Lords Sitting of 28 February 1990

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

The Kurdish People: Welfare
Baroness Ewart-Biggs Baroness Ewart-Biggs asked Her Majesty's Government:
What steps they intend to take to support the interests of the Kurdish people.
The Minister of State, Foreign and Commonwealth Office (Lord Brabazon of Tara): My Lords, we take a close interest in the welfare of the Kurdish people. We shall continue to monitor their treatment and to make clear our concern for their rights within existing international boundaries.
Baroness Ewart-Biggs: My Lords, I am grateful to the noble Lord for that Answer. However, is he aware that there is now clear scientific evidence that Kurdish refugees from Iraq have been poisoned by chemical warfare agents? Can he say what representations the Government have made to the Iraqi Government, either unilaterally or through the EC Middle East Working Party, about those outrages? Can the Minister also say how many Kurds from Iran, Iraq and Turkey have asked for asylum in this country; how many have been granted asylum; and how many have been refused it?
Lord Brabazon of Tara: My Lords, we utterly condemn the use of chemical warfare. We played a leading role in the drafting of UN Resolution 612 which followed the barbaric acts at Halabja. The poisoning to which the noble Baroness referred was the subject of an article in the Lancet, which I have seen. The tests do not show any consistent evidence of the poisoning of bread supplies. Therefore we cannot condemn Iraq on the basis of unsubstantiated evidence. However, we have made clear on numerous occasions, both unilaterally and through other channels, our detestation of Iraq's record of abuses of human rights.
So far as concerns the granting of asylum to Kurds in this country, we are fully committed to the United Nations 1951 refugee convention and its protocol. There is no question of turning away any genuine refugees. I am afraid that I do not have the figures which the noble Baroness requested in terms of the specific numbers from each of the three countries concerned. I shall try to find the answer and let the noble Baroness know.
Lord Cledwyn of Penrhos: My Lords, further to my noble friend's supplementary question, is the noble Lord prepared to go further and say that the evidence is clear that the treatment of the Kurdish people is one of the tragedies and atrocities of this century, and that tens of thousands of Kurds have
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been persecuted, tortured and killed in Iran, Iraq and Turkey? Will he say what is the Government's response to the evidence from Amnesty International and other sources that Kurdish refugees are being returned to Turkey without screening or any processing of their applications for asylum, with dire consequences for them? Can he also say exactly what happened in the case of the four Turkish Kurds who sought asylum at Manchester airport on 20th June? Was that case referred to the Home Office? What happened to those Kurds?
Lord Brabazon of Tara: My Lords, naturally we are concerned at the treatment of Kurds in all of the countries to which the noble Lord referred. We have made strong representations in all cases. I am not aware of the incident at Manchester airport which he mentioned. I shall try to find the answer and let the noble Lord know.
Lord Gisborough: My Lords, can my noble friend say whether it is true, as Kurds claim, that they are discriminated against in Turkey itself? For example, is it true that they receive less pay for serving in the army than Turkish troops for doing exactly the same job?
Lord Brabazon of Tara: My Lords, I am not sure about the specific example given by my noble friend. However, there is no doubt that the Turks do not allow Kurds to use their own language. The Turks must be fully aware of their obligations under the concluding document of the Conference on Security and Co-operation in Europe. I understand that the subject is under discussion in Turkish political circles. We should let those discussions take their course and hope for a favourable result.
Lord Grimond: My Lords, can the Government confirm that while they refused to see the Dalai Lama, apparently in the hope of appeasing China, they have received the Health Minister of Iraq without any protest whatsoever:
Lord Brabazon of Tara: My Lords, as I said, we have made clear our attitude to Iraq's abuses of human rights. We continue to trade with Iraq. I am not sure what was the purpose of the Health Minister's visit, but I am sure that it is not a good idea to cut off Iraq completely. It is better to maintain dialogue.
Lord Mackie of Benshie: My Lords, despite Turkey's far from perfect record on the treatment of the Kurdish people, can the Minister confirm that Turkey has been under a particularly heavy burden in the form of refugees from the greater inhumanities of Iraq? Can he say what our Government have done regarding financial help in order to ease the position and make the Turks give better treatment to those very unfortunate refugees?
Lord Brabazon of Tara: Yes, my Lords. We are pleased that the Turkish Government have provided humanitarian assistance both to the Kurdish and the Bulgarian refugees who have come into Turkey. The Government have donated a total of £800,000 of aid towards those causes.
Lord Kilbracken: My Lords, does the Minister agree that the treatment of the Kurds in Iraq has amounted to an extremely serious case of genocide and, in Turkey, is a blatant violation of the Lausanne Treaty to which Britain was a principal signatory? If so, will the Government initiate appropriate action?
Lord Brabazon of Tara: My Lords, the United Kingdom and other Western countries took the lead in co-sponsoring a firm and unambiguous resolution on Iraq at the last meeting of the United Nations Commission on Human Rights. Naturally, we are disappointed that an Iraqi procedural motion meant that the resolution was blocked. Iraq is in no doubt about our concern over human rights abuse. We shall continue to pursue the issue bilaterally and in international fora, including the EC. Ambassadors in Baghdad made a collective protest to the Iraqi authorities last June.
Lord Kilbracken: My Lords, will the noble Lord comment on the situation in Turkey to which I referred? The treatment of the Kurds there violates the Lausanne Treaty.
Lord Brabazon of Tara: My Lords, we expect the Turkish Government to treat all their citizens with due regard to the terms of the relevant international conventions to which Turkey is a party.
Lord Mackie of Benshie: My Lords, I do not wish to appear ungrateful to the Minister. However, does he think that £800,000 is enough for the many thousands of refugees who have poured in? A sum of £800,000 will hardly re-roof this palace. Does he consider that sum to be generous?
Lord Brabazon of Tara: Yes, my Lords, I consider it a generous contribution from one country. We are not the only people who should be expected to contribute to such funds. If everyone else contributed £800,000, it would add up to a good deal.
Baroness Ewart-Biggs: My Lords, will the Minister say whether Britain's exports to Iraq have risen in the past year? If so, does he agree that that is hardly a way to express condemnation of the human rights violations of a country?
Lord Brabazon of Tara: My Lords, I believe that we have condemned Iraq's human rights abuses unambiguously and on many different occasions.
Lord Cledwyn of Penrhos: My Lords, as the treatment of the Kurds is against the teaching of the Koran, will the noble Lord say whether any protests have been made to him or to his right honourable friend by the Moslem community in Great Britain?
Lord Brabazon of Tara: My Lords, I have not heard of any.

Engineering Industry: Support for Training
2.45 p.m.
Baroness Turner of Camden Baroness Turner of Camden asked Her Majesty's Government:
What steps have been taken to ensure continuing support from the European Social Fund for engineering industry training, and with what success.
The Parliamentary Under-Secretary of State, Department of Employment (Lord Strathclyde): My Lords, we have written to the European Commission asking that the successor bodies to industry training boards, including that for the engineering industry, be allowed to continue applying to the European Social Fund on the same basis as the existing boards. We are awaiting the Commission's response.
Baroness Turner of Camden: My Lords, I thank the noble Lord for that reply. However, is there not a problem that we may not be able to qualify for European Social Fund money if we abandon, as is the intention, the grant and levy system which we have at present? I understand that one of the qualifying bases for obtaining European Social Fund money is that there must be an input of public funds and the grant and levy system qualified in that regard.
Lord Strathclyde: My Lords, the noble Baroness will no doubt be aware that the levy system allows for exemptions and that is does at present qualify for European Social Fund money. The clarification that we seek concerns the situation under the new regime and we shall have to await the response.
Lord Rochester: My Lords, will the Minister go a little further and agree that it would be highly damaging to this country's interests if the Government's decision to convert the Engineering Industry Training Board into a non-statutory organisation were to result in any reduction in the financial support that we receive from the European Social Fund?
Lord Strathclyde: Yes, my Lords, but it is up to the European Social Fund to decide exactly how much money should be handed out to all the people who would like money from the fund. Generally speaking, the amount of money that is received from the European Social Fund as a proportion of the total amount of money that is spent on training in the engineering industry is very small. A couple of years ago the figures were some £5 million from the ESF compared with over £2 billion spent by the rest of the industry.
Baroness Elles: My Lords, will my noble friend confirm that funds from the European Social Fund must be matched by either an equivalent or a percentage sum and that the source is irrelevant? It need not be the Government; it could be a private source. If the engineering training board was a private statutory company, it could match the resources.
Lord Strathclyde: My Lords, I believe that my noble friend is only partly right. I understand that the rules require that the funding must be matched by public sector finance. However, there is some discussion as to what exactly "public sector finance" means. We are trying to show that, whether it is a privately led organisation or one which is totally subsidised by taxpayers' money, the industry training board should still receive social fund money.
Lord Dormand of Easington: My Lords, why is the Minister so equivocal? Is there not simply a conflict here resulting from the doctrinaire approach to training adopted in this country about which many of us have commented? What will happen if the noble Lord does not receive the reply that he expects from the European Commission?
Lord Strathclyde: My Lords, the noble Lord has got it quite wrong. We are not being at all doctrinaire; we are being exactly the opposite. We are moving away from a statutory organisation to one which is far freer and market-led by the industry. That is not a doctrinaire approach. We hope to receive a response from the Commission fairly soon and we shall have to review the situation at that stage.
Baroness Seear: My Lords, does the noble Lord agree that it is just as much a doctrine to believe in the free market—a doctrine which I happen to share with him—as it is to believe in public ownership? It is not a matter of being doctrinaire. One is not only doctrinaire because one believes in socialist doctrines. There are other, better doctrines, in which we all believe.
Lord Strathclyde: Yes, my Lords. I shall not quarrel with the noble Baroness over semantics.
Baroness Phillips: My Lords, is there any question of money not coming from Europe if the engineering industry does not have as many training places for women as it has for men?
Lord Strathclyde: My Lords, the engineering industry is totally non-discriminatory. I am sure that it will continue to support women in the engineering industry as much as it has done in the past.
Lord Dean of Beswick: My Lords, is the Minister aware that unless there is a substantial increase in the training of apprentices in the engineering industry in this country up to something like it was a decade ago, we shall be in no position to take advantage of the single market that will be in existence from 1992? Bearing that in mind, if we do not get the funds from Europe, will the Government look at this matter as one of urgency and themselves provide funds or more money toward that end?
Lord Strathclyde: My Lords, it is precisely because training provision has failed over several decades that we have elected to go into the new regime. We have had in this House many debates on training and we believe that in future in the 1990s training provision in this country will be far better than it has ever been before.

Scottish Electricity Privatisation
2.50 p.m.
Lord Kirkhill Lord Kirkhill asked Her Majesty's Government:
What will be the vesting date or dates of the Scottish electricity generating companies.
The Minister of State, Scottish Office (Lord Sanderson of Bowden): My Lords, the Government have decided that the Scottish successor companies will begin operating on 31st March 1990, when they inherit the assets and liabilities of the two Scottish electricity boards.
Lord Kirkhill: My Lords, I thank the Minister for that reply, but can he now tell the House why the Scottish generating boards which apparently previously were at the top of the sell-off queue now find themselves at the bottom?
Lord Sanderson of Bowden: My Lords, I seem to recall that on previous occasions on other issues we have occasionally been called guinea-pigs and sometimes that name can be applied to certain Bills which come before your Lordships' House. In this case it may well be that we are not a guinea-pig. What does matter and what is important is that the whole industry in Great Britain will be floated within a period of six months and within the lifetime of this Parliament. Perhaps I should add that my right honourable friend the Secretary of State for Energy has still to announce the details so far as concerns England and Wales.
Lord Taylor of Gryfe: My Lords, can the Minister say what the logic is of putting at the end of the queue the privatisation of the Scottish electricity industry when it is a relatively simple operation of two integrated companies compared with the complicated business of the whole industry south of the Border? Has he seen the comment of the chairman of the South of Scotland Electricity Board who said that early birds get the best investment opportunities? There is a limited amount of investment available in the industry. Why should the Scottish one be relegated to the end of the queue?
Lord Sanderson of Bowden: My Lords, I am sure that with the noble Lord's undoubted knowledge of the market place he would rather make haste slowly and get the thing right. I am encouraged by the remarks of Mr. Donald Miller yesterday as regards the flotation of his company and also the North board.
The Earl of Lauderdale: My Lords, are we to understand that noble Lords opposite have now been converted to privatisation and want it to be hurried on as fast as possible?
Lord Sanderson of Bowden: My Lords, I do not think that I need answer that particular comment except to say that it is encouraging to find support for privatisation from all sections of this House.
Lord Williams of Elvel: My Lords, would the Minister care to explain to his noble friend Lord Lauderdale that our opposition to privatisation is much more consistent than his? We have constantly voted against the Government's measures for privatisation whereas the noble Earl has not done so. Given that the Secretary of State for Energy has 47 advisers in respect of the privatisation of the electricity industry in England and Wales, including one personal public relations adviser, paid by the taxpayer, can the Minister say how many advisers the Secretary of State for Scotland has, and does he also have a personal public relations adviser?
Lord Sanderson of Bowden: My Lords, north of the Border we are always very careful to have the right advice from the smallest number of people who have knowledge of the situation. If I may say so, I am well aware of my noble friend's views on electricity privatisation and welcome the healthy debate that we had when the Bill passed through this House.
Lord Ezra: My Lords, can the Minister say what effect if any the separation of nuclear power from the Scottish electricity boards has had on the privatisation programme and indeed on their prospectuses?
Lord Sanderson of Bowden: My Lords, first of all I should say that what is most important as regards the nuclear situation in Scotland is the price that will be paid by Scottish Power and Hydro Electricity. The price set in the supply contract to those two new companies will take full account of our commitment that tariffs should not rise in real terms as a result of the new industry arrangements. I have to say that good progress is being made on these matters.
Lord Kirkhill: My Lords, now that the Minister has given an indication of the sell-off date, can he tell the House when the licensing document is likely to be issued? I ask not as a supporter of the sell-off, as the noble Earl, Lord Lauderdale, seems to think I am, although I am a well known opponent, but rather I am concerned about the consumers of electricity in Scotland and about the workforces of the two generating boards.
Lord Sanderson of Bowden: My Lords, I know of the noble Lord's very distinguished chairmanship of the Hydro Electric Board and his knowledge. He made it very clear during the passage of the Bill. However, I was very glad to hear that he supported the idea of two privatised companies rather than one in Scotland. In answer to his question about licences, they will be published very shortly.
Lord Mackie of Benshie: My Lords, can the Minister tell us whether the privatised board which will succeed the Hydro Board will have an obligation to provide electricity supplies to people in the Highlands where the obligation is more social than economic?
Lord Sanderson of Bowden: My Lords, as to the tariff, the noble Lord knows very well that there is an equality so far as the Hydro Board is concerned.
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Only a tiny number of existing dwellings remain unconnected, generally where costs are grossly uneconomic. The costs of connection to new dwellings need to be met by the individual consumer if he deems it economic. We believe that it is unfair for such costs to fall on the wider body of consumers. However, the noble Lord knows that we have come a very long way in bringing electricity up the most difficult glens and over the most difficult countryside there is in the United Kingdom.
Lord Mackie of Benshie: My Lords, do I take it that the answer is no, that they will not supply to remote areas whether or not it is deemed economic?
Lord Sanderson of Bowden: My Lords, so far as each individual case is concerned it is considered on its merits and so far as possible help is given. But at the end of the day the individual consumer will have to bear the cost.

The Community Charge and Private Tenants
2.58 p.m.
Lord Molloy Lord Molloy asked Her Majesty's Government:
Whether they will state, in respect of the tenants of privately rented housing accomodation for which they are now paying landlords a gross rental including local authority rates, what enforceable rights they have on becoming individually liable for the community charge to secure a reduction of their rents commensurate with the rates for which their landlords will no longer be responsible.
The Parliamentary Under-Secretary of State, Department of the Environment (Lord Hesketh): My Lords tenants' rights will depend on the type and terms of their agreements but most tenants paying rate-inclusive rents can secure a rent reduction following abolition of domestic rates. A substantial majority are still covered by the Rent Act and can have a fair rent registered which will be exclusive of rates.
Lord Molloy: My Lords, with great respect, that does not answer the kernel of my Question. Will all tenants be free from being cheated by landlords to whom they now pay rates in with their rent and will they have to continue to pay rates to the landlord as well as the poll tax to the local authority? Will that be regarded as criminal behaviour on the part of those landlords? Can we have a straight answer and not one about publications? Can we have a yes or no on behalf of the millions of people who are so threatened?
Lord Hesketh: My Lords, I think that the noble Lord refers to the position of licensees. That is a figure which we approximate at some 100,000 people. I should point out that in the current and existing circumstances, if there were legislation which did what he asks the Government to do, the landlord could still be in a position immediately to raise the rent back to the figure that it was previously. The assumptions of rateable value and rates would not change so far as the licensee was concerned.
Viscount Mountgarret: My Lords, is my noble friend aware that there are many employees who occupy tied cottages for which the employers pay the rates? The employees' wages are commensurate with the benefits of those who live in tied cottages. On that basis, will my noble friend give any indication or assurance of what the Government may be able to do to encourage those responsible for negotiating wage structures for people living in tied cottages, in particular agricultural workers, clergy, firemen, police and so on, so that their wages will take into account the poll tax to be met rather than the employer having the benefit of not having to pay rates? Some measure in this direction will be most necessary.
Lord Hesketh: My Lords, by its very definition, the relationship between an employer and an employee as implied by a tied cottage makes it very different from any other form of residence. There are varying forms of tied cottage. There are arrangements whereby sometimes the tenant pays the rates, in which case the tenant would be a beneficiary under the new system in one sense and could lose in another. Because there are different forms of tenancy of tied cottages most employers who I have come across in this situation are arranging a system whereby they finish up with a net effect that is the same as before. However, if the owner of the tied cottage does not wish to equalise the matters as they were his employee will be more than able to say, "In that case I do not wish to continue in your employment".
Lord Dean of Beswick: My Lords, is the Minister aware that when dealing with this subject last week in another place the Prime Minister gave an undertaking that the Secretary of State for the Environment would be making a leaflet available with points of guidance in it in order for the tenant to be able to protect himself from a landlord who may exploit the situation? Will the Minister urge the Secretary of State to make these leaflets available as a matter of urgency in view of the track record of some landlords?
Lord Hesketh: My Lords, the noble Lord is absolutely correct in attributing the remarks to my right honourable friend the Prime Minister. The leaflet is about to go out. However, better than that, on the bottom of the form of every bill that goes out with the community charge notification will draw the bill payer's attention to the fact that he can receive guidance from the Department of the Environment on this point.
Lord Graham of Edmonton: My Lords, does the Minister acknowledge that we now have the experience of Scotland for the past 12 months to guide us on the way in which landlords will or will not treat their tenants? Will the Minister confirm that it has been estimated by reputable sources that at least £40 million has been garnered by unscrupulous landlords who have failed to act as the Minister and his colleagues would wish them to do? Bearing in mind that for England the estimate has been that in excess of £90 million will be lost, will the Minister
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demonstrate the same urgency in threatening recalcitrant landlords as he seems to in looking after the interests of other people—for instance, those landords who may have the poorest of the poor as tenants and those who have two homes on which to pay the community charge?
Lord Hesketh: My Lords, it is my understanding that the figure of £40 million to which the noble Lord refers was based on an assumption that all private tenants paid their rates with their rent to landlords in Scotland. The fact of the matter is that 40 per cent. of tenants in Scotland pay their rates directly to the local authority. The figure has to be treated with a certain amount of care.
Lord Glenamara: My Lords, is the noble Lord aware that there is a very special problem here for students? This year not only will they lose their housing benefit but on 1st April every student in the country will be liable to pay from £50 to £100 as their share of the poll tax. Will he make it absolutely clear that after 1st April no student in lodgings need pay that element in his rent which is attributable to rates?
Lord Hesketh: My Lords, it is important to remember that we made a great reduction for students when we introduced the legislation.
Lord Glenamara: My Lords, perhaps I may—
Noble Lords: Order!
Baroness Carnegy of Lour: My Lords, does my noble friend agree that the taking advantage of tenants by landlords who are paying no attention whatever to the change from rates to the community charge is very bad indeed and that the leaflet and its attendant publicity are the best help yet?
Lord Hesketh: My Lords, it is important to remember that the vast majority of tenants are protected by law. If they go to court and are successful, the courts will not enforce that part of the rent which they believe was represented by the rates.
Lord Stallard: My Lords, does the Minister recall that we have already had instructions in a DSS leaflet, document, paper (whatever one calls it) issued in January 1990 to local authority associations? That document stated that it is highly unlikely on the basis of the experience in Scotland last year that landlords will reduce charges to take account of the abolition of rates. That is the Government's advice which was given in their own document in January this year.
Perhaps I may ask the Minister one further question. Have the Government made any estimates of the effects on housing benefit of this landlord racket, as it was called? From the experience of Scotland it will cost £7·5 million extra in housing benefit. How much extra in housing benefit will it cost in England?
Lord Hesketh: My Lords, I do not have the figure with me today. I shall write to the noble Lord.
Viscount Tonypandy: My Lords, will the Minister bear in mind that he sounded uncharacteristically unkind about those who live in tied cottages? Very often they are the people who especially deserve extra consideration. Will he not go back to his office and return with a kinder attitude than he has shown this afternoon, which is quite out of character with what we usually receive from him?
Lord Hesketh: My Lords, I hope that I have not given that impression. I have considerable experience of tied cottages and am very sensitive to the problems that are involved. That is very far from what I hope my answer indicated. I was trying to indicate to my noble friend that it is a separate question, because there are, as they say, many horses for many courses in the different ways that agreements have been reached in the past.
The Minister of State, Home Office (Earl Ferrers): My Lords, perhaps I may intervene for a moment and point out to noble Lords that we have been on Questions for 31 minutes. The noble Lord, Lord Northfield, has been trying to intervene. I suggest that it might be appropriate if he asked his question and then we passed to the next business.
Lord Northfield: My Lords, the leaflet to which the noble Lord referred was promised in this House when we raised the issue on the legislation passing the poll tax. At that time it was promised that the leaflet would be ready and would go out with the poll tax demands. Will the noble Lord give an assurance that that leaflet drawing tenants' rights to their attention will be distributed with the poll tax demands?
Lord Hesketh: My Lords, it is not possible to distribute the leaflet with the poll tax demands. The leaflet has to go out before the demands. However, as I said earlier, there is a clear statement on the bill that goes out drawing the payer's attention to what guidance he can get.
Lord Molloy: My Lords, is the Minister saying that tenants of private landlords who have to pay rates have also to pay the poll tax?
Noble Lords: Order!
Earl Ferrers: My Lords, whether the noble Lord, Lord Molloy, puts his question, or indeed is able to put his question, is a matter for the House. I rather interpreted the view of the House that your Lordships wished to move on.
Noble Lords: Hear, hear!

Business
Lord Denham: My Lords, I should like to say a word about this afternoon's short debates standing
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in the names of the noble Lord, Lord Annan, and the noble Lord, Lord Birkett. As the mover is allowed 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 debate of the noble Lord, Lord Annan, all other speeches should be limited to a maximum of 12 minutes. In that of the noble Lord, Lord Birkett, the number of speakers is such that it is not necessary to propose any formal time limit. But I know that your Lordships will be confident that noble Lords will keep their speeches within limits compatible with the spirit of these short debates.

European Parliament Electoral Reform Bill [H.L.]
Lord Bonham-Carter: My Lords, I beg to introduce a Bill to reform the law on elections to the European Parliament; to base the electoral system for such elections on proportional representation; to unify the electoral systems of Northern Ireland and Great Britain for the purposes of such elections; and for connected purposes. I beg to move that the Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Lord Bonham-Carter.)
On Question, Bill read a first time, and to be printed.

