Lords Sitting of 4 December 1991

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

Community Health Councils
Lord Carter: My Lords, in the absence through sickness of my noble friend Lord Ennals, and with his permission, I beg leave to ask the Government the following Question:
Whether they will review the statutory rights of community health councils and their role in upholding the rights of patients and the public in relation to the National Health Service.
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Henley): My Lords, there are no plans to review the statutory rights of community health councils and they will continue to carry out their important role of representing the interests in the health service of the public in their districts. Perhaps I may take this opportunity to wish the noble Lord, Lord Ennals, a speedy recovery.
Lord Carter: My Lords, I thank the Minister for that Answer. Has he read the survey of community health council relations with National Health Service authorities published by the Association of Community Health Councils for England and Wales? Are the Government satisfied with a situation in which one third of CHCs have not been invited to comment on the NHS contract plans; nearly 60 per cent. have been excluded from commenting on the contract specifications; three-quarters suspect that district health authorities hold private meetings at which key decisions are taken; and half have the same view about meetings of the family health service authorities? How does all that square with the patient's right, as set out in the Patient's Charter, to obtain detailed information on local health services from health authorities, GPs or community health councils?
Lord Henley: My Lords, I am aware of the report and I have read it. I am also aware of the conclusions that ACHCEW has drawn regarding the statutory rights of community health councils, but I had great difficulty finding evidence in the paper to support the conclusions that the association puts forward. A third of community health councils did not respond to the questions asked. Of those which did and which described their relationships with district health authorities, some 85 per cent. considered their relationships to be satisfactory or better. The number which considered their relationships with community health councils poor or very poor sank from 6 per cent. to only 1 per cent. The report states on page 20:
"Almost all CHCs were able to provide examples of joint working with their DHA".
The report gives various of those examples. I am confident that it is not necessary to make any changes.
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We continue to build on the good work that has been done and to see improvements in the way that CHCs work with district health authorities.
Lord Mellish: My Lords, the Minister will be aware that for 14 years I was chairman of a hospital management committee. I therefore know something about the NHS. Is he aware that most people do not even know the address of their so-called community health councils? He talks about the rights of patients. But how do patients get in touch with their CHCs?
Lord Henley: My Lords, I am sure that any patient who wishes to get in touch with his community health council will find the address and telephone number in the telephone book.
Baroness Masham of Ilton: My Lords, will the Minister consider changing the name of community health councils? There is confusion with community medicine? Would it not be better to call them something like people's health councils?
Lord Henley: My Lords, I take note of the interesting suggestion made by the noble Baroness. We discussed this matter during proceedings on the National Health Service and Community Care Bill. I am satisfied that the name is the right one, but I shall certainly pass on the suggestion to my right honourable friend and the Department of Health.
Lord Dean of Beswick: My Lords, is the Minister aware that both in Leeds where I was a Member of Parliament and in Manchester where I live community health councils are easily accessible, well known and easily identifiable? What is the role of community health councils regarding the new health service trusts that have been set up? Do they have the same approach to those trusts as they have to the area health authorities, bearing in mind their job of protecting the service on behalf of the customer; in other words, the patient? If they do not have the necessary facilities, will the Minister ensure that they are given them as quickly as possible?
Lord Henley: My Lords, I am glad that in both Leeds and Manchester people are aware of the addresses and telephone numbers of their community health councils. As regards the role of CHCs in relation to the trusts, their relationship should principally be with the purchasing authority—the district health authority—but they can visit the NHS trusts if they so wish because that is where the service is provided.
Lord Dean of Beswick: My Lords, do community health councils have a mandatory right to visit those trusts or may they do so only at the invitation or say-so of the trust itself?
Lord Henley: My Lords, community health councils have a right to visit NHS trusts that are managed in their district health authority area where provision is made by the district health authority to purchase services from the trust. If the district purchased from outside its area, the neighbouring community health council would visit the trust.
Lord Shepherd: My Lords, will the Minister encourage community health councils to display their addresses and telephone numbers at clinics and doctors' establishments? That is where most patients are likely to find that type of information useful rather than having to search for it in the telephone book.
Lord Henley: My Lords, I am not aware that there is a problem in that respect, but if there is I shall certainly pass on that suggestion to my colleagues at the department and ask them to look into it.
Lord Stallard: My Lords, does the noble Lord recall the access to information Act of a few years ago? Is it still in operation and are community health councils still gaining access to information?
Lord Henley: My Lords, community health councils have a right to obtain relevant information from local NHS authorities. As regards attendance at meetings, they obviously have a right to attend public meetings. The meetings will be deemed to be public unless the health authorities consider that there are reasons why they should not be public. If a meeting is not public, it is a matter for the district to decide whether to invite the community health councils.
Lord Carter: My Lords, the Minister said that he had read the survey. Following his answer, can he explain why, according to that survey, 10 per cent. of the CHCs do not receive agendas or background papers for meetings of the DHAs? Will he also confirm that the same figure applies to the meetings of the family health service authorities? They are just not sent the papers.
Lord Henley: My Lords, I was trying to say that most health authorities —some 85 per cent.—considered their relationship with the DHAs to be satisfactory. Obviously some felt that it was not satisfactory. As a result of the document that we published last year, the number who found the service they receive from the district health authorities to be poor or very poor has declined from 6 per cent. to 1 per cent.

Farming and Wildlife Advisory Groups: Support
2.46 p.m.
Baroness Nicol Baroness Nicol asked Her Majesty's Government:
Whether the farming and wildlife advisory groups are supported by the statutory conservation bodies and if so, by what means.
Viscount Astor: My Lords, the farming and wildlife advisory groups are supported by the statutory conservation bodies. Most of this support comes in the form of grant-in-aid towards the salary costs of adviser posts. Support is also given in the form of ecological advice and grant-in-aid for specific projects. In addition to this, three of the conservation bodies are subscribing partners to the national Farming and Wildlife Advisory Group.
Baroness Nicol: My Lords, I am grateful to the Minister for that very full Answer. Is it not the case that when the farming and wildlife advisory groups began they had 50 per cent. of their costs paid by the Countryside Commission on a diminishing scale to end in six years' time? That six-year period is now over. Is it not a fact that the replacement grants come to only 33 per cent. of the groups' present costs? In view of the fact that farmers are in some difficulty at the moment and that ADAS, which used to give free environmental advice to farmers, no longer does so and farmers have to pay for it, does he agree that it would be a very good environmental gesture for the Government to ensure that a grant of at least 50 per cent. of the costs was maintained?
Viscount Astor: My Lords, the noble Baroness is quite right to say that the Countryside Commission grants have decreased over a period. The grant was intended to help establish new adviser posts in England. As she said, there was no commitment to support the ongoing running costs of those posts. Payment levels for each new post decline over a six-year period. There are no plans to end or decrease other forms of support currently given by the statutory conservation bodies and the Government will continue to support the provision of free conservation advice, currently provided through the Farming and Wildlife Advisory Group and through ADAS. We shall be considering further funding requests for 1992, 1993 and beyond.
Baroness Nicol: My Lords, the noble Viscount referred to the free advice given by ADAS. My understanding is that it has ended and that now all advice from ADAS must be paid for. Will he also take on board the fact that lack of security is the cause of a great deal of the problem? Apparently no grant is guaranteed from one year to the next.
Viscount Astor: My Lords, we must look at funding commitments year by year as they are met. We are also examining this whole matter in view of where we wish to make advice available for farmers and in which area. As I said, we provide substantial sums. The budget of the Farming and Wildlife Advisory Group is over £1 million a year and we shall continue to support it.
Baroness David: My Lords, from the Minister's Answer, I am not clear whether the Government are fully committed to keeping up the payments so that the Farming and Wildlife Advisory Group, which is very much respected and very much needed, particularly at the moment, will continue to operate to the same extent as before. Does he agree that if the Government want to keep their good name for environmental protection in the countryside, they should be willing to make that commitment?
Viscount Astor: My Lords, as I said, we provide substantial funds. In fact we provide over half the budget of the Farming and Wildlife Advisory Group and that budget is over £1 million. The Countryside Commission deal with specific grants to help establish regional advisers and those decline over the years.

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That is a small sum in comparison with the large amount of money given directly by the Department of the Environment and the Ministry of Agriculture.
Lord Cledwyn of Penrhos: My Lords, is the Minister aware that there is a good deal of concern about the operation of the policies that he kindly sought to explain to the House? Is he further aware that ADAS, which I had the privilege to set up, was intended to help with advice in this field? Indeed, over a long period of years it gave advice which was appreciated throughout the farming community and by all those interested in the heritage. Could the Minister say specifically what assistance now comes from ADAS for that purpose?
Viscount Astor: My Lords, I do not have before me the detailed figures for ADAS as the Question related to the farming and wildlife advisory groups rather than to that service. However, we are looking at the whole matter. We have commissioned a report to examine how the two interact and we shall be considering it in order to find appropriate mechanisms for continuing conservation advice.

Community Charge Shortfall: Surcharge
2.49 p.m.
Lord Boyd-Carpenter Lord Boyd-Carpenter asked Her Majesty's Government:
Whether they are aware that certain local authorities are imposing a surcharge on persons who have already paid the community charge in full in order to cover the shortfall caused by the non-payment of the community charge by other residents in their area; and whether they approve of this practice.
The Lord Privy Seal (Lord Waddington): My Lords, in setting a community charge the local authority has to estimate the level of non-recoverable charges in the coming year and, to the extent that it made insufficient provision for non-collection in the current year, allow for that also. This does mean that the charge is set at a higher level than would be necessary if every local resident was prepared to pay his or her dues. Authorities must, of course, make every effort to collect the community charge from those who have not paid, using the wide-ranging enforcement powers at their disposal. People who are withholding payment must realise that there will be no amnesty for non-payers.
Lord Boyd-Carpenter: My Lords, I thank my noble friend for that comprehensive reply. However, will he indicate whether or not the demand for a second instalment from someone who has paid the charge in full is valid or whether it can be successfully defied?
Lord Waddington: My Lords, as I understand it, it is not a second demand. It is that one finds on the poll tax bill an item, I think under "other adjustments", which covers the charge that it is necessary to make as a result of unpaid community charge during the current year and an estimate of what might be the unpaid charges during the coming year.
Lord Barnett: My Lords, I note the comprehensive reply that the Minister gave to his noble friend. However, he did not reply to the Question. The Question asks whether the Government approve of this practice.
Lord Waddington: My Lords, with the greatest respect to noble Lords, the Question did not ask whether the Government approve of the practice but whether they were aware that certain local authorities were imposing a surcharge. Indeed, we are so aware because the law requires them to do so. If indeed there are unpaid charges in the current year, then the charge which appears on the demand has to cover the charges which are estimated to be unpaid in the coming year and the charges which have not been paid in the current year.
Lord Harmar-Nicholls: My Lords, my noble friend has said that there will be no amnesty. I presume that that means that the Government still hope that the non-payers will pay, however fragile that hope is. If they succeed, and the non-payers eventually pay, will they pay the extra money back to the ratepayers who paid?
Lord Waddington: My Lords, in that event the money which was received late from the people who did not pay at the time they should have paid would go into the coffers of the local authority and therefore would go some way towards defraying the next community charge or council tax, or whatever.
Lord McIntosh of Haringey: My Lords, will the noble Lord the Lord Privy Seal be good enough to convey to the noble Lord, Lord Boyd-Carpenter, my congratulations at his timing in introducing this Question on the very day after Mr. Michael Portillo, the Minister for Local Government, rejected an amendment to the council tax Bill from Tory Back-Benchers aimed at preventing councils surcharging for non-collection? Will he confirm that Mr. Portillo said yesterday:
"The move might mean the councils had less to spend on services than the Government thought they should, which would affect all their residents, including those who had paid".
Lord Waddington: My Lords, I was replying to a Question about the poll tax—the community charge. I have replied correctly that there is an item on the bill which deals with the situation where there has been non-payment. That certainly applies until any new tax replaces the community charge.
Lord Boyd-Carpenter: My Lords, will my noble friend look again at the Question and appreciate, first, that I specifically asked him whether the Government approve of the practice? Secondly, I asked whether it was the practice, after a full payment had been made of the demand originally submitted, for a later demand to be made by some local authorities simply to make up their deficit?
Lord Waddington: My Lords, I apologise to noble Lords. I referred to the first part of the Question, not

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the second. I apologise to my noble friend. The last sentence of the Question asks me whether the Government approve of this practice.
I believe that I answered fully. The law requires local authorities to make up the lost revenue as a result of non-collection. I was not aware of any supplementary bills being handed out by local authorities. As I said, in the bill which local authorities issue they have to estimate the lost revenue in the current year and make an estimate of the lost revenue in the coming year.
Lord Shepherd: My Lords, does the noble Lord the Lord Privy Seal agree that the law is the law in regard to the poll tax? Does that apply equally to Sunday trading?
Lord Waddington: My Lords, I am absolutely sure of one thing. Even if I had misread the Question, it has nothing whatsoever to do with Sunday trading.
Lord Stodart of Leaston: My Lords, is my noble friend aware, although it is not within his immediate province, that the community charge this year in the Lothian region of Scotland is £444, and that in each of the past two years there has been an increase due to non-payment? In this year we are threatened with a further 10 per cent. Can he see any realistic end to that situation?
Lord Waddington: My Lords, if one looks at the figures for collection, they are encouraging. If one takes the financial year 1991–92, by 30th September of this year 39 per cent. of the budgeted yield had been collected. That was after bills had been sent out very much later than otherwise would have been the case because of the reduction in the headline charge which was announced earlier this year. For the financial year 1990–91, by 30th September of this year local authorities had collected 95 per cent. of the budgeted yield.
Lord Molloy: My Lords, the noble Lord, Lord Boyd-Carpenter, outlined a policy being pursued by some local authorities. Will the noble Lord the Leader of the House say whether what they do or propose to do is legal?
Lord Waddington: My Lords, I have answered the question on a number of occasions. In the Bill which legislates for the poll tax an addition has to be made for the unpaid charges in the current year and for an estimate of what may be unpaid in the coming year. No question should arise of any supplementary bill.

European Environmental Agency: Location
2.56 p.m.
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
When they expect a decision on the location of the new European Environmental Agency.
Viscount Astor: My Lords, the Government have been pressing for a decision to be taken on the location of the European Environmental Agency since November 1989 when the Environment Council agreed in principle to set up such a body. We expect a decision to be made shortly.
Lord Campbell of Croy: My Lords, I am grateful for that encouraging reply. Is it correct that the work of the new agency is being delayed by an attempt by the French Government to trade this decision for another decision—that Strasbourg should be the permanent seat of the European Parliament? If so, is there also any sign of a conclusion to that long drawn out argument involving Luxembourg?
Viscount Astor: My Lords, my noble friend is right to a degree. The main problem is that the agency is one of a number of institutions looking for a home. The other two are the Community Trade Mark Office and the European Training Board. One of the location issues to be solved has been the future location of the European Parliament. The French are pressing for a commitment to Strasbourg, and that has caused difficulties for the package as a whole. However, it is important that the agency is set up and running as soon as possible.
Baroness Nicol: My Lords, will the Minister accept that we too support the idea of this agency, and we wish to see it working as quickly as possible wherever it may be located? Is there any intention to attempt to get other non-EC countries into it, especially the Eastern European countries, whose contribution to the pollution of the planet is considerable, and which need to be brought under some control as soon as possible?
Viscount Astor: My Lords, that has already occurred: EFTA countries and our Eastern European friends have expressed a wish to join in the agency work, and we shall work with them.

Business
2.59 p.m.
Lord Hesketh: My Lords, with the leave of the House, I should like to say a word about the length of speeches in today's debate standing in the name of my noble friend Lady Young to which your Lordships have agreed to apply a five-hour time limit. On the principle that the mover is allowed 20 minutes and that the Minister should rise to reply not less than 25 minutes before the scheduled end of the debate, all other speeches should not exceed 12 minutes. If any noble Lord should speak at greater length, he would be doing so at the expense of other speakers in the debate.

Bingo Bill [H.L.]
Lord Harmar-Nicholls: My Lords, I beg to introduce a Bill to amend the Gaming Act 1968 with respect to bingo and for connected purposes. I beg to move that the Bill now be read a first time.
Moved, That the Bill he now read a first time.—(Lord Harmar-Nicholls.)
On Question, Bill read a first time, and to be printed.

Business of the House: Debates, 4th and 11th December
Lord Waddington: My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the debates on the Motions in the names of the Lord Ross of Newport and the Lord Jenkins of Hillhead set down for 11th December shall each be limited to 2½ hours and that in the name of the Baroness Young set down for this day shall be limited to 5 hours.—(Lord Waddington.)
On Question, Motion agreed to.

House of Lords Offices: Select Committee
The Chairman of Committees (Lord Aberdare): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That as proposed by the Committee of Selection the Lord Bishop of Peterborough be named of the Select Committee on House of Lords Offices. —(The Chairman of Committees.)
On Question, Motion agreed to.

Procedure of the House: Select Committee
The Chairman of Committees: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That a Select Committee on Procedure of the House be appointed and that as proposed by the Committee of Selection the following Lords together with the Chairman of Committees be named of the Committee:

L. Ampthill,

L. Belstead,

B. Blatch,

L. Carr of Hadley,

L. Carter,

L. Cledwyn of Penrhos,

L. Colnbrook,

L. Denham,

E. Ferrers,

L. Goff of Chieveley,

L. Graham of Edmonton,

L. Hayter,

L. Hesketh,

B. Hylton-Foster,

L. Jenkins of Hillhead,

L. Mackay of Clashfern (Lord Chancellor),

L. Murton of Lindisfarne,

L. Nathan,

L. Pym,

B. Serota,

L. Shackleton,

L. Stoddart of Swindon,

E. Strathmore and Kinghorne,

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L. Tordoff,

L. Waddington (L. Privy Seal),

L. Wigoder,

L. Williams of Elvel.—(The Chairman of Committees.)

On Question, Motion agreed to.

Joint Committee on Statutory Instruments: Select Committee
The Chairman of Committees: My Lords, I beg to move the third Motion standing in my name on the Order Paper.
Moved, That a Select Committee of seven Lords be appointed to join with a committee appointed by the Commons to consider statutory instruments; that the Committee have the same orders of reference, powers and instructions as that appointed in the last Session (3rd December 1990); and that as proposed by the Committee of Selection the following Lords be named of the Committee:

L. Airedale,

L. Boston of Faversham,

V. Bridgeman,

L. Brooks of Tremorfa,

L. Marlesford,

V. Oxfuird,

L. Shaughnessy.—(The Chairman of Committees.)

On Question, Motion agreed to.

Privileges: Select Committee
The Chairman of Committees The Chairman of Committees My Lords, I beg to move the fourth Motion standing in my name on the Order Paper.
Moved, That a Committee for Privileges be appointed and that as proposed by the Committee of Selection the following Lords together with the Chairman of Committees and any four Lords of Appeal be named of the Committee:

L. Allen of Abbeydale,

L. Campbell of Alloway,

L. Cledwyn of Penrhos,

E. Ferrers,

L. Glenamara,

L. Graham of Edmonton,

L. Hesketh,

B. Hylton-Foster,

L. Jenkins of Hillhead,

L. Mowbray and Stourton,

L. Shackleton,

B. Stedman,

L. Strabolgi,

L. Waddington (L. Privy Seal),

L. Wigoder.—(The Chairman of Committees.)

On Question, Motion agreed to, and it was ordered that a message be sent to the Commons to acquaint them therewith.

GATT: The Uruguay Round
3.2 p.m.
Baroness Young Baroness Young rose to call attention to the Uruguay Round of GATT; and to move for Papers.
The noble Baroness said: My Lords, I am introducing the debate this afternoon because I believe that the outcome of the Uruguay Round of the GATT is the most important issue facing the world today. I am delighted that a number of my noble friends taking part in the debate were themselves at one time engaged in previous GATT negotiations. I look forward greatly to hearing from them. I am also delighted that the noble Lord, Lord Williams of Elvel, is speaking for the Opposition. I know of his interest because he introduced a short debate on the same subject a year ago, and I believe for the same reason.
The GATT Round is a very technical subject but the broad issues raised are those affecting both the industrialised countries and the developing world. They will have an impact on the lives of everyone. It has been said that success in the negotiations could add another 4,000 billion dollars to the value of world trade by the end of the century. In so doing it would create millions of jobs in industrialised countries, help consumers by lowering prices and enable millions in the developing world to escape from grinding poverty.
For Britain the outcome is particularly important. We export about 25 per cent. of all that we produce. Therefore, we depend more than most countries on the openness of the world trading system. Conversely, failure would mean not merely recession but slump. I say that because it is now recognised that the great depression of the 1930s was caused not so much by the Wall Street crash but by the steps which the industrialised countries took to protect their industries. As a result world trade in manufactures fell by 40 per cent.—an incredible amount —with the consequence that millions became unemployed.
A lesson was learnt. Towards the end of the war the United Kingdom, the United States and other countries met to find a better way of managing world trade. They envisaged a rule-based rather than a power-based international economic system. There was to be a framework of trade rules which would ensure non-discrimination and limit tariff barriers.
From that meeting emerged the General Agreement on Tariffs and Trade. It was finally agreed in 1948. The trade policies of member countries were to have four features: liberalism, transparency, stability and non-discrimination. The success of the system soon became evident. Trade barriers were reduced. There was an enormous expansion of international trade and living standards rose. Indeed, the 1950s and 1960s have been described as the golden years of GATT.
One immediate spin off from GATT was the beginning of the liberalisation of trade in Western Europe. Marshall aid provided the leverage needed to push forward that process, thus paving the way for the European Community. In a sense the completion of the internal market by 1st January 1993 is the logical conclusion of it.
By the end of the 1960s problems were appearing. Little or nothing had been done to counter the rising tide of agricultural protection. Developing-country exports in textiles and clothing were restricted by the Multi-Fibre Arrangement of 1974. Developed countries experienced acute political problems relating to particular industries.
So we come to the present. The Uruguay Round began in 1986. More than 100 countries are involved and the round is ambitious and wide ranging. As regards agriculture and textiles, GATT is to be extended to new areas of intellectual property, patents, designs and trade marks as well as to investments and services. As we all know, what was scheduled as the concluding meeting of GATT broke up almost exactly a year ago because the United States and the Cairns Group of countries were unable to reach agreement on agriculture with the European Community. That failure meant that other aspects of the negotiations could not be concluded because many participants linked the liberalisation of trade in agriculture to their willingness to make concessions in other areas.
Despite that major set-back the round resumed this year. A breakthrough came on 9th November when under the aegis of President Bush at the EC/US summit both sides narrowed their differences on agriculture. The United States made considerable concessions. However, I understand that the follow-up talks in Geneva appear to have reached a stalemate. Perhaps in reply the Minister will give us the latest information on that.
Of course there are immense problems. I shall touch on only three. Obviously there are many more, but time does not allow me to go into them. Clearly agriculture is the most important problem. I shall not talk in detail about that because other noble Lords far more knowledgable than I will do so later in the debate. Two sets of figures illustrate the problem. It has been estimated that the Common Agricultural Policy adds £11 per week to the cost of food for the average family of four in the European Community. It is only too obvious that the least advantaged suffer the most. The OECD has estimated that the cost of agricultural subsidies in developed countries is some 300 billion dollars per year; a sum larger than the total amount given in development aid. It is the dumping of surplus food in developing countries at subsidised prices that has been so very damaging. All noble Lords might agree that it is an absurd system. I recognise that farmers are going through a difficult time at present. However, it is generally agreed that British agriculture, which is among the most efficient in the world, will benefit by liberalisation. Some progress has been made but we need to move a great deal faster and further along that path in order to reach a solution.
The second issue is the Multi-Fibre Arrangement. It is a major derogation from the rules of GATT. Its principle aim is to secure an orderly and equitable development of trade in clothes and textiles. It is justified as a temporary measure to allow industries in developing countries—our own included—to restructure in response to low-cost competition as it permits

