We must not neglect the contribution that women can make in this field. Again, I blow hot and cold. I see good signs of that happening even though they are not on as big a scale as I should like.
There is little I can add; or rather I could say much more, but must not if the Minister is to have a chance to reply. As I said earlier, this debate should end on one of two notes: all the evidence is that we shall fail in this regard because we have not done enough in the past; alternatively, that we do know enough to succeed. We know what to do.
I think it will be a pity if ideology gets in the way of solving the problem by putting emphasis uniquely on one or other side of our lives. On the other hand, I should like to make one final comment. I do not disagree with noble Lords who referred to the importance of industry, and so on, but in the end the Government of the country must take responsibility for something which is so fundamental. For there to be a new climate of opinion and a new determination, I am convinced that in the first place leadership must come from the Government, though the more that the rest of us respond the better—and I mean all of us.
Lord Rochester: My Lords, before the noble Lord sits down, may I ask him to accept for the record, since he mentioned me in this context, that I had nothing at all to say about 1992. In fact, I very much agree with him that it is skill requirements for the long term rather than the short term that are important.
Lord Peston: My Lords, always in these debates one comes prepared with an elaborate set of notes to which one refers in the course of the evening. I apologise to the noble Lord. Certainly one of your Lordships raised the issue of 1992. Nonetheless, I was not seeking to be acerbic or difficult. I intended to be helpful.
7.55 p.m.
The Earl of Dundee: My Lords, I should like to join your Lordships in thanking the noble Viscount, Lord Hanworth, for introducing this important debate on the subject of the availability of skilled manpower in the engineering industry.
It goes without saying that engineering has always been extremely important to every age and between centuries we have of course the wonderful memorials and links provided by works such as the famous stepped pyramid at Saqqarah near Memphis, built in 2550 BC by Imhotep, who was the first engineer to be known by both name and achievement. Then in the ancient world there were all the marvellous civil engineering works of his Egyptian, Persian, Greek and Roman successors. And in the Middle Ages we find the fantastic technical accomplishments of building work demonstrated in Gothic architecture.

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The respective levels of human ingenuity in engineering throughout the ages are obviously immeasurable and incomparable. It is certainly fitting, as the noble Earl, Lord Halsbury, reminds us, that the word "ingenious" and the word "engineer" share the same Latin derivation: ingenerare—to create. One difference in today's engineering is that there is a proliferation of branches including mechanical, electrical, electronic, vehicle and aircraft manufacture and engineering construction. Perhaps another distinction is the greater stress that is now placed on cost and competitiveness. Indeed, I have heard the definition of an engineer given as someone who will make for £5 what anybody else will make for £50.
On the theme of competition, today Britain is of course competing in global markets and with countries which view investment in skills as the linchpin of economic growth. By comparison as a nation our workers are too often under-trained and under-qualified, as my noble friend Lord Orr-Ewing and the noble Lord, Lord Dean, observed. But at a time of rapid technological change, when we have to keep up with and ahead of competition, the skills of employees become the employer's competitive edge.
But what just now are the proportions of engineering in the economy? Engineering employs 1.9 million people in 21,600 firms and represents 10 per cent. of total domestic economic activity. Output per head has risen by 25 per cent. between 1983 and 1987, which compares with a rise of 20 per cent. in manufacturing as a whole. The past 10 years in particular have seen an increased demand for highly skilled people which has come about through the pace of technological innovation, the use of microelectronics in products and processes and the rapid development of new materials technology.
So far as the demand for skilled people is concerned, a paradoxical trend has shown itself over the past 10 years. On the one hand, and despite the difficulties focused upon quite rightly in this debate by your Lordships, there are now more professional engineers than ever. Nevertheless, manufacturing companies continue to report to the CBI training agency and others that they expect that a shortage of numbers when recruiting professional engineers will limit the potential of future output. These fears are certainly not imaginary. The simple reason why they are valid is that, while the number of those qualifying as professional engineers has increased greatly over the past 15 years, demand has also grown rapidly; in other words, we are dealing with the problem of success.
The noble Lord, Lord Whaddon, and the noble Earl, Lord Halsbury, mentioned the problem of overspecialisation. The engineering council has recently consulted industry on the proposal to develop a more broad based first engineering degree, which may go some way to mitigating this problem. There are certainly a number of factors which weigh against good recruitment prospects. In referring to them the noble Viscount, Lord Hanworth, and other noble Lords have mentioned that part of the problem lies in attracting young people to study engineering. It is a worry that so many young people remain
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reluctant to take maths and science subjects at A-level and to enter engineering courses at higher education level.
Another recruitment setback which has already been debated is that in the coming years there will be far fewer young people entering the workforce any way. It then becomes all the harder to secure the right number of entrants. However, we must try to achieve this number and if we fail to do so the sector's efforts to remain competitive in world markets will be seriously undermined.
How should we react to the problems of recruitment and to the threat that they present to the industry? Nobody would argue that a focus on training for new recruits is bound in itself to detract from the endeavours of industry to invest in its existing workforce. Yet having said that, to focus on training for new recruits is the first and most obvious thing that one thinks of doing. What is rather less obvious is to remember to invest in the adaptability of established employees. After all, they have already learnt some of their trade, and as an employer one might think it unnecessary, or might even fall shy of the idea, to spend money on doing something which may simply be, one fears, teaching one's grandmother to suck eggs.
In engineering as in all other sectors, prosperity and growth depend on our ability to prepare and maintain a well-trained, adaptable workforce. Industries which neglect this factor of adaptability are bound to lose out to their competitors. The reason that they will do so is that competition worldwide is now far more between workforces and their competence than between products and services.
No doubt the ideal would be to maintain a well-trained, adaptable workforce and also to attract an increase in the number of recruits. But employers can no longer rely on school-leavers to provide the raw material for their industries. By 1995 the number of 16 to 19 year-olds will have fallen by almost a quarter. Equally, competition and technological change will demand even more skills. Clearly we cannot reverse demographic trends nor stop competition from abroad. What we can do is to increase our investment in people's skills as our most valuable national asset.
When you make an investment of this kind in workforce adaptability, either you update people's existing skills where necessary or provide them with completely new ones. It may often be a quite tricky commercial decision to make. However, one thing is clear. It is a decision which only the employer can properly make.
On that theme, I now turn to the White Paper, Employment for the 1990s, which seeks to emphasise that the best way of achieving desired retraining is through a partnership between government and industry. Inevitably any government's role in training, while important, will have to be subject to clear priorities.
I am grateful to my noble friend Lord Lucas for the support that he gave to the essence of this way of thinking. The noble Lord, Lord Peston, referred to the reduction in funding for vocational further education. I note what the noble Lord says. I shall