Higher Education
3.11 p.m.
Lord Annan Lord Annan rose to call attention to the case for a policy for higher education; and to move for Papers.
The noble Lord said: My Lords, today I am asking the Government what their policy is on higher education because no one in the universities, polytechnics and colleges appears to know.
The Secretary of State and the Parliamentary Under-Secretary responsible for higher education are too young to have been required to undertake military service. Mr. Baker undertook military service but, as he became an instructor in the Libyan army in gunnery, he may have forgotten one of the lessons that the army teaches its officers. It is this: always tell the troops you command—whether they are in a platoon or, as in the case of Lord Montgomery, an army group—what your plan is; what your intentions are; where you expect to go; what hardships there are on the way which must be endured; and why that is the best way to reach your objective.
At the beginning of the 1980s everyone knew what the Government's policy was. They were determined to cut public expenditure and as a result 450 dons were retired early. But when Sir Keith Joseph, as he then was, became Secretary of State, the tone of faint regret turned into a snarl. He waved Mr. Corelli Barnett's book in the faces of his officials and told the universities that they were idle, teaching the wrong subjects and doing little to make Britain more prosperous. So tenure was abolished and universities were forbidden to take more students. Academic

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salaries were cut in real terms, presumably in order to make teaching in higher education less attractive and to drive graduates into other occupations. Is that now the policy of the Government?
They may well have in mind two reports written in the 1960s by the noble Lord, Lord Swann, in which he pointed out that the universities had Peloponesian habits; like Pelops they ate their own children. In those days 50 per cent. of graduates in physics went into universities or into teaching following academic careers and only 10 per cent. went into industry. But that can hardly apply today.
No one, certainly no former vice-chancellor, can have criticised more than I the failure of universities and polytechnics to respond in the 1960s and early 1970s to Government's hints and nudges. In those days, when money was still pouring into higher education, the slightest check to the flow brought moans that morale was shaken and the rate of the brain drain was alarming.
But today morale in higher education really is at rock bottom and the brain drain is not an illusion. Dons are not ready to accept Mr. Jackson's blithe reassurance that as many members of staff are draining back to our universities as are draining away to America and elsewhere. The dons are not reassured because the count neglects the quality and age of those leaving compared with those who are returning.
I believe that the Government's policy is to give top priority to the teaching and training of 16 year-olds. If that is so, why not tell the universities and polytechnics that funds must go first to JTS, YTS, ET and now BGT? There are so many schemes that they now resemble alphabet soup. But can the Secretary of State encourage universities and polytechnics by saying, "Yes, this effort has top priority but I have extra funds for the work so you will not suffer"? How many of those schemes are financed from the votes of the Departments of Employment and Trade and Industry? Should not the college have top priority? Is the Secretary of State satisfied that the colleges are providing sufficient full-time courses leading to the higher national diplomas as well as for diplomas and certificates for part-time students? Or does he envisage the polytechnics increasing their share of such
The Government are being urged to reward the polytechnics for the admirable way in which they have accepted many more students with hardly any increase in staff. Naturally, polytechnics and their advocates—such as the noble Baroness, Lady Cox, and the noble Earl, Lord Longford—have argued that they wish them to be funded on the same level as universities.
On that issue my mind goes back to 1962. I then urged that the colleges of advanced technology (CATs) should be upgraded to universities. I thought that technology should be given the same status as pure science and that we needed to encourage the new universities to follow the example of the CATs and introduce sandwich-course degrees.
Following the Robbins Report the CATs were upgraded. What happened? Not a single university introduced sandwich courses, the CATs dropped
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their diploma work and their costs escalated enormously without a single additional student being educated.
We must have some cheap higher education. Do not let the ship which is carrying all the additional students—who last night we said were so important to our economy—run aground on the rock of parity of esteem. Have the Government considered giving encouragement to the polytechnics now that they are admirably undertaking the work for which they were set up; that is, the national diploma and the three-year degree courses? Have the Government considered giving the polytechnics priority over universities in the DES capital programme? If so, are they prepared to tell the universities and the polytechnics that that is their
The universities deserve recognition for the way in which they have changed during the past decade. They have at last responded to government requests that they should introduce more vocational studies. How do the Government intend to finance universities? The last Secretary of State appeared to have worked on the dubious principle of "pull devil, pull Baker". In other words, he set up as chairman of the new Universities Funding Council the noble Lord, Lord Chilver. The noble Lord seems to believe that all should be left to market forces, whereas the head executive of that body, Sir Peter Swinnerton-Dyer, is a convinved dirigiste. Are the Government expecting that student demand will determine which universities will flourish and which will be left to wither? Will students be allowed to take their fees with them and study what they will, where they will? Are universities to do as was forecast; to bid against each other for students? Will the university prepared to take more students at the lowest cost be the one favoured by the
I hope that in her reply to the debate the noble Baroness will not shelter behind the existence of the UFC. I am sure that she will not. I understand that these days the vice-chancellors are in and out of the Secretary of State's office almost every month. The Government must have a policy towards universities. What is it? Perhaps the noble Baroness can reassure some of us by announcing that market forces and student choice are not regarded as being the best ways in which to finance universities. If vouchers come in, the numbers opting for science and engineering will inevitably decline. If universities are to operate on trends, then what they are famous for—scholarship and learning—will perish.
Is it the policy of the UFC to fund research in universities according to the results of the inquiries into the excellence of departments which have been made in past years, at great inconvenience, no doubt, to universities? Of course, many dons have sneered and protested at the methods of those inquiries in determining excellence. However, numbers of dispassionate observers believe that by and large the inquiries got it right. Can we now assume that the half dozen or so institutions will receive preferential treatment in research allocations but that outstanding departments in other universities will receive an indicated increment for research in the UFC grant? You cannot have 50 Caltechs or

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Berkeleys in Britain, and if you try to do so, you will end by having none.
However, I must ask: do the Government value Nobel prizemen? I must ask that because now the cliché seems to be gaining ground in government circles that such research is self-indulgence and that only vocational research matters. If the Government want an example of what a powerful scientific mind can bring to bear on a problem, let them read the devastating speech made last night by the noble Lord, Lord Swann. He exposed the phoney reasoning in the White Paper which was attempting to make a numerical assessment of the so-called social rate of return of university studies.
Why do the Government so often give the impression that they despise the humanities? The national heritage is not just country houses and works of art. It is also our literature and cultural traditions. As a historian, I am old-fashioned enough to believe that history teaches us not only how society works but also statesmanship. The humanities teach us how to distinguish between merit and the meretricious. Perhaps that is why governments are not too keen on the humanities.
I have spent a good part of my life most unsuccessfully trying to persuade universities to change their ways. I know how dispiriting that is. Therefore, I have more sympathy with Ministers from both Front Benches than have most academics. Whatever change is proposed, an outcry follows. Last night the outcry was on loans. In 1967, two years after I entered your Lordships' House, the subject of outcry was the introduction of a differential between overseas students and home students made by Mr. Tony Crossland. The howl that went up then was at least the equal of what happened last night.
I must finish by reverting to my theme and my military metaphor. Ten years ago the universities and polytechnics were fed hard rations and put on the square to be drilled, chivvied and shouted at by Mr. Robert Jackson who was promoted to the rank of regimental sergeant major. The time has now come to replace the RSM on the square by the commanding officer.
The new Secretary of State has the advantage of being a Scot and therefore prejudiced in favour of education. Could he not meet the directors of the polytechnics and then the vice-chancellors and tell them what is his strategy and listen to their comments? I know that in all good faith last night the Paymaster General told us that the Secretary of State had consulted the vice-chancellors about the scheme. I have had an opportunity of looking at the correspondence. It seems that what happened was that in January the Secretary of State wrote to the universities and asked them for their views on the loan scheme. The universities then replied. In a letter dated 3rd March 1989 they said that they had other ideas in mind, one of which was the graduate tax. It was to that letter that they never received any response so I am informed. Of course, I am not for one moment suggesting that the Paymaster General was in any way trying to delude the House on this
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matter but it is precisely on that kind of issue that I really believe that the Government could improve their record.
The Government have a political philosophy and principles. However, that is really only one reason why they come into conflict with the universities. Could the Government not try to help and inform those in higher education? Could they not put the men and women who are in higher education in the picture? I use a World War II expression. You will not make them happy. Times are far too hard. You are asking them to change their ways and to take more students. You are having to curtail the activities on which they like to spend their time such as research and learning. However, you have to convince them that that is right. If you try, you may perhaps win their respect. At the moment, you have lost it. My Lords, I beg to move for Papers.
3.28 p.m.
Lord Prior: My Lords, I am very pleased to follow the noble Lord, but I do so with a good deal of trepidation because he has a lifetime of experience in higher education and particularly university education and I have practically none. When I was up at Cambridge I believe that the noble Lord was a tutor at King's. At that time one of his pupils was Mr. Simon Raven, the novelist. He and I have shared an interest of one sort or another in Mr. Simon Raven and his writing ever since. Sometimes we have wished to disown him, but on other occasions we have perhaps been quite proud of what he has said.
One thing I know is that anybody like myself taking part in a debate of this nature is bound to be shown up for his lack of knowledge because this is a veritable minefield and the more that one delves into it, the more difficult it becomes to decipher. Therefore I shall spend a few moments saying something from the point of view of an industrialist and how I look at higher education in that regard.
I do that because the Council for Industry and Higher Education was set up somewhat at my instigation after I left government some five years ago. It seemed to me all the time that I was in government—and it certainly seemed to me with my interest in industry—that there was a very considerable gulf between what industry thought about higher education and what higher education thought about industry. In a very quiet and economic way the council has tried to examine the points of view of both and to try, wherever possible, to bring both closer to each other.
The purpose of the Council for Industry and Higher Education is based on the identification and acceptance of common objectives for developing higher education so as to produce a more highly and broadly educated nation—and from what the noble Lord said, that must of course include humanities—and one which is able to compete with the most successful and advanced industrial economies.
The fact that we have had two debates on successive days on higher education should not be thought of as a mere quirk of the parliamentary

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timetable so much as an intense interest and concern about what is happening and needs to happen. I know that the noble Lord has some sympathy for Ministers. I only pity my noble friend who has to reply to the question which the noble Lord asked. Thank goodness I am no longer a Minister!
Although there is no evidence from the past to support the view that more higher education leads to more economic growth—over the past few years one could perhaps make out that the contrary has happened—most people believe that educated and highly educated people are the key to success in the market place of the future.
The Council for Industry and Higher Education, which consists of a majority of fairly tough industrialists, put forward a strategy to change our higher education system from one geared to a small minority to a more open system which will bring many more people to a higher general level of education than they now attain. It also stated that larger numbers, more widely recruited, were needed with a diversity of learning opportunities at different stages in their lives, and a broader education balanced towards maths and technology as a foundation for later specialisation. It should not be entirely maths and science based because industry requires people who are well educated and able to think for themselves rather than simply having specialist knowledge. There is therefore a need for those people.
Playing the numbers game for a moment, the latest figures show that there will be a growth in employment of around 7 per cent. in the years up to 1995, but a growth in the need for graduates of 17·5 per cent. Graduates will therefore be needed. The Government suggested a doubling of numbers in 25 years; having suggested that, they started to edge away from it, but at least they made the suggestion and should be kept to that rather minimum undertaking.
That growth has to happen against a falling supply, so we need to attract into higher education those who are less qualified academically and those from different social classes than the majority come from at the moment. It is a fact that social groups 3 to 5—if one can define them—are apparently 68 per cent. of the population, but only 7·5 per cent. of them qualify for higher education. There is therefore something definitely wrong there.
We need to attract more part-timers, more older people and more people from the ethnic minorities. How do we do that? We need to change the culture—this is where Parliament and the Government come in—to make higher education for us and not just for them. A house, a car and a college education must become the natural aspiration of all people. We must move from an elite to a mass system, though I do not doubt that there will always be some elite, and I certainly think that there should be.
That means pupils staying on at school after 16. Incidentally, there is a great improvement in that regard, and that is helpful. It means there must be courses relevant to the life and work of the people we wish to attract to them. We need to attract women
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and mature students and also those who qualify by vocational routes. With regard to women, if, by the year 2000, we could equal the number of women obtaining two or more A-levels—which at present happens in Scotland—we could add a quarter to the total number of people in England and Wales going on to higher education. That speaks well for the Scottish system and for women within the Scottish system who are actually at the top of the whole system, as no doubt my noble friend. Lady Carnegy of Lour will point out. Through a whole range of access courses we could improve the uptake of people attending polytechnics and universities.
The system also needs—and this is where I part company from the noble Lord—to be more customer-orientated. In the past it has been too producer-orientated and some change towards what the customer requires is needed. It has been happening, but needs to go further.
How will we pay for all this? It is very important not to fudge that particular issue. I simply do not believe that any government of any party will ever find the money required to expand the university and higher education system, as much as many of us believe is necessary, entirely from the taxpayer without other sources of money becoming available. That is just a con on the public to believe that that is likely to happen. It has not happened in the past and I do not believe it will happen in the future.
How will we bridge the gap that there is bound to be? There is still room for greater efficiency in the system, though as the noble Lord pointed out there has been considerable improvement in the past 10 years and in some respects perhaps the squeeze has gone too far. There will certainly be a need for some extra government money; the polytechnics in particular will require some new capital investment.
Yesterday we discussed student loans. I see no alternative but to encourage student loans, and I think they have an important part to play. There may also perhaps need to be some switch from block grants to fees so that students can obtain more money from local authorities and rely less on central government. That has the great advantage that it would be demand-led in technical Treasury terms and perhaps not be so objectionable as otherwise it might be. We need new methods of teaching. We will need to make much better use of distance learning than we have so far.
Industry can help, but it will need the assurance that it is not just there to fill a hole which the Government make in advance. Industry wants to feel that it is putting additional money into the system and not substituting money for that which the Government would otherwise put in. In this regard the professions and the City should be encouraged to do a great deal more. Professions and businesses—the commercial sector—are now taking more graduates than the whole of industry, yet they contribute practically nothing towards the cost. There is a great deal more to be done there and I hope the Secretary of State puts a lot more pressure on the City and the professions to play a larger part.
There is perhaps room for more research money; but basically the Government have preserved the

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research element going to higher education reasonably well. There is also the problem of morale. In politics one becomes used to people telling one that morale in a certain organisation is bad. In my political life I have rarely known morale in any organisation to be particularly good. However, I think morale is bad at the moment, particularly in the universities. We have to recognise that. I am not certain that remarks made yesterday by Mr. Morgan of the Institute of Directors were designed to improve matters very much. I do not think one can blame the establishment, the university establishments and the Bishop of Peterborough for everything that has gone wrong over the past 20 years.
There is a strong case for more and better higher education, but it requires the co-operation and understanding of us all if we are to have the improvement we need. Some of the good will that exists between industry and higher education must help to mend the breaches and promote the keen, able and dedicated to get on with their job.
I conclude by saying to all noble Lords that I have enormous confidence in the Secretary of State. He is a sound, sensible Scot. If he is not listening or has not listened in the past, I am certain that from now on he will listen. He is the type of man who wants to steady the whole system and build confidence back into it. For those reasons I wish him every possible success.
Lord Hatch of Lusby: My Lords, before the noble Lord sits down perhaps I may ask him a question; I did not want to interrupt him during the course of his speech. Did I hear him aright that his ambition is that every person in this country should have a house, education and a car? I stress "and a car". If I am right has he spoken to the Secretary of State for the Environment about the effect that that is likely to have on the environment?
Lord Prior: My Lords, I do not have any objection to answering that. Very nearly everyone has a car now. However, I want people to regard a car, a house and a college as all being important parts of their future careers and aspirations. That is what is important. If after having obtained a car they prefer to travel by train, that will suit GEC even better.
3.42 p.m.
The Earl of Longford: My Lords, I am happy to follow the noble Lord though I hope not to follow his example and overstep the time limit. Of course I may also overrun but I am simply stating a fact.
I was glad that in referring to morale the noble Lord appeared to draw a distinction between the universities and the polytechnics. I say nothing about the universities because it is many years since as a college tutor I was qualified to say anything about them. However, as far as I can see morale in the polytechnics has never been so high. The noble Lord, Lord Annan—to whom I shall be referring, I am afraid, in a way that will not altogether please him—said on a previous occasion that the
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polytechnics were the success story of the 1980s. Therefore, let us be clear in that respect: morale in the polytechnics is extremely high; morale in the universities remains an open question.
This House is replete with men of academic genius or at any rate talent. I need only look across the Chamber to see the noble and learned Lord, Lord Hailsham, my old college friend the noble Lord, Lord Blake, and on the Bench below me my noble friend Lord Peston. There is also the noble Earl, Lord Russell, although he appears to have fled the Chamber. The place is full of professors or noble Lords who ought to have been professors if they had had their rights.
Among them all no one has exceeded the academic achievements of the noble Lord, Lord Annan. He comes before us as a supreme elitist. He was Provost of King's College at the age of 40 and perhaps has never quite lost that point of view. At any rate he will not have any use for the poor old polytechnics and I regret that I must disagree with him totally in his whole approach to the subject. He went out of his way, if I may put it in that fashion, to say that there should be no parity of esteem.
I am desperately anxious not to follow the example of the exalted noble Lord opposite and overstep my time, so perhaps I should say at once that I am arguing today for parity of esteem, parity of funding and parity of opportunities. Therefore, there can be no meeting point between the noble Lord, Lord Annan, and myself. He will of course have the final word and no doubt will make some concession or alternatively try to debunk me. We shall see. At any rate that is the position.
We must bear in mind that the polytechnics cover more than half of all higher education and yet the noble Lord who has selected this subject for debate has gone out of his way to say that they should not have parity of esteem. That message will intensely anger the polytechnics. I do not suggest that there will be any loss of morale, rather the adrenalin will flow more strongly through their veins when they hear that pronouncement.
I need to give the House some facts about polytechnics and if during the course of that a noble Lord intervenes to ask whether I am reading my speech I can only say that I shall wait until he delivers his speech and apply the same treatment. There are certain facts about the polytechnics and it is as well to read out the figures rather than appear to be making them up as one goes along.
I am sure we are all aware—I hope the noble Lord, Lord Annan, will agree—that the standards of polytechnics are now as high as those of the universities. Their degrees have the same value. Both groups are partly funded by the state. However, parity of esteem is not to be conceded by, so to speak, the champion from King's College. That is the situation we face today and there is no getting round it.
I refer to the old universities and what I call the best colleges. When I was at Eton with the noble and learned Lord, Lord Hailsham, I knew of only one college anyway. That was King's College, Cambridge, because that is where all the Eton scholars

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went—except the noble and learned Lord. At any rate, we knew about King's College and I understand why they see themselves as being on a pinnacle. They look down on these wretched interlopers who nevertheless have had success, albeit on a lower level altogether. I am bound to say that that is the impression left by the noble Lord. I am speaking warmly on behalf of half the higher education in the country which will be very much affronted by that way of looking at the position.
I now give a few facts. Of course we have this binary line. As I said on a previous occasion, I have a slightly guilty past in this respect because when I held a responsible position in this House I defended it when I did not know what it amounted to; but that was 20 years ago. Today I believe that all who have looked into the matter agree that the binary line has had it. It is the binary line that is at the root of the trouble. While it exists we will have this distinction between the universities and the polytechnics, all to the advantage of the universities.
I agree with the noble Lord, Lord Annan, and most noble Lords who spoke last night that we must have far more resources devoted to the universities. However, do not let me convey to the Government the impression that a gain for the polytechnics should necessarily be a loss for the universities. Taking the amount allocated by the government of the day to higher education, all I am suggesting is equality of opportunity—the right to compete on equal terms. One either concedes that or one does not, but it is not being conceded at present. That is a fact.
The noble Lord, Lord Annan, was quick to concede today and has done so on previous occasions that the polytechnics have greatly increased their intake. In 1989–90 the polytechnics increased their intake of students by 24 per cent. Their reward is to see funding per student for next year, 1990–91, cut by a further 2.6 per cent. That is the way the polytechnics are being treated.
In 10 years the funding per student in polytechnics has been reduced by over 20 per cent. but in universities funding has marginally increased. That discrepancy is increasing the whole time at the expense of polytechnics. I am dealing entirely with facts, whatever conclusions one wants to draw from them. I shall not go into detail because there is no time. I merely want the House to realise the way that steadily, as time goes on, the polytechnics, which are the success story of the 1980s according to the noble Lord, Lord Annan, are being discriminated against.
The polytechnics have suffered years of neglect in funding, building repairs and equipment purchases. It is estimated that over £700 million is required to put the buildings into good order. Obviously the polytechnics need far more help than they are receiving.
The universities have been able to stay more or less equipped, but the polytechnics are having a very hard time compared with the universities. There is not an ideal standard, but I am comparing the polytechnics with the universities. The polytechnics do not receive enough funding to replace outdated equipment. These are policy decisions which can be
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altered tomorrow. I hope I have not said anything offensive to the noble Lord, Lord Prior, but I am ready to believe almost anything that he said, including the fact that because a man is a Scotsman he is going to make a better Minister for Education. I see no reason to believe that at all. I am wearing an Irish rugby union tie and no one would think that because I am an Irishman I would be better as Minister for Education, or even if I were a Welshman. We on these Benches have been accused of being run by the Welsh "Tafia". These racial discriminations are not helpful.
I am quite ready to wish the new man luck but I doubt whether he will be anything like as good as the noble Viscount, Lord Eccles. I hope that I have made at least one convert in the course of these remarks. The new man has the chance to provide equality of opportunity between the two sectors, the first represented by King's College, which probably looks down on all the other colleges, even Trinity I should think. The second is represented by the polytechnics. They will rise bursting to serve the community. I hope that this Government—and no party issue can possible be involved here—will see the light. I feel that there is no man in this country who if he once became converted would be more like St. Paul than the noble Lord, Lord Annan.
3.52 p.m.
Viscount Hanworth: My Lords, it must be more than 20 years ago when, with great temerity and as a much younger man, I attacked university education as being inefficient and not meeting the nation's needs. This I did after a Reith lecture given by the noble Lord, Lord Annan, which was largely in favour of what the universities were doing. Believe it or not, this was at a time when it was seriously thought that whatever was taught at a university and however badly it was taught, it was self-justifying because it was taught at a university or an upgraded polytechnic.
Much has changed since then, but I think that periodically we should look at the aims of higher education and consider how well we are meeting them. I suggest to noble Lords that there are three main headings: first, to train future academics and research workers (in the main that is what universities have always done fairly well); secondly, to teach students disciplines which are likely to be useful to themselves and to the nation when they are employed afterwards; and thirdly, to enlarge students' minds to fulfil their academic interests and, it is hoped, make them more rounded people and better citizens.
I would like to consider the last two aims in more detail. I question whether we have fully exploited what I term methods of instruction. Most certainly, even experienced lecturers can improve their techniques. Brief seminars and discussions for the staff are needed. Some universities have decided to do that and others are still lagging behind. I am sure that for most students, as the noble Lord, Lord Annan, has said, mixed courses are desirable. For example, to spend three years studying economics is wrong unless the student is likely to become an

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academic. Some other added disciplines are required. For example, some knowledge of management skills and even a superficial knowledge of accountancy are useful and important.
Under this heading I believe that sandwich courses are all important. During their academic work students should become acquainted with the harsher and often less satisfactory life outside. In the University of Surrey all disciplines, even music, have to adopt the sandwich course to a greater or lesser extent.
I now turn to the much more difficult third aim. It had been hoped that education would make people more reasonable. I mean that it was hoped that educated people would take a more reasoned and balanced point of view whatever their political persuasion. That has not been the case. Here I stick my neck out. Many lecturers on subjects within this category have come direct from university with no experience of life outside.
I want to put forward a long thought-out personal view which to me is of great importance. Surely, one purpose of education is to teach people to think clearly. By that I mean that they should first logically consider the arguments for and against a course of action and only after doing so should they weigh the factors using their experience and emotional views. But they must be able to analyse the reasons for their weightings. So often people adopt a reverse procedure. They decide what they feel and then look around for the arguments to support their view.
I believe that the approach I have described could easily be taught under the banner of some recognised discipline. One would start with an historical situation which today has little emotional content and build up gradually to some issues which are highly controversial and emotive. If the approach I have described was more common, much of the bitterness and misunderstanding would be eliminated in discussion on controversial issues. I would like to continue with this theme in more detail, but I believe that if I have interested noble Lords at all in this matter then I have probably said enough.
I wish to make one further point which I have made many times over the years. Though I was at Cambridge and took a degree there, the best mental training that I ever received was at the Army staff college. I believe that universities might take that to heart. Finally, I make the point that I believe both universities and technical colleges have slightly different roles to play in higher education. The rather more down-to-earth approach of technical colleges is better for some students rather than that of the more sophisticated university teaching methods. We now require both.
I hope that greater status will be given in the future to the technical colleges and, at the same time, to the teachers and not just the researchers. Some people have said that part-time researchers are impossible; in other words, women who might do this simply could not be employed. My reply to that is in that case most of the university professors and lecturers should be sacked.
4 p.m.
Lord Hunter of Newington: My Lords, I should like to add my thanks to the noble Lord, Lord Annan, for his stimulating introduction to this debate. I wish to make reference to one aspect of higher education in medicine. I refer to the provision of funding for clinical teaching and research centres, the facilities of which are funded by the National Health Service and the Department of Education and Science through the universities.
For many years there has been a very happy relationship between the two departments concerned. This allowed for the creation of medical teaching centres where the medical school was embedded in the hospital. I was concerned with the development of these centres in the 1960s. One thing that made it possible was the knock-for-knock principle between the Department of Health and the Department of Education and Science and amicable agreements on the sharing of capital costs with the University Grants Committee. The universities and the National Health Service both derived enormous benefit from this close relationship in relation to education, research and service to patients.
Two things have happened in recent years which could possibly jeopardise the relationship. There were the recommendations of the Croham Committee about university funding and the creation of the Universities Funding Council to replace the University Grants Committee which operated substantially on block grants. There was also the Government's White Paper, Working for Patients and the National Health Service and Community Care Bill. The Bill proposes very substantial consideration and recording of financial details within the health service. The University Grants Committee had arrangements with the Medical Research Council about overheads. Will those arrangements continue with the Universities Funding Council?
Because of these changes, the Government set up a steering group chaired by the Permanent Secretary in the Department of Health, Sir Christopher France. The group examined the position with the intention that good will and constructive relationships would not be jeopardised, but at the same time recognising that many previously informal relationships might have to be more explicitly defined and better quantified. The first report of the steering group in June 1989 indicated that a further range of matters should be examined before the group presented its final recommendations. Will the Minister indicate whether it is possible to give the House further information about these matters? They are vitally important for the future welfare of the health service, student training and medical research in this country.
I remember vividly my first visit to the Stanford Medical Centre in California. As we went through the front door of the building, I asked the dean about the enormous object which confronted us. He told me that it was the computer which was there to help to divide the costs between the university and the city. Nowadays of course computers are much smaller. This is a complicated business. For example,

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a patient admitted to hospital will first be seen by staff who are health service employees. He may then be taken to the wards to be seen by a professor of medicine who is paid by the university. The equipment used for investigating his illness may be provided by a charity, while the person supervising the use of that equipment may be funded by another charity. It is important that some agreement on these matters should be reached which recognises the enormous input into the medical centres by charitable foundations.
Will the Minister also indicate how these matters will be conducted in the new amalgamated medical schools in London? What is the relationship of the governing bodies of the schools to the National Health Service? Will she be kind enough to indicate whether any of the difficulties that we fear have in fact occurred in the complex London situation?
4.5 p.m.
Lord Blake: My Lords, I should like to express my gratitude to the noble Lord, Lord Annan, for raising this subject for debate. The noble Earl, Lord Longford, was rather severe on the noble Lord but I am sure that he will be well capable of looking after himself when he comes to reply. So I shall not dwell on that aspect of the matter.
I have only one main point to make. I regret that in this House both today and yesterday there has been an inordinate degree of personalisation about the Department of Education and Science. Some noble Lords have spoken as though Mr. Robert Jackson is a kind of demon figure, while on the other side my noble friend Lord Prior said that the Secretary of State has an advantage because he is a Scotsman. Noble Lords should remember that both Ministers merely represent the Government. Can anyone imagine that the proposals on student loans and so on would have gone to the House of Commons let alone come before your Lordships' House had not the Prime Minister, with her passion for detail, approved of them? I think that it is personalising the matter to dwell too much on those people.
The noble Lord, Lord Annan, is surely right—by which I suppose I mean that I agree with him—that there is not at present a policy for higher education, and that there ought to be one. What we get from the DES is very much on a piecemeal basis. We hear announcements of plans to double the numbers of people in higher education and of methods of financing higher education, to one aspect of which we devoted eight dreary and sometimes rather cantankerous hours yesterday. We do not get a clear declaration of what the Government actually have in mind as the purpose of higher education, or a clear definition of the role which particular varieties of institution are intended to play.
I have never been quite clear what the relationship is supposed to be between universities and polytechnics and which functions they are supposed to perform and which functions they actually do perform. I was interested in what the noble Earl, Lord Longford, said on this point but I am still none the wiser about exactly what they are meant to do. I know that the polytechnics have now been freed
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from LEA control, something which most of them greatly welcomed. I know that they have their own machinery for funding. I know too that they are a much cheaper form of education. The cost per student is less than two-thirds of the figure for university students. But what do they actually do? How do they differ in function?
I always thought the difference was roughly that courses in polytechnics were vocational, technical and practical whereas in universities courses were academic, though there are obvious exceptions such as medicine and law in universities. I thought this until I was told on good authority three or four years ago that one of the London polytechnics—I cannot remember which—had the largest intake of philosophers among all the institutions of higher education in the United Kingdom. I believe that this is no longer true today but it certainly suggests that there was at least until fairly recently a curious blurring of the edges.
I read in the press only the other day of a director of one of the polytechnics declaring that what he would really like is for the polytechnics to be renamed as universities. I had a lot of sympathy with his reasons for wanting this. He said that most employers did not even bother to interview polytechnic graduates, and that the CNAA degree was not understood as a qualification in large parts of Britain by employers, let alone abroad where he said that it cut no ice at all.
Perhaps I may say at once that I regard this as a deplorable state of affairs—that is, if is true, for I have no means of checking the position. However, if it is the case, the polytechnics have every cause to feel that it is very unfair. No wonder they would prefer to have the cachet of the name "university", if that matters, and, presumably, the power to award their own degree which would be implicit in that change.
But polytechnics were not set up to be a kind of second tier of universities and I imagine that the Government have no intention of changing the situation. They were intended to have a purpose and function of their own, distinct from that of universities but of an equal status with them. They should have parity of esteem, as has already been said. That was a famous piece of jargon a few years ago but, nevertheless, it means something.
I think we need a clear definition of the role of polytechnics and the respects in which it differs from that of universities. Such a definition should not be an obscure leaflet tucked away in a pigeon-hole in the Department of Education and Science; it should be a lucid document with wide publicity in the world of higher education. It should be a document issued after suitable consultation with other education organisations and it should be issued in the end on the authority of the Secretary of State. One would never get agreement among vice-chancellors, principals and directors. There is no hope whatever of that. However, he should at least consult closely and produce a document which makes clear what really are their roles. At present they are very blurred and it would be a help to all of us who are interested in higher education to know what they are.