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industrialised countries to negotiate bilateral arrangements setting import quotas from the developing countries. At the same time the arrangement provides for guaranteed access and growth rates for textiles from the developing world. We in the United Kingdom, together with the European Community, have agreed that the Multi-Fibre Arrangement should be phased out. However, that depends on strengthened GATT rules and disciplines as well as a transitional period for adjustment.
The third big issue is that of services. As an industry it has expanded enormously during the past 30 years of so. The industry is now estimated to be worth some 1,000 billion dollars of world trade. It is an issue that is important to us because in 1987 we were the world's third largest gross earner from services. I believe that it is difficult to reach full agreement on full liberalisation before the conclusion of the GATT round. However, a basic framework needs to be established. Again, I hope that the Minister will tell us more about that.
What is at stake? The prizes are extremely high. The successful conclusion of the round would provide much needed non-inflationary growth to the world economy. For the United Kingdom it would give a boost to jobs and exports; for example, a 30 per cent. cut in tax would boost European Community exports by 1.5 per cent. and create 340,000 jobs.
It is estimated that liberalisation in services, which now account for 20 per cent. of all world trade, would increase trade by 10 per cent. For the developing countries, it would reinforce the process of liberalisation which is taking place in so many of them. The countries in the Pacific Ring—Hong Kong, Taiwan, Malaysia, Singapore and Thailand—are frequently referred to as examples of a kind of economic miracle and yet the successful developing countries are those with a good export growth; they have depended on an open trading system. There are other developing countries which are liberalising their economies with considerable success—Mexico is a good example. They need the open world trading system to export and to prosper.
When I was a Foreign Office Minister I travelled to a number of third world countries. I shall never forget some of the distressing sights which I saw. For those countries to prosper, they need trade as much as, if not more than, aid. In turn that means that the industrialised world must buy what they can sell. Failure of that system encourages a dependency culture of the worst kind.
Nor are the problems of failure only economic; they are also political. We can already see some signs of that ii we look briefly at the vexed question of immigration into the European Community. Many people from the Soviet Union—and I am not quite sure that I should still call it that—and Eastern Europe in particular will inevitably want to come to work in the European Community, to say nothing of the millions in the third world who wish to do likewise. They want a better life and they will not be prepared to accept the hardships which changing their economies will bring.
One important way in which we can help them is by trade. If those countries cannot improve their economies and raise the living standards of their people, it is inevitable that more will wish to emigrate. That could have extremely unpleasant political consequences. We have all seen pictures on our television screens of the rise of the neo-Nazis in Eastern Germany and we all know of the growth of extreme Right-wing movements in France and more recently in Belgium. The excuse for those excesses is the influx of immigrants. Obviously it is in our self-interest as well as that of the developing countries that that should be prevented from happening.
Finally, the worst danger, as I see it, is the threat of a trade war between the great trading blocs of the United States, the European Community and Japan. That would mean a return to protection. Already voices in the United States are calling for more protection for their industries as are some in the EC. History shows us that competing trading blocs engage in a self-defeating battle in which all are losers.
Political will is now required. Those complex negotiations cannot be resolved by officials. I am glad that my right honourable friend the Prime Minister gave his personal leadership to the GATT round when he was in the chair at the G7 meeting this summer. I am very glad that after that meeting a commitment was made by all those present to the conclusion of the GATT round. It is important that with all the discussions and debates at the Maastricht meeting next week, the principle of the open trading system is high on the agenda.
Time is not on our side. Once we reach 1992 the Americans will turn their attention to their presidential and other elections. The conclusion of the round by the end of the year is still possible and we must not allow narrow sectoral interests to stop it. We have all benefited greatly from the end of the cold war. We must not allow a failure of GATT to take its place. My Lords, I beg to move for Papers.
3.15 p.m.
Lord Williams of Elvel: My Lords, the House will be grateful to the noble Baroness, Lady Young, for bringing this Motion before us. The last time that we debated this matter was on a Motion standing in my name, but obviously with the agreement of my noble friends on these Benches, on 23rd January this year. In my view it is fitting that both major parties have tabled Motions with the same end in view. It is good to be able to use this occasion—unusual as it is—to express what I believe will be a general support for the Government in their efforts to persuade all parties to complete successfully the current GATT round.
In the time available to me, I propose to comment on some of the major issues. Indeed, they are the major issues which the noble Baroness has raised in her opening speech. I propose also to reflect upon the possible consequences of failure.
At the outset—and at the risk of repeating myself—I wish to make it wholly and unambiguously clear, although this is not in any sense a party matter, that on this side of the House we shall work in whatever

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way we can for the success of the round. I only echo the words of the General Secretary of the Trades Union Congress, Mr. Norman Willis who said:
"Jobs in British industry depend increasingly on the expansion of trade and the growth of the world economy as a whole".
That must be our objective.
I know of no serious analysis of the post-war world economy which does not recognise the importance of the liberalisation of trade as a motor for growth. There is no analysis of which I know of third world economies which does not recognise how vital it is that the present round is successfully negotiated. As the noble Baroness said, I am afraid that we are some way from achieving that at present. The round was due to be completed by the end of 1990 to allow for the appropriate procedures to be followed in the United States Congress—known as fast track approval. The last bout of negotiations before the end of last year failed; we must admit that. We are now nearing the absolute and final deadline for the fast track process to operate. That is why the next few weeks are so important.
Quite apart from the politics, the issues are extremely complex. In today's debate we shall certainly not be able to do justice to all of them. After all, over 100 countries are participating in the negotiations and there are 15 major on which agreement is needed. I am sure that noble Lords who are to speak will roam across many of those areas. For my part, I should like to follow the noble Baroness, Lady Young, in identifying the three issues which seem at present to be top of the agenda for negotiation and to offer some thoughts on those.
As the noble Baroness said—and this will not surprise your Lordships—the first is agriculture. By way of background, it is now becoming quite clear that the United States is determined to reduce not only its own agricultural subsidies, which are playing havoc with federal finances, but also subsidies paid to European farmers and perhaps more importantly, when it comes to exports of agricultural products, to traders since the two problems are linked.
The Cairns Group, as it is called, led by Australia, has the same objective as those countries in the third world which wish to sell the products of their land. Let us not forget that in some cases it is their only product for export to the rich markets of developed countries. On the other hand —in these matters there is always another hand—in this country we must take note of the present dramatic decline in domestic agricultural incomes. It would be folly to destroy a major industry, which by international standards is extremely efficient, by reckless or ill-considered action.
There is no doubt—I say that with all deliberation—that the level of agricultural subsidy in Europe is too high. Moreover, we in Britain have a specific grievance; we are net contributors to the Community in agriculture and the CAP costs us dear. Of course we are paying through the CAP a social subsidy—there is no other word—to the small Continental farmer. But—again it is a large "but" —if we are to reduce subsidies to agriculture, it cannot be done indiscriminately and suddenly. The Community must be
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prepared to phase out subsidies over an extended period of time. If, by doing that, we can enhance the cleanliness of our environment and the beauty of our landscapes, then that can only be a plus. But it must be properly planned. Simply relying on market forces will give us all the wrong solutions—a bankrupt agricultural community and a much poorer environment.
As the noble Baroness said, a deal on agriculture is only one of the elements of a successful negotiation. The second major obstacle I shall address is how to achieve freer trade in services. Ideally that means freedom of establishment for service companies in all countries as an ultimate objective. We must recognise that that will not be achieved over night. Many third world countries, let alone the United States and Japan, are instinctively hostile to that idea. The non-tariff barriers—if I can use that expression in this context—are severe. We must therefore work harder. But if we are to give on agriculture, there must be a corresponding give from others on services.
The third issue of importance—again I follow the noble Baroness, Lady Young—is the integration of the textile and clothing trade into the GATT. To date that trade has been regulated by the Multi-Fibre Arrangement, which worked well in providing a framework for the restructuring of the textile industry worldwide. If that arrangement is to be discarded—and it is reasonable to argue that it should be —there must be adequate safeguards in the form of a longish phasing-out period. By "longish" I mean a period of 10 years or so. That is particularly important for Britain which employs almost half a million people in the textile and clothing business. Much of that employment is concentrated geographically.
I chose those three issues not because they are necessarily the most important in objective terms, but because they give the most trouble in negotiations. There are many other points on which agreement is near—protection of intellectual property, prohibition of local content requirements in inward investments, settlement of disputes and strengthening of rules on what safeguards are available to signatories to the agreement. Progress on those issues forms the basis for a sensible package if the major problems can be solved. However, that "if" still represents an open question.
The noble Baroness spoke of the consequences of failure. In our view it does not overdramatise the situation to say plainly that the consequences of failure will be disastrous. They will be disastrous for future growth in the world economy since there is little doubt that failure will spark off a trade war as well as the formation of protectionist blocs such as the North America and Mexico bloc or, for that matter—let us face it frankly, as did the noble Baroness —the European Community. It is not simply that world trade would suffer. The consequential effects on employment in the advanced countries, and on life itself in many of the poorer areas of the world, hardly bear thinking about. Furthermore, we in Britain would be major sufferers since such a high proportion of our national product goes to export and always has done.

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It is therefore in everybody's interest to bring the negotiations to a successful and happy conclusion. However, in this matter there is something more than just self-interest, strong though that may be. What is at issue is the kind of world in which we wish to live. Is it a world that relaxes into protectionism; that lives by beggar-my-neighbour policies where richer countries show no responsibilities for their poorer brothers? As the noble Baroness pointed out, we had that kind of world in the 1930s and we all know where that led us. Or is to be a political world in which we have the political will to reach over frontiers and across seas? Is it to be a world in which we recognise that the world economy, with the advance of technology, is and must be single and indivisible and in which the world economic product must be shared out equitably among all its inhabitants?
That is the underlying and almost philosophical question posed by the present GATT round. However it is wrapped up in the technical jargon of trims and trips and rebalancing and import access, unless that underlying question is recognised, I fear that the technical jargon will triumph. Short-term self-interest will reassert itself and we will fall at the last hurdle. It is to encourage the Government to redouble their efforts to ensure that that does not happen that this debate is taking place this afternoon.
3.27 p.m.
Baroness Seear: My Lords, I must first apologise to the House. Months ago I agreed to take part in a police seminar in Bedford this evening and shall therefore need to leave long before the end of the debate. I am deeply sorry that that should be so.
This will not be a normal party political debate. The difficulty from the debater's point of view is that there is such a wide area of agreement between us. Since it is not a party political debate I shall limit party points to saying what joy it is to hear both Conservative and Labour Members recognising the importance of a free trade policy. It is joy to the ears of those of us on these Benches whose party has preached it for 100 years. That is my only party point this afternoon.
The noble Baroness began the debate—absolutely correctly —by speaking of the industrial aspects of the Uruguay Round. When we are discussing the matter we tend to emphasise, almost exclusively in recent months, the CAP issue and the farming and agricultural problems connected with it. That has led to a failure to understand the enormous importance, in terms of our self-interest and our economic development, of the Uruguay Round for the industrial and services areas.
The noble Baroness gave us figures which illustrated how important it could be to possible expansion of trade in manufactures and services if we could win freedom through the Uruguay Round. Let us consider, for example, the insurance industry. It is waiting to obtain establishment rights in a number of countries in order to expand the work which is recognised as being of the highest order in this country
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and therefore offering opportunities for development and for consequent wealth and wellbeing to this country.
We have a considerable interest in making the Uruguay Round work for our own industry, our own jobs and the development of those areas, such as services, in which we are recognised as being pre-eminent. That needs to be stressed a great deal more than it has been in the past because of our tendency to speak only as though the issue centred around agriculture.
I wonder whether something more can be done, arising from this debate, to get the point over to the country as a whole. It is difficult to see that there is any widespread understanding in the country as to why this subject is important in terms of jobs, increasing the wealth of the country and its ability to carry out all the programmes it wishes to put into effect. It is difficult to see a connection between those factors and success in the Uruguay Round. I hope that this afternoon we shall not be just talking within these four walls, but that the Government will find ways of giving much greater publicity to the issues involved in the Uruguay Round which do not make the pulse of the public as a whole beat very much faster than it otherwise would when it hears that such issues are being discussed.
That said, the issue of agriculture and the CAP is very important and difficult. It has had publicity because it has been a sticking point in the negotiations until now. It seems that because we cannot get everything otherwise real progress would be made if we could overcome the agriculture and CAP difficulties. It is an absolute nonsense that we should be hung up on this particular issue. A dwindling proportion of the people of this country and in the EC earn their living in agriculture. I do not know why we have had to bow before them to the extent that we have for political reasons, which in reality must be becoming less and less important. We should come to grips with the issue. It is very difficult to understand why we have to bow before them to the extent that we do.
As we all now know, in France and particularly in Germany, a high proportion of farmers are part-time farmers. They are only a small proportion of the whole. Many of those farmers would do very well even without the support of the CAP. There are rich farms in Picardy and in the northern and central parts of France which do not need subsidies in order to do very well indeed. It is true that there are problems with the smaller farms both in Germany and France, but the numbers are not very great. It should not be a problem which it is beyond our wit to solve.
The noble Baroness also referred to the developing countries and the effect of failure in the negotiations on them. It is on that point that I want to dwell in particular, both from the point of view of the developing countries and of our own country and European civilisation to which the noble Lord, Lord Williams, made reference. The differences in the standards of living in a world in which people can see what the differences are, are not going to be accepted indefinitely in the poorer countries. If we do not give

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those countries the opportunity to sell not just their primary products, but the opportunity to turn those primary products into semi-manufactured or manufactured goods to sell in those countries, the results will be disastrous. The developing countries will be in gravest poverty.
Last year I was in Kenya, where half the population is under 15 years of age. As your Lordships will recall, the world population as a whole is due to double by the year 2030. Ninety-four per cent. of the increase will be in developing countries. That is the scale of the problem that we are facing. The Kenyan officials said that in 10 years' time they can neither employ nor feed them. If one has a population which can be neither employed nor fed one has one of the most explosive mixtures that the world can ever see. What will those populations do? The people will not just sit there, but will attempt, as the noble Baroness said, to emigrate to other countries.
We are facing a very serious immigration problem with the countries of Eastern Europe. Those countries want to share in the standard of living of the West. However, the Eastern European countries are not in hardship in comparison with the current and future position of the developing countries unless they can trade. There is a need to open up our markets to the goods coming from the developing countries. That is of the greatest importance to them and to us. We have seen already the rise of racialism in Europe. As the North African immigrants cross the Mediterranean into the southern European countries the position will become nastier and nastier. People will not come because they want to, but because they have to in order to eat. It is in their interests as well as ours to see that they can stay at home and eat there too.
The Uruguay Round is important for our own industry, our own unemployed and our own future prospects. It is also important for the mutual well-being of the varying groups in what is a world economy today. Unless trade opens up the result will lead to disaster. As I said a few moments ago, the most important matter is that this message should go far and wide outside this Chamber. It is not understood. We need real publicity to explain to people why this issue matters so much and why failure would be so disastrous. As the noble Baroness said, there is no other issue facing this country which is as important as the success of the Uruguay Round and the real development of world trade.
I hope that we shall get an answer from the Government and I hope that noble Lords will forgive me for not being here to hear it. What can the Government do to get the public and the voters to understand? We are now coming up to an election, with all that that implies. They must be made to understand just how important this issue is. The stakes are enormously high and we cannot afford to lose.
3.37 p.m.
The Lord Bishop of Worcester: My Lords, I am grateful to the noble Baroness, Lady Young, who has a busy life, for giving me the opportunity to speak in this debate. To come to this House and hear three
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speeches of the quality that we have heard from the two noble Baronesses and the noble Lord, Lord Williams of Elvel, is very encouraging indeed. I look forward to the debate in order to learn of some of the technicalities of this immense problem which I confess are not at my command.
The debate is extremely timely. Perhaps I may corroborate what has been said by the noble Baroness, Lady Seear, about the need to get across the issues of the GATT round to young people. Development education has often been regarded as something that should not be taking up time in schools and colleges. I believe that that is misconceived because I believe that we cannot live in this world without understanding the fragile interlocking system which is the world economy to which we belong. I should like to see much more time and resource given to helping towards a better understanding of the issues at stake.
The debate is timely because with the preoccupation with Europe which has possessed us in the past two years or more, the global economy and the related issues have tended to be removed from our agendas. The imbalance between the northern and southern hemispheres remains a contemporary injustice which we must not tolerate.
We have the poor in our own society; but the poor in the societies in the northern hemisphere tend to be the "left behinds" of an otherwise affluent community. There is no comparison with the poverty that exists in the third world. As has been so rightly said, if this GATT round is not completed, the small kerosene lamps will go out; the herds will become thin and emaciated; and they will over-graze. There will be over-cultivation which will leave in its train famine and disease. Not only that, but I am told it will even have an effect on the climate.
The plight of the poor and the poorest countries is growing. I am told that 20 years ago we could talk about one-third of the world's population having access to two-thirds of the world's resources. Ten years ago that became one-quarter having access to three-quarters of the world's resources. I am told on good authority that today one-fifth of the population has four-fifths of the world's resources at its disposal. We know that that must include the oil-rich nations.
However, we in Europe, where in our history people have gone to the stake in order that justice might be done to individuals within the nation, must surely realise that a similar anxiety for justice must possess us as we look at the international scene. We must all welcome the lead given by our own Prime Minister in Harare in promoting the cancellation of debt of the world's poorest countries. That is a lead which is required. It is not enough to negotiate in such a way that the powerful can always call the tune.
Furthermore, as has been implied already, so often self-interest dictates that which justice demands. Disraeli in the "two nations" saw that an economically divided nation is rendered weak and ineffective. As has been said, a world where the gap between the rich and the poor is widening must surely be a destabilised world, a world where people are vulnerable to the

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extremists and those who defy civilised standards because they feel they have no other way of being heard.
I apologise for quoting a report which came out 12 years ago. But noble Lords will remember that it was a principle of the Brandt Report—a report which, like all reports, had its shortcomings—that we cannot cure our own recession if we do nothing to activate the markets of the poorer nations.
I am told that 6 million jobs in the northern hemisphere—the countries of the West, if you like— have been lost because the so-called third world countries have sunk deeper and deeper into poverty. I recall, when I was working in Kent, the laying off of skilled rolling stock workers in Ashford at a time when in Tanzania it was a common occurrence for trains not to reach their destination because the rolling stock was so antique.
In the last stages of the Uruguay GATT round there must surely be a case for establishing to a point special and differential treatment for developing countries. Not to a point beyond which trade is distorted. I could take Members of this House to the village where I live in Hartlebury in Worcestershire to see enormous mountains of grain which cost every taxpayer a considerable sum every year to maintain. We all know that in order to avoid the cost of that, the temptation is to dump them on the world market, thereby depressing or undercutting the price. Rightly the United States is seeking the liberalisation of the world market in order to stop the subsidies which create the growing mountains.
There is a difference in the poorer countries where, for example, in Zimbabwe there has been up to 50 per cent. subsidisation of food growers which has been not to create surpluses but actually to enable the agricultural industry to survive. That has been very successful. Other pieces of good news of this kind can be found. Can we therefore urge that a distinction be made between the kind of common agricultural policy subsidies which have so often reinforced the big farmers, and the subsidies for survival which some of the poorer nations ought to be encouraged to apply in order that they can move towards a certain self-sufficiency; but I agree it should not be to the point where trade is distorted.
There is also the need for survival for the least developed nations—the very poor nations—to have import assistance with their food. That is not to make them a dependent culture, but so that they may survive. There is little chance of making them over-dependent when the small percentage of the gross national product in official aid in the northern hemisphere is only 0.35 per cent. I am sorry to say that in the United Kingdom it is only 0.27 per cent. We are 14th in a list of 18 countries.
A further reassurance from the GATT negotiators is that the countries which have weaker economies should have a longer timetable for the abolition or the reforming out of subsidies so that it may be carried out not in five years, as has been suggested, but in 10 years or even more. Can we be reassured that the Multi-Fibre Arrangement—and not only that, but also other unilateral so-called voluntary arrangements
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—will be no longer allowed? They are arrangements whereby poorer countries may not export their commodities by which alone they could get rid of some of their unemployment. They must not do this because the richer nations do not like processed commodities brought into their midst. It is a situation where the powerful are able to call the tune. I feel that should be abolished in the name of justice.
As I have already said, I greatly look forward to hearing this debate and learning some of the technicalities required for a free and just market-place which other noble Lords will no doubt understand but which as yet I do not. I am grateful to have been able to contribute a small comment on this vital issue. I believe that the future well-being of the whole of humankind depends on the success of the GATT round. I hope and pray that it will not end there. If it succeeds in coming to a conclusion, I hope that the situation will continue to be monitored as the years go on.
3.48 p.m.
Lord Thorneycroft: My Lords, I am delighted to rise and speak for a few moments on this subject. I am all the more delighted to speak in a House which is so united on a great subject, a subject which is going to have immense effect upon the future of everybody in this country.
Thirty years ago I was in Geneva at the Hotel Beau Rivage leading for the British nation on the subject of GATT. I regarded it then as complicated. It still is, but it is not so complicated as the right reverend Prelate suggested. It is not the complication of detail but the principle that matters. It is the determination of people; it is common sense. Then, as in this round, we went on longer than we thought we should. The hotel keepers in Geneva were on the verge of trying to kick us out. If the same principle were adopted in Uruguay we might be urged on towards the end of these discussions.
The negotiation I had was I think successful but it was not universally popular. It is only fair to point out, in a House that is united about these matters, that 30 years ago the Conservative Party was not in favour of GATT. It followed with passion a very different line of country. It favoured imperial preference. When I returned I remember going to the Cabinet in November to find, as a young President of the Board of Trade, that the distinguished gentlemen there assembled did not think that I had been up to much good while passing my time in the Beau Rivage. They argued passionately against me and suggested that when a motion was put down at the party conference against the GATT we should accept it. I argued strongly that we should fight our corner and said that I believed that we could win. Of all the many delightful things that I remember in my life, I remember Winston Churchill saying at the end of it, "Let him try". He was a remarkable man to serve under. At any rate we went to Blackpool, we argued the case and we won. That was the last time imperial preference was argued as a main principle for the Conservative party. From there we moved on to the system of wider trade and

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payments, which we follow in the main today and which, through this debate, we seek to follow in the future.
The battle at that time was not due to any eloquence of mine. It was due to what was happening in the world of those days. The world in which we live today is not a world in which Australia sends grain to us and we swop it for manufactured goods. Australia wanted to sell goods to Japan and to get Japanese manufactures in return. When world opinion and tastes change one cannot hold on to artificial and outdated ideas. Thank God we threw them over, to the immense benefit of trade in this country and throughout the world. I shall not repeat the point except to say to the noble Baroness, Lady Young, how grateful we are to her for raising this subject for debate today and arguing it with such clarity.
Clarity is what is wanted. Half this country does not understand a word about the GATT. Half the world does not know what is going on. We discuss the most fascinating questions about the grouping of nations for trade, about a new Europe, about the Pacific Basin and about new areas of trade to be set up around America and Mexico. Every day I read new ideas for trade, but I hardly ever hear an interesting discussion about what is the main strategy of trade. The GATT is the main strategy. The GATT lays down the rules. It ensures that there is not differentiation in preferences between one country and another and that we treat each other the same.
The amount of free trade on that basis has grown out of all knowledge. Instead, we talk about larger and larger narrow groups. If the world turned into one in which one group was in Japan, another was in Europe and a third was somewhere in the Americas and there was no overruling law such as we have today about the way trade goes on, it would be a disaster. We should lose all the considerable benefits, or most of them, that we have today and we should turn the opportunities which we have enjoyed and are enjoying today into something narrow and protectionist.
I am delighted to hear not from one side of the House but from all sides that it is seen with absolute clarity that to turn back now to that narrower world would be the worst course that we could adopt. I hope that we in this country, speaking together and having the same ideas and the same objectives, can talk broadly, boldly and successfully in favour of what is said today.
Lord Fraser of Kilmorack: My Lords, before the noble Lord sits down, I was one of those who listened to his great conversion of the Conservative Party conference to GATT at Blackpool in October 1954. That is nearer to 40 years ago. It was a remarkable performance. We were converted rather earlier than some people may realise.
3.59 p.m.
Lord Hollick: My Lords, I must first apologise for the fact that I may not be present at the end of the debate as I have duties elsewhere. That explains why I have been pushed up to an unexpectedly high number in the batting order for today's debate.
I have been impressed by the enthusiasm your Lordships have shown for a successful outcome to the Uruguay Round and the widespread recognition that such an outcome is crucial to the well-being of more than 100 nations that are expected to be signatories. The noble Lord, Lord Thorneycroft, suggested that half the population was unaware of the significance and meaning of GATT. While he may have exaggerated a little, that state of affairs is partly our fault. It is very often the practice of politicians and bureaucrats, whether intentionally or otherwise, to obscure the crucial importance of an international negotiation from the public view by adopting impenetrable jargon. Such indeed is the case for the Uruguay Round, which I must admit sounds like a football knockout competition where the odds would be expected to be heavily stacked against the visiting team, a sort of non-tariff barrier.
The merits of free trade and their crucial importance to the United Kingdom should be widely proclaimed so that the process is enthusiastically supported in the country. One of the greatest benefits of free trade is that, like the quality of mercy:
"it blesseth him that gives and him that takes".
There can indeed be an equality of benefit. Free international trade can open markets for the produce and goods from both the developing and the developed countries. It can spread wealth to developing countries and can provide them with the manufactured goods and technology that they need to build their economies.
For the developed world, free trade brings a wider choice of goods and access to food and consumer durables at world prices rather than prices inflated by subsidy and protectionism. Further, the advantages and disadvantages which each country possesses by virtue of its climate, its location, its resources and its skills can be offset and balanced through world trade.
In its 44-year existence, GATT has been a singular success and a triumph of international accord. It has provided a systematic and effective framework for growth in world trade. During this period world trade has grown by 6 per cent. annually. That has led to increased prosperity, higher employment worldwide and has provided the third world with some of the foreign currency that it so desperately needs for investment.
A successful outcome to the Uruguay Round can provide the much needed stimulus to the world economy at a time when recession is inflicting considerable damage both in the developed and in the developing world. An increase in world trade offers the prospect of growth and increased employment without inflation. In the developing world, where agriculture employs more than half of the population and accounts for a quarter of GDP, the opportunity to increase exports of agricultural produce to the developed world can provide a desperately needed