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pass on his remarks to my right honourable friend. I would also say to him in the context of what we see ourselves able to do as a government, governments can create the right climate. We can establish a policy framework and a delivery system for training and vocational education. We can give young people and those with few skills the backing they need to continue learning on the job. For example, through employment training, the training agency supports 300,000 places of which 14 per cent. are in engineering occupations. Nevertheless, business must accept an equal responsibility for upgrading and retraining its own workforce. Employers must be prepared to invest boardroom time, money and management expertise in their most valuable asset.
Underlying the proposals contained in the White Paper is the belief that as the system's foremost consumer, employers are best placed to specify their needs and to ensure that the type of training available and the level of its quality reflects what is going on in the market. Therefore we look first to industry and employers to analyse manpower needs and to define standards based on competence. Employers must also take the lead in developing training through life. What the Government can and are doing, however, is to support their efforts. At the moment the Engineering Industry Training Board is responsible for giving a lead to companies within the sector on setting standards and investing in the training and development of their employees.
The noble Lord, Lord Rochester, questioned the advisability of future non-statutory organisations. The White Paper indicated that the Government would enter into consultation with the training boards and organisations representing employers with a view to drawing up a programme for becoming non-statutory bodies. These discussions are now taking place.
I should like to say a word about the activities of the EITB. Since 1984 some 6,000 technician trainees have registered into EITB schemes. Almost 300 centres offer technician training to EITB recommendations. We have a diversity of trainees in the training programmes run by the EITB which cover graduates, managers, technicians, craft skills and training for women. Updating in new skills has also been addressed, as over 60 per cent. of training directly carried out by the EITB is geared towards the training, retraining, coverting and updating of existing employees. We can see the application of new technology in the 20 per cent. of funded projects concerned with this.
On the broad issue of the image and perceived status of engineers, I agree very much with what noble Lords have said. There is a need to raise the status in the minds of the public at large. The noble Lord, Lord Dean, and my noble friend Lord Orr-Ewing focused on this point. The noble Earl, Lord Halsbury, also referred to the risk of a brain-drain and the need to attract the right kind of teachers. To this end, the EITB's engineering careers information service runs programmes through which it encourages employers to forge links with primary schools in order to give some idea of engineering to young people. It also distributes videos to schools,
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colleges and career services, their purpose being to define and illustrate roles in the industry.
Another key issue is the number of women in engineering. I was interested in the examples of current schemes which the noble Lord, Lord Rochester, gave. Women certainly need to be encouraged to take up a wide range of engineering jobs. There has been a slight growth in the number of women involved, in particular at professional levels, and a joint campaign by the Equal Opportunities Commission and the Engineering Council in 1984 aimed its activities towards encouraging increased numbers of women into engineering.
On the promotion of careers in engineering, the EITB runs week-long courses aimed at first-year A-level students of maths and physics to assist them to make informed decisions about engineering as a career. It also provides grants to encourage the retraining of women operatives and clerical staff to technician level.
Research shows that there is a lack of information about engineering careers. It is often difficult to explain to people what engineering is about. More effort is now being made to let people know what can be done in engineering while still at school. The Government have helped through a number of measures: the national curriculum, the technical and vocational education initiative, new ideas in further education and the enterprise and higher education programme. All these contribute to the quality of our information and education.
The noble Lord, Lord Orr-Ewing, highlighted the issue of teacher supply. I am glad to say that this Government take teacher supply shortages very seriously. We have introduced a bursary scheme for trainee teachers of maths, physics and computer design technology. This will be extended to chemistry in September of this year. We have also established the Teaching as a Career Unit. Support for training for converting and updating skills of existing teachers is also being embarked upon. These and a few other actions have reversed the trend of decline in recruitment. We have also made provision in the new teachers' pay agreements introduced in 1987 for incentive allowances to be awarded to teachers of shortage subjects. This has given local authorities flexibility in recruiting and rewarding such teachers. The Government have recently asked the Interim Advisory Committee on School Teachers' Pay to consider what changes in incentive allowances would be needed to deal with subject shortages in the context of the national curriculum. We await with interest the Committee's report which will be published shortly.
My noble friend Lord Orr-Ewing also asked me when the report of the interim committee on teachers will be available. I cannot give him a specific date for that because it is not known, but it will be reported on shortly. My noble friend Lord Orr-Ewing and the noble Lord, Lord Rochester, also talked about tax allowances. They gave the example of individual engineers who attend conferences and thus give rise to the case for putting their costs against taxable income. As the noble Lord, Lord Rochester, indicated, this is a matter for my right honourable friend the Chancellor of the Exchequer, but I shall pass on his remarks.
Lord Dean of Beswick: My Lords, I am grateful to the Minister for giving way. He has talked about the highest structure of engineers, the civil engineers and so on, but I was mainly concerned with manufacturing engineers. Is he aware that in the past most engineers equipped their own toolbox and bought their own micrometers, scribing blocks and so on? Is he aware that it would now be almost impossible for a youngster starting in the trade to produce those instruments because of the tremendous costs that a nought-to-one micrometer or scribing block have risen to? He would be quite unable to finance it. I hope that when the Minister brings the debate to the notice of the Minister in another place he will also include this matter.
The Earl of Dundee: My Lords, I am grateful to the noble Lord and I shall pass on his remarks similarly.
The noble Lord, Lord Peston, referred to the Finniston Report, as did the noble Lord, Lord Howie. The Engineering Council sprang from that report. The Government's philosophy is that employers must take the lead in ensuring an adequate supply of skilled labour.
Lord Peston: My Lords, I hope that the Minister will bear with me. Does he intend to say anything on the point made by the noble Lord, Lord Howie, on the role that the Government could have in enhancing the image of engineers? The noble Lord referred to what had happened with design and how it has been brought much more to the public attention through Ministers taking a great interest in it and by their presence on certain occasions. His point on engineers applied a fortiori. I was wondering whether the Minister intended to say anything about that and, more to the point, whether he intended to convey that idea to his right honourable friend.
The Earl of Dundee: My Lords, I was coming to that theme and will certainly pass on the remarks of the noble Lord, Lord Howie. I should also like to refer to some other themes raised by the noble Lord, Lord Howie. He talked about status and pay. The issues of pay and status are essentially for employers. The Government do not have a role and believe that market forces should determine such matters. I believe that this might meet with the approval of the noble Earl, Lord Halsbury.
The noble Lord, Lord Howie, also wondered whether the Government should give financial support to the Engineering Council. The Government's policy towards professional bodies is that they should be or should become self-financing. It is difficult to draw comparisons between two bodies—for example, the Design Council, which has been mentioned—without knowing more of the circumstances.
At the level of more highly qualified engineering manpower, we are acting to help overcome identified skill shortages. Such actions include offering engineering experience to degree students prior to their making career decisions, and initiatives to help increase access to engineering at higher education level for students who possess non-traditional pre-entry qualifications.
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During 1988–89 we are supporting over 700 places on high level courses such as computer-aided engineering, electronic engineering, mechanical and production engineering and control engineering. All these lead to qualifications at HNC, HND and postgraduate level.
Turning now to the problems of recruitment, I have already touched on the shortage of young people coming into the industry and the Government are well aware of the importance of this issue. Through YTS we are supporting over 2,000 engineering programmes offering some 50,000 places (this represents 13 per cent. of all YTS places) and 1,100 of these programmes offer craft/technician vocational qualifications. YTS now supports the majority of apprenticeships in engineering occupations. Much is being done to ensure that the industry secures the right numbers of trained engineers and technicians.
Nevertheless, I can assure your Lordships that there is no complacency on our part over the endeavour to encourage the right number of entrants.
However, we should not assume that all shortages are a direct result of a failure to train. There is evidence to suggest that employers may not be making the best use of the skills which their employees have. Companies need to consider carefully the way in which tasks are divided between groups like technicians and graduate engineers. They must also look to improving career development structures and policies in order to reduce turnover among their existing employees.
The noble Lord, Lord Dean, made the point of how important it is to ease the path from shopfloor through to the boardroom and to make this more feasible and flexible for everybody. That is very much something which needs to be done.
Clearly there is a need for continued effort from all quarters. But the lead must come from industry and employers. The most effective incentive for companies to train is the knowledge that people's skills are the key to profitability. Statutory regulation is not the answer.
The Government have made it clear that they can and will help. I have briefly outlined some of the ways in which we are doing so in engineering. But nothing we can do is a substitute for employers' commitment to training. To secure this we believe that a new infrastructure is required. At the national level we need employer-led organisations to set standards, identify skills required and mobilise commitment of senior management within their sector. At the local level we shall have training and enterprise councils which can plan, oversee and promote local training and enterprise.
Each industry and occupation has problems that are in some ways unique to it, and that is of course true of engineering. But many of the issues we are debating today go beyond one industry, and, as the White Paper makes clear, the Government are now establishing a framework at national and. local level in order to make education and training more relevant to working life—a framework for all industries which provides new and exciting opportunities for employers and a way ahead toward national prosperity.
Viscount Hanworth: My Lords, I should like to thank everyone who has spoken and I beg leave to withdraw the Motion for Papers.
Motion for Papers, by leave, withdrawn.

London Local Authorities (No. 2) Bill [H.L.]
8.17 p.m.
Baroness Gardner of Parkes: My Lords, I beg to move that this Bill be now read a second time. The London Local Authorities (No. 2) Bill is promoted by the City of Westminster on behalf of all the London boroughs, excluding the City of London, which always handles its own Bills separately. The Bill is a mixture of items. No one borough has sought to have all the powers listed in the Bill but each power is sought by one or more boroughs. The Bill is supported by the Association of London Authorities and the London Boroughs Association. It results from occurrences in different parts of London which have made people realise that powers are needed to give what many believe is an essential control or to give residents desirable protection.
One man's essential control or desirable protection is another man's unnecessary restriction or excess of bureaucracy. I am well aware that there are two sides to be considered carefully in this matter. The Bill covers many different aspects including helicopters. I have served many committees which have debated the problems of the noise of helicopters. One can argue their desirability and the fact that one does not wish to restrict businessmen coming into London. At the same time one wishes to protect residents and the environment.
Special treatment centres are listed, and I notice that dentists are excluded. I was amused to note that the draftsman has not yet caught up with the new Dentists Act. The Bill refers to the 1957 Dentists Act which has been superseded. I understand however that that is a technical misprint which will be corrected.
It is important that special treatment premises should be licensed or checked as regards sterility of equipment. For example, tattoo parlours can be a source of infection through the use of non-sterile needles. They could pass on Hepatitis B or the AIDS virus: no one would wish to see that happen.
It is important to point out that there is an exclusion provision for reputable bodies. I do not mean only the doctors and dentists who are referred to specifically. There is a wider exclusion. I hope that the many alternative forms of medicine which have become highly accepted and which are providing a valuable service to the community will come forward and establish themselves as being entitled to exemption. They will be sufficiently well controlled by their professional ethics to ensure that the high standards are met. However, it is important to protect the public.
I found interesting the party wall issue. If someone demolishes the house next door and leaves the party wall exposed they must make it weatherproof. There is an obligation at present to do so but there are no standards or conditions attached. The wall could be covered simply with a piece of plastic by one of the
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cowboy builders. One's own living room could become soaked with damp as a result of the penetration of rain or a high wind could blow away the covering. The boroughs have found that they need such provisions.
A controversial clause is that covering the charging for various skips and services in London. I believe that it would be right to be able to charge for a skip. Often they are left at parking meters so the revenue from the meter is lost. Sometimes the skip is in place for weeks or months. I believe that to be wrong. At the moment London is one huge building site. Wherever one drives there is obstruction. Therefore, there is a case for greater control.
The City of London already has many such powers. In the days when I worked in a surgery in the City of London it was not permitted to leave a skip parked on the footpath for even a day. It had to be delivered, loaded instantly and removed at once. It could be left for no time at all. The City already has such a power but I do not know whether it applies to other boroughs.
As regards Clause 52 I declare my interest as a member of the London Electricity Board. I was slightly puzzled by the power to reconnect. Now that it has been explained to me I understand the clause exactly. There may be cases where electricity bills are unpaid and the authority's only sanction is to cut off the supply. However, in some cases it is not the failure of the individual occupying the premises to pay the bill. He may have paid it as an inclusive item in his rent. However, it may be that someone else responsible for the bill at a higher level had failed to pay it. It is terrible that a person who has paid should be left without electricity supply. Instead of being faced with the present choice of either paying to reconnect the person and possibly losing, under the new power, the local authority will have the right to attach a claim to the owner of the premises in order to recover the money at a later stage.
I have given those few examples because I know a number of noble Lords intend to comment. I shall be interested to hear what they say about the different aspects of the Bill. However, whatever consideration we give to the Bill tonight it will go to a Select Committee if the House is agreeable. The committee will consider every argument in the greatest detail. I have great confidence that by the time the promoters of the Bill have met the petitioners who have points to raise something will emerge which will be of benefit to London.
Moved, that the Bill be now read a second time.—(Baroness Gardner of Parkes.)
8.25 p.m.
Lord Colwyn: My Lords, I should like to thank my noble friend and colleague Lady Gardner for the clear and understanding way in which she introduced the Bill. I look forward to hearing the comments of noble Lords who are to speak, particularly my noble friend Lord Massereene and Ferrard. I was pleased to see his name listed below mine because I am sure that we shall be commenting on the same aspect of the Bill.
The Bill is wide ranging but I must admit that I have no specialised knowledge in respect of most of