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I should like to make just two further points before I sit down. They concern the universities. I believe that sooner or later in the field of science, and in particular scientific research, the Universities Funding Council will have to take on the invidious task—that is, if it has not done so already—of selecting some universities as centres of excellence and concentrating its resources upon them. Other forms of research such as those that the noble Lord, Lord Annan, the noble Earl, Lord Longford, and myself have been engaged in—namely, historical, literary, philosophic and even economic—are relatively inexpensive. They do not cost a lot of money. However, scientific research is enormously expensive and becoming increasingly more so. A mass spectrometer—I do not really know what that is, but I read about it somewhere—costs £1 million. Therefore, even if it was considered to be desirable, you could not scatter such equipment all over the place.
As a student of humanities, I do not think that I am in any way criticising or denigrating science research. I do not share the view of the wife of the head of an Oxford college who in 1926 found herself sitting next to Professor Lindemann, who some noble Lords may well remember. He was then a young man in his early thirties who later became Lord Cherwell. Incidentally, he is the only professor who has ever played tennis at Wimbledon. The wife turned to him after a long pause and said, "I suppose, Professor Lindemann, that anyone who has read Greats can get up science in a year or two". It was a remark which that somewhat acerbic character did not lightly forget or forgive.
If only on cost grounds, I suspect that the way ahead will lie more and more with the establishment in the field of science of what are called interdisciplinary research centres, or IRCs. An example is Oxford's first such body which was recently set up, the Oxford Centre for Molecular Sciences, and which was opened by the Prime Minister last July. I believe that it will be necessary for the Government in their various manifestations—namely, the UFC research councils and so on—to concentrate resources more and more in a few places and grasp the rather disagreeable nettle of frankly saying that some universities will simply not receive this form of funding.
Having said that, I must wholeheartedly agree that the university system as a whole is suffering from gross underfunding. It may be that universities were over-generously treated in the years of post-Robbins euphoria. Certainly there was a good deal of waste at that time; but there is not any now. Cuts are reaching the stage of seriously impairing the ability of universities to carry out their functions, though why Oxford University thought it could improve matters by denying the Prime Minister an honorary degree passes my comprehension. No sillier act has ever been performed by a great university anywhere.
The Government's only policy seems to be to urge universities to raise money from industry, banks, business and so on. But, as the Chancellor of Oxford University, the noble Lord, Lord Jenkins of Hillhead, said in an earlier debate on higher
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education, it is quite unrealistic to expect such fund raising to have more than a marginal effect. Oxford's aim of £200 million by no means covers all that is needed. Moreover, Oxford and Cambridge have quite exceptional advantages for fund raising, although they also have one or two drawbacks.
Comparisons with America are misleading. There the whole culture and tradition are different and a system of tax breaks makes painless giving possible in a manner which would only get through here over the Treasury's dead body—a phenomenon we are unlikely to see. I think that there is no alternative but for the Government to view with more sympathy and understanding the real problems of university finance. It is as simply as that: to spend more money. We do not expect the Treasury scrooges to produce a turkey, but even a partridge or a brace would be a help.
4.16 p.m.
Lord Kilmarnock: My Lords, whatever may be our differences on education policy—and I do not propose to follow the noble Earl, Lord Longford, in his passage of arms with the noble Lord, Lord Annan—there is one aspect upon which everyone seems to agree; namely, that the number of those staying on in full-time education after the age of 16 is insufficient and that our student population as a whole is insufficient to provide the skills that we shall need to survive the full implementation of the Common Market and competition from newly industrialising countries with labour costs lower than our own.
If that fact is accepted, it is certainly worth setting indicative targets for student numbers, as Mr. Baker did, and which the noble Lord, Lord Prior mentioned. However, we shall not achieve them or anything like them unless we first manage to eliminate, or at any rate much reduce, the many disincentives to higher and further education which still exist. Today, therefore, I want to devote most of my speech to the twilight zone between school and higher education, between further and higher education and between mature students and their goals. These are shadowy areas in which there are many trip wires, hurdles, conflicting signposts and other impediments. I am convinved that there must be clearer and better marked trails through this labyrinth and much less problematical support mechanisms for those who enter it.
I am not denying that there are well established educational high roads in this country: there is the royal highway from good A-levels at a private sector school, grammar school or middle class comprehensive or the more prestigious secondary schools. With a combination of two or three A-levels above a certain threshold, the red carpet treatment is more or less assured. Universities have encouraged the trend to high quality specialisation at an early age. Whether the AS level, the half A-level, will make significant inroads into university admission policy remains to be seen; the signs are not particularly encouraging. The royal high road is unlikely to change much and it may be appropriate for high flyers. Moreover, as the noble Lord, Lord Prior said,

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we shall never do, nor should we, without some measure of elite.
However, as soon as you leave the well kept verges of the royal high road you enter the shadowy realm to which I have alluded. First, in order to secure a place in any institution of further or higher education a student of modest financial background and with average ability needs to stay on at school into his seventeenth and probably his eighteenth year. Although the education is still nominally free—the Secretary of State has to provide it up to his nineteenth birthday—there are plenty of subsidiary costs to switch off people from poorer families.
At sixth form college level outgoings on travel, meals, books and materials for some courses can easily reach £30 a week. This minus of £30 has to be compared with an almost equal plus on YTS. I have made this point before and I make no apology for repeating it. When I criticised the YTS in the debate of noble Lord, Lord Peston on 31st January, the noble Lord, Lord Strathclyde, was aggrieved and said that it was a triumph, or words to that effect. Only a few days later, suggestions were made in the press that the Prime Minister was minded to wind it up and save for other purposes the £1·1 billion that it costs. That would remove at any rate those letters from the "alphabet soup" of the noble Lord, Lord Annan. If this is in the prime ministerial mind, it strikes me as very sensible because—pace the noble Lord, Lord Strathclyde—YTS has not lived up to expectations. There are plenty of claimants for the money in the education and training field
One claim could be made for an educational maintenance allowance at 16-plus—something which the SDP has always advocated—to improve the staying-on rate in post-compulsory education. Others argue that a blanket provision of this nature would carry a heavy deadweight cost which would unnecessarily reward those who would stay on anyway, and, as the noble Lord, Lord Prior, said, the staying on rate is in any case improving. The argument is that it would be better to target money on more specific courses. If that line is followed, then I would put in a plea for BTEC lower national diplomas and their equivalent which at present attract grants from local authorities on only a very patchy and discretionary basis, if at all.
There has also been talk of training vouchers of £1,000 or so for school leavers. If that is a serious option, I suggest that they should be education and training vouchers so that they could be spent on academic studies or vocational training or a combination of the two. I hope that when the noble Baroness comes to reply she will give us an inkling of what is in the Government's mind in this confusing area. The desired expansion of the student population will not happen if all the potential channels into higher education—particularly the non-traditional ones—are not flowing much more freely than at present.
I turn now to the rather complex area of credit accumulation and transfer, which is still in its infancy. An information and counselling service on this, called "CATS", is provided by the CNAA. This is an important field in several ways. First, it builds bridges between further and higher education. The
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CNAA has agreements with the BTEC council whereby credit is given after the first or second year of a Higher National Diploma Course to those switching on to a degree course. For example, someone who is doing a diploma in graphics and who develops an interest in computers could switch to a BSc in computer science. Such flexibility is valuable because it avoids students getting stuck in the wrong groove and helps them to develop their talents to the full.
The potential of credit accumulation and transfer is, however, probably greatest in its application to mature students, on whom we shall depend crucially for our expansion of student numbers. For them the notion of "portable academic credit", as it is called, is particularly attractive. It is possible to design a programme of study which was full or part-time or done by distance learning or by a combination of these modes and which might incorporate credit for experiential learning or industrial training wherever those could be assessed. The student who moves from one area to another can generally translate credit from one institution to another via the scheme and avoid loss of time or credit. If a break in studies proves necessary, credit for those successfully completed can usually be retained over a reasonable period of time.
All this is admirable. The scheme is subscribed to by 136 institutions of higher education, Including all the polytechnics and some of the universities. It has increasing links with industry. Even so, it is still very small. The advisory service is only on offer (for a fee of £25, I believe) from the CNAA's London office. So far only 1,000 students have contacted the CATS registry and 400 students have joined higher education courses as a result. These were the figures in July last year. Regional centres are being developed but they have not yet been widely publicised, as the council feels that it is not yet in a position to cope with the demand that might come from national promotion. Through its industrial network, CATS programmes are available to many employees through agreement with their firms, but the service to individuals who go shopping in the education marketplace is still very limited.
What else is available? There is also ECCTIS—an unpalatable acronym to chew—which stands for Educational Counselling and Credit Transfer Information Service. Until recently this was run by the Open University but it is now a management consortium funded by the DES with the idea that it should eventually become self-financing. It is much stronger on the information part of its title than on the counselling side, though it has a telephone inquiry service. It has a large database with 60,000 entries covering all post-school further education courses and all higher education courses, including postgraduate degrees but not research. One can undertake one's own search of the on-line database through Prestel or Campus 2000 for a premium of £50. Or one can subscribe for three issues of the disc per annum for £130.
This is clearly of interest mainly to schools and colleges, many of which subscribe. There are also some publications, notably a guide to courses throughout the United Kingdom designed for adults

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without normal entry qualifications, published in conjunction with the CNNA, and an educational credit transfer handbook. Both are priced at £7·50.
These are useful services but not particularly user friendly to the man or woman in the street, a person whom I have described as shopping in the education market. It strikes me that the time may therefore have come to establish a national framework for credit accumulation and transfer, though it would certainly need a more attractive title than that. Something of this kind was mooted by the now defunct UGC and NAB and was then estimated to cost some £4 million, which might mean £5 or £6 million today. The need to cast more light on what I call the twilight zone is now greater than ever before. It really requires counselling points up and down the country on the lines of the CNAA service.
It would also give us more clout for negotiating transfers with our European partners—something that will become increasingly important with the free movement of labour after 1992. It would be helpful if the noble Baroness could say a few words about the Government's view of this.
If the twilight zone needs more light, it also needs more cash. One of the things I learned with interest from scrutiny of the Government's forecasts of the costs of their student loans scheme is that they are based on freezing grant and loan-eligible students at 427,000 from the years 2000 to 2027. That is about the same number as now, well into the next century. This means that most of the expansion for which we are looking will have to come from mature students and by unconventional routes. At the moment most further education and many professional training courses, including social work, attract only discretionary grants. But the local authority grant system is a lottery and will be of even more dubious outcome after the introduction of the poll tax. Furthermore, there is a total lack of grant facilities, so far as I know, for part-time courses, which are ideally suited to mature students' needs. Some mature students are able to finance themselves, others are financed by their firms, but many are not.
Whatever the shape in which the Education (Student Loans) Bill emerges, it will have one large lacuna. It does not address, indeed it ignores the problems of these people. Whether through loan or graduate tax, the same facility needs to be much more widely available than the Bill appears to envisage. It is not appropriate to embark upon discussion today which properly belongs to the Committee stage of that Bill. However, I think it is reasonable to ask the Government what plans—if any—they have to help individual mature students re-enter or embark on higher education.
Given the demographic profile over the next few decades, there can be no doubt that any expansion of higher education will depend crucially on attracting young people into, or mature people back into, it by unconventional routes. The Government owe us an account of how they propose to stimulate this process.
4.28 p.m.
Baroness Carnegy of Lour: My Lords, I must add my words of gratitude to the noble Lord, Lord
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Annan. This is a most timely if short debate. We have reached the point where most people in the country understand that if we are to raise our education and training standards—and we must if we are to survive—one major part of the effort must be in higher education. Most people look to the Government to give a clear, strong and positive lead.
My noble friend Lord Prior spoke from his experience in industry. The CBI tells us that it needs an expanding base of qualified people. For example, with South Korea aiming for 85 per cent. of its people being educated at higher education level and France at 75 per cent., there is no time to lose. If our higher education student numbers are to be doubled in the next few years, as everybody seems to wish, we need institutions which are clear about what the overall strategy is and which are enthusiastic about playing their part in it. I agreed with the noble Lord, Lord Annan, about that. I also agreed with him that only the Government can set the strategy; and the very setting of the strategy, giving a lead, will help to kindle the enthusiasms of those concerned.
Over the last decade it has been necessary to bring about many internal changes in higher education: changes in attitudes, in understanding, in how resources are found and allocated, in management structures and styles. These changes have been difficult and painful but much has been achieved. That, it seems to me, is to everybody's credit, and not least to the Government's and the heads of institutions for sticking to their last despite the uphill struggle and unpopularity involved.
Everybody concerned is now a bit weary, even disgruntled. We saw more than traces of that in our debate yesterday. Change will not go away and at every level management must continue strong and firm. But higher education people are now set to move on to a new, more exciting, more satisfying stage. It seems to me that the time has come for the Government to show themselves much more sensitive to this, to make their broad strategy clear and to give encouragement to everyone concerned to play their part.
My view on this matter derives from experience of the Open University, the institution I know best because I am a member of its governing body and its finance committee. It seems to me unlikely that 50,000 extra students—I think that my noble friend Lord Prior hinted at this—can be brought into higher education without a well thought out and structured increase in open and distance learning. This can happen in a variety of ways, but clearly the Open University should play its part. Indeed, the Visiting Committee, which advises the Secretary of State on Open University matters, recently told him:
"We believe that the University is a key element in the Government's armoury for attaining its objectives for higher education and adult continuing education."
The university is most certainly keen to take up this challenge. Its track record suggests that it is well equipped to do so. But unless it knows what precisely the objectives are, unless it can be given positive guidance as to its place in the strategy, and reasonable resources and flexible arrangements for the use of those resources to carry out the strategy, it is difficult to proceed effectively.

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The accessibility and cost-effectiveness of the Open University are well established. More than 50 per cent. of its students have no A-level qualifications and 10 per cent. have no educational qualifications at all. Although systematic records are not kept, the evidence is that the Open University attracts greater numbers of socially and educationally disadvantaged students than the average of all the other conventional universities. The Open University still has two-thirds of all the country's part-time undergraduates.
The majority of Open University undergraduates pay their fees and expenses out of their own pockets. None receives a mandatory grant. Nearly three-quarters are in employment, some 24 per cent. of those receiving some help with their fees from their employers. Others receive help from local authorities, from their families and so on. Over the years that it takes to get a degree—and of course it takes considerably longer than in a conventional university—a degree costs students several thousands of pounds and the fees are now set as high as the student market will stand.
As to the cost to the taxpayer of all this, the Open University produces over 9 per cent. of the United Kingdom's undergraduates with a government grant of only 4 per cent. of the total they give to the other universities. And cost-effectiveness for the taxpayer has been improving, too. Since 1980 the DES grant has fallen by 13.8 per cent. in real terms, but undergraduate numbers have risen by 10,000.
In addition, there are all the students on the other self-financing courses and there are many more of those than there are undergraduates. For example, the School of Management, now one of the largest schools of management in the country, has 13,500 students. It is undoubtedly a success story. But if the Open University is to play its part in the expansion of higher education the Government really must play their part too. Given that the scope for increases in fees and the raising of other income is now limited, it is simply not possible to sustain and develop the Open University's contribution if the Government's grant does not more nearly meet the increase in costs. Apart from all the other implications, far too much energy has to go year by year into crisis management, into balancing the books, and not enough into strategic planning.
The university also operates within what seems to me to be a quite unnecessary straitjacket of accounting control. It still is not allowed to accumulate reserves. The undergraduate and other programmes' funding have to be kept separate. Much greater flexibility is needed as has been given to other universities. But, above all, the Open University, like all the other higher education institutions, needs, in order to make its special contribution, a clear national strategy within which to work, a positive and encouraging guidance as to its role. I do not think that at the moment it knows what that strategy is.
I hope that my noble friend has listened carefully to what the noble Lord, Lord Annan, the noble Lord, Lord Prior, and other speakers have had to say. I ask her whether she will remind the Secretary of
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State, that sound and sensible Scot, that just as in the army there is a part that only the commanding officer can play there is a part in the work of the Open University and of higher education in general that only the Government can play.
4.38 p.m.
Earl Russell: My Lords, after yesterday I feel a little as if I were purveying tickets to "The Mousetrap". However, I reflect that I was an undergraduate at Merton College, Oxford, whose Visitor I am very glad to see in the Chamber today. That is a college which celebrated its septencentenary shortly after my graduation. In that context perhaps we may regard "The Mousetrap" as the novelty that it is and reflect that the show must go on.
The underlying note of this debate has been the expression of a good deal of dissatisfaction most clearly articulated by the noble Lord, Lord Annan, with questions about objectives, and by the noble Lord, Lord Blake, with questions about funding. Indeed, I have been reminded during the debate of the election posters that many of us remember from 1979 bearing the caption "Education is not working". Listening to the debate I cannot help feeling that if those posters were put up now many of your Lordships would give an instinctive assent. that is said not simply as a criticism of government of any political persuasion but also as a reflection on the fact that education tends to absorb our hope for miracles.
My noble friend Lord Hanworth reflected that we had hoped education might make people reasonable. It was a wonderful aspiration. But David Hume was right. Reason is and ever must be the slave of the passions. Some of the dissatisfaction is of course the result of having a hope of things which never can be, but there is also a real dissatisfaction and acute difficulty about immediate and practical questions.
I listened with a great deal of interest to the noble Lord, Lord Prior, and if I may I should like to assure him that he did not put a foot wrong in any academic matter. Wearing my academic hat I warmly welcomed what he said about the need for better relations between universities and industry. My only reservation wearing my Liberal Democrat hat is that I am aware of the danger of measures which unnecessarily increase industrial costs. Industry will, I hope, invest in things profitable to itself. I agree with what the noble Lord said—that it should not be used as an alternative to government funding but as additional funding. That is a point of great importance.
The noble Lord, Lord Blake, of course made a speech with practically all of which I agree. But I should like to qualify what he said on one point: the refusal of the honorary degree to the Prime Minister. He said that he could think of no sillier act perpetrated by a university. He might perhaps think of when the same university, to which we both owe allegiance, was consulted by King Henry VIII about his divorce and it told him he could not have it. One perhaps needs to reflect here that there is use sometimes in having an intellectual Light Brigade.

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I listened also with a great deal of sympathy to what the noble Baroness, Lady Carnegy, said about the Open University. It does a good job. I think the figures she gave were of a 13.8 per cent. cut in grant and a 10,000 increase in student numbers. I believe that that is correct. That is a pattern—a more extreme example perhaps—which is common around the country and in which I cannot take great pleasure.
If one thing was clear yesterday, it was that those who spoke to a Department of Education and Science brief were saying both that we need an overwhelming expansion in student numbers and that higher education cannot enjoy a much greater share of the gross national product. I can see the force in both those propositions. Put together they are, as my noble friend Lady Seear has often said, a demand to make bricks without straw. In that context I can see why there was a need to send the magician to the Department of Education and Science. Indeed, I am reminded of the concluding words of Sir Keith Thomas's Magisterial History of Religion and the Decline of Magic:
"If magic be defined as the use of ineffective techniques to allay anxiety when no effective techniques are available, then maybe no society will ever be free of it".
Certain specific points arise here: the attempt which the Government have made in many contexts to hold the public services to increases in spending no greater than the retail prices index when they perhaps compare that with what happens in universities in other countries. I take the case of Japan, which we have often been urged to imitate. In the past 10 years Japanese prices have risen by 34·4 per cent; their education costs, depending upon the quality of the institution, have risen in a range from 47 per cent. at the lowest to 80 per cent. at the highest. It is worth remembering in matters involving quality that we get what we pay for. We tend much too often to talk about education exclusively in terms of quantity. We have to remember that there is a problem of quality as well. If we try to get more for less money, what we are hearing is a prescription for a cut in quality. That causes great anxiety in the academic community.
There are some specific points which call for thought. The number of junior staff the universities can afford to employ is a matter of grave anxiety. I fear, having perhaps faced the pressure to retire from now until I reach retiring age, that when I reach it I shall face equally constant pressure not to retire because there will be no one to succeed me. Last year in English the number of full-time permanent lecturers under the age of 30 in the whole country was six; in sociology it was one. I do not know who that one may be, but I hope that he or she is equal to the burden that he or she will have to bear.
I know that there have been government measures since then to help with new academic appointments, which I welcome. Indeed, I warmly welcome them. On the other hand, the help that is given with those appointments is transitional. It is for three years only. It will not be easy for universities to take over the permanent carrying of that weight.
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The Government have not always had a good record in deciding how much other people need to spend. Universities can feel a certain amount of sympathy with borough treasurers looking at estimates of how much they should be spending when they fix their poll tax. For most borough treasurers those figures do not appear to be in the real world. We listened to the Secretary of State tell us that whether universities charge fees is a matter for the Vice-Chancellors and nothing to do with the Government. We feel the same scepticism about that that borough treasurers sometimes feel when told that whether they levy additional poll tax is entirely their own affair. That cannot be true unless the initial spending limits are realistic. It is that realism about which we feel some doubt. We also feel some doubt about the effect on long-term academic planning of universities responding to short-term fashions and market forces. It takes a long time to produce a quality academic department where it is needed.
We have recently had in the Wooding Report, which I welcome, a demand for an expansion of Russian and East European studies. The topical necessity of that is something one can hardly question. Listening to television news from Romania and watching Romanians answering the BBC in high quality English, I can only feel shame at what would happen if a Romanian interviewer, or even a Russian interviewer, were to attempt to do the same in this country. What we are seeing in East European studies is the effect of financial stringency and the cut-back of small departments characteristic of the early 1980s.
It will take some 15 years to build up the postgraduates and the trained staff to produce good East European departments which will be available long, long after the current topical need is over. One only hopes that they may be in place in time for the next round, whatever it may be. There is a real difficulty in trying to plan learning because we are planning for a long time ahead. We do not see the need and we are probably suffering now from the mistaken decisions taken 10 or 15 years ago.
Finally, I beg the Minister when she replies not to give us many figures about increases in real terms because frankly when we see what is happening on the ground we cannot believe them.
4.50 p.m.
Lord Peston: My Lords, I should like to add my voice to those of other noble Lords who have congratulated the noble Lord, Lord Annan, on introducing the debate. Although we are not a vast group of speakers we seem to be a very select one.
I should like to speak to some degree about universities and to some degree about polytechnics. I shall not refer to every noble Lord who has contributed to the debate, not because I disagree with them but because I do not like to repeat arguments that have already been put extremely effectively. Therefore I hope that noble Lords will not be insulted if I do not say that I agree with this point or that point.