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lifeline to economies and societies, many of which are on the brink of collapse. In other words, free trade can be a powerful force to help remove poverty from the third world and can stimulate growth in the recession-hit developed world.
What has been the British Government's contribution to the Uruguay Round of discussions? Frankly, it has been rather disappointing. In the past year, our Government have been far too preoccupied by other matters to play an effective and forceful role in the negotiations. I believe that their priority has been to square away their own internal problems rather than invest their efforts to pursue the most advantageous outcome to the Uruguay Round for Britain. The Government have used up their store of political capital with our European partners in a desperate effort to secure an opt-out clause at Maastricht to ensure that they can ignore the social charter and to avoid the use of the dreaded word "federal". This political capital could and should have been used in the national interest to secure a thoroughgoing reform of the common agricultural policy. The CAP has proved to be a major stumbling block in the GATT negotiations and it continues to impose a heavy burden on Britain's food bill.
In 1990, agriculture accounted for 63 per cent. of the Community budget. That whopping £20.3 billion sets off the absurd chain reaction of over-production, massive surpluses, expensive storage followed by heavily subsidised sales on to the world market which sadly, in turn, inhibit and undermine the development of agriculture in the third world. In order to pay for the high guaranteed prices for agricultural goods and for the export subsidies, food prices throughout Europe are believed to be 15 per cent. higher than competitive world prices. The National Consumer Council has estimated that this is equivalent to £14 per week on the average food bill for a family of four. That is a burden which falls disproportionately on the poorest in our community. In turn, that surcharge reduces the standard of living of non-agricultural workers throughout Europe and, to the extent that high food prices are reflected in higher wages, European industry is placed at a disadvantage in world markets. The abolition of the CAP would reduce food prices and provide an enormous competitive boost for European industry. By failing to press for radical reform of the CAP, our Government have failed to act in the best interests of either the consumer or the business community. Indeed, we appear to have ended up with the worst of all worlds. The way agricultural subsidies are now expected to be distributed will discriminate against Britain's large efficient farmers in favour of the smaller, less efficient, farmers in Ireland and continental Europe.
I should now like to turn to the proposals to include the service industries in the GATT. The inclusion of services and intellectual property rights in the Uruguay Round is of vital importance to the United Kingdom. More than 60 per cent. of our GDP is now contributed by the services sector and it is an area where we have an international proven competitive advantage. I should declare an interest. I work for a company which is busy developing its financial and
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information services businesses around the world. The UK, with its successful services sector, can be a big gainer if the GATT accord includes comprehensive agreement to liberalise and to open the market for services around the world. Our Government should be pushing hard to eliminate barriers and to set in motion a process of further negotiations that will eventually lead to a free trade in services. They should also be alert to American attempts to withdraw such important areas as telecommunications and shipping from the negotiating table.
It is, I suspect, inevitable that once the ink is dry on the agreement at the end of the Uruguay Round—and, based on recent reports, there is now some optimism that an agreement may be achieved by the end of this month—the signatories will be tempted to find ways of improving their relative commercial positions. Your Lordships will know that it is often the small print which is the most important part of a contract. It is, I fear, in the small print where some of the benefits of a successful agreement on free trade may be eroded.
My experience when seeking to establish new businesses in overseas markets has been instructive. Many countries pay only lip service to opening their markets. In reality the rules of the game, as they are interpreted in that country, can present a series of insurmountable, or at best very costly, hurdles which the unwary inward investor must clear before the new venture can be established. Bureaucratic delay, tortuous regulatory requirements, the imposition of unnecessary and often quite unsuitable joint venture partners are only a few of the methods used to fob off and deter the investor.
We in this country hold the view that we not only play by the rules but that we also play by the spirit of the rules. Although this view has, possibly, taken a knock with the recent developments on Sunday trading, I still believe it to be broadly correct. However, I have to tell your Lordships that not every country takes that view. I urge the Government to be alert to the real dangers of these non-tariff barriers and to scrutinise the fine print of any agreements to ensure that as many as possible of the well-known and well-tried loopholes are firmly blocked.
4.9 p.m.
Lord Boyd-Carpenter: My Lords, in politics as in war, good timing is almost everything. For that reason, I think that one must particularly congratulate my noble friend Lady Young on the really admirable timing of this debate. It comes at what is very nearly the decisive moment on this issue. It comes when we are nearly at the end of what had been hoped would be the final year of the Uruguay Round and at a time when it is still possible to achieve agreement, but when it is only just possible. It gives the Government the advice of your Lordships' House on an all but unanimous basis as to what should be done. I am sure that not only your Lordships' House but also the Government and the country should be immensely grateful to my noble friend for taking this initiative.
I shall only comment for a moment on the speech made by the noble Lord, Lord Hollick. I thought that

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he was extremely unfair to the Government on his allegation of the lack of criticism of the CAP. As far as I know the Government have been extremely active in trying to secure an improvement in the provisions of that monstrous policy. I have heard them doing their best again and again. I also thought that the noble Lord, Lord Hollick, was less than fair in his general response to the Government's attitude in the matter.
I do not want to waste further time on that topic, because what is important is that we should hear from my noble friend the Minister that the Government fully realise the great urgency of the matter. Once we get into next year, we are in the year of the American elections. Once those elections start, various pressure groups, interest groups and the rest will be pressing the American Government for concessions in the direction of protection. Equally, as we get into next year, the enthusiasm which has been felt, not just in the United States but in a great many other countries, will begin to diminish. Public opinion tires of any issue, however important, if nothing appears to be happening. If nothing appears to be achieved, public opinion is apt to write off the matter. So it is of the utmost importance that the issue should be settled, and settled quickly.
I agree with much of what has been said by almost every noble Lord: this is the most important issue facing the world. It is far more important than the adjustments to the European Community which are apparently the basis of the forthcoming Maastricht talks. I express the hope that our excellent Prime Minister, and his team at Maastricht, will take advantage of the presence of the Europeans at that meeting to urge them to move quickly, and quickly to achieve agreement. It is still possible, but it is only just possible. It requires the impact of the strong personality of our Prime Minister, backed by his Government, to secure that we move quickly, even at the cost of certain compromises, to complete the round. It will not be completed, of course, in the sense that every detail can possibly be settled. That would be unrealistic. It is vital to have the issue settled in principle. That is why I rejoice enormously at the way your Lordships' House has discussed the matter, because I believe that it will interest the Government.
I listened to the noble Baroness, Lady Seear, holding forth, justifiably, that her party had always been in favour of free trade. I must confess that I was not. When I was a young candidate, I was a protectionist, but as the years passed and the situation changed, I was convinced that high protection lowers the standard of life of most people involved, and that the more free trade one can have, the better. Confession is said to be good for the soul, and as the noble Baroness prided herself on her life of rectitude, it is perhaps appropriate that I should confess that at one time I did not attain that standard.
Baroness Seear: My Lords, it was not my rectitude; it was my party's rectitude.
Lord Boyd-Carpenter: My Lords, the noble Baroness tempts me with that remark, because there are one or two examples which, if I had the time, I
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might bring forward which suggest that rectitude has not been the most conspicuous mark of the Liberal Party over the years.
The crucial issue that must be faced is that of the common agricultural policy. I thought that several noble Lords rather underrated the difficulty of resolving that issue. If one thinks about it, the strength of the French devotion to the CAP is the result of factors that have operated for a long time. It goes back, in fact, to the Code Napoléon. Under the Code Napoléon, as your Lordships will recall, when someone dies, instead of having a system of primogeniture for inheritance as we have in this country, one's property is divided by the number of children one has. As a result, France is full of a large number of small fanners. That has two consequences. One is that they cannot earn a living unless prices are maintained artificially high and protection of one sort or another is given. Equally, it has the consequence that there are an enormous number of voters in France who have an interest in agriculture. The number is out of proportion to the number in this country and many other countries.
One must therefore realise that the French Government, with the best will in the world—I am sure that one has the highest regard for their ideas—are in a difficult position and require to be pushed hard to persuade them not to give way to that significant number of voters. We sometimes ignore the fact that after 150 years the Code Napoléon is indirectly causing us considerable damage.
The situation is such that we depend for the future prosperity of this country and the world on getting the Uruguay Round moving. I am especially enthusiastic for its extension to the service field. To extend it, for example, to insurance will be of the greatest benefit to this country, and it is right, because it would not just enable our insurance companies to operate freely in countries where their activities are now forbidden, but it would give to the world the advantage of the high professional calibre and quality of the British insurance industry. Its extension to services is an important aspect of the Uruguay Round. This country will undoubtedly benefit, but so will the world, from that change when it takes effect.
The right reverend Prelate dealt properly, as one would expect from a holder of his important office, with the poverty which exists in many parts of the world. But to reduce obstructions to trade, to reduce the dumping of goods, and to reduce restrictions of one sort or another will benefit, above all, the ever-increasing numbers of poor in the southern hemisphere in particular. Therefore the intelligent thing for the northern countries to do is to press ahead with that change. I am not denigrating the giving of relief. I am sure that we should continue to give relief and help, but the soundest way of helping the poorer sections of the world is to get world trade going, and to get it going effectively.
We have, for a few weeks perhaps now, but only a few weeks, a golden opportunity to achieve a big move in that direction. I hope that Her Majesty's Government will tell us that they are determined to seize it.
4.19 p.m.
Lord Jay: My Lords, in congratulating the noble Baroness, Lady Young, I must also apologise to the noble Lord, Lord Boardman, in that he is being required to listen to me again, as we always seem to be paired on occasions such as this. I hope that this time he will agree with me.
As I see it, there are three overwhelming reasons why the Government should exert themselves to the maximum to achieve a Uruguay Round agreement before it is too late. First, the Uruguay Round affects, as has been said, the trade and welfare of over 100 countries and about 20 times as many human beings as are directly affected by the war of words now going on over Maastricht which involves, when all is said and done, the affairs of one bit of one continent only.
Secondly, a GATT agreement would most of all benefit the poorest countries of the world by lowering barriers against their exports to the advanced countries.
Thirdly, it would very substantially benefit the United Kingdom by lowering the costs of our imports of food which have been a major burden on labour costs in this country since we had the common agricultural policy forced on us in the 1970s. It is probably the major cause of the huge deficit in our visible trade with the EC which was as high as £10 billion in 1990.
These GATT negotiations have now been going on for five years. They ought to have ended a year ago. In an Answer on 20th November in this House, the Minister told us that the Government hoped for agreement by the end of the year. What has gone wrong and has apparently been holding matters up since then? Of course it is true that many other issues are involved in this argument than the extreme protectionism of the CAP. But everyone knows that by far the greatest obstacle to agreement has been the refusal of the Continental countries, led by the French, seriously to moderate that protectionism.
Nor is it just the United States, as it is sometimes made to appear, which demands further liberalisation, but also the 14 nations of the Cairns Group, including Australia, Canada and Argentina, and a wider group of South American, African and Indian countries.
Therefore, for all those reasons, the United Kingdom Government ought to be taking the lead in the European Community in calling for the concessions necessary for success. The Prime Minister tells us that one advantage of being a member of the EC is that we can influence its policies. I hope that we can do so in this case. However, if we are influencing it, there is singularly little evidence of it.
The public utterances of our Minister of Agriculture, Mr. Gummer, sometimes give the impression that it is all a matter of British agricultural policy. Of course any agreement must be fair to our own agriculture, which incidentally received a much fairer deal under the deficiency payments system before 1972 than it has received since. Even so, it is also true that about 2 per cent. of our population are producers of food and 100 per cent. are consumers.
The latest snag now reported in the press is that the French have discovered a new obstructionist tactic: to
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alter the base year for calculation of proposed cuts in subsidies. Manipulation of the base year is one of the oldest tricks in the statistician's surgery. I am reminded of the occasion in the programme "Yes, Minister" which we all enjoy, when Sir Humphrey advises one of his juniors: "If all else fails, alter the base year".
Surely we shall not allow that kind of thing to wreck this vast undertaking. One cannot help feeling that if one-third of the effort and time that has been lavished on the Maastricht machinations were devoted to saving the agreement, success would soon be achieved.
Surely rather than accept failure, if this week's efforts by officials fail—and I gather that they are now discussing matters in Brussels—the heads of government and others concerned should meet together and not go home until a final practical compromise has been reached. They should do that at an early stage.
I urge the Government, even though their voice in this affair is unhappily muffled within the Commission, to make up their mind that agreement must be reached soon, and ensure that it is. If they do that, I am sure that it will have the unanimous support of the House.
4.25 p.m.
Lord Boardman: My Lords, it is always a pleasure to follow the noble Lord, Lord Jay, as I frequently do, and particularly when I find that I am in closer agreement with him today than has often been the case in the past. I am sure that the whole House will wish to thank my noble friend Lady Young for introducing the Motion today so well and also for securing support from almost all quarters of the House.
As has been said by others, the problem with GATT is that it is not recognised by many of the public. People are not sure what it is or what it does. If we mention the name, they think it probably barks or bites. If we say that it is in some way coupled with Uruguay, that does nothing to add to its credentials. If on top of that people read that it has been going for five years, all sense of its importance vanishes straightaway. It is a problem, as has been rightly said, and I am sure that there should be far more public recognition of what is at stake in the matter.
What is at stake is enormous. My noble friend Lady Young referred to what happened in 1929–30 following the Stock Exchange slump in the United States and the wave of protectionism that followed it, with the introduction of the tariff laws. There was the Smoot Hawley Tariff Bill which came in in 1930 in the United States and which led to the terrible wave of depression which went on for so long.
I do not predict that if the present GATT round fails we shall have anything quite so disastrous, but the damage would be very severe. There would be the setting up of a number of bilateral blocs. I can see the extension of the USA-Canada Fair Trade Agreement spreading to Mexico. I can see Japan trying to secure a ring fence around itself and part of the Asian territories. The Community will become more protectionist, building fences around itself. The damage would be extremely severe.

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Protectionism is a most insidious infection from which most of us have suffered now and again when it affects us and the goods which we like to possess and the things that we like to do. At one end, the local milkman will object strenuously when someone else goes on to his round. At the other end, a large British airline will protest violently if some foreign airline is allotted a slot at Heathrow. That is the range of protectionism that is in-built in many of us. The result is that the customer suffers and at the end of the day so does the supplier.
It is remarkable that, I believe, 108 nations have almost but not quite reached an agreement. It is tremendously important that an agreement is reached quickly. My noble friend Lord Boyd-Carpenter referred to what would happen if the agreement were not reached by the end of this year or certainly by March when the fast-track procedure, which Congress has allowed in the United States, will cease to operate. Presidential elections will be taking place and the term used is that all the work that has been done so far would probably unravel. So it is tremendously important that something should be done quickly.
As has been pointed out, there are a number of sticking points. The main one appears to be agriculture. Much of the blame is attached to the CAP which is an economic disaster. It is a nonsense. It directly opposes everything that was in GATT; it is in direct opposition to GATT in its protectionist approach. It is extremely expensive and unfair. However, we must also, in all fairness to the CAP and those connected with it, remind ourselves that other countries—including the United States of America—have a degree of agricultural protection which is nearly as bad as, and as regards some countries even worse than, CAP.
The problem with the common agricultural policy is that it makes negotiations on GATT almost impossible because the European agricultural scene is cluttered up with a great range of conflicting objectives. The noble Baroness, Lady Seear, referred to that matter in her speech. The CAP attempts to cover a whole range of non-agricultural issues. It tries to deal with economic, social, employment and environmental problems. It attempts to deal with the problem of security of supply. At the end of the day it touches on agriculture. The CAP attempts to solve all those problems in relation to 12 countries as disparate in agricultural terms as Greece and Denmark for example. Such a situation is absolute nonsense.
Taxpayers within the Community are then charged to support the subsidies and payments which are given to attempt to achieve the objectives that I have mentioned. Such a situation makes it almost impossible for any sensible agricultural proposal to be put forward to make negotiations on GATT possible. We must strip down the CAP to its basic objectives. As regards the environment, clearly anyone who occupies or uses land should be prohibited from destroying the environment. On the other hand, someone who attempts to improve his land and builds ponds and installs copses should be paid for doing so. He should not, however, be paid out of the
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agricultural budget. Such payments should come from the environmental budget. I believe that the latter is called a green box. Such environmental matters have nothing to do with GATT and nothing to do with agricultural production. If we can reduce agriculture and the CAP to the bare essentials, we could then get a sensible deal.
If the German Government want to keep part-time farmers and small farms in Germany—as the noble Baroness, Lady Seear, mentioned—we should allow that government to do so. However, that government should pay for that measure. A charge should not be imposed on the CAP, or on the agricultural budget. If we strip out these nonsenses from the CAP, I see no reason why agriculture should present any more of a problem in terms of GATT than is the case with most other traded items.
I also believe that if everyone competed fairly in agriculture and if everyone avoided the practices of dumping and subsidies—those are fairly big "ifs"—the UK's agriculture would hold its own. Instead of that, today our farmers are not allowed to produce and sell all the milk that we in this country consume. They are allocated quotas. Farmers are paid to set aside part of their fertile land although we are only 73 per cent. self-sufficient in produce—produce that we are quite capable of producing in this country. Those are the kind of nonsenses that have crept in and which have made agricultural negotiations in GATT so difficult.
Due to the time factor in obtaining the GATT settlement, there is little hope of achieving a major reform of the CAP on the lines that I should like. To achieve a settlement of GATT without that reform will not be easy, but it must be achieved. I hope that can be achieved without sacrificing the British farmer who has already suffered greatly from certain proposals issued in Brussels.
A sensible conclusion of the GATT round is essential—that has been mentioned by every speaker today. It would be highly desirable if GATT could be extended—as is being sought—to cover services, trade related intellectual property rights and trade related investment, to which my noble friend referred in opening the debate. Such a situation would constitute a real bonus. However, there are problems in settling those matters within the short time that is left. It may not be possible to reach solutions in every case. I hope that we do not risk losing all that has been nearly achieved by trying to go a bridge too far.
4.34 p.m.
Lord Alexander of Weedon: My Lords, every speaker today has stressed how vital the GATT negotiations are. Therefore I hope your Lordships will acquit me of discourtesy in wanting to make a brief contribution to the debate in spite of being unable to stay until the end of it. I apologise that a longstanding commitment prevents me from doing so.
This is easily the most important round of the GATT negotiations since their inception. Its breadth is far greater than before, embracing agriculture, financial services, intellectual property and other issues. This makes it possible to seek a wide-ranging

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liberalisation of trade which should afford opportunities to developed and developing countries alike. The negotiations, which have at times appeared perpetual and at other times to be teetering on the brink of failure, are approaching a climax when the world economy looks fragile. It is therefore more important than ever that the negotiations are successful. Therefore it is heartening that, after the apparently muted efforts to avoid failure last year, there is a much stronger and determined political impetus to ensure success. A breakdown of the talks, which would foster protectionism and regionalism, would carry great risks to the world economy. By contrast, the liberalisation of the trade system will contribute to global economic growth at a time when we are most in need of it.
Agriculture, as has already been said—this will no doubt be highlighted again—has been one of the more intransigent stumbling blocks. It is unnecessary to dwell for long on the absurdities of the common agricultural policy. Its history is a classic illustration of why we should avoid protectionism. Powerful farming nations first agree to subsidise their own farming interests. They are then forced to impose barriers to cheaper imports. Then, when their subsidised farmers increase production, they have to create forms of export subsidy. This not only harms other agricultural countries but also means that according to the OECD the agricultural sector in developed countries has become subsidised by taxpayers and consumers by no less than the monstrous sum of 300 billion dollars a year.
I have perhaps said enough on the inequity of the common agricultural policy for the most necessary and welcome recent impetus given by President Bush and M. Delors has pointed the way to a compromise in the GATT talks as regards the key sticking point of agricultural subsidies. I do not seek to debate whether this compromise goes far enough. It possibly goes as far as can be practically achieved. However, its important effect is to unlock the door to a consideration of the other areas on which an effective agreement to liberalise markets is also so important. I echo the words of the noble Lord, Lord Williams of Elvel, when he said that if the European Community is to give as it ought on agriculture, there should be give from others on services.
Crucial as the common agricultural policy is, there are also other areas which are of great significance. The avowed intention of the agreement for financial services will be to secure liberalisation. In the area of financial services the European Community can speak with some conviction and authority since, in the second banking directive, it has committed itself to a notably liberal policy. As your Lordships know, this directive provides that within the European Community any subsidiary of a bank from anywhere in the world which has been accepted as eligible to bank by the regulatory body in any country of the Community, can trade anywhere else within Europe. This regime will apply from 1st January 1993.
For the purposes of the directive, banking includes dealing in securities; so the directive recognises an
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ability to secure complete geographical coverage of the Community and, where one regulator has granted consent, an ability to engage in universal banking.
However, one understandable and reasonable concern arises where lack of reciprocity exists. To that end, the directive provides that the Commission may propose limitations on the future rights of banks from a particular country which may apply in the future to operate in Europe. As it exists, that limitation would enable some persuasion to be brought to bear on countries which are notably less liberal in their approach to foreign banks than is the Community.
By contrast, there is doubt as to the extent to which the likely GATT agreement contains enough of an impetus to countries with relatively closed financial systems to persuade them to widen access to banks or, as my noble friend Lord Boyd-Carpenter mentioned, insurance companies from other countries. The basic agreement is likely to contain a provision, described perhaps somewhat quaintly as a most favoured nation clause, which requires each party to accord immediately and unconditionally:
"to services and service providers of other parties, a treatment no less favourable than the treatment it accords to like services and providers of like services of any other country".
As I understand it, that means that any concessions made to any one country will have to be made multilaterally right across the board regardless of whether some of the countries which thereby benefit have themselves liberalised their own laws at all. That provision, well-intentioned as it is, could prove a charter for tardiness and minimalism.
At the same time as the overall agreement, countries are tabling the initial offers as to the terms on which they will grant access to the markets. It could well be that, against the background that I have described, many countries will table little more than an offer of what is in fact just a standstill against the introduction of more restrictive regimes. That would be far from positive.
Banks in this country, and I believe in the whole European Community, would hope that greater energies will be devoted in the final negotiations to liberalising commitments in the financial services area from other countries in exchange for the concessions that are made in agriculture and elsewhere. A combination solely of national standstill agreements, plus the "most favoured nation clause," will make many countries see no need to open up their markets soon. There will be just an incentive to sit back and seek to ride pillion on the backs of those who, through liberalising their own markets, open the doors to everyone.
That point has perhaps greater force for us because the GATT agreements will circumscribe European Community action in that area. In particular, it will become more difficult in future for the Community to use its right to require better terms from other countries as a condition of allowing their banks to enter our markets.
There is time to address those points in negotiations. I should be grateful if the Government would indicate the extent to which they currently believe that the financial services regime will be effectively liberalised under this round of negotiations.