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it. In Part III, headed "Special treatment premises", there is a proposition to give London area borough councils the right to grant or refuse licences relating to special treatment to those practising massage, manicure, chiropody, acupuncture, tattooing, cosmetic piercing, light electric, sauna baths or other special treatments. Effectively that covers most practitioners of alternative and complementary medicine. Your Lordships will know that that is a subject dear to my heart and I believe that it is a vital adjunct to allopathic medicine.
Licences may be refused if the council is not satisfied as to the safety, cleanliness and suitability of premises, advertising, manner of operation, qualifications of the practitioner or safety of the special treatment.
A similar Bill came before the House in 1984. Following a petition against the Greater London Council (General Powers) Bill, an undertaking was given on 17th July 1984 by the Greater London Council in consideration of the withdrawal of the petition. An exemption was included in Section 11 and the schedule to the Act. The exemption was similar to that given to doctors and those members of properly constituted bodies who practised acupuncture, chiropractic and osteopathy and others who are required under their constitutions to comply with professional standards.
The GLC was at the time faced with the fact that similar exemptions had been given in Acts produced by the Herefordshire City Council, the Nottinghamshire City Council and the Worcestershire City Council. An exemption is included in the Birmingham City Council (Miscellaneous Provisions) Bill which has a Second Reading in this House on 20th February.
The only named exclusions in this Bill are, first, for treatment carried out or authorised by a medical doctor; secondly, for acupuncture given by a dentist—although I fall into that category I have no special claims on the Bill—and thirdly, for treatment given by a practitioner registered under the Professions Supplementary to Medicine Act 1960. The exclusion of other practitioners would be a major step backwards in view of the great progress made by therapists in the field of complementary and alternative medicine in the past 10 years towards standardised training and registration.
The Bill as it stands could prevent the public having access to specialists in complementary medicine unless they have the approval of local government officials, many of whom are unlikely to have had any training in or knowledge of the therapies which they are to licence.
If the Bill were enacted we should also have a situation where complementary therapists would be able to practise without a licence in Herefordshire, Nottinghamshire, Worcestershire and potentially Birmingham and in parts of the country where no legislation of this kind applies. However, those practising within the area of the participating councils in this Bill would be caught by the proposed provisions as they now stand and be required to obtain a licence under Part III of the Bill.
I understand the need to have some legislation to enable participating councils to control the
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management of establishments which could be considered contrary to the public interest. However, I hope that when the Bill comes before the Select Committee, the participating councils will be required to amend it either to continue the exemptions conferred under Section 11 and the schedule to the Greater London Council (General Powers) Act 1986 or to exempt registered therapists in similar terms to the bodies already mentioned.
The removal of the exemption without any evidence to justify such draconian powers would be a serious diminution of the public standing and reputation of alternative and complementary therapists who are members of properly constituted bodies and would expose them to the risk of liability and prosecution, at the same time affecting their right to practise their calling and their patients' right to choose the practitioner and treatment they prefer.
8.31 p.m.
Earl Russell: My Lords, I should like to congratulate the noble Baroness, Lady Gardner of Parkes, on the skill with which she introduced this Bill. I accept the point she makes that the need for powers in these areas arise from genuine happenings. The question I wish to raise is whether these powers are sought for the right people in the right manner or by the proper method of legislation.
The probate, divorce and admiralty divisions of the High Court used to be known, with sexist logic, as wills, wives and wrecks—a somewhat miscellaneous collection. I believe that the matters covered in this Bill are even more miscellaneous. They include helicopters, massage, manicure, osteopathy, acupuncture, cemeteries, party walls, taxis, squares and fairs.
If one looks at probate, divorce and admiralty, one can find a common principle through civilian influence on the law which holds those subjects together. I believe that one can find a common principle which holds together the subjects that I have listed; they are all matters which show the need for local authority licensing. I believe that one can find something further which holds them together; they all deal with the problems created by the disappearance of a regional authority for Greater London.
There is a long series of petitions against this Bill. I have read them with care. They are interesting and powerful. It seems to me that many common themes emerge from those petitions. However, because of the nature of private Bill procedure, the petitioners have not been able to bring out, as perhaps we can, that many points which they make in the petitions go to the whole Bill and not merely to the individual clause against which they are petitioning.
One theme which emerges throughout these petitions is that they deal with cross-London activities which often cannot be adequately regulated on a single borough basis. For example, that point is made by the taxi drivers, whose petition I take seriously. They argue that borough-wide provisions cannot be adequately enforced on a cross-London service. However, I should have thought that what is true of taxis is, a fortiori, true of helicopters. Can your Lordships imagine a helicopter service which

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does not cross a borough boundary? I do not know how much use that would be. For example, if one imagines a helicopter site in Paddington Basin, which is perfectly possible, one cannot imagine that it will not immediately affect residents of Brent, Kensington and Chelsea as much as those of Westminster. It is not clear whether those who live immediately outside the area of the relevant borough who may be equally affected by the noise have any locus standi in making representations about it.
A similar point is made by the Building Employers Confederation. It says that it operates on a regional basis and needs common standards across that region. That is very much parallel to the point made by the noble Lord, Lord Colwyn, a few moments ago.
The RAC and the AA make the point that there is no body charged on a strategic basis with London's traffic problem. They argue—and I find the argument persuasive—that in a piecemeal fashion this Bill may pre-empt future solutions.
The next theme I find running through many of the petitions is that this matter is more suitable for public than private legislation. Taxi drivers draw attention to the fact that there is legislation pending in their area which this may pre-empt. The British Helicopter Advisory Board draws attention to the point that such matters are in the public interest and best regulated on a national basis by public legislation. It argues that the Secretary of State is more likely to know the circumstances of aviation than the individual boroughs. I do not know what the London Borough of Brent knows about helicopters. I doubt whether it is very much.
The theme of self-regulating professional associations comes out through many petitions. For example, it is brought out by the Acupuncture Association and by the Crematoria and Cemeteries Association. I know that self-regulating professions are out of favour at the moment but that is just the time when I hope that the Committee will scrutinise their rights with more than usual care, because when one is out of favour is when one may sustain injury.
The biggest problem I see in this Bill is that of cemeteries. In passing, I cannot resist commenting on the incongruity of the London Borough of Westminster promoting a Bill on the basis that local authorities are the fittest bodies to have control over cemeteries. That body sometimes shows signs of becoming a sort of Conservative Borough of Brent. Last night I was asked by my taxi driver what business was before this House. I told him about this point and his immediate comment was, "Oh dear". I do not believe that I can improve upon that.
However, there is a bigger problem here. When one thinks of cemeteries one thinks of Gray's Elegy, but that was a country churchyard. The problem of cemeteries in a big town where there is no stable local community and where relatives do not remain in the area to tend the graves needs thought. It is also growing increasingly difficult to run a private cemetery when it will always be the case that the land will fetch a great deal more if it is used for building. That is a problem to which I see no solutions but which I believe has very big ramifications, and I
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believe it is one that, even more than the rest of the Bill, is an appropriate subject for public and not private legislation.
8.39 p.m.
Lord Marshall of Leeds: My Lords, I too should like to congratulate my noble friend Lady Gardner of Parkes on the very clear and attractive way in which she has spoken on the Second Reading of this Bill. However, I beg leave to register my opposition to it, particularly to Part IV.
I understand that the Cremation Society of Great Britain and the Proprietary Crematoria Association have already petitioned against the Bill. I should possibly declare an interest by saying that the Cremation Society of Great Britain was founded in 1874 and is incorporated as a company limited by guarantee. It is registered as a charity and has a membership of 10,000. It has pioneered and led the cremation movement ever since its inception in 1874 and its main objective is to establish and promote the practice of cremation.
My interest is that I am the third Member of your Lordships' House who has acted as its honorary president. The previous Members were the late Lord Horder, who was physician to the Royal Family from the time of attending on King Edward VII right through to our present Queen. He was a most distinguished physician. The other president and Member of this House was my immediate predecessor-in-title, the late Lord Greenwood of Rossendale.
The other petitioning body is the Proprietary Crematoria Association, which is an unincorporated association of proprietary interests. It has been in existence for, I believe, 45 years.
The preamble to this Bill recites inter alia that it is expedient for participating London local authorities to have the power to license and control private cemeteries—and I say that because the definition includes crematoria. Clauses 38, 40, 42, 43 and 45 deal with the licensing, enforcement, inspection and control of such establishments by those participating London local authorities.
The cremation movement is most experienced in that particular field and its members have for many years carried on their businesses within an established code of practice prescribed by the Federation of British Cremation Authorities. That code of practice is recognised by the Home Office and has for many years been considered to be a most satisfactory means of self-regulation. It is considered inappropriate for legislation on these matters to be dealt with by private Act of Parliament. Furthermore, if it were considered to be necessary to change the existing national regulations, this would, in my submission, be better achieved by statute governing the entire country; that is, by general legislation under the control of government rather than under that of certain participating London local authorities.
Under the various cremation and burial Acts of Parliament the Secretary of State is empowered to appoint inspectors to oversee the running of crematoria and, of course, cemeteries should that prove necessary. I can tell the House that it is a matter