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Concerning the universities, I accept that there has always been some degree of animosity between university teachers and politicians. When I had the honour to advise Ministers in the last Labour Government they were occasionally rather dissatisfied with my colleagues in universities. Equally my colleagues in universities were dissatisfied with the Government. That is the usual relationship. However, it seems to me that something more serious has developed in the past few years. The antipathy between university staff and this Government is undoubtedly stronger than any I have known in my lifetime. I do not say that it is deserved but I believe that it is a cause for alarm. Our universities are a major national asset, independent of politics. It is not a satisfactory state of affairs for the view of Her Majesty's Government held by academics to be as adverse as it is at present.
The problem is partly one of funds. I do not want to go into details; I agree with the noble Earl that we do not want to bandy figures about. It is not entirely a problem of funds, but that does not mean that I know entirely what the problem is. I shall give the House an indication of what I have in mind.
A great many years ago I was a graduate student at Princeton University. I then came back to this country. Most of my colleagues at Princeton thought that I was stupid. They could not understand why I should return when I could have stayed there. I returned because—apart from my normal loyalty to the country—I felt that important things were going on in my subject in this country. I felt that I could be part of a serious academic profession and could make a career. I believed that higher education in this country mattered and that it was important to be part of it. I have never thought that I took the wrong decision.
When I reflect not merely on my Alma Mater of Princeton but more generally on what I now see in American universities and compare that with what I see here I know that today I should certainly not come back under any circumstances. The reason is partly a question of facilities. I do not believe that most people in this country, and perhaps even most noble Lords, appreciate how far behind even our best universities are—and I shall not argue about which—compared with those in the United States. The quality of the libraries in a university like Princeton far exceeds anything that we have in this country. The research facilities for scholars in the humanities as well as for scientists are beyond anything that we have or believe that we could have. I despair of persuading people of the nature of the problem, but it undoubtedly exists.
If one goes to the United States, not merely to the great Ivy League universities but to others which one may feel are not quite so great—although in my view they are—one will see a belief in academic values and a belief that there is still everything to be done. There is not the negativism that now dominates our own universities. That is the nature of the problem.
I do not believe that the problem is entirely one of pay. I was interested to learn that the noble Earl did not take early retirement and that his colleagues did not want him to. I have to admit that when I
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announced that I was to take early retirement I did not hear a single voice suggest that I should not. I envy the noble Earl. I still teach part time so I hope that noble Lords will forgive me if I say something about pay because if it were higher I should receive at least a couple of pounds more a week.
On 30th January 1990 the Parliamentary Under-Secretary quoted (at col. 163 of Commons Hansard) figures concerning the growth of real pay in the decade 1979–89. We ought to reflect on those figures. Average national earnings grew at 2·5 per cent. per annum; professors' salaries grew at 1·9 per cent. per annum; university senior lecturers' salaries grew at 1·3 per cent. per annum. I mention those figures as indicative of one aspect of the problem. However, I do not wish noble Lords to believe that I am making a pay claim or expressing a belief that the problem has everything to do with pay. I believe that it is all about attitudes.
I believe that the universities feel that in some sense they are not wanted and that academics are regarded as irrelevant. I shall come to the question of businessmen in a moment, but certainly the Government give the clear impression that they believe that businessmen are far superior to academics in every way. Like the noble Lord, Lord Blake, I deplore personal attacks on Ministers. However, I believe that Mr. Jackson is as puzzled as anyone else by that. It may be a failure of communication, but undoubtedly there is a very serious problem in that relationship.
On the theme of the debate I part company to a certain extent with the noble Lord, Lord Annan, and the noble Lord, Lord Blake. Certainly the universities want to be encouraged. They want to be made to feel that they are wanted. However, I should not care to have a government which told universities what they ought to do. The noble Lord, Lord Blake, said that the Government should have in mind some purpose for the universities. I wonder whether, on reflection, he meant quite that. My own view of the correct policy for the universities—to use a word which I do not like but which conveys the correct meaning—is for the Government to act as a facilitator. The universities could then get on with their job. As a university teacher—and several others have spoken in the debate today—all I wanted was to get on with my job. I wanted the Government at least not to get in the way and, if possible, even to help. That is the nature of the problem.
I appreciate that this is quite a long moan and I do not usually moan in debates. Part of the problem is growing bureaucracy. During the debates on what became the Education Reform Act we expressed worries about the UFC. The noble Baroness's predecessor promised that the dead hand of bureaucracy would not be extended from the UFC. I can only say that so far that promise has not been fulfilled. I believe that I speak for almost all my colleagues in expressing extreme anxiety about what the UFC is up to. Someone—and in this case it has to be the Government—has to tell it to stop whatever it is up to and become a facilitator. As the noble Lord, Lord Annan, said, it should not be dirigiste; it should abandon the degree of dirigisme which it has adopted.

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I have one last point about the universities before turning to the polytechnics. As an ordinary teacher I have never been keen on vice-chancellors. I have never understood why anybody wanted to be a vice-chancellor, but there seems to be a mentality which wants to be a vice-chancellor or a principal. The vice-chancellors are the best that we have. I say to the Secretary of State, through the noble Baroness, that one must proceed by co-operation in this area. One must not proceed by threats. One reason is that threats will not work: it is also not the right way to do it.
There has been a slight difference of view over the polytechnics. I am very much closer to my noble friend Lord Longford in that regard than I am to the noble Lord, Lord Annan. My credentials on the subject are quite good. I have been involved with polytechnics since the first. I was on the polytechnics' business studies committee when it was set up and I was very much involved with raising the level of business studies in polytechnics. I was the first chairman of the polytechnics economics committee at the CNAA. I regard myself as strongly supportive of the polytechnics.
Again, I address the noble Lord, Lord Blake. The noble Lord has shown an obvious new interest in the matter. I believe that the polytechnics have earned their laurels. They started a long way back. People might be surprised by their great achievements, but they have achieved extraordinary things. The Government—I supported them in this—recognised that fact by making them independent of the local education authorities. I said then that that was the right decision. However, I would go further; I would now free them totally from the CNAA. That is not to denigrate the CNAA. It has done its job, but the polytechnics could now be free-standing institutions awarding their own degrees.
On the subject of names, the comments of the noble Lord, Lord Blake, are right. People misunderstood the quality of the polytechnics. They misunderstand their achievements. It is no big deal. If they want to call themselves universities, let them call themselves universities. I do not see what the fuss is about. There is no doubt that businessmen are somewhat misguided in not appreciating the quality of the polytechnics. It is a similar attitude to that which I have pointed out previously to noble Lords; namely, that they also suffer from the delusion that undergraduates from Oxford, Cambridge and London are better than other undergraduates. That is not true either, but we have managed to get rid of that idea to some extent. I strongly believe in supporting the polytechnics along the lines suggested by my noble friend Lord Longford. It has been said that the approach is unfair, and I suppose it is. But it is inefficient. I hope that the idea will appeal to noble Lords on the other side: for business not to recognise the quality of graduates emerging from the polytechnics is a waste of resources and should not happen. I hope that the Government will move in that direction.
The polytechnics are under-financed. One problem is that the Government are loath to let the
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polytechnics move up to the university point because it might mean that they would then have to jump to the same expenditure as universities. I understand the Government's problem. Until they are ready to move over and let us face that problem, it is a problem that they must accept.
Perhaps I may add a word of advice for the polytechnics. They have over-expanded. They have made a slight mistake. They thought that if they expanded to meet student demand the Government would pat them on the head, say, "Well done", and give them more money. But the Government have merely patted them on the head and said, "Well done".
I realise that I have slightly exceeded my time, but I am trying not to delay the noble Baroness whom I wish to hear. However, I cannot resist saying a few words about business in response to the comments of the noble Lord, Lord Prior. I agree largely with what he said, but I wish to make two points about the relationship between business and students.
As was pointed out in the debate yesterday, students are naturally progressive. In due course large numbers of people with degrees—perhaps even the majority—will end up voting for the other side rather than our side. However, noble Lords on the other side need not worry that students will not one day vote Conservative. However, when they are young, they are often not merely naturally progressive, but they know which is the naturally progressive party. What bothers them about going into industry is that they believe that one can do so only if one supports the Tory party. The association of industry with the Tory party can sometimes be slightly to its disadvantage. I merely place the idea in noble Lords' minds. I do not press it too strongly.
Lord Prior: My Lords, what the noble Lord has just said is simply not true. I might wish that it was, but it is not.
Lord Peston: My Lords, I take the point. I do not seek to disagree with most of what the noble Lord said, but my experience is slightly different.
One other point regarding the relationship between business and higher education, which I hope we shall discuss on another occasion as we do not have time today, is the question of who will pay. I repeat the point that I made yesterday in the debate on loans. As the economy has become so much richer, why do we find it harder to finance higher education than when the economy was poorer? I set that as an exam question. I asked it yesterday not entirely as a rhetorical question because I do not know the answer myself.
Lord Lloyd of Kilgerran: My Lords, I am sorry to interrupt the noble Lord in his charming discourse. The only excuse that I can give him for doing so is that I have just come from a lunch party at which his leader, Lord Kinnock, addressed—
Noble Lords: Mr. Kinnock!
Lord Lloyd of Kilgerran: My Lords, I apologise; he is not yet Lord Kinnock. I am always in advance of

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my time. He addressed the Parliamentary scientific committee in the presence of His Royal Highness the Duke of Edinburgh. The noble Lord, Lord Peston, is not following the general policy in relation to higher education about which I heard only this afternoon from Mr. Kinnock. I am also disappointed that so far in his very attractive 15-minute oration he has made no reference whatever to higher education policy in relation to science and technology except for some chance remarks about business. Surely, in his speech on policy for higher education, he should say something about that.
Lord Peston: My Lords, I do not seem to be doing very well these days. My speech yesterday ran into difficulty with at least one noble Lord, who I see is in his place and who thought it was not good enough. It now appears that my remarks today are not good enough for another noble Lord. It is the only speech that I have. However, I have not in the past been backward in speaking on the question of science and higher education. One cannot talk about everything at the same time.
I should like to make one final remark on industry. I am a little worried about attitudes. What will industry pay for? To return to my concept of the university and the polytechnic, pay is not a word that I want to see used all the time. Perhaps I may give a personal example. All my life people have rung me up to ask me whether I will explain this or that for them. I am now told by my colleagues that if people ring me up from now on, I should ask how much they will pay for that piece of advice. My colleagues also tell me that, if people ring me at the office, I should add that there will also be a 40 per cent. overhead charge. I hope that we do not go too far down that line. My day is over, but I do not want our new generation of academics to be so concerned with pay and with paying that they forget what being an academic is all about.
I am sorry. I have gone on far too long, although a little of my time was taken away. I conclude with one final, simple point. The noble Earl, Lord Caithness, reiterated the Government's 25-year doubling policy yesterday. I believe that I heard him correctly, but I should like the noble Baroness to reassure me that that still remains the Government's firm policy.
5.8 p.m.
Baroness Blatch: My Lords, I cannot resist the temptation of saying that we have had something of a surfeit of debate on higher education over the past 30 hours, starting with the Question of the noble Earl, Lord Russell, early yesterday afternoon, followed by hours of debate on student loans and now this debate initiated by the noble Lord, Lord Annan. I ask myself whether it is too much of a good thing. I think not. This has been a most useful and interesting debate. I join with other noble Lords in thanking the noble Lord, Lord Annan, for presenting the opportunity to the House, widening out yesterday's discussions on higher education. However, I stand here rather tentatively before an impressive presence of heavyweights from the world of Academe. A range of concerns has been expressed
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about the state of and prospects for the nation's higher education. It would be unrealistic to think that higher education, any more than any other complex system, could be problem-free. We must not lose sight of what has been achieved and of the opportunities for further achievement being opened up by government policy.
With an estimated 1,061,000 students currently on higher education courses in institutions in Great Britain—over 50,000 more than last year—numbers are at record levels. This success is a fitting end to a decade of expansion in which student numbers have grown by more than a third, and the proportion of young people entering higher education has increased from one in eight to one in six. This increase in demand reflects the priority which the Government attach to education on schools and further education. I am very pleased that the noble Lords, Lord Annan and Lord Kilmarnock, chose to make their starting point the school sector. The introduction of the GCSE examination with its greater emphasis on learning about practical applications has led to a sharp jump in the number of pupils staying on at school. Additional funds were provided specifically to assist the introduction of that new examination.
In 1988–89 the participation rate for 16 and 17 year-olds in schools increased by nearly 10 per cent. and we expect to see further increases in the years ahead. The Government's technical and vocational education initiative (TVEI, as it is known in our schools), funded through the Department of Employment's training agency, has enhanced the school and college curricula for 14 to 19 year-olds to make their learning more relevant to adult and working life.
In the light of those developments we have seen increasing numbers of young people taking A-levels and going on to higher education. With the introduction of the national curriculum we expect pupils to follow a broader and more balanced curriculum leading to higher standards of attainment at 16. That in turn should produce further increases in demand for higher education during the 1990s.
It is important to note that the expansion of higher education has taken place largely in the polytechnics, colleges of higher education and Scottish central institutions. It is too often assumed that higher education is coterminous with undergraduate provision in universities. In fact, more than half of the nation's higher education is provided outside universities, and over half of the higher education qualifications gained are other than first degrees.
I think that this is an appropriate place to applaud the remarkable achievements of the Open University. We have a product of the Open University who is fairly vocal on the Front Bench opposite. With nearly 90,000 students and 6,500 graduates a year it has done perhaps more than any other institution to widen access to higher education, which is a particular aspect of this debate today. As we all know, the Open University is directly funded by the DES. The level of the current grant for the 1990 academic year is £79·5 million, an 11 per cent. increase over the level for 1989. There are plans for early discussions between the department and the

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Open University on the subject of the Open University's future priorities and funding arrangements.
It is sometimes asserted, and it has been asserted today by a number of noble Lords, in particular the noble Lords, Lord Annan and Lord Peston, the noble Earl, Lord Russell, and my noble friend Lord Blake, that the Government have starved the system of funds. In fact, public spending on higher education has increased. I apologise for producing statistics. I was begged not to use them but, like the noble Lord, Lord Peston, my speech also is the only speech I have. Public spending on higher education has increased by 5·6 per cent. in real terms—a phrase that offends the noble Lord—since 1979. At the same time the system has become more efficient with unit costs per student (a point which has also been mentioned this afternoon) falling by about 3 per cent. in universities (a point noted by the noble Lord, Lord Annan) and by about 20 per cent. in polytechnics and colleges.
The most recent public expenditure settlement provided for a substantial increase in the public resources available to higher education of some £750 million over the next three years. Resources for 1990–91 are planned to be some 10 per cent. higher than in 1989–90. That amply demonstrates the Government's continuing commitment to securing the provision of places for all who are qualified and willing to take them and to ensuring that higher education receives an appropriate share of funding.
I must not let pass one other word on the polytechnics. I entirely endorse the view of my noble friend Lord Blake, the noble Earl, Lord Longford, and other noble Lords about the need for parity of esteem for polytechnics. The Government's policy is to encourage diversity and, without wishing to intrude on the debate between the noble Lord, Lord Annan, and the noble Earl, Lord Longford, I think that the point put by the noble Lord, Lord Annan, was about vive la différence as distinct from parity of esteem, therefore encouraging diversity in higher education and not dull uniformity. Different types of institutions should continue to develop their distinctive roles. For example, basic research is one of the essential functions of universities, while polytechnics make a valuable contribution to research in some areas, particularly those relating to the needs of industry—a point that was very well made by the noble Lord, Lord Prior. Their fundamental mission is teaching. The more effectively that polytechnics can project themselves as providing accessible high quality education of a practical character, the more successful they will be.
Whatever the national provision, there are also those who assert that our higher education system compares badly with those of other countries in terms of funding and performance. Although international comparisons are notoriously difficult, the generally accepted statistics tell a different story. The United Kingdom spends a higher proportion of its gross domestic product on higher education than do most comparable countries. We are also well up by international standards in the proportion of our young people who actually gain qualifications, which
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is surely a better measure of performance than the proportion simply entering higher education, where our efficient system can seem to give us a low ranking.
Much has been made of the issue of the brain drain. At this point I should like to make reference to that issue. The volume of alarmist rhetoric about the brain drain has not so far been matched by hard evidence. Therefore the Government welcome the decision of the committee of vice-chancellors announced last July to collect detailed information about the numbers of staff coming from and going overseas. In the meantime the best data available from the universities' statistical records show that there has been a net inflow of university staff into this country every year since 1983. I have not seen the evidence to support the noble Lord's assertion about loss of quality or indeed loss of quantity.
Some of the newly established interdisciplinary research centres are attracting excellent staff from overseas as well as providing challenging opportunities for some of our best young scientists. There are no barriers to the free movement of scientists in the West. British academics have always gone overseas and scholars from other countries have come here. Research and scholarship are enriched by that.
The achievements of the higher education system in the 1980s under this Government speak for themselves. I have no doubt that the planning and funding framework established by the Government will promote further improvements in participation, quality and efficiency in the 1990s.
The Government remain committed to a higher education system which plays its full part in meeting the nation's economic, social and cultural needs. We believe that these purposes are best served not by rigid central planning but by increasing the scope for institutional initiative and the system's responsiveness to the needs of students and employers. That has been the main thrust of government policy, consistent with the assurances that we gave to the House during the passage of the Education Reform Act 1988 about an arm's length relationship with the sector. There are three particular aspects of policy that I should mention.
The first is the shift in the balance of public funding for higher education from institutional grant paid through the funding bodies to tuition fees paid for individual students through the awards system. From autumn 1990 this will create a more direct link between institutional income and recruitment, encouraging institutions to increase their efficiency by making full use of marginal capacity. Just anticipation of this change has helped institutions to respond to the demand for places this year. Differentiated fees, which the Government intend to introduce in autumn 1991, will facilitate recruitment to more expensive practical courses—and that is the answer to the point raised by noble Lords about the need to safeguard provision for engineering and technology. I should add that the allocation of funds to institutions is a matter for the funding councils. However, it is certainly the case that the Universities Funding Council will identify

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separately the funds available for research and will allocate them in a selective way which takes account of research quality in departments, which I believe was a point raised by my noble friend Lord Blake.
This incentive to respond more effectively to buoyant student demand is complemented by the second strand: the inclusion by the funding councils of elements of competitive bidding for places in their methods of allocating funds for teaching.
The third strand is our encouragement of the broadening of the higher education system's funding base which looks set to continue into the 1990s. The Government believe that overdependence on public or any other funding source is not conducive to maintaining the degree of autonomy and self-reliance appropriate to higher education institutions. It was a point well made by my noble friend Lord Prior. Institutions have been increasingly successful in generating income from private sources. However, I wish to emphasise an assurance for which I was asked by a number of noble Lords, but in particular the noble Earl, Lord Russell. The Government will stand by their commitment not to reduce public funding in response to such success.
My noble friend Lord Prior introduced the subjects of wider access to universities for all social groups—a matter that came up in some detail in yesterday's debate—and responding to employers' needs. While student demand is the central factor in the Government's higher education planning, employers' demand for highly qualified labour is also very important. The interdepartmental review of demand for new graduates announced by the 1987 White Paper on higher education, to which the Council for Industry and Higher Education made an active contribution, was completed earlier this month. Its results, which will inform future policy, are currently being considered by Ministers and an announcement will be made shortly.
Some see these market-related initiatives as uncomfortable and even inimical to the very nature of higher education. The Government simply cannot agree. We are seeking to free higher education, not to constrain it. It should have the maximum freedom to make the provision that it judges best to respond to the various challenges and demands. The framework we are putting in place reconciles that with the reasonable requirement that the substantial assistance from public funds is used efficiently and with appropriate accountability.
When the House debated higher education in April 1989 fundamental changes were in progress. Polytechnics and other major higher education establishments had just become independent institutions and the two statutory funding councils, with executive powers to administer the majority of public funding for higher education, had just been established.
Ten months later I am pleased to be able to confirm the successful implementation of those changes. I should in particular draw attention to the way in which the new polytechnics and colleges sector and its funding council have responded to the challenges that they have faced in the new situation.
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Looking forward, all the indications are that student demand will remain buoyant and that, while the decline in the 18 to 19 year-old population will continue until the mid-1990s, their participation in higher education will continue to increase.
The latest projections indicate that, notwithstanding the substantial decline in the age groups leaving school to the mid-1990s, full-time equivalent student numbers will rise to about 8 per cent. above their 1988 level by 1992, then flatten out until 1995, before rising again to about 17 per cent. above their 1988 level by the end of the century. Those projections are being further reviewed in the light of the record enrolments for 1989–90.
I am pleased to reaffirm—and I have been asked again by a number of noble Lords to do so—the Government's commitment to increases of an order consistent with the aspirations expressed by my right honourable friends for a doubling of participation in higher education. I could say a word or two more on doubling of higher education. The latest projection of student numbers indicates that the participation index for young home entrants to higher education will rise from 15 per cent. in the 1988–89 academic year to 23 per cent. by the year 2000, an increase of over 50 per cent. in 12 years. That is about half-way through the period about which my right honourable friend the former Secretary of State for Education and Science was speculating. That rate of increase is consistent with a participation index of around 30 per cent. by about the year 2014. But I must emphasise that my right honourable friends have never seen this aspiration as a target to be pursued regardless of all other considerations.
The cost of the present system of student maintenance grants, which accounts for a much higher proportion of higher education spending than in all other countries, would be a serious obstacle to longer term expansion. That is why the Government intend to change it. The Government's loans scheme, in addition to increasing the resources available to students, will share the cost of student maintenance more fairly among taxpayers, parents and students themselves.
I should now like to respond to some of the other points raised in the debate. I welcome the emphasis of the noble Lord, Lord Kilmarnock, on co-ordination and liaison among all the sectors of education. There is a great deal of scope for improvement there. On his point on vocational education and training the CBI's vocational education and training task force has made some very interesting recommendations for the education and training of the 16 to 19 year-old age group, including the use of vouchers. The Government are considering all these recommendations carefully. I welcome the encouraging report from the noble Lord and accept the part to be played by credit transfer arrangements and good counselling services. As he acknowledges, these schemes are in place and the Government continue to monitor their development. However, this debate and a reminder will certainly do no harm in that direction.
On the point of the noble Lord, Lord Peston, about the independence of the UFC, the Universities

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Funding Council is an independent and executive body which must ensure accountablilty for the substantial public funds that Parliament votes each year for the universities. It has been suggested that it is overly bureaucratic. I reject that charge. The council has established a proper framework for accountability, which is prudent financial management, not bureacracy.
The noble Earl, Lord Russell, made an important point about Soviet and East European studies and the expansion of such studies in the university sector. A review of Soviet and East European studies was carried out last year. I refer to the Wooding Report which the noble Earl gave notice that he would be speaking upon in the debate. A report containing recommendations was produced by the review working party. The Universities Funding Council and the universities have been considering the implications of the report's recommendations for the university sector. Similarly it will be for the Polytechnics and Colleges Funding Council to respond to any proposals arising from the review which involve expansion of Soviet and Eastern Studies in its sector.
However, some of the report's recommendations advocate specific action by other public bodies and government departments. My honourable friend the Parliamentary Under-Secretary of State for Education and Science is consulting those organisations and departments. When the consultation is complete he will consider a further response against the background of the Government's overall policy for funding higher education.
The noble Lord, Lord Hunter, referred to medical research. There is no question of medical education being downdraded by the Government's proposals to reform the National Health Service. The Government's intention is that the vital relationship between universities and the National Health Service should be preserved and strengthened. The Secretary of State for Health remains fully committed to maintaining the high standards of undergraduate and post-graduate medical and dental education and research. He recognises that these standards can be sustained only by full and effective collaboration between universities and all levels of the National Health Service. To this end the interdepartmental steering group on undergraduate medical and dental education chaired by Sir Christopher France, on which all interested parties, including the vice-chancellors and the General Medical Council, are represented, has been meeting regularly and has made a number of useful proposals designed to ensure that the quality of medical and dental education research is maintained.
Perhaps I may draw to the attention of the noble Lord, Lord Hunter, a press release hot off the press. It was released only today. It is on medical and dental education research and arrangements for improved joint working between universities and the National Health Service. Perhaps I may further say that my noble friend the Under-Secretary of State for Health is actively having meetings with her opposite number
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in the Department of Education and Science on this issue. I hope that the noble Lord will avail himself of that document.
Perhaps I may apologise to the noble Lord for not being specific on his question on the London issue. I promise to write to him. In the time allowed I have done less than justice to many of the specific questions that have come out of the debate. If I have missed out anything that is still concerning any noble Lord please remind me and I shall do what I can to elicit an answer. I shall certainly write in reply.
I am conscious of the depth of experience in higher education on all sides of the House. I hope that in the time available I have answered at least some of the questions. I have listened to the debate carefully and, as requested by all noble Lords, I shall pass on to my right honourable friend all the points that have been raised.
Whatever else may divide us, we are united in the value that we place on higher education for the cultural, social and economic benefits which it brings to our national life and in the wish that as little as possible should stand in the way of its being able to meet those goals.
Lord Annan: My Lords, I thank all noble Lords who have taken part in the debate. I have time to take up only two points. I cannot persuade the noble Earl, Lord Longford, that my views on the polytechnics—for which I have the highest esteem—are not the product of academic snobbery. However, I shall continue to try by using analogies such as the colleges of advanced technology and their history.
The noble Lord, Lord Peston, said that the last thing he ever wanted to be was a vice-chancellor. I thought that his speech was eminently that of a professor. He was not concerned with priorities but just the business of, "We must have it and that is all there is to it, Vice-Chancellor!".
I thank the noble Baroness for the way in which she spoke and met so many of the points which I and other noble Lords have raised. However, I did not find what I was searching for; that was the Government's strategy. I do not know that I am any the wiser but I lay myself open to the reply given by F. E. Smith to a judge before whom he was appearing. He said, "Possibly not my Lord, but considerably better informed".
I believe that after this debate funding for higher education is a little less like a lottery. Therefore, I give way to the noble Lord, Lord Birkett, and beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

National Lottery Proposal
5.32 p.m.
Lord Birkett Lord Birkett rose to call attention to the advantages to the arts, sports and the environment of a nationwide lottery; and to move for Papers.
The noble Lord said: My Lords, I am happy to have the opportunity to propose the Motion. The