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Are they anxious about the likely course of negotiations over offers and requests? Are they positive enough? What negotiating stance are they encouraging the Community and the United States to operate in that area? Do they share the view that, as matters at present stand, the Community's ability to act legitimately in its own interests may be circumscribed in future? It would be a pity—perhaps your Lordships would say an irony as well—if, in an area where our Community is conspicuously liberal and which is of such importance economically, we should not be able to seek the same approach from other countries.
I hope that my noble friend the Minister will not think me churlish to have concluded by asking him a number of questions when I am extremely sorry that I shall not be here to hear his reply, but I look forward keenly to reading it with the greatest possible care.
4.44 p.m.
Lord Bruce of Donington: My Lords, the House will be grateful to the noble Baroness, Lady Young, for having introduced this subject this afternoon. For almost the first time since I came to your Lordships' House some 15 or 16 years ago, I found myself in almost entire agreement with the argument of the noble Baroness. She put forward the case with a clarity to which I have not been privileged to listen for some considerable time.
The noble Lord, Lord Alexander of Weedon, referred to the fragility of the world economy at present. There has been the virtual collapse of the economies of the centrally planned states in the Soviet Union and the eastern states, but equally in the doldrums at present are the principal free enterprise and free market economies of the world. That includes the United States and Japan, which has not achieved quite the performance that it has shown over the past four or five years. As for the European Community countries, as Mr. Banham of the CBI pointed out only last week, their performance has been distinctly disappointing: output is down, the balance of trade has deteriorated and unemployment has risen.
Those matters are of the utmost importance for us to consider, particularly within the context of the remarks that fell from the lips of the right reverend Prelate. On the one hand, there are millions of people in the world, including the Western world and the EC, with unsatisfied, urgent needs, not for luxuries, but for the bare necessities of life. Yet, on the other hand, there is what even in pre-war, 1930s terms may be called mass unemployment, with all the consequences that may flow from that condition. Not all your Lordships were with us in the Thirties, although quite a number were. However, I am bound to tell your Lordships that there are considerable similarities between the state of the world economy now and its state in the Thirties. We would do well to ponder the consequences in terms of the preservation of peace and, as ultimately in the Thirties the outbreak of war, of mass unemployment in the highly industrialised countries, to which must now be added large-scale unemployment and widespread poverty in the
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developing and undeveloped countries of the world. Therefore, anything that contributes to freeing trade and increases the demand for and production of goods and services must be good.
That is why GATT is of great importance. If a general agreement is achieved—I accept what my noble friend who is no longer with us said about reading the small print—it will undoubtedly provide a great stimulus to the enlargement of world trade. By so doing it will at the same time free the fiscal resources of the richer states so as to be able to develop aid programmes for the developing countries. That must be taken as an additional bonus to increases in trade which may take place.
I rarely find myself in such agreement with the noble Lord, Lord Boardman. He described very accurately the massive effects and the utter folly of the present common agricultural policy. I shall read what he said so that I may borrow his invective for the next occasion on which I participate in a debate on the EC. However, there can be no question but that the continued existence of the common agricultural policy in its present form will be a bar to the achievement of an agreement at GATT. Therefore most urgent attention must be paid to this matter.
I also find myself in agreement with the noble Lord, Lord Boyd-Carpenter. The achievement of a GATT agreement is indeed far more important than an agreement at Maastricht and is of much more urgency. At Maastricht we shall be dealing in part with the machinations of bureaucrats and the ambitions of not a few. We are dealing with a matter of reorganising what threatens to become Fortress Europe—one of the more protectionist parts of the world which works in essence and particularly but not exclusively through the CAP against the operation of GATT.
More than that, I am afraid that, unless some changes are made, the United Kingdom may find itself locked within Fortress Europe and locked within a Continental system which may inhibit its independent operation for the essential achievement of GATT aims. I regard that as just as much of a menace as the existence of the CAP itself.
The Prime Minister, supported by the Leader of the Opposition and, I am sure, by the liberal parties—a very impressive degree of unanimity—said that he wants this country to be at heart of Europe. I believe that we have a more important role. We are one of the principal countries and the leader of a Commonwealth of 50 nations spread over the whole world. Many of them are developing countries. If they were assisted by growing trade and aid perhaps on the scale of our net contribution to the EC itself, they would bring enormous benefits to both themselves and the United Kingdom.
One cannot have one's heart in two places at once. We should endeavour to regain our place at the heart of the world economy, not merely of Fortress Europe. I am quite convinced that we should co-operate fully with our European colleagues, preferably under conditions of unanimity. But I am also convinced that our historic role in the future is to promote the ideals

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of GATT, and to promote aid to the developing countries to the lasting benefit of those countries and ourselves.
4.55 p.m.
Baroness Elles: My Lords, I join other noble Lords in thanking most warmly my noble friend Lady Young not only for magically choosing this day for the debate, which is so vital this week in the development of the GATT, but also for laying down the ground rules for the debate this afternoon and explaining so ably, clearly and succinctly the many issues which arise within the negotiations at present taking place in Brussels.
On a personal note, I should like to say how privileged and pleased I was—as indeed I am sure were many noble Lords —to hear my noble friend Lord Thorneycroft remind us of the role he played (he claimed a very modest role but indeed it was very important for the country) at Geneva in 1954 during the early negotiations of the GATT. From these Benches I must say how delighted I was to learn that by his own conversion he was able to convert our party to the right way of thinking with regard to trade.
I should also like to say a few words to the noble Lord, Lord Hollick, who is not in his place at the moment. He complained that the Government were not doing enough in the GATT round. I strongly disagree. If he knew anything about the Treaty of Rome, he would know that the Commission has the task of negotiating on behalf of member states. In this particular negotiation member states are closely following each stage of the negotiation and the Commission cannot take any further steps or take any different views than those agreed by member states. The Commission is in the forefront of the negotiation. Consequently it attracts the media, to which I suppose some noble Lords direct their whole attention and so are not aware of what is going on. I should certainly say, as many noble Lords on this side of the House have said, that there is nobody more aware, keen and anxious for the GATT round to succeed than my right honourable friend the Prime Minister. As chairman of the group he has taken the opportunity to remind all members of the G7 that they must work for the successful conclusion of this round. It would not be right in my way to criticise the Prime Minister or the Government for failing in their full duty of trying to reach a successful conclusion to this negotiation.
I want to recall the preamble to the GATT. It refers to raising standards of living, ensuring full employment, the growth of real income and effective demand, developing the full resources of the world and expanding the production and the exchange of goods. There is universal agreement in this House that those are excellent objectives and that everything should be done to achieve them. Nobody would deny that. But more is at stake. By this trade system we should achieve economic stability. That economic stability, which is achievable through GATT objectives, underpins political stability. They are interrelated. Rarely, if ever, is there economic growth where there is political instability. Economic growth is achieved only where there are democratic processes at work.
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That emphasises and underscores the importance of the GATT system not only from the point of view per se of the economy but of the general political stability which we hope will spread. That is basically what the GATT aims to achieve.
Many noble Lords mentioned that the agreement covers new issues at this time: agriculture, services, trade-related intellectual property and trade-related investment measures. They are evidence of the faith that 108 countries have in the effectiveness of the system. If they did not believe that the system had worked well so far, they would not be introducing the new issues in the new GATT round. Again that is a source of encouragement. No one doubts the immense benefits in terms of increased world trade—with especial benefit, I would add, to the developing countries as well as the industrialised countries—of a successful conclusion to the negotiations.
At a recent meeting which I attended there were many representatives of SADCC, the 10 front line states. Members pressed urgently the need for a successful conclusion of GATT. They are optimistic that they will benefit from the process. They recognise that aid is no longer the answer to their problems. About 3 billion dollars were given in aid to the SADCC countries in 1989; yet only two of those countries had positive economic growth, one of those being only 1.5 per cent. They want the negotiations to succeed. That should encourage those who recognise the role and need of supporting developing countries to ensure that this negotiation succeeds.
The UK is a trading nation. Many noble Lords have touched on the 25 per cent. GDP that we obtain from exports. The success of the GATT negotiations, with every increase of exports by 1 per cent. in this country leading to 300,000 new jobs, must be a prize worth fighting for.
As we know, there are certain sticking points, in particular the agricultural problems between the US and the European Community. Both are the biggest export markets for each other's products, with the EC being the world's biggest importer of food—a fact that is sometimes hard to believe when one considers the surpluses that we produce; but those are the statistics—and the world's second biggest exporter. Therefore it is crucial for us to have a settlement. It is not sometimes realised that the proportion of agriculture to world trade is only 11 per cent. Nevertheless everyone is affected by agriculture's success or failure.
The US was the first country to demand big reductions in agricultural subsidies, such subsidies to be eliminated over 10 years. It should not be overlooked that the US also heavily subsidises its farmers by up to 20,000 dollars per head compared with the Community's 8,000 dollars per head. The House recently debated the excellent report on the development and future of the CAP. Many of the matters touched upon are the subject of current negotiations. Reform of the CAP, recognised as essential, cannot overlook the changing background not only of Eastern Europe but of events in the Soviet republics (if I may still call them that), and changes in Southern Africa, so that the concept of regionalisation and remedies to the imbalance in agricultural products

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are taken into account as well as the understanding that those areas all want access to EC markets. In that connection it is worth considering the triangular mechanism, which is sometimes introduced, of EC financial support rather than direct aid to buy produce from areas of surplus for transmission to areas of food shortage.
All parties have agreed within the EC context that a substantial and progressive reduction of agricultural support is necessary. I am sure that that will be cheerful news to many noble Lords who have spoken on that issue. However, at the present time in the middle of negotiations it is not possible to do other than to indicate the direction in which it is hoped they will go; that is, improvement of import access, substantial and progressive reduction of export subsidies and substantial and progressive reduction of internal support. Those have all been areas for negotiation. The reduction of support prices for agricultural products would have the effect of reducing food prices, reducing the cost of export refunds, and facilitating access for imports. Reduction of intervention prices would or should lead to curbing excessive food surplus as well as reducing overall costs of transport, storage and waste, to say nothing of the costs to the EC of fraud arising from the current methods of implementation of the CAP, with special emphasis on export refunds.
There will be new mechanisms, for instance, with the removal of import controls such as quotas and levies. Some measure of control would be possible under the system of "tariffication". That is another new jargon word—something that always seems to occur within the Community. Tariffication is an import tax which would replace the control restrictions.
Overall, new arrangements in the agricultural industry can bring benefit, provided, first, that there is adequate and appropriate compensation to be degressive. That would give time to those farmers who would be hit by changes in support prices to adapt to new products or new land use on the principle that market prices and social needs are clearly separate considerations. Many noble Lords have attacked the CAP but one cannot do so without giving alternative support to enable those farmers who would suffer from the change to adapt to the new situation.
Most noble Lords will accept that the CAP has now become a disaster. I must confess that I was a great supporter of the CAP when I had to feed young children with very short rations. After the Treaty of Rome was signed the CAP supported farmers. It gave them a chance to attain a viable living off the land. To produce food at reasonable prices was an achievement that anyone who had been through the war would have greeted with great acclaim. We all understand that the scheme has now become out of control. Most governments, in particular those with large farming communities, were not able, through a perfectly respectable democratic process, to answer the farmers in a satisfactory way and to reduce the costs of the CAP. We have to recognise the historical role of the CAP and the point that we have now reached.
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The GATT negotiations have achieved what member states' governments and the Commission have been unable to achieve over the past six years. At last the CAP will have to be reformed to implement the provisions which will be contained in the new trade agreement. It is that way round: the GATT will be signed and the CAP reforms will follow, probably early next year, in accordance with the agreement made by all member governments at the conclusion of the GATT round. That outcome, for which we all devoutly hope, will benefit not only the European Community but also the United States which will have access to a large single market, with all the benefits that that allows, including EFTA countries now within that area.
I believe that it would therefore be appropriate to conclude with the words of Arthur Dunkel, Director General of GATT, to whom I am sure your Lordships will pay the greatest respect and admiration for the way in which he has conducted the negotiations over the past six years. He said:
"The successful conclusion of the GATT will mean a guarantee that world trade will continue to grow. Trade creates new business, [and] new jobs".
5.6 p.m.
Lord Elton: My Lords, about a fortnight ago that small proportion of the press which devoted a small part of its space to the subject which we are discussing as the most important issue before the human race began to prepare us for an important statement about a great breakthrough, or progress of a substantial nature, to be made on Friday of last week. Since then the only reference that I could find is a headline in the Financial Times today, which states, "Last chance for Uruguay Round". I believe that that is the sinister background against which we hold the debate. It is ominous for two reasons: first, the hoped-for and—as noble Lords from all sides of the House said—last minute progress is not yet available; and, secondly, that lack of advance is a matter of such extraordinary indifference to almost the whole of the media of this country and, for all I know, those of other countries.
There are two analogies for the GATT process. One is a battle of Titans; the other is a supremely complicated game of chess. The Titans are the European Community and the United States of America—and Titans they are. In 1986, between them comprising about 10 per cent. of the world's population, they had cereal reserves of 316 million tonnes. That figure is two and half times the total international volume of trade in the year, and—in a bizarre statistic —it represents a quarter of all cereals eaten in a year by the whole population of the world and its livestock. That gives an indication of the extent to which those Titans travel the world and dominate local markets.
For some time they have been locked in a rather unedifying, old-fashioned trade war. It began when the Soviet Union had recourse to heavy buying when the world production levels of cereals were at a slightly reduced level in the 1970s. In 1974 the World Food Conference was convened. It was announced that there was a world food crisis. Both Europe and the

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United States responded with alacrity to meet that challenge and to increase production, at a hideous cost to taxpayers, as has already been said.
Between 1980 and 1986, the United States farm budget was increased 10-fold to almost 30 billion dollars. The EC budget doubled during a shorter period to 22 billion dollars. It is important to remember that CAP is not the only obstacle to progress in this field, although it is that on which we can have the most influence. Farm price protection increased at a rate double that of domestic demand during that period. In consequence surpluses were pumped into or dumped onto the world markets. The principal tool for jacking up the United States' production was the 1985 United States Farm Act designed, according to the United States Agricultural Secretary of the day, to:
"squeeze [the] CAP until the pips squeak".
It was indeed an old-fashioned, unedifying trade war. It cut United States domestic cereal prices by 20 to 30 per cent. and was accompanied by a 5 billion dollar export enhancement programme. By the end of 1986 18 billion dollars was being spent to export grain and cotton. Again I mention the figure because it is a bizarre illustration; it was double the value of those goods in the market place. We could have accepted that as largesse but we responded in kind. By 1987 export subsidies equalled half of European Community cereal spending and 38 per cent. of the common agricultural policy budget. In the words of one commentator, world trade had become reduced to a subsidy battle between the treasuries of Europe and America. Who paid those treasuries? We and the other taxpayers of those countries paid at a rate which my noble friend Lady Young has set at £11 per family per week.
I said that the struggle was unedifying. I suppose that the argument about whether the United States' system of intervention should be excluded as being entirely virtuous while the EC system of intervention is entirely wicked seems to bring the whole argument into disrepute. Surely there must be one worldwide standard of what constitutes a trade-distorting practice. That should be the same on both sides of the Atlantic.
The other analogy is a game of chess. It is hugely complicated. At least three boards are in play, although we are looking at only one. That is the most active one of GATT. Games are in progress on the World Bank and IMF tables and also on the United Nations table. However, GATT is the most important board. There are more than 100 players, although not all in tidy groups such as the United States, the European Community, the Cairns Group or the Nordic countries. There are incessant exchanges and even sacrifices of pieces. Some vital moves are simply ignored in the main negotiation. Major liberalisation programmes have taken place in Mexico, the Philippines, Costa Rica, Tanzania and Kenya since the outset of the Uruguay Round but they have counted for nothing within the round itself. Those countries are not Titans and they are the losers by it.
The complexities of existing GATT articles and the agreements under them are huge and well known.
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Perhaps they are greater to me than to my noble friend Lord Thorneycroft because I have not spent an illuminating time in the Hotel Beau Rivage and fulfilled distinguished engagements from there as he did. My briefing is four inches thick and I do not propose to go into it. Your Lordships are seized of the complexities and might agree that in the debate we should be looking for the simplicities.
The complexities are such that for many of our writers and broadcasters they have obscured much that is important; they cannot see the wood for the trees. One ought to say that they cannot see the woods for the trees because it all started in Bretton Woods. It was the product of that previous most terrifying world recession in the 1920s and 1930s. I leap with alacrity to the unfamiliar pleasure of agreeing with the noble Lord, Lord Bruce of Donington—he has had the pleasure of agreeing with everyone else on this matter—that it is to that issue that we must look in order that subsequent generations will understand what is at risk. Our present situation will soon be "in the previous century". Soon I shall no longer be a young man by your Lordships' standards, which means that I am an old man by the standards of the rest of the world. We have a duty to keep the reality of that experience before the consciousness of succeeding generations lest they slide into the awful experiment of doing the same thing again. That means education. We do not need to educate the poor of the world; they can see on television whenever they want the rich enjoying their riches. One of the first things that governments of poor countries appear to do by way of improvement is to provide televisions for their people. They do so for two reasons. The first is for entertainment, as the Romans provided bread and circuses. The second is as a means of propaganda to the people by the government. What the people see are soap operas produced by American companies which are often connected with the companies which set up the television network. I sound as though I am becoming anti-American but I wish to correct that impression. The Americans provide us with a good impression of what we ourselves do wrong and perhaps I take the easiest examples to hand. What is shown to people in poor countries is sumptuous consumption with no political comment—the political comment can be added locally.
The best way to illustrate the very delicate and explosive situation in which we now find ourselves is to ask your Lordships what has been the most dramatic event of the current year. It will not have been the failure of the attempt to dislodge Mr. Gorbachev; it will be the spectacle of 6,000 young Albanians trying to enter the lush pastures of the common market. That is a stark illustration of the extreme differences between comfort and discomfort, between wealth and poverty, very close to home. The right reverend Prelate was absolutely right to say that there is a close analogy and coincidence between the moral imperatives which that and so much else in the world lays upon us and the path that intelligent self-interest would counsel us to take.
If we do not accept the modest discomforts which a change in the present regime of world trade will

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bring to us now we, and more particularly our children, will be faced with a far greater price to pay in the years to come. That price will not be merely in money or standards of living. We are talking about a sector of the world which may be poor in resources but which is in many cases well developed to act. Perhaps I may remind your Lordships of what the United Nations inspection teams discovered when they went into Saddam Hussein's factories. Your Lordships will realise that the existence of an impoverished, embittered and desperate population in two-thirds of the world represents an extreme danger to the remaining one-third. That and the moral imperative between them make an advance in the negotiations essential. It is a matter of education.
I conclude by commending to your Lordships the One World Week organisation started by the Churches in co-operation some 13 years ago. It was designed to allow local communities to become aware of their identity with communities throughout the world, their shared interests and what should be done about that. It sends out 7,000 packs from the Shetlands to the Channel Islands, each pack going to a group which learns from it. The groups can talk to their Member of Parliament and thus engage in the proper process of democracy which my noble friend Lady Elles suggested to your Lordships should be the governing matter in this as in all things.
My noble friend Lady Young has done the House so much good by introducing this debate. I have no more than five seconds in which to say that your Lordships should be deeply grateful to her for her contribution, as my party should be to my noble friend Lord Thorneycroft for that critical steer which he gave to his policies all those years ago at Blackpool.
5.20 p.m.
Lord Judd: My Lords, I join with those who have congratulated the noble Baroness, Lady Young, on making this debate possible. She was right, in her very challenging speech, to underline the immense importance of the subject.
It is clear that on all sides of the House we are united in our desire to see a successful conclusion to the Uruguay Round, it is hoped, by the end of the year. As the noble Lord, Lord Thorneycroft, powerfully reminded us, another breakdown in talks at this late stage would have disastrous consequences for world trade with incalculable political and social consequences. Conversely, as my noble friend Lord Williams argued, success could mark the beginning of sane management of human society in which outmoded concepts of national interest are as dangerous as they are irrelevant.
What do we mean by "successful"? The round will only be concluded once the complex and difficult issues facing negotiators have been satisfactorily resolved. To be judged a success, the final package must genuinely enhance the economic prospects not only of the developed world but also—and crucially—of the developing world where the overwhelming majority of humanity struggles to survive.
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Never has the need for that been greater. We are faced with the greatest humanitarian crisis in history. It is the crisis of famine and grinding poverty faced by millions of people throughout Africa, Latin America, Asia and even now in parts of Eastern Europe and the Soviet Republics, A successful Uruguay Round will be crucial in achieving the sustained relief of that suffering. An "unsuccessful" conclusion to the round could, in the words of Thomas Ogada, the Kenyan representative to the United Nations:
"sound the death knell for Africa".
In terms of its potential success I suggest that there are two main worries about the Uruguay Round: one is the impact that it will have on the ability of people in third world countries to feed themselves; the other is the impact that the round will have on the global environment.
In relation to the first worry, it is now widely accepted that greater food self-reliance is a key factor in achieving food security. Relatively weak trading nations, especially those dependent on a narrow range of primary commodities for which prices have been extremely low for more than a decade, cannot rely on world markets to furnish food supplies to their populations. That is why the Economic Commission for Africa has stated:
"Africa's viability resides, above all, in its ability to feed its own people from its internal resources".
Therefore, a deal on agriculture must allow food deficit developing countries to do what we in Europe have been doing for decades; namely, to subsidise food production and protect farmers from cheap food imports. It is vital that the GATT unambiguously recognises the fundamental distinction between subsidies used in the North, which perpetuate overproduction and export dumping, and subsidies used in the South to raise self-sufficiency, protect rural employment and promote environmental sustainability.
A successful Uruguay Round will also ban comprehensively the agricultural export dumping to which the noble Baroness, Lady Young, referred. That has been at the root of the anarchy in world markets over past decades. It has caused developing countries chronic trade and food security problems. Efficient producers of commodities such as cereals, sugar and beef, have been forced out of markets and have seen their prices collapse. Staple food producers have seen their household incomes slashed with US and EC surpluses flooding into local markets at prices well below production costs for locally produced cereals.
With regard to the treatment of environmental issues in the GATT round, there is reason to believe that in its present form the GATT is not only ill-equipped to address pressing issues of ecological resource management but, through the use of unrestrained liberalisation measures, it could undermine national efforts to encourage sustainability.
As the Bruntland Report emphasised, trade is an environmental issue. A successful GATT agreement will recognise that. It will allow governments to use trade restriction or subsidies for environmental purposes; for example, rain forest conservation. It will

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not infringe either existing or future international agreements or national efforts to raise environmental standards.
Once the round is concluded, we must look to the future and renew our commitment to multilateralism in world trade. That will involve giving serious consideration to urgent reform of the GATT itself. The Uruguay Round has shown that the GATT is ill-equipped to deal with the formidable problems facing developing countries. Not only that, successive rounds have, by and large, failed to control the growth in protectionism.
In short, I believe that we now need to consider whether there is not an urgent need for a more open and democratically run organisation that does not lay itself open to accusations of being a rich nations' club. Such an organisation would not treat trade in isolation from other financial considerations which are of critical importance to the developing world, such as the debt crisis and high interest rates. It would have much wider objectives, including protection of the global environment which I suggest within our lifetime is rapidly becoming the most urgent and strategically significant issue facing political leadership across the world.
5.27 p.m.
Lord Stodart of Leaston: My Lords, as one who on Monday was sitting on a tractor ploughing some ground in preparation for next year's harvest—and I shall be doing the same again on Friday—I listened with enormous pleasure to the opening remarks of my noble friend Lady Young to whom we are so indebted. She referred to the enormous importance of agriculture. I then listened to my noble friend Lord Boyd-Carpenter saying how crucial agriculture is. If they had stopped at that point, I should have been a happy man. However, they went on to say, in a slightly different way, how very important and crucial it is that a GATT settlement should be achieved.
It has been said many times this afternoon that agriculture is the key issue. I can see no likelihood of a favourable result without an agricultural accommodation. It is probably the most complex and most contentious issue of all. For many years now fair trading has been made virtually impossible as nearly every country in the world uses various means of supporting its agriculture—you name it: quotas, tariffs, export subsidies and so on.
The impression is often put about and widely believed that this country and the Community is more guilty than most. The Ministry of Agriculture, Fisheries and Food has published an interesting document entitled Our Fanning Future in which it gives a table prepared by the OECD. That shows the total value of forms of support and protection given by various countries as a percentage of the value of their total agricultural production. It was staggering to see that Japan goes to the extent of 71 per cent.; New Zealand, at the bottom, was no surprise at 6 per cent.; the OECD averages 43 per cent.; and the United States 30 per cent.
Farmers have been longing for a level playing field—an expression I fully expected to hear used in the
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debate this evening. We were supposed to get one when we joined the Common Market. But for most of the time farmers in this country have been disadvantaged by a totally incomprehensible thing called the "green pound". I used to know a little about it; I have long forgotten the intricacies. Certainly the new proposals by the commissioner, Mr. MacSharry, are the last things that will give us a level playing field.
One of my recreations—being a perpetual optimist as all farmers are—is a game of golf. Without doubt the MacSharry proposals are exactly like a golf course on which one is almost certain, whatever one does, to drive into a bunker. Although most noble Lords watching the great golfers on television will have noticed that they appear to get nearer the hole when playing out of a bunker than when playing off the fairway, in my experience and that of most of my friends once one drives into a bunker it takes a tremendous amount of time to get out. That is why farmers in this country are extremely and understandably anxious, and indeed considerably jaundiced, at the thought of the new slant being put on the common agricultural policy.
Like many other industries, farmers are retrenching. The machinery people at the Smithfield Show were in deep despair. Farmers are normally good customers for the shopkeepers of the market towns and factories which turn out a host of different goods. But the ripples are beginning to spread fairly widely. If the GATT round can eliminate the inequities of the support that I described, then at least some measure of fair competition will result. We would know what we had to do. No farmer in any sector is afraid of competition in this country provided that it is fair. After all, who can grow cereals more cheaply than the best of the cereal growers on our arable farms?
A moment ago I mentioned New Zealand with her minimal agricultural support. I want to conclude by remembering an episode in 1971 when the negotiations for the Common Market entry were in full swing. New Zealand sent over Mr. Jack Marshall to negotiate on its behalf. He gave a press conference at Heathrow. Somebody asked him, "What will it be like for New Zealand, Mr. Marshall?" He said, "It is going to be unbelievably tough but if it is going to help the old country we shall muscle in". "It" was the Common Market and the Community's use of export subsidies. Those factors are now virtually strangling the economy of New Zealand. Around 61 per cent. of its export earnings come from the land. New Zealand farmers in company with other farmers deserve a better deal, and I profoundly hope that as a result of the GATT round we shall all obtain it.
5.35 p.m.
Lord Desai: My Lords, let me first join with other noble Lords in thanking the noble Baroness, Lady Young, for the opportunity to discuss GATT. It also gave me great pleasure to listen to the noble Lord, Lord Thorneycroft, as he recalled his and his party's conversion to the idea of free trade. I confess that I, too, am a late arrival in my belief for, at least, "freer" trade rather than "free" trade.