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of great pride to the movement that in the 87 years since the 1902 Cremation Act not one Secretary of State has ever found it necessary to do so. In addition of course, the Public Health Act 1936 and the town and country planning legislation also apply to crematoria.
As regards Part IV of the Bill, it is not only unnecessary and undesirable but also unwarranted. I agree with remarks to that end made by the noble Earl, Lord Russell. I have reason to suppose that the purpose of that part of the Bill, and possibly generally, may not be regarded by Ministers either as too attractive a proposition because the Bill runs counter to the Government's general policies of deregulation. Furthermore it would if passed into law be an unjustifiable restraint on a group of specialist private sector interests. It is for those reasons that I speak against the Bill this evening. I shall he interested to hear the Government's views from my noble friend Lord Arran when he replies to the debate.
8.45 p.m.
Viscount Massereene and Ferrard: My Lords, I shall be brief because I was told that the House would rise much earlier than is apparently to be the case. First, I thank my noble friend Lady Gardner for introducing the Bill and also my noble friend Lord Colwyn, who has done my job for me, far better than I could have done, because he is what I would call a medical expert. He is an extremely good dentist and, I hear, one who hardly ever hurts his patients, which is a good quality in a dentist.
My father told me that in Ireland—I was a schoolboy at the time—a horse and van would go round the fairs with a gentleman offering painless extraction. Of course, there were also one or two musicians, so called, in attendance and when the painless extraction was taking place they struck up a great tune so that the screams of agony from the patient were not heard. However, I must not continue in that vein.
Noble Lords: Yes, splendid, go on.
Earl Fortescue: My Lords, perhaps my noble friend will give way for a moment. I had some experience of dentistry today and there was no horse and cart, no extraction, and none of the horribleness mentioned.
Viscount Massereene and Ferrard: My Lords, I am sure that my noble friend was a patient of my noble friend Lord Colwyn.
I declare an interest, but not a financial one. I am a patron of the Institute of Complementary Medicine. 1 got into that movement through one or two violent injuries sustained during my life. I am sure that if that organisation had not existed with its various therapists and natural remedies, if that is the right word, I should be far worse off in health than I am.
I have had a lot to do with bureaucrats and I am sure that if borough councils had the power to control the many hundreds of highly trained practitioners—trained largely through the Institute of Complementary Medicine—the NHS would be far
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worse off, because many of those trained people help patients in the NHS. The Institute of Complementary Medicine carries out about 6 million treatments a year and that is growing by 15 per cent. or more a year.
I quite agree with Clause 25 and with many of the things that the borough councils do. They have the right people to do them as regards, for example, dirty premises. We all now what they are. We have heard about cockroaches in one or two famous West End clubs. The councils are responsible for fire precautions and all kinds of provisions of that nature. They are very adept at them. The officers are highly trained in those and many other spheres like the structure of buildings and the suitability of premises.
With due respect to those officers, however, so far as I am aware they are not highly trained in the various therapies to which I have referred. I believe that there are now seven petitions and no doubt there will be more going before the Select Committee. I presume that the Select Committee will have on it people who know what they are talking about. I am quite sure that it will alter the Bill and that it will be far more favourable than it now is to many hundreds of individuals. Some of them have trained for five or six years in these therapies. I believe that there are 20 natural therapies in all. After the Select Committee the Bill will come back to this House. Many people will be cured by what is sometimes called the laying on of hands. I am sure that there will be a great service done to many thousands of people.
I was very pleased to hear my noble friend Lady Gardner speak about skips. In London one sees quite a lot of them. This is quite off the subject but my noble friend did mention them. They are sometimes to be seen in the same place for three, four or five weeks. In the country with the county councils that cannot happen because one has to pay so much per day to have a skip. Why cannot that be done in London? I am sorry if I have spoken too long. I congratulate the noble Lord, Lord Colwyn, who has put the matter far better than I could.
8.53 p.m.
Lord Lucas of Chilworth: My Lords, I hope that my noble friend Lady Gardner of Parkes will not think me ungallant if I say to her that I am sorry that she has introduced this Bill into your Lordships' House. She described it as a mixture. Frankly, I describe it as an unsavoury collation of cold and unappetising measures of bureaucratic proportions which frustrate most people's aspirations and, to a great extent, business. She said that the Bill was designed in part to deal with certain happenings. But she did not go too far into what those happenings were.
I wish to concentrate on two clauses. My noble friend Lord Colwyn referred to Clause 21. Some years ago there was before your Lordships. House the South Yorkshire Bill that went to a Select Committee. That dealt with an outbreak of hepatitis and the subsequent control of tattooists and acupuncturists. I can see what lies behind that. My noble friend Lord Colwyn described the provisions of the Professions Supplementary to Medicine Act 1960. I wish to draw the attention of the Select

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Committee to the case of the chiropody professions. Clause 21 excludes a number of highly trained chiropodists in the private sector in membership with the British Chiropody Association. They are almost on a parity with the state-trained chiropodists who are exempted. That does not seem to be fair and just, because those members also have to put up a £750,000 insurance bond.
Much the same argument can apply to the physiotherapy provisions. Exemptions are given in Clause 21 to allow bona fide qualified practitioners' premises to be exempt from licensing. It appears to exclude those physiotherapists who are privately trained and qualified with the SMAE Institute Post-Graduate School of Physiotherapy. It forms a major group within the profession. The membership of that institute had to put up a £750,000 professional indemnity cover.
Clause 21 also makes provision for chiropractic measures. Massage is listed as a special treatment. My understanding is that the McTimoney Chiropractic is a form of treatment and the practitioners are trained by the McTimoney Chiropractic School, registered and insured by the Institute of Pure Chiropractic. As I tried to suggest in my opening remarks, it seems that the provisions in the Bill are far too all-embracing. There has not been sufficient thought given to some particular aspects. My noble friend pointed this out in some particular and some general terms. I merely wish to underline what he had to say in that regard.
I refer to the concluding remarks of my noble friend Lord Marshall of Leeds. He asked whether some of the provisions should be under a local authority Bill or should in fact be a national responsibility. This takes me to Part V of the Bill at Clause 51. I have to declare an interest in that I am a member of the Royal Automobile Club public policy committee which, as part of the standing joint committee of motoring organisations, has petitioned. There is a crying need in London, as elsewhere, for parking space in order to reduce congestion.
I believe that it is absolute folly to close the door on any kind of possibility whether overground or underground, though I know that some people disagree with that. We had this argument when the underground car park was built in Portman Square. It was said that it would destroy the ambiance of the square. That was absolute nonsense because the square was replanted afterwards and it was almost as good as new. Modern technololgy can do this. It is folly to close off any avenue. It is even greater folly to close off avenues when we have the government-led plans being formulated to deal with the problems of London's traffic and parking.
This will apply not only to central London but to boroughs from Hillingdon in the west, Havering in the east, Enfield in the north and Croydon in the south. They are all suffering from congestion. It is the kind of problem that the noble Earl, Lord Russell, described when he spoke of helicopters travelling over boroughs. I draw your Lordships' attention and that of the Select Committee to a paragraph in the paper Transport in London. It says:
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"There is more to sensible parking policies than enforcing the law. It is also important to make the right provision of parking facilities. Planning policies will vary between parts of London as to the emphasis given",
and so on. There is adequate provision under the existing planning procedures to deal with the difficulties which I suspect the London authorities in promoting the Bill envisage. The Select Committee should reject that part out of hand.
9 p.m.
Lord Underhill: My Lords, I thank the noble Baroness for introducing the Bill. I am certain she will agree that the points made by the noble Lords who have spoken in the debate will be of great value to the Select Committee considering the Bill. However, the sponsors' position has not been helped by the absence of an all-embracing London authority. That was clearly shown by the noble Earl, Lord Russell, and is evidenced also in Part II of the Bill, which deals with helicopters.
The preamble to the Bill refers to controlling helicopter movements and helicopter noise in London borough council areas. How can one borough control the movements of helicopters? A helicopter taking off from Hackney will almost certainly have some effect on Waltham Forest. Certainly the noise will have an effect on adjacent boroughs. I am in favour of licensing helicopter movements, but whether we should do so through individual boroughs is another matter.
I should like to refer in particular to Clause 49, which deals with sections of the Local Government (Miscellaneous Provisions) Act 1976 as specified in Schedule 3 to the Bill. Schedule 3 lists the 28 sections of the 1976 Act to which Clause 49 relates, either entirely or in part. A detailed scrutiny of the 28 sections of the 1976 Act is required to understand what Clause 49 is about. It relates to the licensing of private hire vehicles and also refers to the position of hackney carriages. I am informed that the proposals could have a damaging effect on London's licensed cab trade. Although we have difficulty at lunch time in getting taxis, there will be general agreement that the London cab system is one of the finest in the world.
Noble Lords: Hear, hear!
Lord Underhill: My Lords, there is also the problem of cross-boundary working, a point stressed by the noble Earl, Lord Russell. Licensing borough by borough would be almost impossible. My most serious criticism is that in framing this part of the Bill there has been no consultation with those working in the cab trade, either through the appropriate section of the Transport and General Workers' Union, which has a vital interest in the matter, or, as I learnt earlier this afternoon, through the Licensed Taxi Drivers' Association.
That is bad enough, but I understand that the Government are at present conducting a review of the taxi and private hire industry and that the findings of the review are expected to be published in two months' time. I understand that the Government will then consult interested parties about the possibility of legislation. I appreciate that the noble Earl who is to