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notion of a lottery has been so little before your Lordships or the other place that it is an ideal subject for a short Wednesday debate. Such debates are expected to range as widely as possible over the subject in hand and I hope that this will be no exception. I have taken care to draft the Motion so that it is not broader than it need be. Noble Lords will note that it calls attention to the advantages to the arts, sport and the environment of a nationwide lottery.
I have chosen those areas to be the beneficiaries of a lottery because many noble Lords are as devoted as I to all three aspects of our national life. Surely, the arts refresh and recreate our spirits. In some cases, filtered through the great works of art and the great minds of genius, art can teach us more about life than life itself. It can enrich our lives in a mysterious way. Above all, it keeps us inquisitive and fresh.
If that is true of the arts for the mind, surely the same is true of sports for the body. Mens sana in corpore sano is not a particularly fashionable phrase but it is not a bad ideal. Perhaps Juvenal had it right and orandum est indeed say I. Sports also have the advantage of being capable of taking our rivalries and ambitions and working them out in a friendly and pleasant way. One may not know that from some of the sport which takes place today but the majority of sport is played in that spirit. The Olympic spirit is not dead.
The environment feeds us all, the arts and the sports, and makes us what we are. I fear that it is long past the time when one could rely upon the environment simply to be the unencumbered work of nature with man as a small insect crawling within it. Nowadays it is all too apparent that man is an exceedingly powerful and influential insect crawling upon it. We must work to defend and improve our environment. We can no longer rely upon its benevolence.
Noble Lords may ask why I did not propose a lottery beneficial to education, medicine and health, science, transport systems and even law and order. I believe that such elements of our national life are so deep-rooted in the structure of our society that they must be supported by government; that is to say by taxes. They must be a central governmental concern because without them we have no structure to our society.
I have been known to say exactly the same about arts, sports and the environment. However, I have long given up the hope that they will achieve the same automatic funding recognition as the other aspects I have mentioned. They need special support and for that reason I have framed the Motion as it appears on the Order Paper.
There is a history of lotteries in this country. In the 17th and 18th centuries they were common all over the world. In some cases a great deal of good resulted. The building of the British Museum owes a great deal to lotteries. There was a time when the Cinque ports could be repaired only through the benefits of a lottery. The great American universities of Harvard, Yale and Princeton owe a great deal of their foundation to lotteries. The Sydney Opera
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House, an unparalleled operatic spectacle, owes its existence to a lottery. The Olympic Games held in Canada, Moscow, Seoul and Mexico City, depended to a greater or lesser extent upon funds from lotteries.
The history of lotteries is beyond the scope of our debate tonight. However, it would be unfair not to mention the Royal Commission chaired by the noble Lord, Lord Rothschild, in 1978. Its report is enormously scholarly and almost compendious in the way it deals with all forms of gambling. The Royal Commission reported on gambling in general but also examined the type of lottery with which I am dealing today and by and large approved it. That was 12 years ago but I do not suppose that anything has vitally changed.
Noble Lords will also notice that I used the words "nationwide lottery". I might well have said "national lottery". The important distinction is that I do not mean a state lottery run and governed by the Government. I am well aware that the Government do not wish to run a lottery and I see no reason why they should be compelled to do so. It is perfectly possible to run a lottery privately and without it being commercial in any way.
The only way in which one can determine or guess how successful a nationwide British lottery may be is by looking at the numerous lotteries throughout the world, extrapolating the figures and converting them into figures for this country. That is a very speculative game because it depends upon the size of the country concerned and it depends upon what statistics you take, whether you work or the basis of the population of the country, on its, per capita income or national income. There are all sorts of ways of looking at the matter.
In the USA a great many lotteries are state lotteries—not in the sense I have talked about but in the sense that they operate state by state across the United States. Nearly all our EC partners already have lotteries. The biggest, in France, in Spain and in Germany, are very successful. A single national lottery once it is up and going—for example, in its second year—is likely to produce a gross figure of something in the region of £2·5 billion per year. I make it clear that that is £2·5 thousand million per year. I am assured that is quite a reasonable capability of a national lottery.
Of course, national lotteries need a great deal of administration and very complex technical procedures. Therefore one must assume that about 20 per cent. of the figure will be paid out on the sheer administration of it. Apart from anything else, there needs to be a very large chain of people selling the tickets, very much as phone cards are now to be found in almost every shop in the land. That requires a very large back-up operation. I am glad to say that the technical expertise is to be found very largely in this country. We are already experts in many of the security printing systems essential for a lottery. Indeed, we supply them to other lotteries throughout the world. If 20 per cent. is taken off, that still leaves £2 billion.
The nature of such lotteries is usually that half the remaining money is taken for the prizes. Therefore, the prizes would amount to a very large sum indeed.
I am told that a concave structure is needed. In case your Lordships are wondering what a concave structure is, it means that there are very few large prizes at the top and lots and lots of small prizes at the bottom. So there is the excitement of a very large prize; we are perhaps talking of a prize at the top of £1 million. Of course, that is very rare and it is extraordinary to win that amount. However, there are lots and lots of prizes; for example, perhaps £5 or £2 on a £1 ticket. Those prizes are encouraging rather than profitable in any real sense. However, that is the shape which lotteries seem to take. It seems to work and to create no particular unhappiness.
Having dangled those extraordinary figures before your Lordships, you may ask whether we should have a lottery at all. You may ask whether or not lotteries are evil. If one believes as an article of faith that any form of gambling is automatically evil, then I can say nothing for that is an article of faith. I cannot change an opinion of that sort. It seems to me on balance, however, that so much of life is already speculative and chancy that to take advantage of it for worthy causes is not wrong in simple moral terms.
It is suggested that this sort of activity can become compulsive and a devastating social evil. I do not believe that a lottery is like that. The casino, race track or arcade seem to have an atmosphere which compels you to go on. Once you have lost too much, you go on to lose the rest. I do not believe that that applies to the cool and entirely chance-governed business of a lottery.
It is also a good reflection to think that if you lose £5 at a race track or in a casino, it gives you no satisfaction at all to think that the bookmaker or croupier will be having a good meal on the proceeds. However, if you lose £5 in the lottery I propose you may think that a new wood will be planted, that there will be a new sports ground or that a new orchestra will be maintained. I should have thought that an altogether more comfortable feeling.
It is also suggested that where very large sums of money are involved fraud is automatically involved. I believe that the security systems available to the world no longer make that a realistic proposition. ERNIE has been operating for years without a breath of scandal to his name. I believe that security systems are such that there can be a foolproof lottery which there would have to be in this case.
There is then the thought that lotteries might damage other forms of charitable giving; for example, the small charitable gambling which already exists. Experience from other countries has shown that that is not the case and that lotteries attract new money. Indeed, the Irish lottery, introduced in 1986, led to so many worries that a form of compensation legislation was produced enabling anyone able to show that an existing form of charitable gambling had been damaged to claim compensation. As far as I am aware, there has not yet been a claim.
In much larger terms, your Lordships may ask whether it would damage the football pools which,
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one must admit, provide an enormous amount of money for the Exchequer. Again, it does not seem that it would. It attracts new money, according to the experience of other countries, which is very considerable.
Let us suppose that one allows that a lottery is not bad and might do good. Who would look after those immense sums of money? I think that those responsible should be independent people. There should be no involvement of arts councils or sports councils, of many of the environmental bodies which are now springing up or of the Government, although everyone of those must be represented. It simply means choosing very responsible and knowledgeable people who know what they are talking about and who are outside the internecine battles which are sometimes waged within those spheres.
That may sound like the famous phrase, "The great and the good". The phrase is usually uttered with a faint edge of mockery. However, we do have great spirits, great minds and great administrators, and thank goodness. I believe in my sense of optimism that there are a very large number of men of goodwill, and I do not believe it is impossible to find an impeccable body of people to control such sums of money and use them for the best.
What should that best be? It is already late and I am within a minute of speaking for too long. I shall however steal a moment to make a few suggestions off the top of my head. The Royal Opera House has recently been involved in enormous controversy about how much money it must use in commercial enterprises in order to back what it has to put into revivifying its stage and so on. None of that would have been necessary with the proceeds of a lottery.
In the early 1970s the National Theatre was costing in the region of £20 million. What would it cost today? I suggest that it may cost £50 or £60 million. I doubt whether we could ever raise that now without a scheme of this sort. There are so many enterprises which should have been off the ground by now; for example, the Roundhouse, an arts centre for the black community, a national jazz centre and galleries for all the reserve collections which now are buried under our great museums. We all know that there are not enough of those collections on view and that we need galleries for them.
On exports of works of art, only two days ago there was a Question in your Lordships' House about "The Three Graces". Millions of pounds are needed to save that; similarly, a Sir Thomas Lawrence picture and a Paul de Lamerie inkstand. They are all going out of the country because of lack of funds to keep them here. I suggest that that would not be a problem if we followed my proposal of a lottery.
The playing fields of England need preserving. Coaching for the young is desperately needed. Indoor tennis and athletics are almost unknown in this country and will continue to be so until we start to provide proper facilities. We need skating facilities. We need sports centres all over the place. Millions of pounds are involved.
Lastly, as regards the environment, let us consider the woodlands. There are storms raging; we now

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seem to be a storm country. There will be an enormous amount of planting and care necessary throughout the land. We still need more and more parks with the encouragement of garden festivals.
I shall not continue because so many of your Lordships already have schemes in mind. All those schemes need to be endowed as well as created. I suggest that an endowment fund for anything new would be essential. Otherwise, the funding bodies may well say. "Thank you very much for providing the money to build but we cannot now fund it". An endowment fund to go with the building would be essential. Above all, I am talking about capital because there is no capital fund for the arts, sports or the environment at present. Sometimes people say that a scheme of this sort will let the Government off the hook. I suggest that the Government are not on the hook. Indeed I go further; I suggest there is no hook.
We desperately need a scheme such as this. I do not ask the Government to reply at this stage. If the noble Earl, when replying to the debate, cares to rise to his feet and say that he agrees with every word I said, I shall not protest. However, I do not expect that of him. I expect only that we all listen to what, for some of your Lordships, may be a very novel subject and see the climate of opinion. That is exactly what these debates are for.
I recommend a nationwide lottery to your Lordships, not because lotteries are in themselves a particularly good thing or a particularly bad thing, but because in this case one lottery with the legislation necessary for it could make a great deal of difference to the arts, to sport and to the environment. Those things make the difference to our society. With careful growth and really careful nursing we could approach the millenium with confidence and pride. They are the touchstone of our society; it is by them we shall be judged, I suspect. They are what make the difference between a more or a less civilised country. I beg to move for
5.51 p.m.
Lord Donaldson of Kingsbridge: My Lords, the noble Lord has admirably presented a most excellent proposition. I am enthusiastically in favour of any plan which will make more money available for the arts. The noble Lord's proposal for a national lottery from which a large proportion of the proceeds will go to the arts is therefore quite irrestistible to me. I am particularly glad that he has not confined his remarks to capital, but included endowment, because the problem that arts face at the moment is not capital but an inability to continue at the proper level.
The need for money in the arts is so obvious and so real that I would embrace any scheme, whatever it was, so long as it was practical. The noble Lord's scheme would produce considerable sums of hard cash without taking it away from any particular individual. That, to me, is a great attraction. It is a much nicer way of raising money than taxation. When taxation rises it produces resentment and hatred; when it falls it leads to extravagence.
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Lotteries, on the other hand, have no such results except that the occasional man who wins £1 million may get into some trouble for it, but usually not; there is no reason to.
Some people believe that increasing support for the arts might encourage laziness and slackness. They remind us that some of the greatest art of all times was produced by artists living in dire poverty, but that means only that their genius survived the garret, not that poverty gave any help to the creative art. Art flourishes in conditions of generous and enthusiastic patronage. When Maynard Keynes founded the Arts Council at the end of the last war, he started something which was meant to and could provide support; for a good many years it did provide such an atmosphere. The moment the cuts began the generosity disappeared and penny-pinching raised its ugly head.
Art cannot flourish in an accountant's world. Artists need the stimulus of the admiration of the patron who gives them a commission to do their particular job, whether it be to write a poem, a book, a symphony or an opera, to paint a picture, to produce a sculpture or even to design a building. When accountants have the upper hand the artists miss the appreciation of an enthusiastic patron, whether an individual or an institution like the Church or the Arts Council. The worst example of that can be seen all around us in the ribbon development we drive through when entering or leaving London. That we must try to avoid.
I do not think there is anything wrong with gambling. I certainly do not think it should be legislated against as such. Like alcohol, it is addictive, but not nearly as addictive as alcohol. However, it is addictive enough to wreck some homes. Most of us know some homes which have been wrecked by gambling. For 99 people out of 100 it is a harmless, fascinating indulgence. It is often maintained that filling in football pools and betting on horses and dogs involve elements of skill and judgment which remove those activities from the category of gambling proper. However, as results are unpredictable and virtually random, it is a superficial argument. I imagine, as was suggested by the noble Lord who opened the debate, that the Inland Revenue would be very unhappy to lose their returns from pools, racing and casinos, not to mention premium bonds. However, I repeat that I have no objection to gambling even in its purest and most undisguised form as in tossing a penny.
I turn to the question of whether there are practical objections to the noble Lord's scheme. cannot see any. The Irish have surely demonstrated that it is not too difficult and, as he told us, so have a large number of other nations. Apparently only Albania and ourselves stand out, but I hope not for too long.
In his figures the noble Lord allowed generously for expenses and prizes and he was therefore talking realistically when he spoke of £2 billion. That is a substantial amount and must not be sneezed at even by this very successful Government.
We are left with the question of whether such a venture, which is neither impractical nor immoral, is worth implementing. The answer is that of course

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it is. I cannot think of any better way of saving the arts from step-by-step lowering of their standards. As the Government gradually reduce support for the arts, something must be done in substitution. Private giving has done as well as anybody thought it could. It could be greatly increased if we adopted the US system, but that it too difficult for the Treasury to accept, because it is both useful and effective. Meanwhile, in spite of hard and not always unsuccessful pressure from the Minister on his somewhat philistine colleagues, we see crisis on every side of us in the arts.
The noble Lord referred to the opera. The Royal Opera House has a subsidy of 44 per cent. of expenditure as against 92 per cent. in Rome—and so on all around Europe. Last year the Royal Opera House was 89 per cent. filled for both opera and ballet for every day of the year bar Christmas—a remarkable figure—yet it has suffered a 15 per cent. real cut in its Arts Council support over the past five years. It is now reduced to hope rather than hard cash in planning the programmes for the next few years.
Twice as many people went to the opera as watched the Football League Cup; more people went to ballet performances than to Rugby Union football, yet the case of English National Opera is even worse than that of the Royal Opera House. Its annual grant is just over 50 per cent. of income. It sells some 400,000 seats a year. In a study financed by the Arts Council three years ago, Price Waterhouse concluded that a further £2·5 million of public money needed to be invested if ENO was to maintain its work and avoid significant deficits. Nothing has happened since then. It received a 2 per cent. increase last year. Admittedly, it was promised an 11 per cent. increase for next year, but it will not be able to carry on very much longer like that. Kent Opera has disappeared. It was a very good opera company, so that it is to be deplored.
Turning to theatres, the noble Lord referred to the National Theatre. That has undergone an 18 per cent. cut over the past five years. We all know about the RSC, which has had its funding cut by 20 per cent. over the past five years and is now having to close for four months. A week or so ago we discussed the plight of museums and galleries. I will not go into that again, but reference to the debate will show that the British Museum, the V & A, the Tate Gallery and many others are all complaining desperately.
The truth is that the arts have been under-funded for years. An unacceptable state has gradually built up as a result. The arts have made a valiant effort to raise public support but that is now nearing its peak. Meanwhile, more often than not subsidies fail to keep up with inflation and always fall short of the annual increase in salaries which have to rise according to the Government's dictates. Most of the arts are highly labour-intensive, so they are especially hard put for it to keep up standards; yet keeping up and improving standards is the one aspect that matters to the arts themselves, to our visitors and to the people in this country who are patronising the arts more every year.
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Speaking seriously, I believe our whole artistic heritage is at risk. By "heritage" I mean the achievements of living people rather than, say, old buildings—a subject which will be dealt with by my noble friend Lord Charteris in his contribution.
We should jump at the noble Lord's suggestion to put matters right. I have spoken about the arts but I have no doubt that the needs of the environment and sport are no less pressing and their value to the nation no less essential. At least these three sections of our lives are not concerned with profit and loss alone, or indeed takeover bids or insider trading, but directly and exclusively with the quality of life for everyone in the country.
Clearly there are a number of important details to be worked out; not least who settles what amount goes to whom. Here I differ from the noble Lord because for the arts my idea is that the task of distribution should remain where it is: with the Arts Council and the Museums and Galleries Commission, who, when given enough money, did the task extremely well. I hope that the Government will not simply say, "no" and turn their backs on the only scheme we have ever come across which might save the arts for us.
6.3 p.m.
The Lord Bishop of Manchester: My Lords, as this is the evening of Ash Wednesday perhaps I should start my few remarks on a suitably penitential note. The Churches simply do not have their act together over the issue of gambling in general. We are divided about it. Perhaps I may illustrate that with a little story. Some years ago the secretary of the Churches Council on Gambling was tackled by a certain gentleman who pointed out that gambling is referred to favourably in the pages of the New Testament. In the Acts of the Apostles we read that they drew lots and the lot fell on Matthias. The secretary was not at all put out by that because he immediately replied, "Yes, but whoever heard of Matthias again?" That perhaps does less than justice to St. Matthias but it illustrates the ambivalent attitude to gambling found in the Churches.
I remind your Lordships of the definition of gambling, because lotteries form one side of it:
"The [distribution] of money, or money value, by an appeal to an artificially created chance, where the gains of the winners are made at the expense of the losers and the gain is secured without rendering in service or in value an equivalent of the gains obtained".
I am afraid that that is quite a mouthful from the Dictionary of Christian Ethics but it is a good reminder that we are dealing with the distribution of money—large sums of money—purely by chance.
It is argued of course that gambling is deeply rooted in human nature, and there is not the slightest doubt about that. People have always gambled and I suspect that they always will as long as this world lasts. Why is it, then, that some of us—I do not know if I am alone in this Chamber tonight but I am sure that it is true of the community in general—feel uneasy about the Motion put by the noble Lord, Lord Birkett, in spite of the eloquent way in which he put forward his argument and the obvious means that he has put in front of us, which are tremendous?

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If gambling were all small scale nobody would stop to ask about the justice of the principle behind it. If it were simply a matter of a few bob changing hands, giving innocent amusement here and there on raffles, and so on, nobody would question whether this was a just or unjust principle. It would not be worth it. In fact, gambling is not like that. Whether you take it in the form of betting, gaming, lotteries or pools—the various forms in which gambling appears—you find that there are very large sums of money in prospect; and what we have heard tonight puts in front of us the possibility of a nation-wide lottery involving extremely large prizes.
When that happens one is forced to examine the principle behind gambling and ask whether it is healthy either for individuals or for a society. In the Christian tradition we would be bound to say that although we live in a universe of chance, on the whole mankind has always struggled to bring order out of chaos. For example, the insurance principle is based on reducing the vagaries of chance. The noble Lord, Lord Birkett, asked why we should not take advantage of the fact that there is chance in nature and in society; and why not make use of it and obtain money from it. The difficulty of that argument is that it does not seem to be a proper, rational principle in mankind simply to increase the distribution of money in a haphazard way and by chance.
No one in their right senses would suggest that we should ban something so deeply rooted in society and in human nature as are the possibilities for gambling. It gives pleasure and doubtless is a harmless pleasure for many people. I often attend church bazaars and am asked to guess the weight of a cake or, perhaps, the weight of Sir Cyril Smith. In fact, I know that he has signed a Motion in favour of a nation-wide lottery. That is all innocent enough and doubtless gives pleasure to many. I am frequently caught in my own parishes with a difficulty in that regard. Instead of guessing the weight of a cake or Sir Cyril I feel more ready to make a suitable donation for a raffle ticket but not take it.
The difficulty is that inevitably gambling becomes a bigger element in society step by step. Moreover, gambling rests on a socially unjust principle. If that is true, even though it is deeply rooted in society it ought to be kept within bounds. For example, prizes should be kept moderate in size. I quote again from the Dictionary of Christian Ethics:
"An individual or a community in whose life gambling plays too prominent a part betrays a false sense of values which cannot but impair the full development of the personality or the society. It should therefore be the concern of the state to control the indulgence within reasonable bounds".
It is for that reason that I would not wish to see a nation-wide lottery established. I admit that when I quickly read the noble Lord's Motion I felt that what he was referring to was a state lottery. He has made absolutely clear that that is not the case. Inevitably, however, a nation-wide lottery becomes associated in the public mind with a state lottery. The state would, to some extent, have to participate actively to see that such a big operation was properly conducted.
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If the Government were to go down that road one would have to accept that they would be giving support to something on which opinion is widely divided in our society today, and not only within the Churches. For example, there is the argument concerning greed. We have all received a briefing paper in which it is said that the suggestion that large prizes stimulate greed would not apply to a lottery which has so many environmental and social benefits, particularly as any donation to the lottery can be looked on as charity. It is said that that is questionable.
To my mind the noble Lord, Lord Birkett, contradicted that in what he said because instead of emphasising that the primary intention of those who took part in a nationwide lottery would be to support the arts he said that the primary intention would be to win prizes, and in some cases very large ones. I quote not from his speech but from his article in The House Magazine. He said that prizes,
"should be in what is technically known as a 'concave' structure"—
and he explained this to us—
"with a few very large prizes (as big as a million pounds) at the top of the scale and a very large number of small consolation prizes at the bottom, with only a few middle sized prizes in between. The psychology behind this is that the very big prizes provide the excitement of a jackpot while the numerous small prizes give a statistically encouraging chance of at least some small winnings".
Who can possibly claim that the prime intention behind giving to a nationwide lottery would not be the encouragement of greed rather than support of the arts? For example, a small stake in a raffle can be genuinely motivated by a desire to help the charity concerned. I do not believe that most people care too much whether they are going to win a bottle of whisky or whatever it may be. However, it is a very different matter indeed when we speak of money prizes of this order.
I have enormous sympathy with all of what the noble Lord said to us about the importance of the arts and of the difficulty in getting money to meet these many admirable causes which are so underfunded. For example, we went on holiday to France last year and my wife and I were enormously impressed—this is nothing to do with the arts, but with sport—that in virtually every small French village there are beautifully set out standard tennis courts. I should love to see that kind of provision in this country. But I am not at all sure that it is right to raise money even for such admirable aims as sport and the arts by producing a nationwide lottery.
The noble Lord, Lord Birkett, said that the full list he could have given is larger by miles but the sums already run into hundreds of millions of pounds. The only feasible way of raising such sums seems to be a lottery and, from the experience of other countries, that method appears to be painless. I question the view that the experience would be painless. What does that really mean? On the surface many things can be painless: for example, the taking of certain drugs in personal life and in society, but the effects can be insidious, damaging and lasting.
I was a little disturbed when I heard the noble Lord, Lord Donaldson, say that he would accept any

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scheme which helped to fund the arts. I cannot believe that in his more sober moments he really believes that. I should be quite prepared to give him privately one or two examples of roads down which he would not be prepared to go, but I do not think I should quote them in front of your Lordships tonight.
Lord Donaldson of Kingsbridge: My Lords, I believe that the right reverend Prelate would have very great difficulty in finding any.
The Lord Bishop of Manchester: My Lords, I suggest to the noble Lord that he would not exactly encourage a scheme in which the proceeds of prostitution were used to fund the arts.
Lord Donaldson of Kingsbridge: My Lords, it was the noble Lord, Lord Goodman, who said many years ago, when he was chairman of the Arts Council, that he would receive money for the arts from anywhere, including brothels. I share that view.
The Lord Bishop of Manchester: My Lords, I am sorry that the noble Lord, Lord Goodman, has fallen into the same error, but I am not responsible for the views of either noble Lord. The danger is twofold. There is an erosion of the public sense of what charitable giving is all about. It has to do with generosity to causes about which men and women know something and which appeal to their best motives and their sympathies for them to give what they can without expecting anything in return.
I have a fear that a nationwide lottery would be yet another twist to something which is already happening. In many senses we are already a very mean nation. I believe that recent figures produced on personal giving show that to be true. We should be very careful of anything which gives a further twist to that kind of meanness and which means that giving is always associated with getting something, or the hope of something, in return. In the Churches we are faced with a tremendous crisis concerning personal giving and that is an experience which is relevant here. We should love to have these kinds of shortcuts which would relieve us of the burden of the enormous sums of money required to maintain, for example, the Victorian churches in my diocese. Yet I believe that there is no real substitute for the education of people as to what giving really means in order to increase the amount of money given. Within my own diocese the level of giving is not very good at all.
That is one danger. The second is the erosion of a proper sense of taxation and public funding and what they really mean. I know that the noble Lord, Lord Birkett, has drawn a distinction between provisions that should be properly funded by the state. He has put subjects such as the arts, sport and the environment on the other side of the line. I am sure he will agree that he has not done that completely, but he has certainly tended to do so by saying that these subjects should be funded in other ways.
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I am not at all sure about that distinction. What is needed is a proper campaign of education by those responsible for both local and national taxation policies in order to help people to understand that these provisions make for a good life in our community. The Government have an important educative role in that respect and so do members of all political parties. It is a tragedy when leaders of political parties simply favour the idea that taxation should be kept as low as it possibly can be without emphasising the positive side of what taxation is needed for in order to improve life in the community.
What is the positive answer to the very strong case which the noble Lord, Lord Birkett, has put in front of us tonight concerning these tremendous needs in our society for more money? I believe the answer lies in public education and in generating enthusiasm for the causes which exist. I agree that is a slow road and one which offers no immediate relief from the enormous crises that face us in this field. I believe that if we were to go down the road of establishing a nationwide lottery we might be doing damage to the social fabric of this country which we cannot see at the moment, but which will become visible in later years.
6.17 p.m.
Earl Attlee: My Lords, I begin by congratulating the noble Lord, Lord Birkett, on introducing this short debate. Though I am in full agreement with a nationwide lottery, I diverge from his views as to what should be covered by it. I do not believe that the noble Lord will like that, and neither will the right reverend Prelate the Bishop of Manchester like what I am going to say now.
If I understood him correctly, if one gives a few pence, though one needs thousands, that is all right, but if one gives thousands of pence, for example, for the fabric of churches, that is wrong. I went to your Lordships' Library before lunch to find a good quotation about lotteries, but I could not find one at all in the Oxford Dictionary of Quotations. In another book, the only one I could find stated that marriage was a lottery. Some people like that lottery so much that they go in for marriage more than once, and I am one of them.
It is thought that lotteries are something new. There are lotteries in Belgium, France, Italy and Spain which are all Christian Roman Catholic countries. A lottery has done those countries no harm. There are also lotteries in Germany, Holland and even Russia. I am not suggesting that those countries are not religious, but they are not quite as religious as some other countries. We also have lotteries in the USA and Australia. As the noble Lord, Lord Donaldson, said, only Albania and the United Kingdom do not have a lottery. The noble Lord, Lord Birkett, pointed out that we used to have a lottery in this country. However, it was terminated in 1823, though no one seems to know why.
As I understand it, the arguments against a nationwide lottery fall roughly into one or two fairly closely defined areas. We are told that it would encourage the poor to spend money that they could