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As my noble friend Lord Judd said, for a long time it was believed that GATT was a rich man's club; it was a club for rich countries because it concentrated on the manufacturing trade for the richer countries. In that respect it was a great help. Let us not forget that the Kennedy Round and the Tokyo Round were a great help to the trade and manufacturing of developed countries. The main feature of the current round of GATT is that by now the middle income members of the developing countries have been converted to the benefit of freer trade. It is they who took the initiative in this round of GATT, which is why it is called the Uruguay Round.
In my speech this afternoon I wish to concentrate on the angle of the developing countries rather than of the developed countries, which has been well covered by other noble Lords. In one sense the quantifiable benefits of the Uruguay Round are not large. It must be remembered that the best calculations of the World Bank show that the success of the Uruguay Round will, at most, add three-quarters of 1 per cent. to the growth rate of industrial countries and something smaller to the growth rate of developing countries. We must consider not only the benefits, but also the dangers from its failure. The losses are much greater and more serious to contemplate than the quantifiable or non-quantifiable benefits. It is from that point of view that we must recognise that the success of the Uruguay Round is important for the developing countries, no matter how large or small the benefits.
A dangerous trend through the 1980s was that the developed countries adopted a number of quantitative restrictions—called among other things "voluntary export restrictions"—which were used to block the manufacturing exports of the developing countries to developed countries. That trend was widespread in the US and to some extent in the EC. Indeed, in economic literature it goes under the title of, "strategic trade policy". Strategic trade policy is old-fashioned protectionism under another guise. It is in order to reverse that dangerous trend that we should wish for the success of the Uruguay Round.
We hope that finally the Uruguay Round will get rid of the Multi-Fibre Agreement—a major example of the specific restriction used by developed countries for many years to block developing countries. Major benefits to the developing countries from the Uruguay Round arise from the relaxation of the textile restrictions that take place. In return for that, in the current GATT round the third world countries have taken on board intellectual property for the first time. Up until now they have been pirating, copying or stealing intellectual patents and not paying any price for them, and so they have benefited. It will cost them something to accept that the trade-related intellectual property (TRIPS as they are called) will have to be paid for. In return for that they will receive concessions on textiles and some on agricultural products.
The swap is a good one but we have to remember two things. Through the 1980s, partly because of a debt crisis and partly because of the goading of the IMF, many developing countries unilaterally adopted
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liberal trade policies. The GATT negotiating structure is such that if you have behaved well in the past there is no concession made in return for that. If you have been a free trade nation you cannot offer anything in return for a reciprocal cut. As the noble Lord, Lord Elton, pointed out, many of those countries which have liberalised their trade have nothing more to offer in bargaining for a reciprocal cut from the developed countries.
In any future reform of the GATT procedures we should give countries credit points for past good behaviour outside the GATT process. People should not have to wait until the GATT negotiations start to begin behaving well. The procedures actually subsidise bad behaviour because if a country behaves badly until the GATT round starts then concessions are offered. That is also partly the reason why the negotiations themselves seem so complicated and dull. Many commodities are being negotiated simultaneously and some of the negotiations are absolutely bizarre.
One major problem with the benefits of liberal trade is that by and large they benefit the better-off countries. Even among the poorer countries, those which are to benefit from GATT negotiations are the middle income countries of Latin America and East Asia and some of the major textile producers of South Asia. Africa stands to gain very little from the GATT negotiations. Therefore, we have to remember that while freer trade is good, and I welcome it, we shall have to find other factors in the international economy to reach the very poor nations because they are countries which do not trade very much. What they do trade are commodities for which, if I may use the jargon, the elasticity is too low for them to benefit by cutting tariffs or prices.
When we consider the GATT process, while it is clearly a very important one, we notice that both this and the Tokyo Round have each taken six years to negotiate. That is clearly a very long time. We also notice that this time there are very many more countries involved in the GATT process and many more subjects being taken on board. Uncertainties caused by the GATT process while it is taking place may have their own costs. I believe that once the Uruguay Round is out of the way we should seriously consider whether there is not a better and more flexible process for conducting international trade negotiations. It should be a process which will give a place as much to the developing countries as to the developed countries. It should also be remembered that in the next round we may have the Eastern European countries and the Soviet Union joining GATT. We shall have to find procedures which will be speedier and more beneficial all round.
We recall that GATT has arisen only because of the reluctance of the US Senate to sign the Havana Charter. We need to revise the process by which the international trade organisation is to be set up along with the IMF and the World Bank. We need new institutions, but in the meantime I welcome the opportunity to say that the GATT process should succeed, but if it fails it will cause great damage to us.
5.45 p.m.
Lord Wade of Chorlton: My Lords, I too wish to thank my noble friend Baroness Young for bringing this debate before the House. I wish passionately to support all those who believe so implicitly that a successful negotiation of GATT and further international trade is essential to the wealth of all of us. However, although we need to see a successful outcome to GATT which makes everyone wealthier, that would not be so attractive if we end with an outcome in which some become poorer so that others grow richer. We need to be able to utilise the trade of all the world to make us all better off.
I wish to draw the attention of noble Lords to some information which is in the latest edition of Agra Europe which deals with the agricultural situation in Europe. Already it has been agreed within the Commission that translating GATT into reality will mean that the exports of grain and wheat from the EC will drop from 17 million tonnes to 9 million tonnes. However, the export of grain from the United States which reached 47 per cent, of the world markets in 1981–82, will increase from that level by 16 per cent, to 20 percent. Recently there has been a confidential Commission report which says that as a result of the CAP reforms brought about by GATT negotiations, land set-aside plans will take 4.4 million hectares of arable land out of production in the EC. It is estimated that out of 4.6 million landholders, 250,000 will take the early retirement pay-off very soon. It is also calculated that about 7 million hectares of land for agriculture will be abandoned altogether.
I draw the attention of noble Lords to those factors because there is a downside to having a much more competitive world where we all should be doing better if in fact the competition, as other noble Lords have said, means that some are disadvantaged. It seems that if we are now moving into a much more competitive world the last thing we should be doing with our agriculture is to make it less efficient than it has ever been and at the very time when we are going to be competing with many more countries, which it is quite right that we should do in a free market. We do not want to be making life more difficult for those of us who are trying to operate in this more and more competitive world.
Many noble Lords have suggested that the CAP has been a disaster. I remind them that many people in Europe have benefited enormously from it. There is a choice and range of food throughout Europe which nobody else in the world has except the United States of America, which has a similar system of support. I also remind the House that many noble Lords show great concern about the environment and how we can utilise land to make this country a better place in which to live. That is a luxury that we can afford only if we have supportive agriculture. Nobody worries very much about the environment in some of the countries to which noble Lords have referred and which want to move into our market place.
If we are to be put into a world market place and compete, as I strongly believe that we should, then we have to be very conscious of the fact that we cannot expect our agriculture reductions to be carried out
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with a great deal of restriction which does not apply to our competitors. Over the past 10 years the United States of America has increased its milk production by 4 per cent. The result of quotas has meant that milk production in Europe has fallen by 12 per cent. That is not brought about by the market place, but because society in general and the EC in particular have felt it right to put that restriction on European agriculture.
Many noble Lords have complained during the debate about the export of commodities and export refunds. In fact, 65 per cent, of the export of foodstuffs from this country is in added value branded products, it is not in commodity products at all. In order to achieve those added value branded products, some 600,000 people are employed in the food industry in this country, which makes a very important contribution. Therefore, when we talk about agriculture we are not just talking about the 2 per cent. to which the noble Lord, Lord Jay, referred—which does not seem to be very important. We are talking about many more people than that, and vast industries which make an enormous contribution to the well-being of everyone.
Therefore, although on the one hand I firmly support the GATT negotiations, I also firmly believe that we have to move to free world trade in products that give the underdeveloped countries in particular the opportunity to move into our market places. Give them the opportunity and they will. Eastern Europe is already sitting on the borderlines waiting to push forward products as soon as they can negotiate their way into the European market place. They are going to be a lot cheaper than we have seen here up to now. Just two weeks ago, Hungary negotiated an agreement to send several thousand tonnes of duck products into Europe. If those people who complain about the way we farm in this country saw how they farm ducks in Hungary, we would not be allowed to get anywhere near. Yet suddenly we are having to compete with products that are produced very much more cheaply but under conditions which we and maybe the rest of Europe would not accept.
Therefore, as we tackle the world problem, I feel that it is most important that we go into the freer world market which is so essential in a strong position to compete in that world market and should not find that we are marginalised in everything we want to do. One of the noticeable changes that we see in food production enterprises in more competitive parts of the world where they do not have support is that the added value to food production is made in the rural community and not in the urban areas, as happens so commonly in this country. That is a very good thing for the rural community because it adds value.
As we go to a more competitive world, as we undoubtedly shall, then the same pressures will arise in our market place. Already we see changes in the milk industry in this country because of potential changes in the Milk Marketing Board which are essential. We see pressures on individual milk manufacturers, or people adding value to milk, to move nearer to their milk supply. If they are to compete with eastern Europe they will have to get nearer to their milk supply. What stops them? Suddenly there is an

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enormous outcry from everybody that we must not have a milk value added factory in the countryside because that spoils our view. If our view becomes more important than our competition with eastern Europe, then we shall fail.
So there are many important factors of which we must be aware, not just as a Government but as a nation, in what will happen as we—and I hope that we will—negotiate a much freer market for products throughout the world. We shall also open ourselves up to the competition from which the CAP and other walls around Europe have protected us for so long. It will affect our industry at all levels. It will enormously affect anything to do with the manufacture of food. We have the United States of America ready to pump much cheaper food into the European market place. We must see that as an opportunity and not a threat. However, we can only see it as an opportunity if we realise the pressures it will exert on our industry and do what we have to do to compete. If we wish, we can become an importer of grain from Europe to which we can then add value in this country to put value added products into the rest of the EC. However, it is no good when that is coming into say, north-west England if suddenly a stop is imposed because we say that we must not build any more factories in the North West as that is not what we want to see.
There is a balance in everything we have talked about and, although I strongly support everything that noble Lords have said, I hope that we shall also be aware that we shall have to make fundamental changes in our own attitude towards many of the things which are going to have to change as the world grows more and more competitive.
5.55 p.m.
Lord Mackay of Ardbrecknish: My Lords, I am sure we are all grateful to my noble friend Lady Young for introducing what has developed into a most interesting debate. I should love to be tempted to follow my noble friend Lord Wade down the highways and byways of the agricultural policy. However, I shall resist that in the main, but I want to say that he makes a valid point which I can best sum up by saying that there are more to barriers between nations in trading terms than just tariffs. There are other non-tariff barriers and I shall come to some of them later in my speech. However, he has mentioned some of them in the simple way of how we in this country—and indeed in the European Community—expect our fanners to produce their products and how we seem to be pretty lax about expecting the same standards when we import products from other parts of the world. My noble friend makes a valid point.
I want to move a little from agriculture to the processed industries that derive from agriculture. I do not think that calling the processing industry that processes cereals into Scotch whisky quite does it credit and properly savours the product. Noble Lords who were here on a Friday will perhaps recall that in the Second Reading of the Finance Bill I discussed how the United Kingdom Government was not entirely fair in the way it taxed spirits, namely Scotch
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whisky, and for this purpose I am quite happy to allow all the other lesser spirits to come along in its wake. We unfairly tax spirits as against beer and wine. I suggested that the Chancellor might improve on our record in that regard. That is important when it comes to the European Community, where there are equal imbalances between the way our European partners tax beer, wines and spirits. Indeed, some of our principal European partners do not tax wine at all and they tax spirits very heavily indeed.
Our interest in Europe, as it is in the rest of the world, is that we are the major spirit producers so far as concerns our food processing industry. Therefore it falls more heavily on us if tariffs around the world are unfairly placed on spirits, and on Scotch whisky in particular. I certainly hope that my right honourable friend the Chancellor of the Exchequer will be fighting hard, as he promised he would, to make sure that the minimum rates laid down by the Community for spirits will not be punitive on Scotch whisky and will not be at such a level that the price of Scotch whisky in the southern European Community countries will actually have to be raised in order to meet the levels imposed by the Community, especially when the Commission has said that wine-producing countries can have a zero rate on wine.
Where that spills out on the rest of the world is that if we do not treat these matters fairly and equitably in the Community we are on slightly shaky ground when we go outside the Community into GATT negotiations, or even into one to one negotiations, and attempt to ask other countries to treat whisky and European spirits more fairly than they do. That aspect of the GATT Round is what I want to spend a minute or two looking at.
As these negotiations come to what I hope will be a fruitful conclusion I hope that the processed goods from agricultural production, whether they be biscuits, confectionery or whisky, are not forgotten in the negotiations and in the desire to get a solution.
I make no apology for concentrating for a few minutes on Scotch whisky because, as I pointed out to your Lordships some months ago, it is a very important industry. If my recollection serves me rightly, it is the fifth most important export earner for the United Kingdom; it is the top one for Scotland; it employs not huge numbers of people but 16,000 people in Scotland—largely in rural areas, but not exclusively. And of course in the Scotsman's view—and probably in your Lordships' view, I trust—it brings a lot of goodwill to Scotland and to Britain from all over the world.
Noble Lords: Hear, hear!
Lord Mackay of Ardbrecknish: I thought I might get agreement on that, my Lords.
One of the problems in the Scotch whisky industry, as in so many other industries around the world, is that when we try to export we find ourselves up against severe tariff barriers and non-tariff barriers. Perhaps I may give examples of one or two of the non-tariff barriers. Brazil and Mexico require onerous documentation. Canada and South Africa have chemical analytical requirements which are pretty

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tiresome to meet. Thailand and the Philippines carry out pre-shipment inspections. Noble Lords will notice that I have chosen my examples to range from some of the most developed and richest countries in the world to some of the less developed and perhaps poorer countries. I have done so to illustrate that the problem is not confined to certain nations.
There are 40 instances of discrimination in favour of locally based spirits. Japan is quite bad in that regard, although I am happy to say that, thanks to the efforts of my right honourable friend Mrs. Thatcher when she was Prime Minister, major progress was made in Japan in 1988–89. Indeed exports of Scotch whisky to Japan rose by around 27 per cent, after those efforts. Korea, which ought to be a trading nation, is another example of what I have in mind. My goodness, I keep on seeing when I do my shopping, as no doubt other noble Lords do, products made in Korea. What is the Korean view of fair trading? A 35 per cent. tax is put on the local product but 150 per cent, tax is put on Scotch whisky. If we were to impose such a tax on some of the products that we see in our shops from Korea—I am not suggesting that we should—they would suddenly be by no means some of the cheapest items in the shops.
Then of course there are the tariff barriers which involve import duties or Customs duties. The list of countries with such barriers is quite considerable. It includes Korea, Japan, Brazil, the United States of America—which sometimes in this GATT Round has tried to appear as the whitest of white countries—Hong Kong, India, Australia and New Zealand. Those countries all have some form of import tariff on Scotch whisky. I very much hope that the Commission—as the noble Baroness, Lady Elles, reminded us, the Commission negotiates on our behalf—will not forget that it has a responsibility to the Scotch whisky industry as it negotiates for fair and equitable arrangements around the world.
I doubt very much whether we shall ever remove all these impediments to trade. However, what the Scotch whisky industry would like—preferably, in one-to-one negotiations inside GATT—is to negotiate a zero-for-zero tariff arrangement. We in the European Community are fair and equitable to the import of spirits from abroad. We then expect foreign countries to be equally fair with our exports to them. I very much hope that my noble friend the Minister will be able to assure us that the Government will be doing all they can to encourage the Commission to take a reasonable lead on this matter and to look in particular at the common Customs tariff of the Community itself.
The Community must look at some of its trading arrangements if it expects other people to do likewise. The Community must see to it that there is a reasonable rate on all bottled and bulk spirits imported into the Community, that they are treated alike, that the duty is levied on the basis of alcoholic strength—I have been over that ground before—and that no other import duties are allowed on any imports into the Community. In that way, with whisky
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as with many other products, we should be able to persuade other countries to have much fairer arrangements for the import of our products.
My noble friend Lord Wade mentioned export refunds. I very much hope that the Government will not allow the Commission to think that any trade-off can be made between a reduction in tariffs around the world and the export refunds given to the Scotch whisky industry. The industry has to use the very much higher priced European and British cereals. Its competitors in the United States who make bourbon buy cereals at a much lower price. The export refund is for that purpose and is not to compensate for the tariffs.
In conclusion, I wish to refer to another industry of equal importance to our country which is often looked at from the point of view of needing protection but which in fact is very important in the international trading scene. I refer to the textile industry. In the United Kingdom the product is worth around £16 billion. About a quarter of that total is exported. In Scotland we do slightly better. Of the £1.5 billion output almost half is exported. It is important for the textile industry that there are level playing fields around the world. I do not just mean in some of the poorer countries—I mean in some of the richest markets or in some of the improving markets around the world.
We should like to see the prohibition of trade distorting subsidies. South Korea has just given a £2.5 billion subsidy to its textile and clothing industries. We should like to see protection of brand names. In Taiwan and Japan that is not done very well at all. The United States of America has a 36 per cent, import duty on our exports to it of wool cloth. What I have illustrated there and in the whisky examples is that some of the richest countries, including the United States, which wish to see themselves portrayed in regard to agricultural products as whiter than white, are in fact fairly protectionist. What we need is a freeing of world trade.
My noble friend Lord Thorneycroft in his powerful speech made it perfectly clear that over 30 or 40 years the freeing up of world trade benefits every single person. I hope that the European Community does not turn itself into a fortress behind whose walls we all shelter, and will in fact take a leading role in liberalising and opening up world trade for everyone's benefit.
6.7 p.m.
Lord Plumb: My Lords, I wish, first, to apologise to my noble friend Lady Young for not being present when she opened the debate on the Uruguay Round of GATT. Nevertheless I thank her for enabling the debate as a whole to take place. I was not sitting on a tractor reflecting on the world scene, as my noble friend Lord Stodart was the other day, but I was very much involved in the Smithfield Show. I say that particularly, and I say it in the context of this debate, because there one sees the finest examples of the products produced in this country and throughout Europe. One sees the products of British agriculture and British industry. One sees the high quality stock,

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machinery and technology. One sees the many overseas visitors who have been pouring into London over the past few days to look for business, to look for opportunities and to look for the expertise that can be offered by agriculture in this country. It is in that context that we should consider the development of trade in the more competitive world into which we are moving.
As I am sure many noble Lords have said, agriculture lies at the very centre of the GATT negotiations. British agriculture, together with European agriculture, must be free to compete on fair terms, and any solution that may be reached in the GATT or any settlement made must apply equally to competitors worldwide. A settlement in GATT is imminent and therefore this debate is timely.
I do not believe that we can ever move towards that level playing field to which many noble Lords have referred. I am not sure that we have ever had a fully level playing field in the United Kingdom. We certainly do not have one in Europe. Nevertheless, on fair terms, we can compete. We should therefore welcome the initiative already taken by the Director General of GATT who has come forward with a detailed framework which I hope will allow the negotiation of a final agreement.
His proposal puts forward a number of elements which would bring about an agreement to reduce trade distorting support measures and protection over the period of the rest of this decade. He claims that that would cover the border measures, to which reference has been made, the export assistance and the internal support which, together, go towards distorting trade. If we accept that policy, it is crucial that each country in turn accepts the discipline of such an agreement and that within the European Community, as part of the overall deal, no discriminatory measures are taken between producers.
A GATT settlement will set the guidelines for a CAP settlement and CAP reform. I do not believe that it is overdramatic to say that the positions which now need to be reached on both the reform of the CAP and on food and agriculture in GATT will indeed cast a shadow forward to well beyond the end of this century. If we produce the wrong answers, then we could see lasting damage done to our ability to compete on fair terms both in Europe and in world trade.
As I see it, the risks are real and the problems deep. No one can argue against the need for those major reforms. The United States and the European Community, together with Japan and many other developed countries, have been subsidising each other out of the market over many years. That has forced world market prices down and, as has already been said so clearly, the sufferers have often been not those countries which are exporting but the developing countries whose market has been undermined.
Therefore to avoid that lasting damage, agreements must be made progressively to reduce the level of trade distorting support measures that we have seen operating over the years. Forms of internal support exempt from such reductions, assuming that they do
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not distort trade, could include: programmes which provide general services to agriculture research; disease control; general marketing and promotion; retirement and retraining programmes; the transfer of technology; infrastructure building; bona fide food aid and disaster relief, together perhaps with crop insurance and public stockholding for food security reasons. As I see it, there has to be flexibility to allow programmes for regional development, environmental protection and conservation and restructuring of agricultural sectors.
Food safety and animal welfare, as my noble friend Lord Wade said earlier, is a major concern in a world of more liberalised trade. There is always the danger that regulations can be applied and used as non-tariff barriers to protect the individual market. Therefore, we should make sure that there is agreement to enact rules to ensure that sanitary and phytosanitary regulations are based on scientific criteria, and not just on political expediency which often happens or indeed on emotion.
Therefore, in any agreement progressively to reduce direct export restitution and indirect export assistance, there has to be a tightening of rules and disciplines so that the assistance does not exceed the difference between internal and external markets. For example, export subsidies from the European Community have often been higher than the value of the product. That is of no direct benefit to the producer/farmer who is concerned to produce for the marketplace, not for the intervention store. High quality beef, for instance, soon becomes low quality beef after freezing for long periods of time.
Perhaps another area of concern which we cannot ignore as we consider world trade agreements relates, as so many noble Lords have said, to the problem in many developing countries. It is an irony is it not?—that we continually highlight the areas where we have surpluses, yet half of the world's population is either starving or suffering from malnutrition. Special provisions for developing countries and countries undergoing transition to market systems to allow appropriate development programmes and a slower timetable for reductions in border measures and trade distorting internal support have to be made. Many of those countries, including those we see developing in Eastern and Central Europe, are experiencing short-term and long-term problems in financing the normal levels of commercial imports. I believe that they should be eligible to draw more easily on the resources of international financial institutions.
I believe that it is imperative that governments should take all the initiative necessary to ensure that a satisfactory agreement on agriculture in particular is reached during this round and that the round itself is completed as soon as possible. Indeed, it would be an appropriate goodwill message to the world as we enter 1992. It would help to restore some of the confidence that is currently sadly lacking.
6.16 p.m.
Lord Clinton-Davis: My Lords, perhaps I may at the outset express an apology on behalf of my noble friend Lord Williams of Elvel for the fact that he had