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reply cannot commit the Select Committee, but the Government should give an assurance that the two bodies to which I have referred will be fully consulted before legislation is considered. It must be absolutely inappropriate to include in this Bill matters which are at present subject to a government review and consultation prior to legislation.
I am given to understand that a petition on this point has been presented. I hope that is so, though I am informed by the section of the Transport and General Workers' Union which deals with cab drivers that it learnt of this Bill only by a chance conversation with a member of one of the London borough councils. I hope that there has been time for it to present a petition.
I hope the Select Committee will consider what I have said on the matter. In view of the Government's review—the Minister can tell the House whether I am correct on that point—in view of the consultation they will have after the report is presented in two months' time and with the possibility of legislation, whatever happens to the rest of the Bill this clause and Schedule 3 should be expunged from it.
9.5 p.m.
The Earl of Arran: My Lords, it may be helpful to the House if I briefly intervene at this point to give an indication of the Government's view on the Bill.
It is customary for the Government to adopt a neutral stance on Private Bills, and certainly we have no objection to the principle of London authorities, as they are empowered to do by statute, promoting a Private Bill seeking additional general powers for the London area. On this occasion, however, there are a number of provisions in the Bill which give rise to considerable concern in departments. Some of these were touched on by noble Lords earlier in the debate.
The Department of Transport and my own department object to the proposed powers in Part II of the Bill to license helicopter movements. I understand that those are aimed at curbing noise nuisance, but we consider the provisions to be unnecessary and an undesirable extension of existing legislation. The helicopter noise provisions in the part appear to conflict with the Civil Aviation Act 1982, particularly Section 76. The principle in that section that no action shall lie in respect of an aircraft over a property has been enshrined in legislation since the Air Navigation Act 1920. While the Government support, in general, the promotion of good neighbourly behaviour and steps to mitigate excessive noice intrusion and to minimise the risk of accident by helicopters, we have no evidence to support the need for the proposed licensing regime.
My right honourable friend the Secretary of State for the Environment also is firmly opposed to the proposals in Part IV of the Bill to license private cemeteries. These are unnecessary and at the same time seriously defective. Given the paucity of such cemeteries operated by firms, coupled with the unlikelihood of new entrants to the field, we can see no justification for such a licensing system. Moreover, the proposals include private crematoria of which there are only six in London. My right honourable friend the Home Secretary, who has responsibility for the law and regulations relating to
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the operation of crematoria, is strongly opposed to the proposal. Cremation authorities are already subject to control through national regulations.
In addition, the wide regulatory powers which are sought in Parts II and IV of the Bill would go against the Government's deregulation policies and would be an unjustifiable restraint on small groups of specialist private sector interests. Indeed, that point was taken up by my noble friend Lord Marshall of Leeds.
All these concerns have been put to the promoters. Departments are awaiting their response. I have to say that if these powers continue to be sought in the Bill, then in the usual way departments will oppose them by a report to the Select Committee on the Bill seeking their deletion.
Departments have also raised with the promoters other points of concern in respect of provisions relating to party walls (Clause 48), private hire vehicles (Clause 49), power to charge for council services (Clause 50) and London squares (Clause 51). In particular the latter provision is considered objectionable as an unnecessary extension to existing controls.
It might be appropriate now if I were to take up the point made by the noble Lord, Lord Underhill, as regards taxi and hire-car legislation. My right honourable friend the Secretary of State for Transport is at present reviewing all taxi and hire-car legislation and is looking at this aspect. However, we believe that it is right that this should be dealt with in comprehensive legislation which takes the situation of the whole country into account. Moreover, for private hire cars as well as taxis, we see impossible practical problems if as proposed in the clause different boroughs run different schemes when so many mini-cab journeys cross borough boundaries. I think that that point was also raised by the noble Earl, Lord Russell. Legislation on taxis in London already includes some 14 different Acts. The proposed clause would cut across many areas of existing legislation and create confusion.
I return now to Clause 51, which concerns London squares. The purpose of the planning system is to regulate the development and use of land in the public interest. In the Government's view, the town and country planning legislation provides adequate planning control of development in London squares. Planning permission is required for development on, over or under land, so any development proposal affecting London squares would be so regulated. The London Squares Preservation Act 1931 pre-dated the Town and Country Planning Acts and to extend its scope now, as proposed, would lead to unnecessary duplication of control. My department hopes to persuade the promoters to withdraw the clause.
I have to say that on this and other outstanding issues, if suitable amendments cannot be agreed with the promoters, we shall have no alternative but to submit a report to the Select Committee opposing the provisions. In addition, there are 10 petitioners against the Bill and they will have the opportunity to present their objections to the Select Committee.
9.11 p.m.
Baroness Gardner of Parkes: My Lords, I should like to thank all those who have taken part in the

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debate on this Bill. I must say that I have found the comments most helpful. I suppose that the Bill is the closest we have had to a "Greater London Powers Bill". I thought that the point made by the noble Earl, Lord Russell, was a most interesting one. He said that he thought the problems had arisen due to the disappearance of an authority covering all London. While he may be correct in some aspects of the matter, many of those problems existed even when there was such an authority. Indeed, I served as a member of that authority. I can say that certainly at that time the local boroughs greatly resented the fact that the licensing powers for late night music and dancing, for example, were vested with the Greater London authority, which they felt was not sympathetic to local needs. Therefore there has always been the argument as to what is local, what is regional and what is national. Moreover, the same point has been brought out in the debate today.
I think that the point made about taxis and helicopters crossing borough boundaries is a valid one. The point was made by the noble Earl, Lord Russell, and the noble Lord, Lord Underhill. I know that the noble Lord, Lord Underhill, has heard me say before that I believe that there is a need for a single London traffic authority. I say that because everyone is always keen to pass all their traffic problems on to the next borough. In fact, it would be most interesting to see what would happen if every borough had powers and passed on all their problems to the borough next door. I wonder where such problems would eventually end up.
I can understand the argument which has been put forward, but the fact that the Bill has been introduced in its present form is an indication of the direct individual problems that boroughs feel they have suffered. Indeed, different boroughs have requested the inclusion of different points in the Bill.
So far as concerns the Building Employers Confederation wanting the same standards to apply everywhere, I think that London has always been somewhat different in that respect. It has had different building regulations and it is only over the past few years that we have seen the disappearance of the district surveyor. In my view he operated a higher standard of building control than that which existed outside London. I was sorry when I saw that district surveyors had been done away with. That again is a point that must be looked at.
The noble Lord, Lord Marshall, and the noble Earl, Lord Russell, spoke about the Westminster cemeteries, which is a sensitive subject. The council sought the powers because of the unfortunate experience it had had and because it found that it could not do anything. When I heard the messenger come in to say that my noble friend Lord Massereene's taxi had arrived, I said to him, "Please do not wait", but I should have liked to point out to him that the Bill provides for the control of fares, and that before we had anaesthetics, there was a band to drown the noise of having one's teeth extracted. Even that would come under the control of the Bill.
My noble friends Lord Massereene and Lord Colwyn made the relevant point about the number of
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people who are highly trained in complementary medicine. Medicine goes much wider than it did. My dental colleague rightly mentioned to me that a few years ago if either he or I had spoken as dentists we should have been accused of advertising. It would have been completely unethical. That is how much even our profession has changed within a few years.
My noble friend Lord Lucas said that I did not go into detail about the happenings in various boroughs. I did not because I thought that no one would want to be here all night. The points were based on actual circumstances. I am sure that many of those points will be brought out and the relevant experiences attached to them before the Select Commitee.
I should like to take issue with the Minister and my noble friend Lord Lucas on car parking and the London squares. I was on Westminster Council when we agreed to allow a car park to be put under Cavendish Square. We were worried about the future of those enormous and beautiful plane trees, but because the square was in the council's ownership—I may be wrong about that—it was able to impose conditions and the trees had to be protected and retained. Those squares, especially in the centre of London, are London's lifeblood. It is a great joy to people living in built-up areas to be able to look out on to something green. Recently in Westminster—I believe that it was Ennismore Gardens, but I am not sure—there was an attempt to take over a square and construct something in it. I believe that attempt was made by a gentleman who did not understand that there was a London Squares Preservation Act. He had come from another country. Someone had sold him the square in the way that people regularly sell Sydney Harbour Bridge.
The London squares are a sensitive issue. What goes under the squares and the protection of trees which have taken a long time to grow are important. One of your Lordships underlined what a desperate need there is for car parking. My GLC borough built a car park beside the railway. No one would use it. The late Sir Anthony Berry was instrumental in having it built. People would not go into it because they had to pay. Even now, research has shown that underground car parks are the least attractive type of car park. People do not mind how high the rate goes at a parking meter above ground. If there is a meter available, they will always choose it rather than go into a multi-storey or underground car park.
Lord Lucas of Chilworth: That is safer.
Baroness Gardner of Parkes: Which is safer?
Lord Lucas of Chilworth: On the ground.
Baroness Gardner of Parkes: My Lords, I agree that that is safer, especially for a woman. To be down several floors can be a hazard.
The noble Lord, Lord Underhill, mentioned licensed cabs. I agree with him 100 per cent. that we all have the greatest regard for the London taxi,