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ill afford and that it would upset the various churches, charities and large football pool companies. I lived in Brussels for some 18 months. I always bought a few tickets for the state lottery. I quite honestly did not expect to win a major prize. I would win a few hundred francs and immediately go out and buy some more lottery tickets. In the countries I have mentioned there has been no evidence to show that running a lottery has done anything but good.
The right reverend Prelate was worried about gambling. But let us consider what we gamble on today. We gamble on the football pools, on horse racing and dog racing, on bingo, on one-armed bandits in arcades and in pubs and on premium bonds. We gamble in casinos, at church fetes, at charity functions and even in pubs where there are various draws. One of the biggest gambles is on the Stock Exchange, with people buying and selling shares.
The Lotteries and Amusements Act 1976 set a limit of £180,000 on the total amount of prize money and a limit of £12,000 on the highest individual prize. Those limits were set in 1976. How much would that money be worth today? It would be worth very little. Unless people are offered the chance to win a big prize they will not go in for a lottery. Why else do football pool companies publicise their big winners? Joe Bloggs who wins £1·5 million is given terrific publicity. People think that if he can do it, so can they. There is nothing wrong with that. What will happen if we in this country do not go in for a lottery? I know personally and I have read it in newspapers that the organisers of continental lotteries will invite citizens of this country to put money into their lotteries. If that happens to any great extent money will leave this country to help the citizens of another country. It will not benefit this country at all. That would be a terrible shame.
I believe that we should have weekly lotteries. We should have El Gordo, which is what the Spanish call their big prize. In English it means "the fat one". Each main ticket should be subdivided, whether into 10, 20 or even 50 parts. If one buys one-fiftieth of a ticket and the big one comes up, one receives one-fiftieth of the top prize. I do not agree with the noble Lord, Lord Birkett, that such lotteries should be limited to the arts, sports and the environment. I appreciate what he means by "the environment" because he explained it very carefully in his article in the House Magazine.
The arts, the theatre and the opera cater for the few. My wife will kill me for saying this. The mass of the people do not go and probably are not interested in them. If we are to have a nationwide lottery, surely the proceeds should go to the benefit of all citizens, wherever they are, whether they are rich or poor, and whether or not they are interested in the arts. The Arts Council provides money for the opera and ballet which stage productions with extravagant costumes and settings. What is wanted is something more simple. Let us have opera and ballet but let us bring them to the people. Let us not spend so much of the grant on these fancy productions. By all means keep what we have for
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the few, but I am not interested in a lottery for the few. I want a lottery for everyone.
The noble Lord, Lord Birkett, specifically stated that he did not want lottery proceeds to go to schools and education. I disagree fundamentally with him. I believe that the vast majority of the money raised by a lottery should go to provide more facilities for schools and to buy highly sophisticated and expensive equipment for our hospitals, equipment which could not otherwise be supplied and which could help the sick and injured. I should like in particular for this money to go towards helping the disabled. They may be supplied with the basic necessities but disabled people have expenses which are not covered by anything else.
I am dyslexic. I have a little friend called Timothy Bakewell who is in a special unit in school. The equipment needed to teach him how to read and how to make his writing legible is expensive. In the case of my little friend I am not talking of someone who is backward. Tim has an IQ of 122. If we spread our net wider we shall help everyone in this country. We shall help not just the rich or the poor but everyone. We can plant our trees and do all those things. We can help to make this country a better place for all its citizens. That is what we require.
6.28 p.m.
Lord Charteris of Amisfield: My Lords, I congratulate the noble Lord, Lord Birkett, not only on having won the lottery for short debates but on having chosen this subject when he won it. I hope very much that the Government will look seriously at making it possible for a nationwide lottery to be held.
I listened with the greatest respect to the views of the right reverend Prelate the Bishop of Manchester. I do not agree with them. We are, for better or worse, a nation of inveterate gamblers. It may not be a good thing that we are, but we are. There is every advantage in diverting that passion into charitable purposes as opposed to gambling on cards or on the horses.
My personal interest as chairman of the National Heritage Memorial Fund is that there should be more money for the arts and for the environment. The task laid on the fund by Parliament was to give financial assistance for the acquisition, maintenance and preservation of land, buildings and objects of historical or other interest to the heritage. I am putting in a firm plug here to say that if we have these lotteries, I hope that the National Heritage Memorial Fund will receive some of the lolly, because we need more money to do our job.
Those of us who work for the fund receive applications from museums and galleries because they need our help to purchase items. We also receive a great many applications from the National Trusts of England and Scotland and the other amenities societies because they wish to take over houses or to preserve our hertiage.
Perhaps I may say something about the museums and galleries. We must remember that their purchase grants have been frozen since 1985. That is nearly five years ago and this is happening at a time when

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the cost of works of art is rocketing. No one now asks for less than a million for a painting. That is absolutely terrifying. It is no good saying that museums and galleries have got so much stuff stacked away downstairs that they ought not to buy any more. Unless museums and galleries can buy they become fossils. It is absolutely essential that somehow or other they should have the power to increase or improve their collections.
When it comes to the National Trusts and the various societies for the preservation of woods and so on, it looks as if we shall be asked to provide as much assistance in the future as we did during the first 10 years of the fund's existence when we paid out £110 million. At least half of that figure was for buildings, woods, coastline, bogs, fens and flats. What is especially attractive about the lottery idea is the fact that it would tap new money. The amount of money available from generous benefactors, from trusts and from business sponsorship is limited.
The National Heritage Memorial Fund has never felt it right to appeal to any of those bodies for money to top up what the Government have given. The reason is that we think that it would be poaching. The Government have an obligation to keep us in funds, but organisations like the two National Trusts depend entirely upon subscriptions from the public for their survival. If we were to enter into the picture, we would take from them what they should be receiving.
As I said, I think that the lottery would tap a completely new source of money. Therefore I am much in favour of its introduction. I suppose that the greatest help for the arts and the environment so far as concerns my fund knowledge comes from the taxation system, the in-lieu provisions improving the douceur and so on. However, that aspect must be looked at separately.
I have but one further point to make. Even if we have lotteries they will not solve the problem. I know that the Government will remember that they have an absolute responsibility to put money into the arts and especially, if I may say so in a loud voice, into the National Heritage Memorial Fund.
6.33 p.m.
Lord Jenkins of Putney: My Lords, perhaps I may begin by expressing my appreciation to your Lordships for allowing me to intervene in what I believe is called the "gap" of the debate. I did not put my name down to speak because I have an important engagement this evening in Putney and I did not realise that the debate would take place early enough to enable me to fulfil both obligations. I hope that noble Lords will return my impudence with the kindness of allowing me to depart after I have spoken. The reason I must go to Putney is that an important event is taking place there this evening. We are selecting our parliamentary candidate for the next general election. The process is devoted to the important task of enabling Mr. David Mellor to return to more lucrative work at the Bar as a QC after the next election. Therefore, I am sure that Members on all sides of the House will understand that I must be there.
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However, before I depart I must say that I am in a little difficulty this evening because I find myself in principle on the side of the right reverend Prelate the Bishop of Manchester but wondering whether in practice some good might come to the arts out of the proposal put forward by my noble friend—I think I can call him that—Lord Birkett. I find myself divided on the issue. I am quite sure, I suppose because of the puritan source from which I come, that gambling is wrong. The Labour Party has always taken that view. Indeed, it has been expressed trenchantly from these Benches in this House and from those in another place from time to time. We have always taken the view that a national lottery is not for us.
The noble Earl, Lord Attlee, pointed out that a large number of Catholic countries on the Continent run lotteries. That is the trouble with Catholics; they get it wrong. They fail to distinguish between what is important and what is not important. They sometimes miss the important matters and seem to favour the unimportant ones. Therefore in principle I find myself agreeing with the right reverend Prelate.
I am quite sure that nothing should be done to break the principle of ultimate government responsibility for the arts. I think that that is a vital and important principle. If the effect of a national lottery were to diminish the feeling of government responsibility and the amount of government investment in the arts, even to prevent it from increasing, then what is proposed is a thoroughly bad idea.
The reason that government support is vital is that it is distributed on a rational basis. The Government devolve upon the Arts Council the function of choice; in other words, it does not happen by chance. It is vital to the arts that this distinction of distributing money on a basis which is judged by people who know about the area to be the right thing to do is vitally important and in my view it should be maintained. It is precisely why the arts in this country have flourished during the period since the war. They have flourished because that method of distribution of funds has been maintained.
I am worried that the introduction of the proposed scheme may destroy this vital basis upon which the arts have thrived for so long in this country. It is why the arts in this country are better on the whole than those in the United States. It is interesting to note that the Americans are now moving back from commercial support for the arts to a larger degree of state intervention. In many cities it will be found that there is an excellent plurality of support from federal, state and city sources. In many cases that matches or sometimes even exceeds the totality of business and individual contributions, which is certainly an extremely vital part of arts support in the United States. For those reasons I am doubtful about the idea of a lottery.
However, whatever we may say, it may well be that we shall move in that direction. I do not know what the noble Earl, Lord Ferrers, will say to us this evening and unfortunately I shall not be present to hear his reply. I shall read it eagerly in Hansard tomorrow morning, or it may be that I shall be able

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to listen to a recording of the debate later this evening. It is important to discover whether he will maintain the position put forward very convincingly by the noble Baroness, Lady Trumpington, on the last occasion when the subject was debated in this Chamber. She set out the position which has hitherto been held by the Government and did so very effectively. I could not quite discover the philosophical basis of her argument but it was very effective for all that. From our side it stems from a puritan background. Where it comes from on the other side we shall perhaps hear later.
Suppose nevertheless that the lottery is to come. What would be a good use for it? A good use would be for it to go to a beneficiary which is not yet receiving money; it could not then be dissipating government support. That point is vital. A beneficiary which has been almost totally neglected is the buildings for the arts, which are running down. The theatres are running down and getting into bad condition. There is no money to repair them. The museums are running down; the art galleries are running down. In many cases they are in quite a desperate situation. There is no money for this purpose.
Therefore if we could produce a substantial sum of money from a lottery—I am satisfied with the point made by the noble Lord, Lord Birkett, that the money would be substantial—that sum would preserve the foundation on which our arts exist. Unless we have buildings in which to contain areas where people perform or which we can visit in order to see the valuable and enchanting objects which we have, the foundation on which the arts are based will not be there. So if we are to have a lottery it should be dealt with in that way. At present we are living off the fat of past investment and there is not much fat left.
If we do not invest in theatre buildings, no matter how much support we give to the arts, theatre activities will contract. In some places they may have to cease altogether. The only way to remove theatre buildings from risk and to ensure their care to very high standards is to create a really generous capital endowment fund, and this is a possible source for it.
There would have to be safeguards. The endowment fund for each theatre would have to be held and managed by an independent trust. I suggest that the freehold of the site or some substantial part of it should be held by a body such as the Theatres Trust. Here I must state my interest, for I was the first director of the trust and I am now its consultant.
My experience as Minister for the Arts tells me that much of what I have said about the theatre applies, as the lawyers would say, mutatis mutandis to buildings. Many of them are quite splendid but they are now in serious trouble. They house museums, art galleries and cinemas. Here is a cause for a national lottery which could do no harm. It would fill a gap which is not filled by any other means. It would be a good goal, as all of your Lordships would agree, if it could be done in that way.
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However, I must come back to my roots here and say that fundamentally I do not believe that gambling is right. In the Labour Party our feeling has always been similar to our views about alcohol and perhaps even tobacco: a little of it does not do you much harm. A little wine does not do us much harm. But to have it encouraged on a national scale so that everybody becomes drunk is not a good thing at all. That possibly explains why we take the view that we do.
6.44 p.m.
Baroness Ewart-Biggs: My Lords, I too am glad and grateful that the noble Lord, Lord Birkett, has chosen such an interesting subject for his debate this evening. The debate comes at an opportune time because there has been considerable interest and much comment has been made recently about the possibilities of a national lottery. The noble Lord, Lord Birkett, made out a persuasive and enthusiastic rationalisation of his case this evening. He gave a long list of mouth-watering opportunities which would arise from a national lottery One could only be attracted by the idea of the retention of pictures which would otherwise go abroad. There would be a greater number of theatres and greater flexibility for work within the theatres. There would be additional woodlands and parks and other benefits which the noble Lord described.
As all speakers have said, no one could possibly go against the benefits which the noble Lord, Lord Birkett, described this evening as coming from a national lottery. He had strong support from the noble Lord, Lord Donaldson. I thought that the latter's lust for the arts went rather too far when he even suggested that the proceeds from a brothel could go into the building of theatres. He would not take me with him there, and I am rather glad that a female is responding from these Benches this evening.
Lord Donaldson of Kingsbridge: My Lords, I must intervene to ask whether, if the proprietress of a brothel came forward and said, "I have been earning money evilly for years. I want to give you money for the arts", the noble Baroness would not accept it. I should.
Baroness Ewart-Biggs: My Lords, I am afraid that I see myself in rather a different position from that of the noble Lord, Lord Donaldson. I think I should not be drawn any further down that route.
Earl Ferrers: My Lords, perhaps I may interrupt the noble Baroness. I think that the noble Lord, Lord Donaldson, was suggesting that the noble Baroness would be the recipient, not the donor!
Baroness Ewart-Biggs: My Lords, I am grateful for that clarification. It brings much relief to my anxiety. I believe that everybody has agreed that the objective of raising funds for the arts is thoroughly acceptable. It was interesting to hear the historical background which the noble Lord, Lord Birkett, gave this evening. It is worthy of note that, as he said, the principle of state lotteries was accepted as far back

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as 1569, when the first recorded lottery took place under state auspices. It was mainly for the repair of the Cinque Ports. The system went on, as he again said, to cover an important objective: a lottery to buy and house a collection for the British Museum. Then in 1826 there came the last state lottery, following the recommendation of the Select Committee in the House of Commons.
However, even if lotteries stopped there, that has not been the case on the Continent. As noble Lords have said, at present all our EC partners have national lotteries. The total EC sales are now £11·6 billion. Much of this money is used for various good causes. I understand that the proposition put forward by the noble Lord, Lord Birkett, has attracted a great deal of support. I have received a paper written by the Adam Smith Institute and copies of many articles that have been written. The interest and support are certainly there. Arguments have also been made regarding the dangers of powerful European lotteries anticipating the opportunity to fill Britain's void in the European lottery market. That telling point was made by the noble Earl, Lord Attlee, this evening.
For my part I wish to make one or two comments about the proposition, first from the gambling point of view. The moral question of gambling has been well covered by the right reverend Prelate this evening. It was difficult to disagree with anything that he said. I also wish to point out how a national lottery would affect other existing forms of gambling and then I wish to examine the fund raising aspect. I shall say a word about the mechanics of establishing a lottery. Finally I wish to put one or two questions to the Minister of which I have given him warning.
As regards gambling, it has been mentioned and it must be said that the United Kingdom has the greatest diversity of legal gambling to be found anywhere in the world. The noble Earl, Lord Attlee, has mentioned most of the different forms. But, apart from the football pools, which is the biggest, there are premium bonds, horse racing and greyhound racing betting, betting shops, casinos, bingo, gaming machines and a multitude of small lotteries. So one might conclude that the appetite for gambling is already catered for, and that the arrival of a national lottery would undoubtedly take money away from this market, although I noticed this evening that several noble Lords thought that it would be new money that went into the lottery.
Attitudes towards lotteries as a form of gambling have varied over the years. There was a time when it was thought immoral for anyone to be able to gain a large sum of money without any skill or effort on his part. As I said, the right reverend Prelate made a very good case for that. Nevertheless it is evident that a more tolerant attitude has evolved towards gambling, so long as it is conducted under proper control.
On the matter of control, the 1978 Royal Commission on Gambling accepted the principle of lotteries, as the noble Lord, Lord Birkett, said, but it made some very important points. As regards control, it stated:
"All lotteries must be strictly controlled. Lotteries may be socially harmless but they present greater possibilities for fraud
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than either betting or gaming, because the punter does not see what is happening to his money. Moreover lottery frauds often go undetected, because most people have little expectation of winning a prize and take for granted the integrity of those who organise the lottery."
That was one of the many very good points that the Royal Commission on Gambling brought out with regard to lotteries.
My next point is the way in which lotteries are viewed from the point of view of fund raising. There is little doubt that it is reasonable and perfectly acceptable that proceeds provided by the public should be used to fund something needed by the public. The noble Lord, Lord Birkett, gave some very good examples. My noble friend Lord Jenkins, who has not yet gone, also provided some very good examples of how funds could be used, though I suspected that my noble friend rather wanted it both ways. It was difficult to go against gambling but yet to want to have the proceeds. So he wanted to have his cake and eat it, but I cannot say that I blame him for that.
What I do not think should happen is that money raised in this way should replace any kind of government funding. That is what my noble friend Lord Jenkins and other speakers said. There are many services which must be provided for and controlled centrally. Otherwise injustice and imbalance occur.
Although I know that this debate has nothing to do with the National Health Service, there was an appeal for the Great Ormond Street Hospital for Sick Children and so much money was raised for it that, in the end, it was felt quite certain that money was withdrawn from other children's hospitals which needed it as much or possibly even more. So that the system certainly created an imbalance for hospitals around the country. I see a danger that, if the proceeds from national lotteries were used to finance the arts, sports and the environment, government would be under a very great temptation to withdraw funding.
I should like to make one short point about the mechanics of setting up a lottery. A study made by a promotions company showed the necessary stages. First, and most important, the public must be in favour. Next it must be ascertained whether legislation is necessary. Then it must be decided what type of administration would be best to organise and run a lottery. Should it be a private commercial body, as in West Germany, a state-controlled body as in Holland or, as in Ireland, an independent, semi-state body running the lottery? Then there is the appointment of a lottery administration, the making of arrangements for the distribution of money raised, the prize structure and so on. So a very complex mechanism is necessary to produce a fair system which prevents fraud and makes for efficiency. There is little doubt that getting the right answers to these questions is critically important.
I should like to ask the following questions of the Minister. Can he say what representation, if any, he or his right honourable friend the Home Secretary has received from the general public who are either in favour of or against the introduction of a national lottery? Can he say to what extent foreign lotteries

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are mailing tickets to UK residents? I have heard of examples of this happening and I wonder to what extent it has gone on. Also can the Minister say what measures Her Majesty's Government have taken to prevent these lottery companies operating in this country? Can he say, too, whether there would be a need for new legislation to enable a national lottery to operate in the United Kingdom, or would present legislation be amended?
This is a difficult subject on which to take an inflexible position and I agree with the noble Lord, Lord Birkett, who said that lotteries are neither good nor bad, but they make a big difference. The day of the national lottery in Britain may be brought about either by public acclaim or by outside pressure, through trying to protect ourselves from the intrusion of foreign lotteries.
But may I end by saying something which has not been said this evening? It is mainly the poor who buy lottery tickets. This has been proved by experience in other countries. People buy tickets to win prizes and they do it because they need the money. I was asking an Irish parliamentarian yesterday about his experience in Ireland. He replied: "I would not have them any more. I have seen members of my constituency go to buy their lottery tickets sometimes on the way back from collecting their family benefit. That is where the new money comes from. It comes from people who want to make money out of the prizes. This is the danger."
So if it is the poorer group in society who invest the money, it is surely they who should benefit from the proceeds. It is for that reason that, if there was a national lottery, the proceeds should be channelled for a wide distribution. This is where I agreed with the noble Earl, Lord Attlee, and with the noble Lord, Lord Henderson of Brompton, who would have made the point if he had been able to speak today. It is the charitable organisations and voluntary agencies who could benefit from those funds. Some of them might put money into sport or the arts but, on the whole, they would put money into ways of assisting the people who invested money in these lotteries. I very much look forward to hearing what the Minister has to say in response to this debate.
6.58 p.m.
Earl Ferrers: My Lords, this may have been only a short debate, and 0there may not have been so many of your Lordships participating in it, but for all that I have found it most interesting. I was deeply indebted to the noble Lord, Lord Birkett, when he said at one moment that he did not want a reply. I should have been happy to oblige, but I thought that it would be discourteous if I took what he said at face value.
What he wanted to do by raising this matter was to hear the climate of opinion, and he has done that. He made a very diverse and persuasive case himself and I heard a number of your Lordships side with him over that. It was interesting to hear the right reverend Prelate the Bishop of Manchester offer a cautionary approach to this business of gambling. He agonised over the principles of it and said that it might damage the social fibre of the nation. Each
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of your Lordships will have to consider whether that is so.
When I heard the right reverend Prelate speak, my mind was taken back to 20 years ago when the right reverend Prelate the Bishop of Chester, as he then was, who subsequently became the Bishop of London, introduced a debate on gambling. In his speech he happened to refer to the fact that a certain club had opened in London. It was called the Playboy Club. It invited various Members of your Lordships' House to have membership for a year for nothing. The right reverend Prelate had also received that invitation. Together with the invitation came a small leaflet depicting the advantages of membership in glorious technicolour. I remember the right reverend Prelate saying, in that glorious episcopal phrase:
"I wish that such enthusiasm had been put to greater effect".
I shall not follow the noble Lord, Lord Donaldson, down the bizarre avenue that he introduced as to whether the arts should be supported by the proceeds of brothels. That extended the level of debate a good deal further even than the noble Lord, Lord Birkett, had intended. I shall explain the present position with regard to the law and policy on lotteries which operate under the Lotteries and Amusements Act 1976. Public lotteries in this country are in general permitted only as fund-raising activities of registered societies, such as charities and sports clubs, or of local authorities.
The law limits the total value of the tickets which may be sold and the amount of the maximum prize which may be offered in any lottery. The limits were increased last September so that in the biggest lottery the turnover may be £180,000 and the maximum prize £12,000. The limits are set at modest levels deliberately for a number of reasons. They aim to prevent the undue stimulation of what is after all a form of gambling—I know that that will meet with the approval of the right reverend Prelate—but they also allow small societies to compete with larger ones. Both because of their small scale and because they benefit charitable or other good purposes, those lotteries are specifically exempted from gambling duty.
The noble Lord, Lord Birkett, and the noble Earl, Lord Attlee, referred to the fact that we had lotteries until the early 19th century. I believe that the noble Earl asked why they stopped. The last British state lottery was held in 1826. Lotteries were then ended, not because of the problems of buying lottery tickets, which were too expensive for the majority of people, but because of the widespread illegal betting on the drawing of numbers in the lottery itself. A Select Committee set up in 1808 reported:
"by the effects of the lottery…idleness, dissipation and poverty are increased, the most sacred and confidential trusts are betrayed, domestic comfort is destroyed, madness often created, crimes subjecting the perpetrators of them to the punishment of death are committed and even suicide itself is produced".
The right reverend Prelate might take succour from those words of nearly 180 years ago.
A major difference between lotteries under the current law and major lotteries is that in major lotteries the gambling element is seen to predominate over that of charitable giving. As the noble Lord, Lord Birkett, has said, there can be a distinct