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to leave the House shortly after completing his speech. He was unavoidably required to be elsewhere. Certainly no discourtesy was intended, and I am sure that the House will understand.
As has already been said, the House must be indebted to the noble Baroness, Lady Young, for her notable contribution and for her initiative in bringing forward what on any terms has been a very remarkable debate. Several former Ministers, leaders in industry, banking and other significant fields of activity have participated. We even heard about Lord Stodart of Leaston's problems with bunkers. We also had a notable contribution from the noble Lord, Lord Plumb, who was a very distinguished President of the European Parliament. I was very glad to have participated in debates there under his guidance.
If I single out one speaker, I am sure that the House will understand. I say that because for me it was a pure joy to hear the humorous, yet purposive, reminiscences of the noble Lord, Lord Thorneycroft, about the part that he played in advancing the cause of GATT in those early days and also about the part that he played in demolishing some of the ideological prejudices of his party. I happen to feel that he is needed again in that regard, but there it is. I believe that significant lessons may be learned from the powerful and passionate speech that he made.
In my view the common denominator of this debate—and much agreement has pervaded the House today—is the recognition on all sides of the significance of this Uruguay Round and of the fact that time is of the essence. Yet, in the very limited time available, so much more needs to be done if we are to achieve success Of course it is right that, historically in this regard, deadlines have been set before and extended. However, it seems to me that this time most people feel that the deadline which has been set is for real. The stakes are indeed high. I believe it was Carla Hills who said that if the negotiations prove to be successful the world stands to gain about £2,325 billion in terms of world output.
If there is failure, then, as my noble friend Lord Williams of Elvel said at the beginning of the debate, there will be a loss of trade, unemployment, trade wars and disaster for the poorest of all. All that will ineluctably follow. In that context, it is as well to remember the prudent words of Mr. Barber Conable, the President of the World Bank, who said:
"Protection of the industrial nations costs developing countries more than twice as much as they receive in aid".
The present negotiations, and indeed the debate, have focused inevitably on agricultural issues and the common agricultural policy. I wish to put on the record, on behalf of the noble Lord, Lord Cockfield, and myself, that we struggled manfully in the Commission to try to get some sense into the policy. However, we did not always succeed. Other major issues too are critically important. Banking is important, alongside beef. Copyright, textiles, telecommunications, transport, tourism and shipping are critically important in the negotiations. It is as well to observe that the United States itself, while complaining bitterly as it does about the CAP, engages in appalling discriminatory and restrictive
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practices in terms of shipping; notably as a result of the long-established Jones Act which is still iniquitous, however long it has been part of United States law.
The difficulty with the development of the negotiations is that they have tended to obscure the penalties of failure and the significance for other players on the GATT stage. There is a lack of balance about the negotiations. I refer to the way in which the issues are portrayed, especially in the context of relations between the United States and the European Community—in parenthesis I have to say that on the whole the United States has come off rather better, at least in the PR battle; the way in which the interests of the developing world have been addressed, or, perhaps, more correctly, have not been addressed, as my noble friends Lord Judd and Lord Desai said (of course everyone pays lip service to the interests of the developing world); and then there is the failure to take account of environmental issues, so eloquently depicted by my noble friend Lord Judd.
It is noteworthy that the GATT does not take account of environmental issues, although there is competence there, because a committee was set up in 1971 to examine the relationship between trade and environmental issues. That committee has never met. It is also noteworthy that the Nordic countries, Austria and Switzerland have called for that committee to be revived and to sit. I should like to know from the Minister whether the United Kingdom Government support those endeavours. More than that, the GATT rules forbid environmental protection measures being accompanied or supported by restrictions on trade. I should like to know from the Minister what is the Government's attitude to those issues. For example, how can the Montreal Protocol on CFC emissions be reconciled with that situation? The Montreal Protocol insists that there should be trade restrictions to protect the environment. It was right for all the European member states to support that protocol and to inspire the reaching of that accord.
The noble Baroness, Lady Elles, referred to the Commission being the negotiator there, and rightly so. Nonetheless, it is important to take account of the fact that the Commission has to negotiate according to a mandate which is set by the member states; and so it is relevant to ascertain from the Government what is their position on some of those matters. What about the CITES regulations which impose restrictions on trade in endangered species? What of those many developing countries which are not self-sufficient in agriculture and look for food security? Are they to be placed in the same position as rich countries in being required to phase out subsidies to farmers and farm import controls? How would that impact on third world powers if they were to lose their only source of income? What then of the concept of sustainable development?
Those are serious issues which, in the light of massive hunger, poverty and indebtedness (all so indivisibly connected) must be faced, or are we to shelter under the insubstantial argument that it is not the business of the GATT to address those problems?

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A number of your Lordships have expressed, in reasonably polite terms, the belief that the CAP is iniquitous. If we had all been farseeing when the Community was established, we might have had some influence in shaping a more rational agricultural policy for the whole Community. There may be a lesson in that too as we approach the IGCs at Maastricht. I noted that the noble Lord, Lord Boyd-Carpenter, who, if I may say so, made a characteristically good and robust speech—we expect that from him—seemed to suggest however that success at the GATT and success at Maastricht were somehow mutually exclusive. I cannot accept that doctrine.
Lord Boyd-Carpenter: My Lords, will the noble Lord give way?
Lord Clinton-Davis: My Lords, certainly. I thought that I would provoke the noble Lord.
Lord Boyd-Carpenter: My Lords, if the noble Lord so misunderstood me, I must have expressed myself badly. All I indicated was that success over the GATT round was more important and more urgent than success over the other matters which will be dealt with at Maastricht.
Lord Clinton-Davis: My Lords, I was not that far wrong. In my judgment, at least—perhaps I differ from the noble Lord—they are equally important. Success at Maastricht is important, but so, of course, is success in the world wide negotiations. Perhaps there is not so much between us after all.
It is right also to observe that not much less iniquitous than the CAP has been the deficiency payment system used in the United States—the main source of United States exports subsidies. In the negotiations, certainly in the PR battle at least, we have tended to lose sight of that fact.
I shall say a few words about the consequences of failure. Stronger protection for individual property will go; the liberalisation of trade will suffer; investment in services will be jeopardised; the developing countries will be denied protection against the dumping of vast food surpluses at prices which make it impossible for them to engage in efficient food and agricultural production. So the test for the Community in relation to agriculture is not merely whether we recognise the need for reform—even the most unlikely people seem to understand that today—but whether we can formulate, agree, and then enforce detailed proposals. There is a sorry story to be told about enforcement so far.
As the noble Lord, Lord Boyd-Carpenter, said, we should not underestimate internal political problems posed for so many in the negotiations: the United States presidential elections; our general election next year; the change in the presidency of the Commission; the new post-Maastricht situation; in Germany, where battle has been joined by the German Economics Minister and Herr Kiechle, that champion of small, inefficient, moonlighting farmers whose appetite for unrealistic farm support is insatiable—I can only hope
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that Herr MÖllemann will succeed; and in France, where there have been violent demonstrations by farmers. There are worldwide internal contradictions.
I wish to say in conclusion that the European Commission has a major task in seeking to formulate a united position. But it must do so if we are to succeed. Concessions here are self-evidently conditional on the United States in particular making much greater concessions in the services sector, on anti-dumping and subsidies. We are so close now to the end of the Uruguay Round that we have to ask, will it be failure or success? Will it be beggar-thy-neighbour policies or better-thy-neighbour policies? Will it be international humiliation or international hope for the future of peoples right across the globe?
6.30 p.m.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Reay): My Lords, I am grateful to my noble friend Lady Young for introducing this debate. I do not think that I have ever taken part in a debate in which there was a greater degree of unanimity. There was hardly a dissentient voice, hardly a discordant note, only faint traces of partisan speech in a general recognition of the importance of this issue and the need for us to reach an agreement before the end of the year. That was very welcome to me.
The General Agreement on Tariffs and Trade—GATT—has served us well for over 40 years. It has provided a framework of rules for the conduct of trade relations and the settlement of disputes without the need for recourse to damaging retaliation and counter-retaliation. It has also provided the forum for negotiating trade liberalisation. It is a framework within which world trade has grown and prospered.
Its success is demonstrable. Since GATT was formed in 1947, tariffs in the industrialised countries have dropped from an average of 40 per cent, to an average of 5 per cent. World trade in goods has grown nearly twice as fast as world GDP. When recession came, as it did in the mid-1970s and again in the early 1980s, the world trading system held up, unlike the disastrous falls in trade and output which occurred in the 1930s, resulting from protectionist legislation in response to the Wall Street crash.
At the same time an increasing number of countries have come to realise the benefits of liberalising trade. When the GATT began it had 23 members. Membership has now grown to over 100 countries, with still more applying to join. GATT members now account for nearly 90 per cent, of world trade.
However, in recent years the GATT system has been coming under increasing strain. There has been a growth in protectionist pressures and in grey area measures which circumvent the GATT system and thus undermine it, even if they are not directly contrary to it. In addition, GATT does not cover important new areas of increasing importance to trade, such as services, investment, and intellectual property. Moreover, new rules are needed for textiles trade and for agriculture. It is for these reasons that GATT members embarked on the Uruguay Round of negotiations to modernise and strengthen GATT. We

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believe that a successful conclusion to the Uruguay Round would bring great benefits both for developed countries and for the developing world.
British industry stands to gain considerably from trade liberalisation which will open up more opportunities for exports. Participants in the Uruguay Round have set themselves the objective of reducing tariffs by an average of 30 per cent. It has been estimated that if this objective is met, it could boost British exports by more than £700 million.
As far as service industries are concerned, liberalisation in this important area would provide major new opportunities for the British service sector. The European Commission has suggested that European Community exports of services could increase four-fold. At the moment services account for 60 per cent. of advanced countries' domestic economic activity, but for only 20 per cent. of world trade.
The introduction of GATT disciplines into the field of intellectual property protection would also yield important benefits to industry. At present, the lack of such protection loses our drug companies £50 million a year; and it costs our record industry perhaps as much as £1 billion a year. These figures give some idea of the importance to our industries of an agreement which protects them against piracy, counterfeiting, and illicit copying.
More and better opportunities to invest overseas will be opened up if we can achieve an agreement on removing trade-distorting conditions on investment such as minimum export requirements. This is of major significance to a country such as the United Kingdom, which is the second largest outward investor in the world after Japan.
Proof of the value to our industries of a stronger, more open international trading system lies in the fact that British industry has consistently lobbied hard on the need for a successful round. I am greatly encouraged by the support which it has given the Government in our efforts to promote a successful outcome. Representatives of British industry and commerce have also joined their colleagues in other European countries and elsewhere to ensure that the Commission and other governments are left in no doubt of the importance they attach to a substantial agreement.
However, we must not think that it is only producers who stand to gain. The consumer too will see major benefits. Liberalising markets will promote competition and offer the consumer greater choice. It should also bring lower prices, by reducing protection. Protection of the textiles industry costs United Kingdom consumers alone £1 billion a year. This is equivalent to an extra 5 per cent. on retail prices. Let us not forget that it is the poorest members of society who are hit hardest by higher prices.
As my noble friends Lady Young and Lord Alexander of Weedon reminded the House, the OECD estimates that agricultural subsidies in OECD countries cost consumers and taxpayers some 300 billion dollars last year. The common agricultural policy is estimated to cost EC consumers and taxpayers 130 billion dollars a year. Of course, these costs will not disappear overnight. But reform would
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put in place a mechanism which will enable market-distorting subsidies and barriers to agricultural imports to be progressively reduced.
As the noble Lord, Lord Judd, brought out in a forceful speech, the benefits of a successful Uruguay Round will not be limited to producers and consumers in the developed world. Developing countries also will benefit from a general reduction in tariffs. At the moment, developing countries suffer more from the exclusion of their products from markets of developed countries than they gain from overseas aid. A Uruguay Round agreement will give them better access to developed markets. To give an example, improving access for tropical products provides one means by which the developed world can help developing countries. In this context I am glad to be able to say that as part of the Uruguay Round negotiations the European Community has found itself able to reduce the tariffs it levies on such products and has offered further reductions. Reduced tariffs will encourage increased trade flows, not only between north and south, but between south and south, that is between developing countries themselves.
Developing countries will also benefit from agreements on services, intellectual property rights and investment. The presence of GATT disciplines will make western firms more willing to supply services, technology and investment in developing countries, and this in turn will provide new skills and promote domestic research and development in those countries.
I mentioned the costs of textiles protection to our own consumers. Many developing countries are major producers of textiles and clothing. As the noble Lord, Lord Desai, reminded us, we must not forget the obstacles which protectionism puts in their way in this sector above all others, as they seek to increase export earnings and create employment opportunities. I am happy to say that negotiators are close to an agreement which would entail phasing out the Multi-Fibre Arrangement over a period of about 10 years. At the end of this transitional phase textiles trade would be brought fully within the normal rules and disciplines of the GATT, as strengthened in the current negotiations.
I should like to turn to this subject of strengthening existing rules and procedures. Improved rules covering trade in all sectors are necessary to ensure that producers are not subject to unfair competition. But we are also pressing to ensure that these rules are not abused for protectionist motives. In the case of anti-dumping, for example, we believe that there is a need for anti-dumping provisions to deal with unfair trade, which GATT members should not be able to circumvent. However, we also believe that there is scope for tightening up the rules to ensure that when action is taken this is done on the basis of criteria which are as objectively assessed as possible.
We are also seeking a strengthened mechanism for the settlement of disputes over breaches of GATT obligations. Under the present consensus principle, the consent of all GATT members is required before the findings of panels hearing cases brought before the

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GATT can be adopted. This means that parties to a dispute can block decisions which go against them. We need to reform procedures so that this is no longer possible. If such a reform is implemented there would no longer be any justification for unilateral trade measures.
The most difficult issue in the Uruguay Round has, of course, been agriculture. Disagreement over cuts in agricultural support and protection was a major cause of the breakdown in negotiations at what was to have been the final meeting in Brussels last year. Since then participants have gone a long way to resolving their differences. The European Community and the United States are much closer to bridging the gap which exists between them. This time last year the US was demanding cuts of up to 90 per cent. in agricultural support. The two sides now seem close to a more realistic figure of 30 to 35 per cent. reductions in support over five or six years in each of the separate areas of domestic support, export subsidies and import access.
Four outstanding issues have yet to be resolved in the agricultural negotiations. First, negotiators are still discussing how reductions in export subsidies should be measured. A commitment based on a reduction in the total value of export subsidies would be simple to measure and is favoured by the European Community. However, if the gap between world prices and domestic prices narrows and the subsidy per tonne therefore decreases, a budgetary limit might actually allow the quantity of subsidised exports to increase. The United States is therefore looking for a commitment to reduce the volume of subsidised exports.
My noble friend Lord Wade has seen press references to substantial reductions in EC exports occurring as a result of GATT. I believe the figures he has seen are rather high, but I emphasise that nothing has yet been decided. A compromise solution incorporating both budgetary and quantitative commitments would seem a sensible solution and may well be possible. The second key issue is how to convert import barriers—
Lord Jay: My Lords, what is the British Government's attitude on agriculture and what proposals are they putting forward in the negotiations?
Lord Reay: My Lords, we are not responsible for that matter in the GATT negotiations as they are conducted by the Commission. I shall discuss agriculture further in a moment.
As I was saying, the second key issue concerns how to convert import barriers, such as quotas and variable levies, into fixed tariffs which might then be subject to a reduction commitment. Tariffication as this is known, is now accepted in principle by most contracting parties, but the precise methodology for calculating tariff equivalents is still under discussion.
The third issue involves what is known as rebalancing. When the European Community put forward its original offer of 30 per cent. cuts in total subsidies, it also proposed to introduce new protection
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for certain cereal substitutes, such as oil seeds. The Community accepted that such an increase in protection would need to be matched by correspondingly larger reductions elsewhere to meet the overall 30 per cent. cut. In our view, however, the Uruguay Round is not the time to introduce new protective subsidies, and we argued against including rebalancing in the European Community proposals. Predictably, rebalancing has not proved acceptable to other contracting parties, and I believe the European Community must now be prepared to moderate its position if we are to get movement in other areas.
Fourthly, negotiators still have to determine the precise nature and scope of the green box; that is to say, those subsidies which will be exempt from cuts. There is general agreement that some measures which are not directly linked to production, such as set-aside or environmental payments, should be placed in the green box and be exempt from reductions. Although these policies transfer government funds to agricultural producers, they do not encourage excess production. Other policies which offer price support or production subsidies clearly should not be in the green box. Between these extremes the precise boundaries of the green box have yet to be decided. In particular a decision has yet to be taken on the situation regarding direct payments to producers, such as the compensation payments proposed by the Commission as part of the reform of the common agricultural policy. We would like to see exemptions from cuts kept to a minimum to ensure that the agreement results in effective overall reductions in support, not only in the Community but in other countries too.
Of course, it is not enough for the European Community and the US alone to reach agreement. Any deal on agriculture must be acceptable to other GATT members, including Japan and the Cairns Group of agricultural exporting countries. The agreement which seems to be emerging from these negotiations may seem disappointing to some contracting parties. However, the crucial point is to get an agreement which locks agricultural subsidies into the GATT system once and for all. The remorseless application of the GATT ratchet has brought tariffs on manufactured goods down by seven-eighths since GATT began and I am sure that future rounds of negotiations will produce further reductions in agricultural tariffs.
As my noble friend Lord Plumb pointed out, inflated agricultural subsidies cost us dear in higher taxes and higher prices, and yet the full benefit of this sacrifice is not passed on to the farmer. All too much of the subsidy goes on storage, refrigeration and disposal costs. Also, returns on farming are higher than they would otherwise be and this perversely drives up the price of rents, land and other inputs.
Lord Wade of Chorlton: My Lords, my noble friend the Minister said that in Europe production will be limited. Is he aware of any other participants in the GATT negotiations who, in addition to reducing their tariffs, will also put a limit on their level of production?
Lord Reay: My Lords, that matter is part of the general negotiations. A general reduction in subsidies will not necessarily adversely affect farmers as much as they may fear. This is particularly true of British farmers whose greater efficiency will be rewarded by increases in their competitive advantage as market distorting subsidies are reduced.
I was pleased to hear the confident assertion of faith of my noble friend Lord Stodart of Leaston in the ability of British farmers to meet the demands of a more open and fairer market. I share that faith. An agreement on agriculture is in all our interests. It will pave the way for agreements in other sectors, for agriculture is not the only unresolved issue.
Negotiations are continuing on reductions in tariffs. The UK has strongly supported the Community position on the importance of cutting high or peak tariffs. This is because high tariffs are more of a barrier to trade than low tariffs. The European Community has largely given up relying on high tariffs. Our highest industrial tariff is 22 per cent. Once the Community tariff offer is implemented, the highest rate will be 19 per cent. Initially the United States focused on its zero for zero proposals under which each participant would completely eliminate tariffs on certain items. However, these proposals would only result in the elimination of tariffs in cases where rates are already very low. However, cutting peak tariffs and eliminating low tariffs are not mutually exclusive options. It is looking increasingly likely that it will be possible to reach a compromise covering elements of both approaches.
In the field of services good progress has been made. All the major parties accept that the most favoured nation principle should be the long-term objective for all forms of services. This principle, which means that no nation receives more favourable treatment than that available to other nations, is a principle which has been a powerful mechanism for promoting free trade. It is vital that it should apply in the agreement on trade in services.
I entirely agree with my noble friend Lady Young on the importance of achieving a framework agreement for services. Good progress is being made although the detailed work on specific commitments for each service sector will continue into next year after the main package of Uruguay agreements has been settled.
Having gone through the principal areas in which work remains to be done, let me now turn to the overall state of the negotiations. Attention is focusing on the talks between the European Community and the United States. The European Community/US summit early last month underlined the determination of these two parties to reach agreement. It also did much to bring that agreement closer. Since then high level negotiations have continued. Meetings have been taking place in the Hague today following preparatory meetings which took place in Brussels yesterday. The talks have widened to include all aspects of the round, rather than focusing exclusively on agriculture. While differences remain, these are gradually being resolved.
Further progress in these bilateral negotiations would act as an additional stimulus to the multilateral
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negotiations in Geneva where progress has fallen behind the timetable set by the GATT Director-General, Mr. Dunkel. He had originally hoped to table a draft agreement in mid-November. However, the negotiating committees failed to produce the sectoral agreements which would have made that possible.
The noble Lord, Lord Jay, queried whether an agreement would be possible this year. We believe that we can still achieve the necessary breakthrough before the end of the year. Once that is achieved, there will still be some detailed work to do. It should be possible to complete that work in time for the final agreement to be formally approved by March next year, but agreement on the principles of a comprehensive package covering all areas of the negotiations must be reached this year. If a breakthrough on agriculture is achieved in the next few days, Mr. Dunkel hopes to achieve an overall agreement by 20th December.
Perhaps I may now respond to some points raised by other noble Lords which I have not touched on or have touched on only briefly. The noble Lord, Lord Williams of Elvel, raised the matter of textiles. I am grateful for his support on that matter and for the support that he promised generally from his side on the matter. It was well illustrated by his extremely constructive speech. Perhaps I may add to what I said on the subject of textiles by making it plain that the Government have always been committed to liberalising trade in textiles, but it is equally our aim that the rules and disciplines should be strengthened by improvements, all or most of which would come in before completion of the MFA phase-out.
United Kingdom industry rightly attaches great importance to progress in the areas of safeguards, subsidies, intellectual property, dumping and better access to all markets. The right reverend Prelate expressed his anxiety about the dumping of agricultural products on the third world. We all share that worry. The reductions in agricultural support and export subsidies to which I referred should make such practices unnecessary as well as undesirable.
On the issue of the reform of the common agricultural policy, several noble Lords, including my noble friends Lord Boyd-Carpenter and Lord Boardman, the noble Lords, Lord Williams and Lord Jay, and the noble Baroness, Lady Seear, referred to the urgent need for reform of the CAP. I can assure the House that the Government continue to be committed to secure a genuine, fair and sustainable reform of the CAP. I am grateful to my noble friend Lord Boyd-Carpenter for recognising the Government's strong line on the CAP reform and for protesting at the failure of the noble Lord, Lord Hollick, to do so. I should have thought that our efforts to secure reform of the CAP were fairly widely appreciated. We believe that changes which make European agriculture more market-oriented, cut the costs of the CAP and lead to a closer integration between agriculture and the environment are vital, regardless of what happens in the GATT Uruguay Round.
I am grateful to several noble Lords, including my noble friends Lady Young and Lady Elles, for