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which of course is no longer black. He pointed out that there has been no consultation, but there is still plenty of time for consultation. As I understand it, the procedure on the Bill will be lengthy. The Minister made the point that the Government make a report upon any aspect upon which they wish to comment. The petitioners can have consultations and
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meetings and present their case fully in a way that no one can fault.
I ask your Lordships' House to give the Bill a Second Reading so that it may be referred to the Select Committee.
On Question, Bill read a second time, and committed to a Select Committee.

MBP Russell & Co. Ltd.
9.19 p.m.
Earl Russell Earl Russell rose to ask Her Majesty's Government whether they will consider a further investigation into the affairs of MBP Russell & Co. Ltd.
The noble Earl said: My Lords, the Roskill Committee on fraud trials expressed doubt whether the legal system was now capable of bringing the perpetrators of serious frauds expeditiously and effectively to book. It is argued that fundamental change is therefore required in certain areas of the law. The case I am raising tonight tends, I believe, to suggest that the Roskill Committee was right. I believe strongly that it is the individual case which gives life and meaning to this sort of general phrase. Also, I believe this case tentatively identifies some of the certain areas of the law in which change may be required. These, I hope, are points of legitimate public interest.
In raising this matter, I must of course declare my interest. The MBP Russell mentioned in my Question happens to be my cousin. It is inevitable, because of this connection, that my remarks may have a certain quality of advocacy. I have heard too much distinguished advocacy in your Lordships' House to believe that advocacy in this House is necessarily improper. What I do think is that it is essential, when advocacy is served, that your Lordships should be able to recognise it for what it is in order that you may sit down to it fully equipped with pinches of salt, to be applied according to taste. It is in that spirit that I declare my interest.
Your Lordships may not appreciate perhaps that I am taking up the torch rather late in the history of this matter. My kinsman turned first to his representative in another place who very properly began by writing to the Minister. Having done so several times and having received no satisfaction, he tabled Questions for Written Answer on 24th July and 10th December 1986. He then decided, having received no satisfaction, to raise the matter on the Adjournment. This was delayed by the general election. He finally came out of the ballot with a debate for 7th July 1987. However, a few days before that he was appointed PPS to the noble Lord, Lord Young of Graffham. and was therefore estopped from proceeding.
It was only at this point that my kinsman turned to me and so I come into this story as the understudy. I think it is the duty of the understudy very often to take up the part at the point where his leading man had to drop it. I also decided after prolonged thought that the judgment of my kinsman's representative in another place had been entirely correct and that a general debate was now the only way in which the issues in this matter could be ventilated. Since this Question was tabled, his representative in another place has ceased to be PPS to the noble Lord, Lord Young of Graffham, and I am delighted to hear that he is now taking up the matter again. I look forward to receiving his advice on this with a relief that your Lordships may perhaps imagine.
I am aware of the responsibilities imposed on those who attempt to use parliamentary privilege. I have attempted, whether successfully or not I cannot say,
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to say nothing tonight which I could not say outside these walls. I have also received advice to the effect that it is not clear that letters to Ministers enjoy unqualified privilege. That, I will confess, influenced me in deciding to come to the Floor of the House.
The story I have to tell concerns the failure of a bank in circumstances which appear to demand rather more investigation than they have yet received. It is not my wish to make any specific charge, nor to prejudge what the findings of any further investigation might be. I am aware of the force of the point made by the noble Lord, Lord Williams of Elvel, in this House yesterday—that in investigations it is essential to avoid casting suspicion on those who may be innocent. I have tried to be mindful of that point in drafting what I wish to say, but I think it is a point which must go to how and not to whether investigations are conducted.
I make no charge tonight against Her Majesty's Government or any of their servants. In my opinion, the worst that can be said of the DTI's handling of this matter is that they have left undone those things which they ought to have done. That is a conclusion that I suspect may be far too familiar to your Lordships to approach the realms of the scandalous.
In fact the DTI appears to believe that this case is a matter of de minimis non curat lex. In a case involving the suspicion of fraud for between a quarter and half a million, depending on the method of calculation, this seems a somewhat complacent definition of de minimis, almost on a level with the famous defence of a young person called Rex to a charge that I may leave to your Lordships' imagination.
I do not suggest that the DTI's handling of this case is in any way out of the ordinary, and it is for that reason that I think it raises issues of general public importance. I would also stress that, for the protection of the innocent, it is as important that those wrongly suspected should be cleared as that those rightly suspected should be brought to book. I am not trying to prejudge to which category this case may belong.
MBP Russell and Co., the bank concerned, had on 31st March 1975 declared assets of £279,175. The shares of this bank were divided between two holding companies. The first, the minority, MBPR (Holdings) Ltd., was the one in which my kinsman was the key figure and had some 22 shareholders. The other, the majority, was Allied City Share Trust Ltd. with over 100 shareholders but with 25 per cent. of its shares held by a single director. By agreement between these two holding companies, MBPR (Holdings) nominated three directors and Allied City Share Trust nominated five.
During the period from 1973 to 1977, and mostly in the later part of that period, the senior director from Allied City Share Trust, whom I see no present need to name, approved advances, mostly in the form of unsecured overdrafts, totalling £644,147. A very high proportion of these was either to himself and his immediate relatives or to companies in which he is known to have had a material interest, including £114,659 to Allied City Share Trust, £24,615 to his and his wife's joint account, £38,485 to his private