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difference between a state lottery and a major lottery on a national scale. A state lottery is a lottery run by government. That would involve the state in the promotion of gambling, and if that were the noble Lord's proposal—which as he explained, it is not—I am bound to tell him that it would not meet with the Government's approval as it would run counter to our policies on deregulation and privatisation.
The idea of major lotteries on a national scale, though, is different. There could be one or more major lotteries. They would be privately run but they would have to be subject to regulation in order to protect both the punter and the intended beneficiaries. New legislation would therefore be required.
The noble Baroness, Lady Ewart-Biggs, referred to the fact that people in the United Kingdom are receiving lottery tickets from abroad. One might think that if that is so—I understand that it is—it is slightly ironic for a British person to be invited to take part in a lottery to build an opera house in Cologne when it is against the law to participate in a lottery to build an opera house in, let us say, Bournemouth.
The position is that it is unlawful to promote or to conduct major lotteries here, including lotteries based outside Great Britain. Some in West Germany and Canada have been promoted here by post and it can be difficult to curtail that activity. Action is being taken to deal with it. Customs and Excise has impounded quantities of promotional letters which were intended to be posted individually although they were imported in bulk. In addition, the Foreign and Commonwealth Office has taken steps to end the attempts by lotteries which are based abroad to circumvent the law here.
The authorities in the Federal Republic of Germany have been alerted to the problem, and information is being exchanged with them with a view to stopping the posting here of invitations to participate in lotteries in West Germany. Similar action is being taken in respect of Canadian-based lotteries. In addition, since the beginning of the year Customs and Excise has impounded 390,000 envelopes containing material on West German or Canadian lotteries. It has alerted postal depots nationally to look for material.
Lord Wyatt of Weeford: My Lords, I hope that the Customs and Excise will not impound my winnings, if I get them, from a West Germany lottery in which I take part.
Earl Ferrers: My Lords, I suggest that the noble Lord waits to see whether he is lucky and wins before he comes up with such a speculative idea.
I was about to advise your Lordships in answer to the question asked by the noble Baroness that a trade organisation representative of British domestic postal distribution companies has warned and advised its members not to accept contracts for the distribution of foreign lottery material. Advertisements for some foreign lotteries have appeared in magazines here and the Gaming Board
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for Great Britain has drawn the attention of the publishers concerned to the provisions of our law. The publishers have undertaken not to carry such advertisements again.
Some people are worried about the position under the single European market. Our present understanding is that the law on lotteries will not be affected by its advent in 1992. A good defence of our prohibition on major lotteries could, if necessary, be made if the prohibition were to be challenged under the Treaty of Rome as it stands. I know that that would not satisfy the noble Lord, Lord Birkett, because he would not wish us to defend the prohibition: he would wish us to remove it.
It is right and sensible to consider some of the complex factors which a major British lottery would raise. The noble Baroness asked what representations the Home Office had received. In the past 12 months we have received representations about a major lottery from 30 people. Those representations are varied. Some have advocated or inquired about the merits of a major lottery or lotteries and some have complained about the attempted marketing here of foreign lotteries. I am sure that the noble Baroness will agree that that is not a good guide to public opinion.
The noble Baroness also asked a number of very penetrating questions. She asked: if we were to change the law, how would we set about it? Would the new law allow one national lottery or a number of them? Who would decide who would run and who would benefit from the lottery—the Secretary of State or a lotteries board? What would the criteria be for accepting one application but rejecting others?
If there were more than one lottery the advantages would be dissipated by the other contestants. The large prize money of £1 million or so, which has been mentioned by many noble Lords, depends on huge circulation. The greater the number of lotteries the smaller are the prizes and the smaller the benefits—and the less the attractions. If there were to be one lottery it is more likely that the prize money and the benefits would be considerable, but such a lottery would be a monopoly. The questions would then be: who should benefit from that monopoly and who should be denied that benefit?
The noble Lord, Lord Birkett, is certain that that monopoly should be granted to the arts, sport and the environment, which were his particular hobby-horses. Those causes are undoubtedly worth while, but I fancy that there would be many other worthwhile causes which would come knocking at the door. The noble Earl, Lord Attlee, suggested some. He referred to dyslexia. The noble Lord, Lord Donaldson, asked who would distribute the money. That is a very pertinent question. I fancy that causes such as cures for cancer might be considered suitable targets, as might the homeless, the starving or animals. It would be no easy matter for Parliament or any quango to decide between the multitude of legitimate but competing interests which could bid for that privilege.
The noble Lord, Lord Birkett, referred to the Roundhouse, the jazz centre, galleries, woods, skating, and retaining pictures which would

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otherwise go abroad. I got the feeling that if only we had a lottery that would be the panacea for all our troubles and everything would be easy thereafter.
Even if it were decided which area of our national life should be the beneficiary, who would decide which opera house should be built and which should not, or whether a picture should be purchased or an orchestra assisted? Should those have priority over a football stadium? The noble Lord, Lord Charteris, made no bones about it. He wanted money for the National Heritage Memorial Fund. He gets a fair stack already, but that does not satisfy him. He wants more. He banged the drum very effectively for that cause. I fancy that the gentle rustle of sharpening steel would be deafening.
The noble Lord, Lord Donaldson, was worried that the Government had reduced their support for the arts. The noble Lord, Lord Charteris, said that the Government must fund the arts. It is important that the noble Lord, Lord Donaldson, should remember that we are giving 22 per cent. more money to the arts over the next three years. That is an additional sum. In 1990–91, £175 million is being given, 12·5 per cent. more than at present. That is well above inflation. The noble Lord would be the first to say that that is not enough but I hope he will agree that it is a considerable increase.
Vice and fraud are always just round the corner where any form of gambling is concerned. The whole exercise would have to be carefully controlled. A number of questions would have to be asked: has the draw been fair? Has it indeed been undertaken? Have all the purchasers participated? How many have participated? The greater the number of major lotteries the more those problems of regulation would arise. We would have to be careful too that if the purpose of the lottery was to be charitable in the loosest sense of the term the recipients were chosen because they were correctly deserving and not because they happened to have a public profile which would attract heavy participation in the lottery.
Successive governments, including our own since 1979, have allowed various gambling activities to go ahead, but only to the extent needed to meet unstimulated demand for them. All forms of major gambling here are therefore subject to a variety of controls ranging from restrictions on advertising to limits on the number of outlets. The evidence from other countries is that major lotteries require heavy advertising in order to attract maximum participation. Persistent public promotion might well therefore be a necessary condition if major lotteries are to be successful in this country. An exception of that nature for this particular purpose might be not too easy to defend.
Should a national lottery be free to advertise for example, on television and, as it were, to tout for participants, whereas established gambling interests such as football pools cannot? If football pools and the like were not also permitted to advertise they might reasonably complain of unfair competition. They would say that if there is only a certain amount of money floating about, as it were, in the gambling area it would inevitably be drawn away from those who are not allowed to advertise on television to those who are.
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The total turnover of all pools, betting, bingo, casinos and gaming machines is about £10,000 million, of which some £2,400 million is what might be termed new money. Of that total the Exchequer takes about £1,000 million. So if we introduce a new form of gambling which has no tax attached to it, not only may all the existing members in the industry suffer but so also may the Treasury. If, in compensation, the lottery or lotteries were taxed, the profits would diminish accordingly.
Much of the argument of the noble Lord, Lord Birkett, rests on the fact that major lotteries would attract new money only, leaving the expenditure on current gambling by the public unaffected. That is an untested proposition and experience in other countries may not necessarily be a reliable guide. No other country which is comparable to ours appears to have as varied a gambling industry as we have with which any new gambling enterprise would have to compete. It is commonly assumed that a major lottery would divert current spending, in particular away from the football pools. I suggest that there must be a limit to the amount of money which is waiting to find a home in the general area of gambling, although that was not evident from some of the speeches this afternoon.
The possible impact on charitable giving also has to be considered. A major lottery might damage the current modest lotteries which exist at present. The proponents of major lotteries, like the noble Lord, Lord Birkett, say that the evidence from other countries suggests that modest and major lotteries can thrive side by side. That may be so but such international comparisons need to be treated with caution.
There is then the question of whether a major lottery or lotteries might damage charitable giving. The right reverend Prelate said that there was not enough charitable giving in this country and that new lotteries might curtail even further what he believes is already inadequate. Let us assume that money could be attracted to lotteries which are designed for specific charitable or other good purposes. There is certainly some concern that the lotteries would nevertheless draw from a pool of money which charities as a whole could otherwise tap directly and more cost-effectively.
I am sure that the noble Lord, Lord Birkett, will feel that I have made a somewhat negative and unhelpful speech. That has not been my objective. I have tried merely to indicate some of the curious slugs which start to crawl out from under this particular stone when one starts to move it. The noble Lord has put forward a very persuasive case for a national lottery. My aim has been to try to point out some of the difficulties which might arise if we were to go down that path. It has not been to question the merits of the environment, the arts or sport. Nobody doubts those. My purpose has been simply to lay before your Lordships some of the complexities which need to be taken into account if we are to look to lotteries to fund some of those requirements.
The noble Lord, Lord Birkett, said that he did not want a reply. I am not giving him a reply; I am

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stating a fact. I am bound to tell him that the Government have no plans at present to amend the law to introduce one or more major lotteries. However, I can assure him that we shall continue to consider whether, and if so how, some of those complexities might be addressed. The views which your Lordships have expressed this evening will be of great assistance.
Lord Birkett: My Lords, I am immensely obliged to everyone who has taken part in today's debate. As the noble Earl said, few though we were, many of the contributions were distinguished and thought-provoking, which is exactly what I had hoped. Obviously, in the few last minutes allotted to me, I cannot comment in general or in detail on what has been said, but there are one or two small points which might just as well be cleared up.
Many noble Lords have been worried that a scheme such as I proposed would encourage the Government—any government—to withdraw their support for the arts, sports or the environment. That was never my intention. I do not believe that that will happen. I should be able to persuade the noble Lord, Lord Donaldson of Kingsbridge, the right reverend Prelate and the noble Baroness, Lady Ewart-Biggs, that I am talking about capital. Capital does not exist at present. I did not mention it as an example, but, if one wanted to build a home for the Welsh National Opera—at present all it has is a dotted line and no money—there is no way in which one could look to a fund or even to the Government. One might look to the Government, but it would not be fair to expect them automatically to say yes to something which cost about £60 million or £65 million. The fund would not conflict with or get in the way of present or even future arrangements in terms of revenue. That point was made by so many noble Lords that I thought I should make it clear that the scheme that I advocated did not have that effect.
I can reassure all those who wanted the money to go their way, including the noble Lord, Lord Charteris, that that is exactly the way it should go. The objects of the National Heritage Memorial Fund would be exactly paralleled by what I seek to do. It would have been a help to the noble Lord. I can reassure the noble Lord, Lord Jenkins of Putney, that I am talking about theatres and their upkeep.
I also agree with many noble Lords, including the noble Baroness, Lady Ewart-Biggs, and the noble Earl, Lord Ferrers, in that I recognise how difficult the security and organisational problems are and how difficult it is to choose who will adminsister the scheme in the end. I do not think that any of those problems are insuperable, however.
The noble Baroness, Lady Ewart-Biggs, thought that it was always poorer people who went in for lotteries. Everything that I have heard points to the contrary. American statistics show that it is the upper income bracket far more than the lower income bracket which go in for them, quite disproportionately so. The social effects predicted by the noble Baroness will probably not therefore come about.
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There is no way that at this time of night I can contribute to the debate as to what the uses should be. In proposing such a Motion for the arts, sports and the environment, in whichever proportion, I recognise that other people will say that other subjects should be included. The disabled would automatically be included and would receive sums of money under any such scheme. However, there would be no resolution of the problem as long as the scheme lasts. As the noble Earl said, if there are too many lotteries, it spoils the point of having them. Is it fair to have a monopoly or a monopoly that breaks advertising conventions? I recognise those problems. They will have to be solved and I believe that they are soluble.
However, the interesting problem raised by the right reverend Prelate is not soluble. Does the question of lotteries relate to greed rather than charitable giving? There is no answer to that and I do not think that there ever can be unless there is a separate answer on every ticket. My own guess in practical terms is that, if one invents a lottery such as this with £1 tickets, even if there is a million pound prize, one knows that one's chance of winning is so remote that it is a vague pipedream. Even one's chance of winning £2 is likely to be about one in eight. It amounts to charitable giving with a little shiver of excitement just in case something else might happen. That is how most rational beings would look at the matter. I suspect that that will not reassure the right reverend Prelate on the subject of greed, but I believe that that is what would happen.
Finally, perhaps I may deal with the question of competition from abroad. I am interested to hear from the noble Earl what is being done to ensure that we are not overwhelmed with competition. However, I was struck by his recognition that, however much one may legislate, promoting or selling tickets for lotteries abroad will be easy. Whether it is before or after 1992 and whatever the legislation may be, I suspect that it will be difficult to stamp out competition completely. As the noble Earl said, it would be galling if a major enterprise arose in Germany out of British citizens' contributions to their lottery. We should be better off with our own.
That was how I started this evening. I must conclude by renewing my thanks to everyone who took part and to the noble Earl for such a considered reply. I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

Planning Protection for Conservation Areas
7.25 p.m.
Lord Raglan Lord Raglan rose to ask Her Majesty's Government what legislative or administrative proposals they have to enable planning authorities to overcome their present difficulties in protecting areas worthy of conservation.
The noble Lord said: My Lords, about 10 years ago the Government brought out a paper called Lifting the Burden which indicated that they

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intended to relax the planning system. They said that there were too many controls and that large sums of money were involved in new buildings which were necessary to wealth creation and to the revitalisation of the economy. They said that the planning system should obstruct new construction in as few ways as possible. They wanted the public to take the view that all potential development was benign in effect, that the system should be made to work faster and that councils must not fuss about what new buildings looked like or where they should be put.
At first, in spite of those pronouncements, things went on much as before. That was because of a struggle spanning two decades over planning policy between the old and the new. Only recently had an uneasy balance been achieved, much of the trouble being that modern architecture was and is, intentionally or unintentionally, inimical to older architecture.
However, over the last four or five years, although there have been few changes in planning legislation, pronouncements issuing from the department have become more and more insistent. The Government have evidently been determined, through administrative means coupled with circulars and planning policy guidance, to change custom and practice. It has not been merely a change of emphasis, more a reversal of what most people involved in conservation, whether amenity bodies, national institutions or councils, had grown to believe that planning legislation was all about and should be achieving.
Perhaps I should explain to noble Lords who are not familiar with the planning system that departmental guidance, as it is called, is the means by which the Secretary of State controls the planning system. Guidance spells out in effect his orders to the planning inspectors. There are 170 full-time inspectors and about 180 part-time inspectors. Those inspectors, who by profession are usually architects or town planners, preside at planning appeals.
Following such guidance from the department, planning inspectors have increasingly overturned conservation-friendly decisions by local planning authorities—the councils—where the latter have tried to defend their decisions on appeal. Councils have been fined large sums in costs when councillors have properly carried out their function as they saw it. As a result, at planning committee meetings they are being made to feel obliged to reach conclusions on conservation matters against their better judgment as they are ever conscious of the risk of costs being awarded against them.
As an example of what has been happening, in 1987 to 1988 costs were awarded in over one-third of all inquiries and 86 per cent. of them were against councils for supposedly unreasonable behaviour. That has been taking place during a period of unprecedented pressure for development, particularly in conservation areas because of their special attraction. As a result councils have been losing the ability to have adequate control of their streets. That, in turn, is resulting in irreversible erosion—incremental erosion is a good description
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that I have heard—of the quality of environments, which may well have been saved with difficulty some time ago and subsequently carefully defended over decades.
I understand the Government's attitude. Certainly their sentiments sound liberal enough—so far as concerns developers anyway—in embracing the views that I have outlined and forcing them on planning authorities. But they have not paid much attention to the wishes of the general public. For example, aesthetic controls, which have been anathematised by this Government, are demanded of councils by residents. Surely that is not surprising. After all, though designers and developers pursue a necessary occupation, they work privately for themselves on behalf of clients. However, their products are consumed both physically and visually by the citizen at large. A new building cannot avoid impinging on the street scene and that affects people other than those who are building it. I know that that seems a glimpse of the obvious, but it is something that is often overlooked.
In addition, when residents value their surroundings, as they usually do when they live in conservation areas, their own pecuniary interests are likely to be affected as well as those of potential developers. It would be all right perhaps if developers were altruistic but unfortunately not many of them are. Most of them tend to say something like, "Here is a nice site with a fine view of these listed buildings. I have thingummies designed for a ziggurat in my back pocket"—I know that to have happened—"but perhaps as this is a very well known area I shall get an architect to design something with a period gesture. That should sell very well". That is known as robbing the view and is all too common. The sentiment is, "I have a fine view of your place and I don't much care what you think of
This Government have in general, rightly I think, set themselves against producer control, endeavouring to keep the balance right on behalf of the consumer. Therefore I find it all the more strange that they should have been behaving as they have done over planning. It is inconsistent with their philosophy to absolve this particular producer group, whether architect, developer or client, from responsibility towards the quality of the environment as perceived by the residents of an area. They—they say—with the passers-by are the consumers. Context and compatibility are enormously important to them. I may say that nobody knows or should know more about the qualities of that kind of context and compatibility than the local councils, prompted by residents. They probably know much better than the inspectors.
There have been, and I expect will be again, occasions when for one reason or another councils have not done well by their residents. However, in the past residents have known that they could appeal for help to central government and expect some sort of sympathy. That happened in Bath some 20 years ago when the council got it into its head to pull down large parts of the city. If central government had not intervened there would be nothing like so much left of that city as there is today. Now, at the Government's suggestion, UNESCO has deemed the

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city to be of world importance. A continuing central government commitment to protect the city has been invaluable both to the council and to the amenity bodies.
Nowadays, though, we do not know where we stand. Former government policy has gone overboard and the city is once again open, not this time to demolition but to spoliation of its setting by erosion. Architectural fashion has changed for the better over the years but my civic society has to remain very alert and the Government have been no support at all. Quite the opposite. Not long ago the council, supported by the amenity bodies and local residents, won an appeal to oppose a new building in a central residential area. It won on grounds of lack of adequate parking provision. Yet, in an act of wonderful—and I am tempted to say wilful—perversity, the inspector awarded costs of £12,000 against the council. That was in respect of the architect's estimate of his own costs in supporting his designs against the council's disapproval of them. For the council had had the temerity to include its disapproval of those designs in its reasons for rejection and, according to the department, councils are not allowed to hold views on aesthetics, which is astonishing.
Likewise in Bath, the council, with the full support of residents, resists the conversion of houses to offices in the city centre in order to keep life there. On appeal against one such council ruling, one reason that an inspector gave for allowing change from residential to office use was that the house in question had no front garden. I may say that nearly all the houses in the city centre have no front garden. That is just one illustration of how far inspectors are or have been going in leaning over against even the most sensible of controls.
In doing so thay are causing the character of conservation areas gradually to alter. The only means of remedying such decisions is by application to the High Court. But that is vastly time-consuming and expensive and can only be contemplated when the decision appears to be fundamentally flawed and the potential harm is so great that it simply has to be avoided. That is another instance of how loaded is the system against conservation at present.
I shall only briefly mention the vast number of problems thrown up by the Use Classes Order 1987 because I understand that the Government have its effects under review at the moment. However, let me give the House an example of how the Secretary of State is deterring councils from doing the kind of job that they are supposed to do. Only last week I was shown the result of an appeal in Notting Hill where the council had refused change of use from shop to restaurant for its own good reasons, which it gave. Yet not only did the restaurateur win on appeal; he was awarded £27,000 costs. In other words, costs are being used punitively to steer government policy. I think that that is wrong. I appreciate that there is a certain mordant humour in making councils subsidise opposition to their own planning controls and decisions but it demonstrates a lack of appreciation of the problems that so often accompany development and change of views.
I must also mention what is known as presumption in favour of development. It has always existed as a general principle although not written into legislation. As a free citizen, one is at liberty to put forward a proposal for a planning development. If the planning authority agrees, there is no need for it to say anything. But if it refuses or disagrees, it has to give reasons. In other words, an explanation has to be given if one is stopped from doing something. The principle is not written into legislation because there is no need. However, the Government have tried very hard to turn an unwritten principle into a written precept. They wrote it into a circular in 1980 and again into guidance in 1988, stating also that to refuse permission local planning authorities have to demonstrate that the development would do harm. That is quite hard to do. However, one cannot act upon such a principle where Parliament has decreed otherwise; and Parliament has decreed otherwise in conservation areas. Presumption in favour of development in a conservation area is a contradiction in terms although no one would gather that from the guidance notes or from anything else emanating from the department.
The way in which a Secretary of State can shuffle legislation to one side with one hand while he writes new policy guidance with the other seems to me a matter of great concern. Pushed out of sight altogether has been the developer's duty as laid down by Parliament to preserve or enhance a conservation area, and only public-spirited action in the courts has shown this up, as it did in the Steinberg case. I am told that the department does not like the Steinberg judgment and is doing its best to water down its effects. I hope that this information is incorrect.
I have mentioned Bath. Your Lordships may think that my remarks are prompted only from my experience there. However, I have been hearing complaints all around the country. I have also received many letters of support from your Lordships, including the noble Lord, Lord Gibson, who is away. However, he told me that I could mention his name in support of my argument if I thought that it would help. I know that it will.
There is deep unease among conservationists at the department's stance. The Government should hold the ring, but instead of that people see them as making onslaughts on those who hold opinions different from those of developers. They are deterring councils and amenities bodies from conserving areas. They have even been trying to impose the view that the look of the building is a matter only for its designers. I seem to differ here from the Royal Town Planning Institute. I see no reason why planning authorities should not set the style of design as part of a planning brief. Why ever not, my Lords? It would save a lot of argument.
When I put down the Question last summer I learned that the chairman of the Kensington and Chelsea planning committee had become so frustrated by the Government's preventing his committee from doing what it saw as its duty that he was resigning in order to campaign to change government policy. Through the borough he produced an excellent pamphlet, a copy of which, the noble Lord, Lord Reay, told me, came through

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his letter box. I have sent one to the department. It should be helpful.
Councillor Gordon is now the mayor and therefore has withdrawn from campaigning. However, I mention two matters that I have discussed with him. One is that, as things are, councillors are duty bound because of the queston of costs to consider every application as it would be considered on appeal by a probably hostile planning inspector. The other is that in no case does a council stand much chance on appeal if the councillors have reached a conclusion that is different from that preferred and advanced by their officers. So much for exercise of responsibility; so much for independence of judgment. Surely the Government should not impose their views thus but rather should take notice of the widespread dismay that their policies have been causing.
I was chairman of a new town development corporation and of its planning committee for almost 13 years. I know much about the economic importance of new development of factories, of business and of the encouragement of enterprise. Indeed my town gave a lead with a number of ideas in this regard. It is from my experience in a new town that I know that conservation is inimical to these issues. It is a matter of thinking how to handle the question with sympathy, of not imagining that conservation must stand in the way of progress, of respecting old buildings and the people who prefer to live among them, and so on.
The Government's present approach is all wrong. They must rethink it. I hope that they will do so in the light of the debate this evening.
7.48 p.m.
Lord Cullen of Ashbourne: My Lords, I feel very diffident about following the noble Lord, Lord Raglan, who is clearly very much an expert on this subject. I must confess that up until now I have never taken an interest in the subject and am doing so this evening only because I received from the Royal Borough of Kensington and Chelsea the brochure to which the noble Lord has referred. I suppose the reason that I received it is that I live in that borough. Most of the very few words that I was going to say have already been said by the noble Lord. However, I shall proceed with what I had in mind to say.
As I understand it, the position is that since national planning control began in 1947 there has always been a presumption in favour of development, as the noble Lord mentioned. That has been going on all the time, not just during the period that this Government have been in office. It was natural enough that there should be such a presumption just after the war, after all the ravages of that war on the capital and on other parts of the country. But this presumption has continued ever since; and I am also told that it has become stronger in the past 10 years.
In Circular 22/80, to which the noble Lord referred, the Government directed local authorities to grant planning permission unless having regard to all material considerations—and I emphasise the
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word "material"—there were sound and clear-cut reasons for refusal. In January 1988 in PPG 1 the Department of the Environment gave guidance as follows:
"The developer is not required to prove the case for the development he is proposing to carry out but if the planning authority consider it necessary to refuse permission, the onus is on them to demonstrate clearly why".
I now return to the word "material". One of the many considerations which most people would regard as material is surely what the development is likely to look like. Yet the same guidance note in January 1988 stated:
"Matters of detailed design have long been an unnecessary source of contention and delay in the planning system. Planning authorities should not impose their tastes on developers simply because they believe them to be superior".
That appears to mean that the reverse can occur; the authorities can have the taste of the developers imposed upon them.
The general policy guidance appears to be completely at variance with present government policy. The philosophy behind the community tax charge is to make local government accountable to the community. That would make it essential for planning authorities to canvass the opinions of local residents before giving or refusing permission. However, if they do so and the developer appeals it is probable that refusal of permission will be reversed by the department. I understand that that situation occurs not only in Kensington and Chelsea but all over the country.
Usually there are two sides to every question. I shall listen with interest to the remarks made by my noble friend Lord Reay. During the past 40 years there have been some odd developments. Many have not been pleasing to the eye and I suspect to some others. If they stem from a fault in the system there must be a strong case for its reform.
7.51 p.m.
Lord Addington: My Lords, having listened to the noble Lord, Lord Raglan, I have reached the conclusion that he knows far more about the process of planning authorities than I ever shall. Therefore I shall restrict my remarks to the function of the system as it stands. A system that presumes the right to devleop must have strong bounds placed upon it if it is not to become a means of abusing the environment as a whole.
"Environmental" and "green" issues have become buzzwords and all political parties and interest groups appear to have developed a green hue. I suggest that in domestic areas the Government should do something to make that hue a little more believable. If we continue to damage our environment at the current rate as a result of new development and certain types of agricultural practice, the statements which we make about the environment of other countries—the rain forests are a classic example—will look fairly shallow. It is worth remembering that centuries of development have led to a total change in our natural landscape and that little is left. We must be careful about what we do in setting examples.