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recognising the role played by my right honourable friend the Prime Minister. Throughout those important final stages, he has played an active role in the round through the contacts with his counterparts in other key GATT countries. As chairman of the G7, he recently wrote to all his colleagues reminding them of their commitments and emphasising the need for everyone to face up to the difficult decisions involved. That gives the lie to the accusations of the noble Lord, Lord Hollick, that Her Majesty's Government have not done enough to advance the negotiations. Moreover, it must always be remembered, as my noble friend Lady Elles reminded us, that it is the Commission which negotiates on behalf of all member states.
A number of noble Lords, including the noble Baroness, Lady Seear, said that the whole subject of GATT should be given a wider airing and a higher degree of public awareness. I agree with that, but I do not see that if that matter does not achieve success it can be blamed on the Government. I understand that my right honourable friend the Secretary of State for Trade and Industry and his predecessors have constantly sought to bring this subject to public attention. I understand that my right honourable friend the Secretary of State made a major speech on the subject only two days ago to the Institute of Directors. This I strongly commend to your Lordships, although those who pay close attention to my speech will have less need to read his.
My noble friend Lord Alexander of Weedon asked about the liberalisation of financial services as a result of the Uruguay Round. The United Kingdom and the European Community want to see the maximum possible liberalisation by other GATT members in that sector. As my noble friend said, the Community is already fairly open. The offers by other GATT members and currently on the table certainly fall short of what we would ideally want, although we must remember that this is the first time that services have been covered in GATT. If we get a sound framework agreement in place, it can be built on later. My noble friend is not in his place, but, as he said, he will read the debate in Hansard and I can assure him through that medium that I shall reply to his other questions in writing.
Perhaps I may reply to my noble friend and clansman Lord Mackay of Ardbrecknish on the subject of Scotch whisky and, as he put it, the lesser spirits. We are well aware of the importance of gaining improved access to third country markets for Scotch whisky producers and for other spirit producers. We have consistently supported the Scotch Whisky Association's position on that issue. We are also aware of the association's support for the United States proposal for multilateral elimination of tariffs and non-tariff measures on distilled beverages. We have made its views known to the European Commission negotiators who will respond to the United States. However, that is only a small element of a much wider United States proposal whose implications will need to be considered carefully in the context of our overall aims for the negotiations.
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The noble Lord, Lord Clinton-Davis, sprang several questions on me to which I shall reply in writing. However, I can tell him that the GATT working party to which he referred has recently been re-established.
It was a privilege to listen to one of the players in the GATT story. I refer of course to my noble friend Lord Thorneycroft telling us of an important moment in the development of free trade thinking in British politics, a moment in which he himself played a most significant role. I agreed with my noble friend in what he said about the urgency of reaching a conclusion.
All the major parties agree that the round must be substantially concluded this year. If we do not reach an agreement this year, there is a risk that we shall never reach one. We must be absolutely clear that we cannot afford another failure like that of last December. As my noble friend Lord Boyd-Carpenter said, we have now a golden opportunity. We are nearer a deal than we were this time last year. In key areas of the negotiations, the agreements will be more robust and comprehensive than they would have been had they been signed last December. The extra time has enabled negotiators to improve on draft texts and to agree more tightly drawn-up provisions.
The GATT Director-General has put the onus for resolving the final difficulties firmly on the participants, where it belongs. If we shirk that responsibility and avoid taking decisions, however difficult they may be, we risk seeing an increase in protectionism, restrictive bilateral agreements, and the creation of inward-looking trade blocs, as my noble friend Lord Thorneycroft warned us. We would not simply return to where we were before negotiations began and we would lose much more than the chance to open up new areas of trade. People would lose faith in GATT. At a time when developing countries and the countries of Eastern Europe are adopting market economies and seeking to participate more fully in international trade we cannot fail them by allowing the framework which safeguards that trade to be destroyed.
Finally, a successful Uruguay Round will cement world peace. Whereas in the 1930s protectionism led to the Great Depression which was the prelude to war, free trade can provide the framework for peace. We can, and must, ensure that the international trading system, which has served us so well in the past can provide the basis for fair and open trade into the 21st century, to the greater prosperity of all mankind.
6.59 p.m.
Baroness Young: My Lords, it remains for me to thank everyone who has taken part in this important debate today. Unfortunately, neither time nor the conventions of the House allow me to respond to all the points raised or to say all the many things that I should like to do, but I too shall read Hansard very carefully.
In thanking all noble Lords who have taken part, I should like particularly to echo what my noble friend Lady Elles, the noble Lord, Lord Clinton-Davis, and, a few moments ago, my noble friend the Minister said about my noble friend Lord Thorneycroft. He made an extraordinarily moving speech. He gave us an

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insight into an important piece of history and the role that he himself played. We should all be very grateful for what he did on that occasion as well as for his speech today.
This debate has been unique in my experience too by the very wide measure of agreement in all parts of the House. Every noble Lord who spoke agreed on the vital importance of completing the GATT round. I am grateful to the noble Lords, Lord Clinton-Davis and Lord Williams of Elvel, for their support as well as to the noble Baroness, Lady Seear. The GATT round is of importance not only for the industrialised countries but also for its effect on the third world. We all listened with great interest to the noble Lord, Lord Judd, who spoke from his great experience of the matter.
Several important messages came forward to the Government. First, the agreement needs to be made quickly. I was most interested to hear what my noble friend the Minister said on that point. Secondly, the importance of what is at stake in the GATT round needs to be much more widely known. That is always difficult to achieve. I recognise that my right honourable friend the Secretary of State for Trade and Industry has made a number of speeches on this matter. But people find it very technical and difficult. As my noble friend Lord Boardman said, they are bewildered by it. However, it is something which affects us all. That point was made also by the right reverend Prelate the Bishop of Worcester.
Much of the latter part of the debate turned on the issue of agriculture. I listened with great care to what was said by my noble friends Lord Wade and Lord Stodart about the importance of a level playing field. I am quite certain that no one will be able to drink a glass of whisky again without understanding exactly what is meant by a non-tariff barrier. It was helpful also for my noble friend Lady Elles to explain so clearly the reasons for the development of the common agricultural policy and to draw our attention to the importance of the role of Mr. Dunkel. We certainly wish him well. I should like to add my recognition of the value of the high standards of British agriculture. Like all those who have taken part in the debate, I hope that my noble friend Lord Plumb is right and that a settlement is imminent.
I conclude by thanking my noble friend the Minister. He gave a very full and extraordinarily interesting reply. I was pleased to hear where we stand in the detail of the negotiation and I felt greatly encouraged by what he said. I hope that in his turn he will take back a message from this debate about the strength of unanimity of view in all parts of the House. Everyone spoke from both knowledge and experience. Quite properly we want to support the Government at this time in all that they do to press the Commission for a settlement of the GATT round. My Lords, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

City of Edinburgh District Council Order Confirmation Bill
Brought from the Commons; read a first time, and (pursuant to the Private Legislation Procedure (Scotland) Act 1936) deemed to have been read a second time and reported from the Committee.
Strathclyde Regional Council Order Confirmation Bill
Brought from the Commons; read a first time, and (pursuant to the Private Legislation Procedure (Scotland) Act 1936) deemed to have been read a second time and reported from the Committee.

Boxing Bill [H.L.]
7.5 p.m.
Lord Taylor of Gryfe: My Lords, I beg to move that this Bill be now read a second time.
First, I should explain the purpose of the Bill. It is quite clear; it is to ban professional boxing in this country. There may be some comments to be made on the Bill's clauses. It is a rather simple Bill and any amendment to it to clarify its purpose could be made at Committee stage. I sincerely hope that it will reach Committee stage.
This Bill has an interesting history. It was moved on 10th May 1962 by Lady Summerskill. On that occasion it was defeated by 27 votes to 22 votes—a rather thin House. Ten years ago, almost to the day, I introduced the Bill to this House. On that occasion there voted Content 47 and Not-Content 77. The Bill did not receive a Second Reading.
However, recent events in the ring have certainly encouraged me to reintroduce it. There is growing concern on the part of the public about those recent events. I am aware that the British Boxing Board of Control has tried to make the sport—if it can be called a sport—more acceptable. Looking at the changes that it is making in the affairs of boxing following the sad events of 10 weeks ago, it is obvious that anything done is done to improve the treatment of boxers after they are knocked out and not before. It is after they have been knocked out that the authorities will make an ambulance available and will have a doctor at the ready and there will be no ringside or in-the-ring interviews. That does not deal with the basic problem of boxing and the objections to boxing as a sport which I have and which I hope are shared by this House.
Ten years ago I put before your Lordships three basic propositions. The first was that anything that perpetuates violence is an evil and anything that glamorises violence damages the fabric of a civilised society. I know that Members of the House of Lords have been gravely concerned—and have had many debates—about the growing level of violence in society. There can be no doubt at all that at boxing matches, with all the hype and excitement that surrounds the spectacle, violence is glamorised.

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Secondly, and now justified by the evidence of the British Medical Association, I claimed that boxing frequently results in brain damage and sometimes in death.
The third proposition was a challenge to our moral conscience. We must ask ourselves: what is the justification for organising for our entertainment a public spectacle whose main object is for one human being to knock unconscious another human being? I cannot accept that there can be any moral or ethical justification for that kind of situation.
With regard to brain damage, there is now abundant evidence provided by the British Medical Association of the extent of such injury. There is an article in tonight's Evening Standard which some of your Lordships may have read. It links head injury to Alzheimer's disease. No one who has seen sufferers from Alzheimer's disease can fail to realise what a miserable condition it is. Anything that contributes to Alzheimer's disease must be condemned.
The BMA is concerned about the problem of brain damage. In 1982 it passed a resolution which stated:
"In view of the proven ocular and brain damage resulting from professional boxing, the Association should campaign for its abolition".
In 1987 it said:
"In view of the continuing serious ill effects on the health of boxers, this Meeting requests the BMA to pursue government with renewed vigour until there is a ban on boxing".
There is abundant evidence from the BMA of ill effects on boxers.
Experience of people in the ring shows the damaging effect that boxing has on the brain. Following our last debate 10 years ago, I received a call from New York from a young man known as Sugar Ray Leonard. He asked, "Are you the guy who wants to stop boxing?" I replied that I was. He said, "I'm coming over to England. I want to meet you eyeball to eyeball". I did not offer him five or 10 rounds but I was glad to meet him on the terrace of the House of Lords. We discussed the problem of brain damage in relation to boxing. He is a beautiful young man, a perfect athlete and highly intelligent. I said to him, "I know that you have a detached retina". He said, "Do you know how much they are offering me for my next fight? Twelve million dollars". That was 10 years ago. I said, "I don't think your eyesight is worth 12 million dollars".
Sugar Ray Leonard went back to America. Not entirely on my advice, he retired from the ring. I regret to say that he has now re-entered it; I have no knowledge at present of how much damage that has done. However, his illustrious predecessor, Sugar Ray Robinson, on whom he modelled himself, was a victim of Alzheimer's disease. He is now dead. All of us have seen the pathetic spectacle of the shuffling, mumbling, former wonderful athlete, Mohammed Ali. Consider what boxing has done to him when remembering him in his prime.
Frank Bruno entered the ring the other day. I was interested to note that the medical doctor of the BMA did not attend the fight because he did not believe that Frank Bruno should have another fight since he had
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recently had operations on his eyes. That does not suggest that the British Boxing Board of Control is controlling the sport as it ought to do. There are many cases—some of us know of them—of boys who enjoyed the glamour, excitement and rewards of boxing and who ended up mentally damaged and frequently in the gutter. In my view it is not a sport which should be encouraged or supported.
In boxing it takes some time for the ill effects to become evident. They are not immediate. In the case of Michael Watson there was immediate concern because he simply clung to life and no more. He has not fully recovered by a long chalk. I hope that he will recover. But there is little likelihood that he will ever enjoy a return to normal faculties.
I have suggested that there is no moral case which justifies our encouraging, or paying for, entertainment to watch two young men each seeking to knock the other unconscious. People will say, "That's interesting, but should we ban it? Is it not an intrusion on personal liberty to ban personal boxing?" In our society we occasionally take steps to prevent certain abuses. It is a long time since we abolished cock fighting. We felt that the spectacle of cock fighting was demeaning. We have taken steps recently to ban fighting between pit bull terriers and other dogs which are trained to fight. We have banned animals fighting in a ring, yet we seem to be less sensitive to the greater problems of young men in the ring.
Violence in the ring affects young people; ask anyone who advertises on television. They know that by advertising on television one attracts people to imitate and act in certain ways. With the code of conduct which governs the BBC and ITV we ensure that there shall not be gratuitous violence in programmes on television. At the same time we permit the spectacle of boxing matches on television. That glamorises violence.
People will say that other sports such as rugby football, soccer and motor racing are sometimes dangerous. But in no other sport is there intentional violence. It is only in boxing that the purpose of the exercise is for one man to knock another unconscious. There is no doubt about that decision. On a points verdict there is always conflict about the decision. If one wants to win one has to knock the other fellow out. In no other sport is that the purpose of the exercise.
I hope that we shall give the Bill a Second Reading today. First, boxing glamorises violence. Secondly, it causes brain damage and sometimes death. Thirdly, there is no moral case which would justify our encouraging and paying for such a spectacle. In those circumstances I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read a second time. —(Lord Taylor of Gryfe.)
7.18 p.m.
The Earl of Balfour: My Lords, I have often admired the constructive approach to many problems that have been raised in your Lordships' House by the noble Lord, Lord Taylor of Gryfe. However, I cannot support him in this legislation.

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I think it is excellent for children to learn a little about the art of boxing and self-defence. At school I was a very shy person. However, I remember my instructor telling me very firmly, "Now you've got to look at your opponent eye to eye. Only in that way will you know where to hit him". I believe that through that advice, perhaps more than anything else, I lost my shyness.
As I understand the position at present, under English case law stemming from a court decision of 1882, a boxing or sparring match with gloves, fairly conducted under recognised rules, is not illegal. Homicide in the course of such a contest is not manslaughter unless it results from a foul blow or one struck with the intention of causing serious injury. That is according to a court decision made in 1865. However, a contest in which the men have to fight on until one is incapacitated by exhaustion or blows is not a legal contest. The fact that gloves are worn is immaterial, for in such a case the contest is virtually a prize-fight. That was a decision taken in the case of R v. Orton 1879 (14 Cox County Court, 226).
A prize-fight is often considered to be a fight where gloves are not worn. However, even if the fight is with gloves and the contest is decided not upon the skill of the competitors but by one or the other being rendered incapable of fighting any longer, the promoters are guilty of an unlawful assembly. If in such a contest death ensues, the surviving combatant and the backers are guilty of manslaughter. However, I should add that in the case of R v. Coney (8QBD, 534) the court decided that the presence of persons at a prize-fight was not enough to sustain a conviction of assault against those persons.
I am not an expert on English law but the word "profit" is usually connected with land or tenancies of property. Without a definition of the word "profit" I believe that the Bill will make any boxing match illegal where any charge is made for ringside seating, or where there is any spectator entrance fee or even a sweepstake. I hope that the Bill will be withdrawn because we shall drive this sport either underground or overseas.
7.24 p.m.
Lord Addington: My Lords, the noble Lord, Lord Taylor of Gryfe, was most eloquent in introducing the Bill. He spoke primarily about what he regarded as the moral dilemma of having two people indulging in a sport the aim of which was to inflict damage on each other. I had always assumed that the aim of a boxing match was to establish a superiority in a skill. That involves the landing of a series of blows on a target area. That can result in injury. I suggest that if we begin to look at the sport in that light its colour begins to change.
I fully appreciate the fact that a degree of injury will result, but that is inevitable in the vast majority of sports. Indeed, I play rugby, which is a game in which one is almost guaranteed to be injured by the numerous people against whom one is playing. Deaths have occurred in virtually all sports. Any sport involving an element of physical contact risks damage and in turn death. We must look at the matter in that
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context while appreciating that the aim in boxing is to deliver a blow. All sports have a similar risk if not the same concentration.
I wish to draw your Lordships' attention to a major failing in the Bill. It refers to boxing but it does not refer to contact martial arts. The fastest growing sporting activity in this country is full-contact martial arts; for instance, Thai boxing and kick boxing. They might be covered by the provisions of the Bill, but I suggest that the organisations which wish to continue with the sports will change their names rapidly. Those sports are more dangerous than boxing for the simple reason that they involve kicking. One can inflict far greater damage with a kick than with a punch. Furthermore, they result in people being struck more often because they are technically likely to be more open.
It is true that the British Martial Arts Association has tried to modify its laws so that there is not the same degree of danger in this country as in others. In Thailand Thai boxing results in dozens of fatalities. Steps have been taken to try to reduce the damage inflicted. For instance, blows such as the elbow to the temple and the knee to the groin have been taken out of the sport. The degree of brutality in the sport has been lessened. However, unless the Bill deals with the whole range of full-contact martial arts we are on a hiding to nothing. If interest in such sports is growing but we deprive people of boxing, where will the potential audience go?
I suggest that the idea of encouraging people towards violence, even the theatrical American wrestling which we now see, is another issue that we should investigate. I suggest that to try to convince children that picking up a man and slamming him head first onto a canvas mat or a floor will cause no damage and that he will be ready to fight again next week, is far more dangerous than showing them that if someone is hit it hurts. I believe that films must show that if people are shot they die painfully and unpleasantly rather than showing people shot in the arm and wandering about for three or four days. We should let people know the truth about such things. Violence in the raw might be more acceptable than glamorised violence.
I suggest that the Bill misses its target. If we expand the debate to cover all dangerous sports we shall stop most sports. The current death toll from boxing is not the highest. If we wish to stop violent sports the Bill will limit the number of sports available. Those involving a degree of humiliation for the loser involve the skill of the martial arts—indeed, physical-contact sports—and fall short of the Bill. I suggest that it is inappropriate to continue with consideration of the Bill.
7.28 p.m.
Lord Walton of Detchant: My Lords, I was greatly moved by the sincere and obviously earnest way in which the noble Lord, Lord Taylor of Gryfe, moved that the Bill should be read a second time. I felt it right that I should try to draw to your Lordships' attention certain well-acknowledged and well-recognised medical facts which are significant in our debate. Perhaps

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I may congratulate the noble Lord for bringing the matter to our attention and allowing the debate to take place. However, I must apologise to him and to your Lordships for the fact that, having been compelled to postpone a long-standing commitment that I had arranged for the early part of the evening, I may be unable to stay until the end of the debate.
Since my childhood I have had a deep interest in many forms of sport, both as a participant and as a spectator. Of course I appreciate that many of those sports can result in serious physical injury. Whenever I have an opportunity and time allows I watch rugby football, association football, tennis, golf and many other sports with avid interest. I must confess that there have been occasions on which, perhaps through some kind of basic primitive urge, I have found myself glued to the television watching a professional boxing contest. My head has told me that I should not do so but my heart has compelled me to continue to watch.
As a doctor and primarily as a neurologist I must say to your Lordships that the effect of professional boxing and, as the noble Lord has just said, of many other contact martial arts is to produce a degree of brain damage in certain circumstances which I believe to be unacceptable in a civilised society. Of course it is true that people die driving motor cars on a race track. Sometimes people are paralysed as a result of a collapsing scrum on a rugby football field. Some work carried out in my own department of neurology some years ago in Newcastle upon Tyne by Dr. Foster demonstrated that repeated brain injury as a result of many falls by steeplechase jockeys resulted in the punch-drunk syndrome. It is well recognised that that occurs. However, the primary aim of those sports is not to injure one's opponent, as is the case in professional boxing and certain other sports.
I confess, too, that many who have been professional boxers over the years, like Henry Cooper and Frank Bruno, have a certain homespun charm which attracts the public at large. One accepts that entirely. One must accept also that many professional boxers have completed their careers without demonstrating evidence of that kind of progressive and serious brain damage which admittedly afflicts only a minority.
In passing, I must refer, as did the noble Lord, Lord Taylor of Gryfe, to the fact that according to press reports the chief medical officer to the British Boxing Board of Control, Dr. Adrian Whiteside, apparently wished that Frank Bruno had not had his licence restored, but he was overruled by the board. I accept also that that board of control and its medical advisors have done a great deal to introduce techniques of neurological examination with brain scans, magnetic resonance imaging scans and other techniques for examining boxers prior to their entry into the ring in an attempt to reduce the toll of damage which occurs as a consequence of the sport.
All that is commendable. The reports carried out over the years by the British Medical Association and the Royal College of Physicians have shown that the sport is to some extent unique in that the consequence, purpose and objective is to apply a sufficient number
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of blows to one's opponent to inflict physical injury and, despite what the noble Lord has just said, the objective of most boxers in both the professional and amateur ring is to knock one's opponent unconscious if possible.
There is powerful neurological evidence to indicate clearly that a severe blow to the head, however caused, not only causes concussion, which is the consequence of the jarring of brain tissue within the skull cage, but it almost inevitably results in the death of a small number of brain cells and the division of a small number of fibre tracts within the brain. That information is now available from neuro-pathological studies.
In the course of my professional neurological practice I have seen too many men who have gone on too long in the professional ring, who have been allegedly, according to the press and to others, marvellously brave at taking punishment. In consequence they have suffered progressive brain damage which has led not only to atrophy, which means shrinkage of the brain, but also to enlargement of the cavities or ventricles of the brain, and to a loss of the central structure which separates those brain cavities called a septum pellucidum, which is a characteristic effect of the brain damage of boxers. They have gone on to develop a progressive deterioration or degeneration of the intellect, called dementia, combined with features of Parkinson's disease and that slow, sombre shuffling gait which is so much a hallmark of the punch-drunk syndrome. I have seen that far too often to believe that this so-called sport can be justified as a spectacle in a civilised society.
I appreciate that, as has been said, other sports cause injury. However, that is not their primary objective. There are those who say that were the sport to be banned, ultimately it would be driven underground. I ask them to produce evidence that that has happened in countries where it has been banned; that is, Sweden, Norway and Iceland.
I am not so sanguine as to believe, however powerful the advocacy of the noble Lord, Lord Taylor, that the Bill will ultimately reach the statute book. One recognises that there are many vested interests, financial and otherwise, which are likely to oppose the Bill in its subsequent stages. Having said that, I am in no doubt that the day will come when professional boxing will be banned in this and many other countries throughout the world because its objectives are intolerable and its effects unacceptable in a civilised society.
7.36 p.m.
Lord Soper: My Lords, as I understand it, I have just listened to an irresistible case on the basis of the medical evidence which, it seems to me, must be incontrovertible and decisive. I add very little from my own competence, which is marginal, to the experience of those who have suffered damage from repeated activities in the ring. I shall attempt to support the moral argument in a rather wider context than that in which it has been referred to already.