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account and £30,976 to his second mortgage account. Your Lordships may perhaps feel that the circumstances in which these overdrafts were approved bear investigation. The bank ceased to accept deposits in February 1978. During the period from 1978 to 1981 my kinsman was unable to finance a minority action and would in any case have found it difficult to pursue one since he had no access to the bank's records until 26th August 1981.
We are now told that during this period the DTI conducted an investigation under Section 109, now Section 447, of the Companies Act. Such investigations are of course confidential, and I know nothing of any conclusion that it may have reached. However, it is relevant that the Roskill Committee was particularly critical of the lack of power to investigate fraud in banks. It made three points, which I think are relevant tonight. There is no power to make an order for access to hank records at the investigation stage; the correspondence between a bank and its client cannot be made the subject of an order; and there is no power to make an order covering more than one bank. That can make trails difficult to follow. It is perhaps one of the areas of the law in which some change might be considered.
In March 1981 my kinsman purchased the shares, formerly belonging to Allied City Share Trust. He got control of the records and is now willing to show them to anyone qualified to conduct a proper investigation. There is thus the possibility of fresh evidence which may justify a fresh investigation.
The Roskill Committee also made another point relevant to this case. It said there is a potential conflict in fraud cases between civil and criminal proceedings, and that institutions in particular may be reluctant to make a criminal report because they may want to recoup losses by civil proceedings. That was the course my kinsman followed, relying on the civil law rather than on the criminal law, because he believed he had a banker's duty to recover money for creditors and shareholders. He accordingly commenced a series of civil actions, which he proved unable to pursue for want of funds.
In 1985 he began proceedings for voluntary liquidation. For reasons which are not clear to me, this attempt was blocked by the official receiver. But in December 1986 there was a further petition for liquidation from one of the defendants in one of the civil actions which after some dispute was successful. I shall not go into the technicalities of that now. There is dispute as to whether the company is in liquidation, but the DTI believes that it is.
It is a basic principle of English law that there should be no wrong without a remedy. We have here a prima facie appearance of a wrong. We have the failure of a business, consequent losses to a number of creditors and shareholders, the loss of an occupation and a substantial financial loss as well. All that happened by means of which no adequate public account has yet been given. There should be a remedy. If we were to be told that no remedy was available, I believe that would indicate a very significant defect in the law.
A company which has suffered a civil wrong may normally seek a remedy through civil action. But if
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the effect of that wrong is to make the company insolvent, it is thereby deprived of its natural remedy. That is why the official receiver has a statutory duty, reiterated by the Insolvency Act 1986, to investigate possible offences in every compulsory winding up or bankruptcy. We are now told by the DTI that the official receiver has no funds to enable him to discharge this duty. If that is the case, we may agree with the Roskill Committee that:
"the overall shortage of resources which clearly exists must be remedied as a matter of priority".
Under the Insolvency Act it is perfectly proper for a liquidator's report to give rise to an investigation under Sections 431 and 432 of the Companies Act. Under Section 132 of the Insolvency Act 1986, it is perfectly proper for such a report by the official receiver to provide the foundation for an action by shareholders or creditors. I do not know whether that is the proper way to seek a remedy. I only argue that there should be a remedy and that it is in the public interest that one should be found.
In the end the key question is that of the public interest. Mr. Francis Maude in a letter to Mr. Kenneth Warren, MP, on 14th September 1988 stated the issues in this case I think very fairly. He said:
"there is in my view no substantiable public interes. in the provision of public funds for … these civil actions. This is because the beneficiaries would be the creditors or (perhaps) the shareholders".
In normal circumstances that might be an impeccable principle. I would argue only for one exception to it. That is when the inability of those who believe themselves to be wronged to pursue a civil action is due to their having been rendered insolvent by the action which they claim wronged them. To say otherwise would be to say that a fraudster may be immune from any liability to repay his ill-gotten gains provided only that he takes sufficient care to render his victim helpless by making him insolvent.
That seems to come dangerously near the incentive to rapists to avoid prosecution by leaving their victims dead. It is to argue that a fraudster may acquire immunity by rendering his victim financially dead. That is a doctrine which I hold not to be in the public interest because I believe it encourages crime.
I think there is a great deal of truth in the view expressed by the Inland Revenue that it is essential to prosecute some of all classes of tax fraud because it is the possibility of prosecution that prevents the spread of tax fraud to unacceptable levels. Similarly, I believe that to tell fraudsters that if only they are successful they can be immune from an action in damages is to encourage the belief that crime pays. That belief is not in the public interest.
9.36 p.m.
Lord Grimond: My Lords, the reason why I support the admirable speech of my noble friend Lord Russell is that Mr. Martin Russell, who is a friend of mine, approached me some years ago about this matter. It seemed to me that a question of public interest is involved and that further inquiries ought to be made into the unhappy history of his bank.
I do not intend to go over that history again. It has been very clearly explained by my noble friend.

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However, I reiterate that Parliament has decreed that the public interest is involved when individuals are harmed by illegal practices in the financial markets.
Parliament might not have done that. There is a case for saying that those who enter the somewhat tricky waters of the City should abide by the principle of caveat emptor and must take the consequences of their efforts to make money. After all, a lot of people hope that they will be supplied with inside information so that they may invest their money wisely on the Stock Exchange. It was not made public by the Rothschilds that they knew of the victory at Waterloo, which was the foundation of their fortunes.
Parliament, rightly, has taken a different view. It says that there is a public interest and that there are matters concerning finance in which it is extremely important that the public should be assured that honest dealing is the order of the day.
I also maintain that it is not the case that because the injured parties in such dishonest dealings, if they are dishonest, may benefit from investigation by the public authorities, that is any bar to such investigations. The public interest is pursued regardless of its effects, harmful or beneficial, upon individuals or individual companies.
I think that it is worth mentioning that individuals, for their own reasons and their own purposes, are perfectly entitled to bring such matters to the attention of Parliament, and constantly do. As a Member of another place, one's mailbag is entirely filled with applications from people who think that they have been wronged by Ministers, the law, their neighbours or whoever it may be. No one doubts that it is a parliamentary duty to look into those matters.
The fact that some individuals or companies may gain is neither here nor there. If the public interest demands an investigation, it would seem right that an investigation should take place. I think that that is the answer to the paragraph of the letter of 14th September 1988 already quoted by my noble friend. The Minister, writing to Mr. Warren, MP, says that he agrees that,
"there is a public interest in the pursuit of crime, but the way in which to satisfy that interest is by criminal prosecution rather than by civil action".
That is certainly the case, but it is not the only way in which it can be and has been pursued. As we all know, there are many recent cases in which the Department of Trade and Industry has intervened either to assist or in addition to prosecutions.
The matters raised in this case have been outlined by my noble friend. There are allegations of excessive overdrafts to friends of the directors. There appear to have been efforts to prevent interested parties from taking action to protect their interests. There are allegations of dilatoriness against public authorities. I emphasise that those are allegations. They may be wrong, but they are borne out by a considerable amount of evidence in this lengthy correspondence and the interviews that took place and they seem to me worthy of investigation.
There is then the curious behaviour of the official receiver, who apparently vetoed a voluntary
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liquidation and then accepted what is admitted to have been a misconceived application for liquidation from a private individual. As I understand it, there has been no explanation of why the official receiver behaved in that way.
Further, the official receiver has apparently admitted that the Department of Trade and Industry has power to use public funds to continue proceedings after a company has been put into liquidation. One of the points at issue that has been made clear is that Mr. Russell has been prevented from pursuing his rights because of the lack of funds and the inability of the company to take action since it has been put into liquidation. However, if the official receiver is right, it is open to the Department of Trade and Industry to use public funds to continue actions already instituted.
Those are only some of the allegations and I emphasise that they may not be wholly justified, but there is evidence regarding these matters and it seems to me that they should be pursued. It is not only I who felt this to be the case; at least two Members of Parliament have taken up the matter and, as my noble friend said, if a Conservative Member of Parliament had not been given an appointment, he would have raised the matter in the Commons in an Adjournment Debate.
In another passage in the correspondence it appears to be suggested that the small size of the amount at stake might mean that it is not worth while for the Department of Trade and Industry to become further involved. That cannot be supported. The stake may be small to the City but to most people the sums involved are considerable enough. If there is a serious matter of public importance and if it is essential to show that the City deals honestly and that dishonest dealing is exposed, the degree of the dishonest dealing cannot be a reason for dropping the case. If there is anything approaching fraud in this matter, the fact that the sums are small will do nothing to restore faith in the City.
To some extent, that faith must be restored. It seems that the whole of our financial legislation is based on the premise that there is a public interest and that the public at large should be encouraged to entrust their funds to the City and to bankers on the understanding that they will be protected from fraud and that fair dealing will be enforced. Therefore, quite apart from the justifiable wish of Mr. Russell to have his claim examined, to my mind there is a public duty that this should be done. I fully accept that there has been some examination by the Government. No doubt the Government have studied the papers extremely carefully. But I think they would agree that there is certainly room for further investigation and that further investigation, whether it turns out that Mr. Russell was right or wrong, will clear the air and prevent any feeling that there has been a cover up or that fraud or wrongful dealing in the City has in any way been condoned.
9.45 p.m.
Lord Strathclyde: My Lords, I should say at the outset how much I and the Department of Trade and Industry appreciate the way in which the noble Earl has approached his task today by giving me an advance copy of his address. I am grateful too that he