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The value of our environment is difficult to place in terms of the benefits gained from certain developments. It is true that there is a housing problem in the South of the country. I suggest that a more realistic regional policy would take away some of the pressure, but not all. When undertaking developments we must consider the cost of our actions, which affect virtually everything that we do. Every time we develop a greenfield site we destroy some natural ecosystem which has evolved over many years. That is equally true of natural heathland and domestic gardens which have not been subjected to a barrage of pesticides. There is a natural ecosystem of wildlife, plants and animals even in one small patch of land. Therefore, it is particularly worrying when people sell parts of their gardens for the development of, say, new flats. Not only is that land destroyed as a form of natural habitat but there is an effect on the surrounding area.
Many forms of wildlife which used to find a home in rural settings are now moving into suburban settings. The process of farming has destroyed their habitat and often their food source, as in the case of birds of prey. Mice and voles are not now found in such large numbers in urban areas because of the use of pesticides and poisons. Many birds of prey are now moving into urban and suburban environments.
Therefore, we must consider some form of guideline which protects all the different environments. In the current situation, where it is assumed that the developer has the right to develop, the balance is wrong. Environmentally we can no longer afford to develop at will because we are running out of space. Ours is a densely populated island, particularly the southern half, and no longer can we allow people to do as they wish.
In considering the Question—it concerns our quality of life and whether we wish to keep in that certain parts of our environment—we must remember the visual appearance of the environment. Anyone who has looked out upon great lumps of concrete thrown up in large regimented lines knows that that view is not conducive to a feeling of well-being. Indeed, living in such an environment causes depression and is deeply dehumanising. At present the huge grey giants are falling to bits. We should be more concerned with the aesthetic aspect and that is undeniably so when we look at the results of the past.
We must develop a policy which asks why an area is to be developed and what the benefits are. They should be weighed against the cost to the environment and we should ensure that they outweigh the costs. Any damage caused to the environment must not be irreversible.
7.57 p.m.
Lord Kennet: My Lords, the House should be extremely grateful to my noble friend Lord Raglan for introducing the Question. His speech came from deep and wide experience of the subject. It had the added and uncommon advantage of pulling no punches. He also went into detail where necessary. I do not remember having heard a better speech
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about conservation, especially urban conservation, for many years.
I have only two points to make, both of which are subsidiary to my noble friend's main exposition. They fit in as points of emphasis as regards what he has said. Since the middle of the second world war the mainstay of our system of conservation of historic environments in cities, towns and villages has been the investigators of buildings of historic and architectural importance. They are a core of people who objectively judge, say, a street for architectural or historic importance and grade it. Naturally they develop immense expertise and a core of general academic knowledge. Naturally and rightly, in taking planning decisions involving such considerations, Secretaries of State have always turned to the investigators for advice. Without them and their advice it is possible that we should have no preservation of historic and architecturally important buildings. If their role were abolished, we should have to invent a different system; perhaps like the French system, which rests on a different basis and is much more onerous for developers to face.
The investigators and the administrators who administer the investigators used to be part of the Department of the Environment. At one very pleasant period of my life I was the junior Minister responsible for them. Naturally, I noticed and paid a great deal of attention when Mr. Heseltine, who was then Secretary of State for the Environment, proposed to hive them off into the quango which later became English Heritage.
At that time I was so worried about it—and I would not say that I was hostile, because I did not fully understand why he wanted to do it—that I went to see him. He kindly agreed to talk to me. He said, "I understand your worries but consider this advantage. At the moment I could halve the money for the historic buildings branch of the Ministry, I could halve the grants given for the upkeep of historic buildings, streets and towns without anybody knowing. Once I hive it off and it becomes freestanding, I shall have to publish the amount of money it receives every year. If ever I show any signs of reducing it then I have no doubt that you will kick up a public scandal. That will make it less likely that I shall be tempted to reduce the amount". I thought that was a very good argument and on reflection decided to support what was proposed.
I must say that at that time it never occurred to me that the investigators of the historic buildings branch would be treated otherwise than as the experts in the field who would be turned to first and always, nor that, while the advice could not always be statutorily accepted, it would not always be given greater weight in the matters in which the investigators were competent than the advice of anybody else. It is very sad that that is no longer so.
One has been able to see by mere anecdotal reading of the press that there has been an increase in the number of occasions on which the advice of English Heritage in a question involving the demolition of a listed building or street has been rejected. When I saw that that was the case I tabled a whole series of

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Questions and wrote many letters to Ministers asking for figures. I asked what was the increase in the number of occasions on which the advice of English Heritage had been rejected. The answer came back that no record is kept. I tried again by asking whether or not it would be desirable to keep a record and the answer came back that it would not be.
I then turned to English Heritage to ask if it kept a record of those figures. It said that it did not but that it could reach a figure, if it judged it worth while, by combing back through all the records—a long and arduous business. I do not know whether they are going to do that.
What is quite clear—and it can be seen again and again from reports of inspectors' findings and from Answers to Parliamentary Questions and letters to Ministers—is that the Secretary of State or his inspector consults English Heritage, receives its advice and consults other parties on the value of a given building and receives their advice. These are very often the statutorily listed amenity societies, and it is very good that they should be consulted. However—and this is new—the department or the inspector goes further and consults intending developers. He takes into account—and I have a very well known case of this in Weymouth—a study of the architectural or historical importance of a given building which has been paid for by the applicant for permission to pull it down. He takes that into account as material.
English Heritage has been pushed downhill so that it is now very little more than an amenity society along with the others. It is consulted among others and its advice may or may not be taken into account. If I and others had thought at the time when Mr. Heseltine invented English Heritage that that was to be its fate, we should certainly have opposed the move and said, "You keep it where it has been for 30 years, inside the department, and listen to it as the Government's prime adviser". All I can say is that what is now happening to English Heritage is something which should not happen to an official body with statutory powers which has been entrusted by Parliament with the duty of giving statutory advice to the Secretary of State.
I now turn to my other point, which concerns the world heritage sites which have been mentioned this evening. It is almost a year since we debated world heritage sites. At that time I voiced my fears about the future of heritage sites. I questioned whether existing planning law would be sufficient to protect them. Let us remember that we are dealing here with places of which there are only 12 in Britain and only about 200 in the world. They are by definition—and a definition accepted and proclaimed by HMG—of world importance.
In the first place they are left to a district council, since district councils now have the planning power and county councils no longer have that. I said at the time that I did not believe that that would work out very well and that the Government should do something to increase the degree of central protection afforded by government to our 12 world heritage sites. I was not quite sure what should be done. However, I made a proposal to use the never
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yet used system of planning inquiry commissions in each case of a planning application of any significance for one of those sites.
The noble Lord, Lord Hesketh, answering for the Government ruled out the proposal and said that he was sure that the protection afforded by existing statutory and administrative arrangements was sufficient. I took the precaution of writing to him in time for this evening's debate and received a letter from him today in which he wrote that it was still his opinion that the degree of protection afforded by present statutory arrangements was sufficient.
Later on I went with the Kennet District Council, which is responsible for the world heritage site at Avebury, to see Mrs. Bottomley when she was the junior Minister concerned at the Department of the Environment. With some dash for a very small rural council, the Kennet District Council put forward possible arrangements involving no change in statute law which could be introduced to protect all the world heritage sites in the country. Mrs. Bottomley expressed a keen interest and I thought that we might be on to a winner. However, since then nothing has happened. That is the second constructive proposal which I have put forward which has been rejected.
I do not intend to put forward another proposal this evening. The record is not so favourable to my having a third shot. However, I should like to tell the House what has happened at that one world heritage site since that time and to draw what seems to me to be the moral. There have been four public inquiries in two years. That does not seem very many. However, Avebury is a village with a population of somewhere between 100 and 200 and the parish of Avebury, which is the planning unit, takes in that and another village. I dare say that between them the population is 300. There have been two separate major hotel proposals, both of which would completely ruin that site and deprive it of any right to continue with the designation of a world heritage site. Each of those underwent a separate public inquiry lasting many weeks. Avebury Manor has been bought by a commercial exploiter who has been very rightly ordered by the district council to cease doing what he is doing to the historic buildings and to undo what he has done. He has chosen to appeal against those orders and that has involved a third public inquiry lasting many weeks. The fourth inquiry will be when the Kennet District Council produces its draft parish plan for Avebury, covering the tiny population of roughly 300.
The last time we debated these issues in this House it was very good to hear the noble Lord, Lord Montagu, say that English Heritage would be putting forward its own proposals for the management of the world heritage site at Avebury, most of which is owned by the National Trust. However, I have not yet found out whether there has been any progress in that respect and the local planning authority has now put forward its proposals. They are well meaning, but in the opinion of many inhabitants of the village—I live in the next village—they do not go nearly far enough. We said so to the district council and it decided that it would be right to have a public inquiry. It is quite right, but I have not the least doubt that it will last many weeks.

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What is a population of 150 or 200 expected to do to finance and find the energy and skill to fight four public inquiries, each of which lasted many weeks, in two years? We are flagging. They are flagging; that is natural. I expect that, as pressure mounts from the international hotel chain developers on all our world heritage sites—mark you, it will; it is already happening in Durham, in Cambridge, which is not even designated yet, and other areas—we shall find the force for conserving that which makes it a world heritage site and which stands beside the district council (which is sometimes very small) in its attempts to ensure that it is worth preserving, simply vanishing away through sheer lack of size. That is another reason why the Government should re-examine the refusal they have so far maintained to entertain the possibility of any change in the existing law or arrangements concerning world heritage sites.
8.12 p.m.
Lord McIntosh of Haringey: My Lords, I echo the thanks which have already been expressed on behalf of myself and the crowded Benches behind me to the noble Lord, Lord Raglan, for the very expert way in which he has introduced this important subject.
When I first saw the Unstarred Question put down I thought I had to declare interest as a former chairman of the development control sub-committee of the London Borough of Haringey. That would have meant my declaring an interest as a gamekeeper. However, since that time I have this week learnt that a planning application which I put in for my own property and which was turned down by the London Borough of Haringey has now been allowed on appeal by the Department of the Environment inspectors. I therefore have qualifications as a poacher as well as a gamekeeper and I propose to capitalise on both qualifications.
Noble Lords who have spoken in this debate have referred to some of the most important issues which face our country in preserving a civilised way of life. Most of the debate has been about the problems of unsuitable architecture—what the noble Lord, Lord Raglan, calls "robbing the view". The noble Lord, Lord Addington, made an impassioned plea for the preservation of the natural environment and of greenfield sites. I do not want to do other than to echo what he said about the importance of maintaining the natural environment.
In the short time I allow myself I want to talk about the balance of interest and the powers of the Department of the Environment and local planning authorities. I want to consider how best they might be meshed together to reflect the interests not only of residents but of the population as a whole. At the moment it seems to me—it has been emphasised by many speakers—that the balance is wholly wrong. The problem with the relationship between the Government and local planning authorities is that the Government have never been under any obligation to state openly and in risk of contradiction by Parliament what their policies are. What has happened is that there has been a back-door revolution.
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I paid tribute to Mr. Michael Heseltine when he came out into the open and explained in his paper Lifting the Burden the basis of his policies. At the time I did not agree with what he said, but I thought it admirable that he should be willing to say what he said openly and to raise the matter as an issue of public debate. As the noble Lord, Lord Raglan, made clear, the changes that have taken place since that time—they did not take place immediately—have taken place by the back-door. They have taken place in the form of guidance notes for the inspectors rather than in the form of public debate. It is for that reason above all that this question is of such great importance.
We have to remember with regard to planning applications that the cards are always stacked in favour of developers and against planning authorities. The most obvious reason for that is that, once planning permission has been granted for something, that permission can never be revoked, or at least not revoked except at enormous expense and with very great legal difficulty. Once a developer has been turned down, however, that developer can come back time after time, whittling away at the determination of the planning authority and of local people to resist a particular piece of development. The noble Lord, Lord Kennet, gave a graphic account of that when he described what was happening at Avebury. I fear that that story is not yet complete and it may well be that the whittling away will result in something disastrous.
In that sense the cards are already stacked against local planning authorities. It is extremely difficult for local planning authorities, which do not have money available, and certainly for local residents, who do not have money available, to resist the very well-heeled developers who have a great deal of money to make from certain forms of development.
The second way in which the cards are stacked against local authorities has already been referred to, and that is the way in which costs are increasingly being awarded against local authorities even when they win the case. It is bad enough for local authorities to have costs awarded against them when they lose a case; after all, they are only reflecting a public wish to protect the conservation areas and the environment. When developers put forward proposals of this kind, they are quite clearly looking to make money out of them. In my view they must take the risks and should pay the costs whether they win or lose the application. That position has now been turned on its head and councils which defend the interests of the electors and local people find costs awarded against them even when they win.
The third way in which it is becoming increasingly difficult for councils to act objectively and effectively—the noble Lord, Lord Raglan, again referred to this and I believe the noble Lord, Lord Cullen, also made this point—is when they are told that their decisions are at risk if they go against the advice given to them by officers. In a democratic sense that seems to me to be outrageous. What are councillors for unless they have the ability, on occasion, to follow their own judgment and the judgment of those who elected them to overturn the

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views expressed by professional officers? I do not denigrate professional officers; I have worked very successfully with them both in a borough council and in the Greater London Council. There are times, however, when it is necessary for the greater good to prevail and the greater good should be capable of being expressed by councillors. There should not be a risk of their case being overturned simply because there is disagreement between councillors and officers.
The fourth way in which councils are hamstrung in the way they deal with planning applications, as I have already hinted, is in the guidance given to inspectors. This guidance goes far too far to enhance the presumption in favour of development and far too far against the presumption which ought to exist that there is such a thing as a heritage, both architectural and natural, which ought to be preserved. After all, architecture is not like the other arts. If one does not like a painting one does not have to go into the art gallery to see it; if one does not like a book, one does not have to open it.
If you live in this country at all you are exposed to architecture, and you are exposed, thank goodness, to a wide range of architecture of many centuries. Some of it over the centuries is good and some is bad—I am not making a point in favour of or against modern architecture. I am certainly not going to enter the debates which have enraged the Royal Institute of British Architects over recent years.
Because architecture is so visible I am reminded of the Coit Tower on the top of Telegraph Hill in San Francisco. It is so ugly that it is said the only way to avoid seeing it is to live in it. There are plenty of examples in this country of similar buildings which ought to be crammed with sensitive people seeking to avoid looking at the place in which they live. Because architecture is so visible there should be a presumption that the advice of such organisations as English Heritage and the Royal Fine Arts Commission—the noble Lord, Lord Kennet, made a valuable point in that connection—is taken into account. We should be given the answer to the noble Lord's question regarding the number and proportion of occasions on which the advice of English Heritage has not been taken into account.
There is an extreme view held in some quarters that there should be no such thing as planning control. The City of Chicago is always used as an example. It is said that Chicago is a successful city economically because it does not have planning or zoning controls. I believed that to be the case until recently when I visited Chicago and discovered that that is not true. There may not be strict controls over the aesthetic appearance of buildings but the city has strict zoning controls and has much more concern than we tend to have.
My final and most important point is that planning controls are essential not just from an aesthetic point of view but because of the zoning implications—the implications of new developments on the demand for transport services, water supplies, utility supplies of other kinds, social and educational services and so on. The creation of a balanced community which
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contains the services that are required in the places where they are needed is the fundamental reason why planning controls are so necessary.
The need for planning controls for conservation purposes is an important case, but it is a special case which should be taken alongside the social reasons for effective, consistent and clearly expressed planning controls. I fear that with recent unpublished decisions the Government may be moving away from the requirements of our society which have been expressed over the years in the form of planning controls.
8.23 p.m.
Lord Reay: My Lords, your Lordships' House can be in no doubt about the commitment of the noble Lord, Lord Raglan, to conservation. His speech today was generously and justifiably praised by the noble Lord, Lord Kennet. I can assure your Lordships that the Government are equally committed to protecting the best of our architectural and natural heritage, to use the phrase of the noble Lord, Lord McIntosh of Haringey.
With the ever-increasing demands and expectations of our living, organically growing society it would be unrealistic to expect to be able to preserve everything, even everything worthy of conservation; nor would it be natural. For centuries buildings and landscapes have been altered and adapted to cater for the requirements and tastes of successive generations of owners and occupiers. Nevertheless, there is a very great deal in this country that it would be everyone's wish to see everything possible done to preserve. That need has been progressively recognised since the war in an expanding framework of legislation and policy guidance from successive governments. I welcome the opportunity which the debate this evening provides to glance briefly at this topic.
The oft-quoted presumption in favour of development is not, as is sometimes supposed, a recently invented policy to facilitate development. It is a statement of principle which has underlain the planning system for over 40 years, ever since the traditional freedom of a landowner to develop and use his land as he wished first began to be subjected to a comprehensive system of control based upon the public interest.
The idea that local authorities should designate areas,
"of special architectural or historic interest the character or appearance of which it is desirable to preserve or enhance",
found legislative recognition in the Civic Amenities Act 1967. We now have some 6,000 conservation areas. They vary in scope from historic town centres—as in Bath where the conservation area now covers two-thirds of the built-up area—to smaller terraces or squares, groups of houses in towns or villages or parks around historic buildings. Many of them are centred on listed buildings but not all: many simply represent good, pleasing architecture in harmony with their surroundings.
For over 20 years there has been a statutory requirement that those who determine planning applications and appeals—that is, local planning

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authorities and the Secretary of State for the Environment—must pay special attention to the desirability of preserving or enhancing the character or appearance of a conservation area. This requirement was highlighted in the case already mentioned in which a Professor Steinberg successfully challenged a decision by one of the Secretary of State's inspectors. The inspector had allowed an appeal against a refusal of planning permission to develop a site in a conservation area in the London Borough of Camden. The judge held that the inspector had misdirected himself when he identified the issue to be decided as whether the proposed development would harm the character of the conservation area. The judge said there was a world of difference between whether the proposal would harm the character of the area and the correct test of the need to pay special attention to the desirability of preserving or enhancing it.
That was a significant judgment. It highlighted in a way that had not been done before the need to apply the positive test of preserving or enhancing the character or appearance of a conservation area rather than simply the negative test of not doing harm when planning applications are considered. The noble Lord, Lord Raglan, suggested that the Department of the Environment is doing what it can to water down the effect of the Steinberg judgment. I can tell the noble Lord that the judgment of the High Court has been accepted and that planning inspectors have been made aware of the lessons to be learnt from it.
The noble Lord, Lord Raglan, referred to a complaint which is made in the planning brief, The Need for Reform. As he correctly said, I have seen a copy being a resident of Chelsea, as is my noble friend Lord Cullen. It was issued by Councillor Gordon, the former chairman of the planning committee of the Royal Borough of Kensington and Chelsea. The noble Lord repeated the complaint made in that document that in conservation areas to have a presumption in favour of allowing applications for development is a contradiction in terms and should go. To that I would say that the presumption in favour of development anywhere, as set out most recently in PPGI, is qualified by the requirement to have regard to all material considerations. In the case of conservation areas that must mean paying special attention to the desirability of preserving or enhancing their character or appearance.
The Government's planning policy guidance, published in the Department of the Environment Circulars and Planning Policy Guidance Notes, puts flesh on the legislative framework of development control. The courts have said that such guidance is a material consideration to be taken into account in decisions about development proposals. I believe the noble Lord, Lord McIntosh, implied that there is something "back-door" about this method of issuing guidance. However, the PPGs are published documents. They are distributed to local planning authorities and are available to the general public. They largely reiterate advice previously published in circulars but in a more concise and accessible form.
Lord McIntosh of Haringey: My Lords, perhaps the noble Lord will allow me to intervene. I am grateful for that explanation. I entirely accept, and would never dream of denying, that planning policy guidelines are available to councils and to the general public. However, that is a different matter (is it not?) from having them subjected to political debate. For example, it is different from having them presented to Parliament by Secretaries of State or, even better, being the subject of legislation. The noble Lord will agree that there have been major changes in the emphasis of these planning policy guidelines. I should have thought this was a matter for debate in Parliament.
Lord Reay: My Lords, I do not entirely accept that. I shall be dealing with some of the points that the noble Lord raised. I now turn to the subject of aesthetics raised by the noble Lords, Lord Addington and Lord Raglan, which is such a subjective matter. It is extraordinarily difficult to provide guidance which is capable of practical application and satisfies a consensus of opinion. PPG1 says:
"control of external appearance can be important, especially for instance in environmentally sensitive area—such as national parks, areas of outstanding natural beauty, conservation areas and areas where the quality of the environment is of a particularly high standard".
We also recommend authorities to reject,
"obviously poor designs which are out of scale or character with their surroundings".
It is pertinent to bear in mind that this advice has to be applied to some half a million planning applications each year, the vast majority of which are resolved locally without, I suggest, undue fuss or bother.
I should like to emphasise to your Lordships the Government's desire that as many planning decisions as possible should be taken locally. In an ideal world they would all be resolved at a local level. In fact, fewer than 2 per cent. of all planning permissions are granted by or on behalf of the Secretary of State. Inevitably, that 2 per cent. includes a number of major or controversial proposals which attract publicity and generate wider public interest.
The allegation is made from time to time that the Government are allowing progressively greater numbers of appeals against local authorities' decisions to refuse planning permission. However, let me give your Lordships some figures. Last year, 1988–89, 35 per cent. of appeals in the city of Bath were allowed, compared with 36·7 per cent. in England. In the first nine monhs of the current year, 1989–90, only 23·5 per cent. of Bath appeals were successful, and the national figure was 34·4 per cent. Those figures suggest that both in Bath and in England as a whole the proportion of appeals allowed is diminishing.
Lord Raglan: My Lords, I am grateful to the noble Lord for providing those figures. I suggest that it is perhaps a false reading. In my speech I said that the councils have the Ridley axe over their heads and they are worried that they are going to be done for costs. That is what is making them feel more inclined to give planning permission in some cases rather than otherwise.
Lord Reay: My Lords, I shall be dealing with the question of costs in a moment. I believe that some will find the figures I have quoted reasssuring. Earlier the noble Lord, Lord Raglan, mentioned the case where an inspector upheld an appeal against the change of use of a house to offices in Bath. Each case must be considered on its merits, but since early 1989 all four appeals against the refusal of permission for such change of use have been rejected by the Secretary of State.
I now turn to the question of costs and I shall address some misconceptions about the award of costs in respect of planning appeals. The present appeal costs regime is not intended to punish the local planning authority for a wrong decision when it has been taken as part of the development control process. The purpose of the costs regime is to enable either party to retrieve some or all of their appeal costs when it is clear that either the planning application should not have been refused or the planning appeal should never have been submitted because it had no reasonable prospect of success.
That policy is applied even-handedly. For example, in the last year costs have been awarded in favour of the local planning authority in respect of dismissed appeals for three particularly large proposals for regional shopping-leisure development. These were on green belt sites in the London borough of Bromley, near St. Albans and at Wraysbury, Berkshire. In each case my right honourable friend the Secretary of State considered that the local planning authority and its ratepayers should not have to pay for resisting development proposals which flew in the face of established government policy. Provided local planning authorities are careful to take decisions on their planning merits, by reference to national and local statements of planning policy, there is no reason for them to fear that the result of an appeal will be an award of costs against them.
I should like to turn to the question of use classes and the general development order. The use classes order removes from the definition of development, and so from the scope of planning control, changes of use where both the present and proposed uses fall within the same use class. The order was reviewed and overhauled in 1987. Some of the changes made then have proved controversial, but I believe that the 1987 order largely satisfies the Government's paramount objectives. These were to make it unnecessary to obtain planning permission for types of development that generally do not damage amenity, while retaining effective control over those that do.
The Government have decided that, since the use classes order has been in force for more than two and a half years, the time is right to assess its impact. We have therefore commissioned independent research to provide an objective assessment of the effects of the order. The research is now under way, and we expect it to provide results by the summer.
The general development order grants a general planning permission for a wide variety of minor development, such as house and factory extensions. It has been subject to numerous refinements over
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the years, but in 1981 the legislation embodied a two-tier approach for the first time. This provided for less generous tolerances for certain categories of permitted development in conservation areas, areas of outstanding natural beauty and national parks.
In 1988 the differential between permitted development in these areas and elsewhere was further widened. Specific control was extended to loft extensions and the cladding of dwelling-houses, as well as to the erection of outbuildings exceeding 10 cubic metres in size, in conservation areas, areas of outstanding natural beauty, national parks and the Broads.
The department monitors continually the working of the GDO, and is always ready to consider constructive suggestions for further refinement. However, in deciding the limits of permitted development we must always keep in mind that to require planning permission for minor works places a burden both on hard-pressed local planning authorities and also on householders anxious to carry out repairs or improvements to their property.
It has been suggested that when development takes place without planning permission—a complaint made in the Royal Borough of Kensington and Chelsea document—or at variance with an existing permission, the local authority should have power to issue an immediate stop notice, without considering the merits of the development.
The Government consider that such an approach would be too draconian. There are, we believe, two better ways of dealing effectively with any unauthorised development which is so unacceptable as to require urgent remedial action. First, we can legislate to improve and strengthen the existing stop notice provisions in the Town and Country Planning Act 1971. We already have some proposals for doing that, in a report last year by Robert Carnwath QC. We hope to implement them as soon as we have a planning Bill.
Lord McIntosh of Haringey: Can the noble Lord say when that will be?
Lord Reay: I do not believe that the noble Lord, or anyone else, would expect me to anticipate what might or might not be in the Queen's Speech.
Secondly, even without new legislation, if a local authority decides that it is essential to compel unlawful development to stop at once, it can use its existing injunctive powers in Section 222 of the Local Government Act 1972. Although seeking an injunction is a last resort, local authorities should be aware that this course is available for use when appropriate.
The noble Lord, Lord Kennet, spoke at some length about English Heritage, and he speaks with very great experience. I believe he said that the advice of English Heritage was increasingly rejected. That body is the statutory adviser to the Secretary of State, and I can assure him that its advice is always considered most carefully in deciding whether to call in applications for planning permission, listed building consents for the Secretary of State's own decision and permission to hold a public inquiry.

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The noble Lord, Lord Kennet, also referred to world heritage sites. He correctly summed up our view that the existing development control system and the additional safeguards which we already have as regards the built and natural heritage provide adequate protection.
With regard to the proposed developments at Avebury, I can make no comment on the case of the tourist centre at West Kennet Farm, this being at present under consideration by my right honourable friend the Secretary of State. With regard to the Elizabethan theme park at Avebury Manor, I similarly cannot comment on the merits of the case, which involves planning and listed building enforcement appeals. I understand that the inspector, who held an inquiry from September to November 1989, expects to submit his report to my right honourable friend shortly.
Lord Kennet: My Lords, in saying that he cannot comment on these matters, does the noble Lord imagine that I thought he could? I should like to disabuse the House of any idea that I was unaware that these matters were under consideration and could not be commented on by the very party who had to decide them.
Lord Reay: My Lords, I had no idea whether the noble Lord was aware or unaware of what my reply would be. I did not presume that he knew or did not know.
In conclusion, I hope that some of what I have had to say may have demonstrated the comprehensive nature of the existing primary and secondary legislation for protecting areas worthy of conservation and of the Government's planning policy guidance. The Government are well aware of the need to keep under constant review all the instruments and guidance which provide the background to every decision on a development proposal. In shaping the legislation and publishing advice on development control, the department is fully conscious of the need for the planning system to reconcile many different interests. I hope that your Lordships will agree that the Government have acknowledged the interests of conservation and are committed to ensuring that full weight is given to this important issue in the planning process.
House adjourned at eighteen minutes before nine o'clock.