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has not sought to question the integrity of officials. I may say that they—including those who wrestled with the events in 1978 and thereafter—have considerable personal sympathy, as I have myself, for the noble Earl's kinsman and the position in which he finds himself. I can fully understand why the noble Lord, Lord Grimond, should support him too.
The noble Earl has set out the background facts, and I shall not repeat them except in amplification where necessary and to correct any misunderstandings, of which there are a few. This is a very complex affair and I apologise if it is difficult to follow in a short time. It is important to distinguish between events before and after the liquidation in 1986 and the policies which apply. I shall deal with them separately. We must also be careful to distinguish between civil and criminal matters. Like the noble Earl, I see no need to name names.
I must emphasise that I cannot discuss the affairs of particular companies nor can I disclose any of the information obtained by DTI investigators under the Companies Act.
The noble Earl set his story in the context of the report of the Fraud Trials Committee chaired by the noble and learned Lord, Lord Roskill, and perhaps I should deal with that aspect first. He suggested that the committee report was critical of the limits on the powers to investigate fraud in banks. The noble Earl may have been referring to paragraphs 2.53 to 2.56 of the report, dealing with the Bankers' Books Evidence Act 1879. These referred to criticisms of the limitations on the powers to inspect bank records under that Act. The report went on, however, to summarise provisions in the Police and Criminal Evidence Act 1984 which could be used by fraud investigators to overcome the limitations of the Bankers' Books Evidence Act.
However, DTI officers, in carrying out their inquiries, do not operate under the Police and Criminal Evidence Act. Access to the records of a bank can be obtained by DTI officers under the powers contained in Section 447 of the Companies Act 1985 when a bank is itself under investigation. These powers enable the officers to obtain copies of banking records, including correspondence between a bank and its customer, where this is necessary for the investigation into the bank. The Secretary of State may thereafter pursue those inquiries, if there is a good reason to do so, into other companies and their banking records.
The noble Earl also referred to the possible conflict of interest, noted by the noble and learned Lord, Lord Roskill, on the part of victims of fraud between civil and criminal proceedings. I regret, as do we all, the fact that in some cases some large institutional losers may be inclined to keep quiet when they are injured by fraud.
There may be valid, if not good, reasons for that. I can understand them. But, as the report said:
"The early discovery and reporting of fraud to the appropriate authorities is crucial to the chances of successful prosecution".
The committee was not referring to any conflict affecting the authorities—only the victims themselves.
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Although the noble Earl drew attention to that possibility I am glad to observe that his kinsman took the correct steps, because he reported the matter to the department when it was discovered. The fact that he later started civil proceedings did not prevent the authorities investigating the case, nor was it relevant to the decision not to prosecute, as I shall attempt to demonstrate.
I turn now to the facts of this particular case. In March 1979 inquiries under Section 109 of the Companies Act 1967 (now Section 447 of the Companies Act 1985) as described by the noble Earl, were made by the department not only into MBP Russell & Co. Ltd. (which I shall refer to as "the bank") but also into two related companies. As a result of those inquiries, further inquiries under Section 109 were made into yet a fourth company between October 1979 and February 1981. As he rightly says, all those inquiries were confidential. They were made as the result of complaints from shareholders in Allied City Share Trust Ltd. that they had not received adequate information after the suspension of its Stock Exchange quotation and a complaint from Mr. Russell himself.
The Department of Trade had to consider what to do with the results of the Companies Act inquiries. Officials considered whether the facts found by the investigators indicated that a criminal investigation would be justified or if any other action should be taken. As to criminal proceedings, the department's solicitor advised that they would not be justified or would not be likely to succeed. A possible summary offence which then carried a maximum fine of £100 was not pursued. In addition, regulatory action was taken which had the effect of reducing the risk of further mischief.
In the meantime, in 1980 MBPR (Holdings) Ltd., the holding company, had gone into compulsory liquidation on a creditor's petition. For the record, I want to clear up a small but important point made by the noble Earl. This was that the official receiver, who was also the liquidator of the holding company, prevented the bank going into voluntary liquidation. This is not so. What the official receiver did was to vote against a motion, supported by Mr. Russell, for the bank to petition the court under Section 517(1)(a) of the Companies Act 1985 for a compulsory winding up order against it.
Mr. Russell's objective was to get the official receiver appointed liquidator of the bank with a view to the official receiver initiating or continuing civil proceedings for the recovery of money due to the bank. The official receiver explained to Mr. Russell and his legal advisers that, in the absence of company funds, if the motion was carried, the duly appointed liquidator of the bank would have to be indemnified for costs—and possible adverse costs (that is, the costs of the other side, if the case were to be lost)—before he would take on such actions.
The position was that the bank had started four legal actions for the recovery of money in 1983 in respect of claims which had arisen prior to 1978 but had run out of funds to continue them. Two of the defendants were no longer defendants as they had obtained an order for costs with which the bank had been unable to comply. In February 1986, Mr.

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Russell approached the Department of Trade and Industry. He wished to have the Secretary of State's support for the actions brought by the bank. You will note that these actions were by now three years old and the events on which they were based over eight. He had already tried, without success, to obtain the support of the Attorney-General, the Bank of England and, as I have explained, the official receiver.
The department considered the matter again in great detail. Officials interviewed Mr Russell on 14th February 1986 and, after correspondence between the then Parliamentary Under-Secretary of State and his representative in another place, Mr. Russell was seen again with his legal adviser on 3rd September 1986. Following that meeting, he provided further information, all of which was studied by officials but found to contain little to add to what was already known.
As a result of Mr. Russell's approach, the department was faced with three possible options. The first was that the Secretary of State should provide funds to support and continue the actions instituted by the bank. This was not possible. The Secretary of State has no general power to use public funds to finance actions brought by private individuals or bodies.
The second option was for the Secretary of State to take over and continue the actions under the provisions of Section 438 of the Companies Act 1985. This section enables the Secretary of State to bring civil actions in the name and on behalf of any body corporate if it appears to him to be in the public interest for such proceedings to be brought. This power can only be exercised following an investigation or inquiry under the Companies Act. The Section 109 inquiries in 1979 provided a possible trigger to the Section 438 power. The department sought advice from Treasury counsel on the issue. Counsel advised firmly that Section 438 does not empower the department to take over the conduct of an action which has already been started. Accordingly, this option was not available.
The third option was to institute a fresh investigation to put the Secretary of State in the position where he could use his Section 438 power if appropriate. This was carefully considered but was rejected because the events which might justify an investigation occurred prior to 1979 when the previous inquiries began, and at that late stage the object of the investigation would have been little more than a device to give rise to the Secretary of State's powers under Section 438—not to establish the facts which were already known to Mr. Russell. I do not think that your Lordships would consider this a proper use of the powers, however much they may sympathise with Mr. Russell.
I hope the noble Earl will accept that this represented a careful assessment by the department of the various options available and that it was understandable that Mr. Russell was told that nothing could be done to help him.
The next development was that the banking company went into compulsory liquidation in December 1986. Mr. Russell disputed, and continues to dispute, the validity of the winding-up order. I
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understand that although, strictly speaking, Mr. Russell had no locus in the matter, the companies court judge nevertheless allowed him to address the court on the issue. His point was, and is, that the petition was not properly served and that the company was wrongly described in the winding-up order.
The court nevertheless made the order. This is a matter for the court. It is not for the DTI to question. For my part, I can see no injustice in the result. I should add only that Mr. Russell has been told this on several occasions. Indeed, I find it odd that, having wished to see the bank in liquidation in 1985, he should oppose liquidation in 1986, when, so far as I am aware, the circumstances had not changed in the interim.
And so I come to the matter of the official receiver's role in the affair. The winding-up order was made against the bank on 8th December 1986. The official receiver became the liquidator. In these circumstances, the official receiver had two distinct and separate functions. As the official receiver, he had to investigate and report to the court on the company's promotion, formation, business, dealings and affairs; under the provisions of what is now the Company Directors Disqualification Act 1986, report any misconduct by the directors of the company to the Secretary of State. As liquidator he had to realise the company's assets and to distribute the proceeds of those realisations to creditors and the shareholders, should the proceeds stretch that far.
The official receiver is not constrained financially in his investigatory and reporting duties which are laid down by statute and funded by the state. He is often constrained by lack of funds in carrying out his role as liquidator, as in this case. The noble Earl is therefore wrong in suggesting that an investigation by an official receiver is hampered by a lack of funds. Moreover, contrary to what the noble Earl said, Section 218(5) of the Insolvency Act 1986 does not apply in cases where it is for the official receiver to investigate. The subsection gives the Director of Public Prosecutions (as it would be in this case) a discretion to refer a report by a voluntary liquidator to the Secretary of State for investigation. This is because a voluntary liquidator does not have the investigatory powers of an official receiver.
I should add that, once the official receiver is appointed, the question of any further investigation by the Department of Trade under the Companies Act does not arise because the official receiver is equipped with all the necessary powers of investigation. I am sorry to say that Mr. Russell has not co-operated with the official receiver. He has not submitted a statement of affairs as required by law; nor has he provided the official receiver with any information about the affairs of the bank. So far as the official receiver is aware, there are no assets available for realisation other than the possible proceeds of the various legal actions to which I have referred.
Earl Russell: My Lords, I am sorry to intervene but I should like to point out that the failure to supply information was, in large measure, due to the lack of access to the records and subsequently to the auditor's inability to sign the accounts for perfectly proper reasons.
Lord Strathclyde: My Lords, perhaps I may finish my remarks. It is a complex issue and I am sure that there are details which I or my officials have missed. It appears that Mr. Russell has been unable to cooperate with the official receiver. The official receiver understands that Mr. Russell is the principal creditor and shareholder of the company and any civil proceedings would be largely for his benefit.
There is certainly a public interest in the pursuit of crime. In this case, that was considered at the conclusion of the Section 109 inquiries back in 1981, some eight years ago. What is proposed now on behalf of Mr. Russell is that public funds should be provided to support civil actions for the recovery of money for the benefit of creditors and possibly shareholders; in other words, largely for the benefit of Mr. Russell.
It is well-established practice that such recovery proceedings should be funded from the assets of the company or, if there are none, from funds provided by the potential beneficiaries of a successful recovery. The Department of Trade and Industry may authorise an official receiver to incur uncovered costs, but the Secretary of State is of the opinion that such an authority should be given only where the proposed proceedings would be primarily in the public interest. This is not the case here.
The noble Earl asked about access to records. I understand that Mr. Russell was willing to make the records available to anyone interested in seeing them. Therefore I am unsure about how the noble Earl's interjection fits in.
The noble Earl's concern in this case is that there is a wrong without a remedy. In fact what this case shows is that there is a remedy for the alleged wrong but that the funds are not available to ensure that it is used—a not unusual state of affairs, however sad and regrettable that may be in particular cases.
I have spoken at considerable length because this is a complicated and sensitive issue. At the outset I said that I had great personal sympathy for the noble Earl's kinsman. I hope that he and the noble Earl will read carefully what I have said and that many points will have been clarified for them.
House adjourned at three minutes past ten o'clock.