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I begin with a reminiscence which your Lordships will permit because it is germane to what I have to say. As an unregenerate youth, I was an ardent boxer. I had some little competence in that field. I was immensely proud of the fact—I have not been able to verify it since but I believe it to be true—that I was trained by one of the trainers of the the immortal, or at least well known, Jack Johnson. I wore that almost as a badge of competence.
Therefore I am compelled to say that the aura of pleasure and the sense of satisfaction has not diminished in my old age. I find it difficult to turn off the television when a programme of boxing is on the screen. Occasionally I turn it off but it is a struggle. It is a struggle because the watching of boxing and the participation in boxing bears witness to one element which is not bad; that is, the sense of power which is a legitimate desire on the part of those who seek it and want to use it.
The question which must be answered is whether or not violence is one exercise of that power which is permissible. I do not believe it is. Having come to the conclusion that boxing is one experiment in the field of illegitimate power, it is my responsibility as a would-be Christian to say "No" to it and to campaign for its abolition, at least professionally.
I am able to tell the House that, generally speaking, I may be in consort with the Churches, as far as I am aware of their position. I can at least speak confidently with regard to the Methodist Church which has taken the view I have already briefly tried to express. However, I invite your Lordships to listen for a short while to an extension of the moral argument.
I believe in what has been clumsily called the ubiquity of violence in modern society. I do not wish to shiver any of your Lordships' timbers when I remind myself that there is a unique characteristic with regard to power in contemporary society which is totally unprecedented. Those people who see violence see it in the context of a terminal condition which may be as thorough for the human species as another kind of terminal condition was for the dinosaurs.
I know that it sounds melodramatic to some people to talk about the prospect of the end of the world. But I have the unfortunate and uncomfortable feeling which almost reaches conviction that, unless we get rid of the menace and generality of violence, we shall be preparing ourselves for an irresistible change which may be final. I do not say that with any great authority, though ecclesiastically and from the biblical standpoint it is worth saying and I wish more parsons would say it.
I am concerned to say this. The widespread concept of violence epitomised in the various forms of violent sport about which we have already heard, that perpetuation of violence, must be dealt with from where it can first and most satisfactorily be approached. Though I am a pacifist I do not believe that in my lifetime the concept of pacifism is likely to reach the dimensions of a coercive programme. But I believe that in other areas where violence is now practised we can do two things. We can remove the glamour which I remember as a child. At the same time we can break into that continuity, that ubiquity
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of violence which is one of the most contemporary and dangerous situations that the human species has ever faced. We have that opportunity, dramatically and inexorably presented in medical terms which are overwhelmingly convincing as far as I am concerned. I believe that from the standpoint of the damage that is done we have no right to think of a body as a commodity, liable to the vagaries of a market and constituted within the framework of a capitalist society. Worse still, I believe that there is a continuation within the areas of literature and the media to celebrate violence as though it were a commendable acceptance of something which belongs to our better nature or indeed to our survival.
We have an opportunity to strike a blow; to deal with a specific expression of violence. I hope that we take that opportunity. The opportunity to break into that continuity is denied to us if we make a broad and general attack on the whole concept of society and of violence without at the same time epitomising and analysing aspects of that violence which are within the competence of intelligent and moral people to deal with now.
It is an argument which is an extension of the argument that it is immoral to take part in professional boxing—as I believe it to be. But that immorality is conditioned by the fact that we contribute to the general area, the miasma of violence, which infects everyone who is partaking of the opportunities of violence. His lungs are contaminated by the irresistible force of the air he breathes. I want a purer air. If I cannot have it all today, I believe that here is one way in which we can break into the continuity of violence and I hope that the Bill receives a Second Reading.
7.45 p.m.
Lord Belhaven and Stenton: My Lords, I do not believe that I can follow the noble Lord, Lord Soper, in his philosophical and religious discourse. Though I am sure that when I read his speech I shall probably agree with about two-thirds of it, I am not sure that I can accept the whole of it.
The noble Lord, Lord Taylor, is certainly tenacious in his opposition to professional boxing. I emphasise that the Bill is against professional boxing. If it receives a Second Reading and practitioners of the amateur sport are worried, they can always table an amendment at Committee stage to protect their amateur sport.
To use possibly an apt expression, I should like to compliment the noble Lord, Lord Taylor, on being a bonny fighter. As he himself said, it has been 10 years since he last introduced a Bill on the subject. I shall certainly support him in the Lobby. However, since he introduced his Bill 10 years ago I have experienced certain doubts, not on the matter of professional boxing and the damage done to the participants, which is part and parcel of this barbarous sport (if we can call it such) but rather on making illegal something which for many years has been legal. Nowadays far too many people in this country—I do not include the noble Lord, Lord Taylor—want to

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stop other people from doing what they want to do. Unfortunately, the number of such people is increasing.
Turning back to boxing, it may be argued that if two men, of their own accord and abiding by certain fairly stringent rules in the presence of a referee, wish to knock each other insensible, they should be allowed to do so. I strongly believe that such an activity should not be encouraged. I confess that I do not know whether or not there is a case for making it illegal. In society as it is developing today I feel that the police have sufficient to do.
Although the noble Lord, Lord Walton, places another construction on it, nonetheless it is proven that over a length of time boxing results in the condition known as being "punch drunk". Men become stupid and eventually they go mad. Those are simple layman's terms. Professional boxers ought to know the risks that they are taking. I understand from conversation outside the Chamber that they do. But money can pay for almost anything, including self-destruction.
I agree with those who think that a heavy responsibility rests on the press and television for the publicity that they give to professional boxing. The lives of prominent and successful boxers are well known; they become public figures and are written about in the press and so on. But as the noble Lord, Lord Taylor, said, less is known about the way in which those lives end.
Finally, one must remember that in professional boxing fights go on for 12 three-minute rounds. In amateur or army boxing there are only three three-minute rounds. I believe the rounds were cut from 15 to 12, but that is still a murderous ordeal for any man. It is no wonder that it often results in serious injury or even death.
I personally believe that it would be the best thing in the world if this sport ceased to take place. I would like to see it end for many reasons although I have expressed doubts about the wisdom of bringing it to an end by making it criminal. As I have said, I shall support the noble Lord in the Lobby tonight because I feel that by doing so this House will have set down a marker showing what it feels about this sport. I salute the noble Lord for bringing attention to a very real evil. I hope that his efforts over many years may assist in ending it.
7.50 p.m.
Lord Airedale: My Lords, the noble Lord, Lord Soper, said that this is the time to strike a blow against professional boxing. How much I agree with him! The other day I was discussing this subject in the dining room with the noble Lord, Lord Allen of Abbeydale. I said that I could not understand why anybody would want to pay what Mr. Desmond Lynam of the BBC calls "funny money" for a ringside seat at a big fight because for one thing it might all be over in a few minutes, as happened the other day in the big fight. There is also usually the opportunity to watch the match on television from an armchair where one probably gets a better view than from a ringside seat.
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The noble Lord, Lord Allen, said "Yes, but you are forgetting something. With a ringside seat you have the added thrill that you might be bespattered with blood".
The crowd certainly seems to enjoy the bespattering of blood. One can hear the spectators, from the shelter of their seats well back from the ring, react to the added excitement that occurs when the blood starts to flow. Of course the spectators say that they are not there to watch anybody being hurt; they are there to enjoy the skill. If that is so, why is it that all the big fights seem to be between big men? Surely the lightweights exhibit as much if not more skill than the heavyweights, but the lightweights do not seem to attract the audience in the same way.
It was in the days of the bare-knuckle fights that the worst of the facial injuries and the blood-letting occurred. In consequence of that the boxing glove came along as a protection. However, I fear that it has turned out that the boxing glove is the villain of the piece. One does not need the expert knowledge of the noble Lord, Lord Walton, with his medical experience, to tell one what are the precious parts of the human body. Nature has shown us, for instance, that the eyes are precious because they are indented in the face for protection. We may be quite sure from examining the human skull and the thickness and hardness of it, that something must lie inside which is very important so that it receives the utmost protection. The boxing glove strikes the skull with a far heavier blow than the boxer could bare to inflict with bare knuckles. The boxer would break his hand if he inflicted the kind of blow which is inflicted by the boxing glove.
One partial solution to the problem might be to say that in the ring the boxer should wear the same head protection as I believe he customarily wears in training. However, I do not suppose that that idea would appeal very strongly to the box office. I very much hope that this Bill will receive a Second Reading.
7.54 p.m.
Lord Brooks of Tremorfa: My Lords, I am an administrative steward at the British Boxing Board of Control; I am a member of the Welsh area council of that board and I am the patron of the Welsh ex-boxers' association. I believe that ex-boxers would be very hurt indeed if they were to hear it suggested that they or their sport were in any way allied to the increasing violence that we see all about us. Indeed, I believe that they would say that if some of the young people who were causing the violence were to attend boxing gymnasia to be trained in the discipline that they were trained in, we would see much less violence than we see today.
I was not trained by Jack Johnson's trainer, but I do share a distinction with Rocky Marciano. He was a former heavyweight champion of the world. He boxed 49 times and won 49 fights. That is a 100 per cent. record of course. I boxed in four fights and lost four. Whatever way one looks at it that is also a 100 per cent. record. I would like to quote an extract from a letter to the South Wales Echo, which is the evening

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paper which covers South Wales, an area which has produced many great champions in the past and where there is a tremendous following for boxing. The letter was inspired by what happened on that awful night at White Hart Lane when Michael Watson was knocked out.
The letter says:
"It is good news that Michael Watson is coming out of his coma. I hope and pray that he will recover as my family and I know what a terrible traumatic time his family is going through.
"While I have every sympathy with Michael and his family, I do not have any sympathy towards those who jumped on the bandwagon calling for boxing to be banned after this unfortunate fight.
"Every boxer who goes into the ring knows the risk he is taking. To ban boxing is NOT the answer. If it was banned it would only result in the sport going underground and becoming even more dangerous. If this were to happen you would not have the rules and conditions governing boxing that we have today. Instead of banning boxing we should strive to make the sport safer".
That letter was written by Mr. Dick Owen who was the father of Johnny Owen of Merthyr who died in an attempt to win a world title 10 years ago. I believe that Mr. Owen is right.
Reference has been made to the way in which rules and conditions of boxing have changed over the years. Although the boxing records list bare-knuckle fighter James Figg as the first British champion in 1719, prize fighting began long before then. In those days the promoters made their own rules and controlling bodies were non-existent. There was no system of standardised weights. Opponents were often ill-matched and lighter men were often slaughtered in marathon bouts. Of course, boxing was then illegal and when men were killed or seriously injured very little comment was made. Fatalities were not uncommon and fights often lasted for hours. The longest on record lasted for 276 rounds.
It was bloodthirsty, brutal and cruel. There were no proper referees or rules. There were no medical examinations to make sure that fighters were fit to enter the contest. There was no doctor on hand to give immediate and expert treatment when needed. If a fighter died there was no insurance scheme to provide for his dependants and often there was no money even to bury him. The illegal fights were not, of course, publicised. Nevertheless, huge crowds would gather in the fields where contests were held to watch men like Daniel Mendoza, Tom Cribb, and Gentleman John Jackson and other bare-knuckle contestants oppose each other for anything from 40 rounds to 100 rounds. It was largely the gentry who patronised the fights, showing their appreciation by tossing coins into the ring.
One of James Figg's pupils, James Broughton, is credited with the first attempt to clean up the sport in 1743. Boxing became so popular that it attracted wealthy patrons wanting to learn what they were pleased to call "the noble art". The first rules were devised along with the introduction of gloves to protect boxers from severe injuries and to stop them from breaking their knuckles. Broughton created an image of honesty and fair play, and all who took part were expected to follow his strictures.
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The Marquess of Queensberry Rules were introduced in 1867 and were used five years later. They brought in weight divisions, basic rounds of three minutes each with one minute intervals, and the 10 count for a fighter unable to get to his feet after a fall or a knock down. These rules applied to glove fighting as bare knuckle contests mercifully began to fade into obscurity. The National Sporting Club was formed to take the brutality out of prize fighting and the NSC gave boxing a new image, stopping crooked fights and ruling the sport with iron discipline, with referees in the ring conducting proceedings. It ruled boxing for 20 years and its president, Lord Lonsdale, gave his name to the challenge belts that have become a major feature of British championships.
Thankfully the days of vicious bare knuckle fights are just history. Britain now has the best controlled body of sport in the world in the British Boxing Board of Control. The British Boxing Board of Control appoints all referees, stewards, inspectors and time-keepers. It is an organisation administering its authority over boxing with stringent medical supervision. Many amateur champions have been refused professional licences because they failed to measure up to the BBB of C medical standards. No other controlling body in boxing is better run, and in all respects the welfare and safety of the boxer comes first.
It is because the sport is so well controlled that serious injuries to boxers are not commonplace. It is because serious incidents arc so rare that they attract publicity. Few sports are without risk—that is often why they attract such a following.
There have been many serious injuries and deaths in other sports, and reference has been made to those this evening. I shall give some figures very briefly. Between 1969 and 1980 there were 480 deaths in sport: 93 in mountaineering and rock climbing; 85 in motorcycling; 66 in football; 53 in horse riding; 34 in parachuting and hang gliding; 28 in motor racing; 32 in rugby; 28 in skin diving; 16 in canoeing; in cricket there were nine; in hunting there were nine; golf had six; rowing had four; in karate there were three; judo had three; professional boxing had two.
As Mr. Dick Owen so clearly put it—and no one can speak from such personal experience as he: "If it were banned it would only result in the sport going underground and becoming even more dangerous". That is why we must not ban it. That it why we must have proper controls and regulations. Let us not force the contest back to deserted wharves and warehouses or hidden fields. Let us not force it back into the twilight world where it will be controlled by the unscrupulous and the greedy. Let us keep it in the open, where it is now, properly run with proper rules and first-class supervision—medical and otherwise—and where the welfare of the boxer is paramount.
Anyone who saw the television programme on unlicensed boxing recently would realise that if this Bill were to succeed, we would be back to the dark days of crooked promoters and no protection for the boxers. This Bill should he aimed at unlicensed boxing and increasing the powers of the British Boxing Board of Control.
8.4 p.m.
The Earl of Shrewsbury: My Lords, I listened carefully to the noble Lord, Lord Taylor of Gryfe, and I understand his concerns. In fact I should also say, as Mohammed Ali does that Lord Taylor of Gryfe floats like a butterfly and stings like a bee.
I support and enjoy boxing and I listened very carefully to what the noble Lord, Lord Brooks, said, and I think he is absolutely right. I am extremely concerned about the wording of this Bill because it does not cover just professional boxing; it covers all boxing. Clause 1 of the Bill states:
"Any person who organises for profit a boxing match …"—
not a professional boxing match or an amateur match —any boxing match. That is a dangerous ball game to get into.
While I appreciate that professional boxing is potentially dangerous—by its very nature it has to be —there are very many other sports which take place in this country where participants are regularly injured, sometimes permanently and sometimes even killed. Professional jockeys, to take one example—which is a world I know better than boxing—often suffer horrendous injuries with a fatality occurring every few years. They do it because it is their living, they know how to do it, they are professional, and they enjoy it. It is their choice.
Injuries occur regularly in all competitive sports. Indeed, if we take this Bill through tonight to a Committee stage and we accept that it has a Second Reading, are we then to ban such sports as football, horse racing, hunting and riding in general? It goes on a very long way. If they are done for profit, as the wording of this Bill says, how does one define profit? Under what circumstances is there a profit? What are the circumstances where perhaps it is not a profit but money that goes for fund-raising purposes?
I feel that much regulation could, and most definitely should be exercised in the running of professional boxing, where at the very top of the profession huge rewards are increasingly more often the order of the day. That is not always a good thing by any means.
It must be said that amateur boxing in this country is well run, well controlled and the officials ensure that on the slightest hint of any distress at all the referee stops the match. I have a little experience in this as last week I organised a boxing evening for the Staffordshire Association of Boys' Clubs. The Staffordshire Association of Boys' Clubs is affiliated to the National Association of Boys' Clubs and most of our clubs in Staffordshire box. These boys come from very deprived areas. The only thing that they have to do is to box. It is a way in which the boys can strive for a real degree of excellence in an otherwise very deprived situation. Their parents support them.
The noble Lord, Lord Taylor of Gryfe, mentioned earlier the growing concern of society regarding violence. Amateur boxing in these clubs—and the police agree with this statement—actually takes violence off the streets. These boys would otherwise have nothing to do in the evenings. They go along to
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a gym where they are taught and regulated, they are kept under very strict supervision and they actually do something which is of benefit to the community.
Should this Bill become law as the clause now stands, all boxing for charitable causes like the National Association of Boys' Clubs and many others will be direly affected. I would have been liable to a fine last week had this Bill been law, a fine not exceeding £100,000. That cannot be right. It really does not bear thinking about. The banning of professional boxing will only drive it underground. An example given earlier was that this has not happened in Scandinavia. It will happen in this country. I know it is illegal but there is a growing movement for underground bare knuckle fighting and it happens whether we like it or not. This in itself will produce illegal betting, which is something that none of us wants. It will produce much less supervision and control. Indeed, I might be so bold as to add that it will cause a greater incidence of very serious injury. Boxers in bare knuckle fights do not box to a certain number of rounds; they box until the person they are fighting goes down on the ground and does not get back up again, whether it be five rounds, 20 rounds or 25 rounds. That is not boxing, it is barbaric, and that is what could happen.
Another thing that goes along with this Bill and the results thereof should it become law is that British fighters will still be able to train in England and in Britain. They will simply fight abroad. The increasingly large sums that they are paid now will still be made available to them. It will make no difference at all to fighting in this country.
I am delighted that the noble Lord, Lord Taylor of Gryfe, has brought the Bill before the House, because we do then at least have a chance to discuss it. However, the Bill serves no useful purpose. It is far too wide-ranging, and to take it further would only waste precious parliamentary time. I would feel very able indeed in the future to support a Bill on further and better regulation of professional boxing, but I cannot support this Bill.
8.10 p.m.
Lord Rea: My Lords, I must apologise to my noble friend and to your Lordships generally for mistiming my arrival. I had been informed by the Whips' Office that the debate would start at eight o'clock. The previous debate apparently collapsed much sooner than was expected.
Doctors tend to be regarded as spoilsports, wagging fingers at those who are enjoying themselves in case they may do themselves or others an injury. Thus, in your Lordships' House I have been accused by the noble Lord, Lord Harris of High Cross, of being authoritarian—by implication, a cryptoStalinist—for suggesting that tobacco advertising should be banned. In the Sunday Telegraph this week the noble Lord was quoted as suggesting that the anti-smoking lobby had fascist tendencies. Some of us who advocate change in the national diet have been labelled food Leninists. The underlying reason for these attacks is not the preservation of individual

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freedom but the very large financial interest in allowing things to continue as they are even though they may be bad for our health.
I am sure that my noble friend is right in his very short Bill not to attempt to ban boxing altogether. The British public is certainly not ready for that, although, as I hope to explain later, there is really no justification for allowing boxing to continue in any form. The prospect of earning large sums of money and becoming famous, nationally or internationally, encourages young men to take up boxing and persevere with building up their muscles very intensively, so as to inflict concussion upon their opponents, preferably before it happens to them. If the money was taken away, amateur boxing would continue, although perhaps at a lower pressure, and eventually it might become less popular as the appetite of the public was less often stimulated through the media, especially television.
I was an amateur boxer for about a year when I was aged around 17 and at school. It so happened that I matured rather earlier than average so that at the age of 16 to 17 I was rather more muscular than my contemporaries. Thus, although my opponent and I were both terrified as we faced each other in the ring, I was usually successful because I packed a heavier punch. However, I did not succeed in knocking anyone out. Boxers who are older and bigger than I was then can now train themselves to deliver a punch with tremendous force. An experimental punch by Frank Bruno has been measured and found to represent a transient blow to the head of about half a tonne. I am sorry if some of the points I make have already been made by other noble Lords.
As the noble Earl said, almost any sport involves some risk, but the injuries are not the prime object of the race, the game or the competition; in fact they interfere with that sport and may lead to the disqualification of a player if deliberately inflicted. Boxing is exceptional, in that the express object of each participant is to inflict injury on the other. The fact that gladiatorial combat has always been a popular spectacle should not alter our concern about the particular type of injury which occurs in boxing. Although it is possible to win on points and for head injuries to be minor, the real object of a boxer is to deliver as hard a blow as possible to the head of his opponent and if possible to knock him out. A knock-out is a form of concussion—when the function of the brain is so disturbed temporarily that consciousness is lost. There is now evidence that suggests that every episode of concussion, even when full recovery apparently occurs, leads to permanent loss of a variable number of brain cells. But injury to the brain can occur even without loss of consciousness.
My noble friend Lord Walton of Detchant will have described this much better than I can but the brain is a very soft jelly-like organ surrounded by a thin layer of fluid in a thick membrane—the dura mater—inside the skull. In fact it is cushioned from low velocity bumps such as one might be subject to in normal life—from bumping into lamp posts or falling down. Bit high velocity impacts or rapid changes in
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direction, especially if there is a twisting or rotational element to the impact, as is common in boxing, result in parts of the brain being stretched or sheared against irregular ridges or shelves on the inside of the skull; for instance the edge of the foramen magnum, the opening at the base of the skull through which the spinal cord passes.
Injuries to the brain which commonly occur in boxing fall into two categories. There are the acute injuries, luckily rare, which are caused by bleeding into and around the brain. Nearly half of those are fatal despite modern neurosurgical techniques. We have all read the accounts of Michael Watson, who is critically ill. I am informed that he still has not regained consciousness after some weeks. Then there is the much larger group of boxers who suffer from the effects of repeated minor head injuries, some but not all resulting in concussion—loss of consciousness.
It is said that the number of true "punch drunk" ex-boxers —the medical term for that is dementia pugilistica—is less than it used to be, and that may well be so. As many noble Lords have already pointed out, boxing is more carefully supervised today. But the eventual health status of boxers remains uncertain as long as the British Boxing Board of Control declines to co-operate with the British Medical Association in allowing a full health survey of boxers to be undertaken. The technique of computer assisted tomography can now reveal evidence of brain damage well before any clinical or psychological evidence of damage is apparent. Brain damage has been found in the great majority of post mortem studies of ex-professional boxers. For the record, those should be described. I again apologise if my noble friend has already given this information.
First, there is frequent rupture of the septum pellucidum, which is the delicate double membrane of nervous tissue separating the left and right cerebral hemispheres. Secondly, there is evidence of damage to the cerebellum and the substantia nigra of the mid-brain, the parts of the brain concerned with balance and muscular co-ordination. Thirdly, there is atrophy or thinning of the cerebral cortex, the part of the brain associated with intellectual functioning. This is the anatomical structure which most clearly distinguishes man from other mammals, a point on which noble Lords should reflect. Is a so-called sport which results, even when fought according to the Queensberry Rules, in damage to our most unique possession—my noble friend may have described it as a God-given possession—justifiable on any grounds?
The fourth type of damage found in the brains of ex-boxers is the microscopic appearance of what are called neuro fibrillary tangles, in which the many intricate connections of a brain cell are instead shrivelled and knotted up. That is a picture characteristic of the brain of those who suffer from Alzheimer's disease—a condition with which I believe most noble Lords will be familiar. Of course, I should stress that they are familiar with it in connection with friends and relatives, and not themselves. It is otherwise known as pre-senile dementia. Although we do not yet know the cause of that very sad affliction,

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it is of interest that repeated injury, as happens in boxing, can produce a rather similar picture histologically.
I wonder whether it is only boxers who are injured at a boxing match. Joyce Carol Oates, a boxing writer, has described:
"The electrifying effect upon a typical fight crowd when fighting suddenly emerges out of boxing—when, for instance, a boxer's face begins to bleed—and the fight enters a new and more dangerous phase. The flash of red is the visible sign of the fight's authenticity in the eyes of many spectators and boxers are justified in being proud, as many of them are, of their scars".
I suggest that that passage implies that boxing may excite the violent and sadistic urges which lie dormant in most of us. I do not know if any studies on the behaviour of boxing crowds have been carried out but, judging by the manic way drivers behave on their way home from a motor race, I think that it is more than likely that aggressive behaviour is encouraged by witnessing the spectacle of two men hitting each other to applause.
In summary, I believe that with this Bill my noble friend has got it about right. If the financial reward goes, less young men will enter into boxing and even fewer will remain in it. The indecently large profits made by the promoters which underlie the less savoury aspects of boxing will disappear.
I hope that the Minister who is to respond will recognise the strength of the arguments which have been put forward by my noble friends Lord Walton and Lord Taylor of Gryfe and others who oppose boxing, and that he will support the Bill. I also hope that the Government will indicate that they intend eventually to phase out what I can only call a barbaric activity.
8.22 p.m.
Lord Cochrane of Cults: My Lords, I intend to detain the House for only a short time as I am the eleventh speaker. The lure of boxing is quite simply money: it is fighting for gain. We have heard most dramatically from the noble Lords, Lord Walton and Lord Rea about the damage which can be inflicted. Indeed, they spoke with immense authority. I am also most grateful to the noble Lord, Lord Taylor of Gryfe, for introducing this Bill.
I carried out some research and found, while looking through Hansard, that some years ago, in 1962, a similar Bill was lost. I believe that it was mentioned by the noble Lord. My research revealed that my noble kinsman Lord Rathcavan, who attended this House almost to his one hundredth year, voted against the Bill. Indeed, it was lost. My father remarked of his cousin that at school he was immensely tough. He probably was; he was born in 1883, and went to Eton, where one had to be tough in those days.
There was a splendid and tremendous heavyweight fighter, Gene Tunney, who said:
"After being unconscious for two days"—
and this was in the 1920s—
"I decided to get out while I still retained my sanity".
He was right; he got out in time. He recognised the damage which could be done both to himself and to
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others. That was in the early days when the punch-drunk syndrome was beginning to be recognised.
I invite your Lordships to consider not our being in the position of stopping boxing but, let us suppose, for example, that there was a great public outcry because a new sport had been introduced in which people stood together in a roped enclosure and battered each other until one was unconscious and was then declared the loser. Surely there would be absolute uproar. Indeed, one might ask: what did they do? Again, the advice may be, "Let him have it hard on the point of the jaw. That does the most damage. Then give a heavy blow to the ribs or body. Finally, hit the jaw again and that will finish the man." Surely we would regard that as revolting?
A very distinguished amateur boxer on the point of becoming a professional about 30 years ago in an interview published in the now long defunct Daily Herald— which, of course, is now the Sun—remarked:
"I'm no longer a sportsman. How can you call professional boxing a sport, with all the villains and rogues who are part and parcel of the game? It's a business. A hard business all the time, a cruel business some of the time. I've no illusions about the noble art of self-defence or any of that kid stuff. That's all right for the amateurs. But from now on I'm paid to hurt. The more I hurt, the more I'm paid".
I believe that those remarks prove that your Lordships would never allow boxing as a new sport to be started, and also prove the case put by the noble Lord, Lord Taylor of Gryfe, that professional boxing ought to be stopped.
8.26 p.m.
Lord Meston: My Lords, as your Lordships have been reminded, it is almost 30 years since the House rejected on Second Reading a similar Bill introduced by the late Lady Summerskill. The essential arguments have not changed. The noble Lord, Lord Taylor of Gryfe, wants to add professional boxing to the list of criminal offences in this country. As I understood him, he does not seek to criminalise the organisers of amateur boxing, although the Bill in its present form may have that effect. Therefore, it must be the professional element in the sport to which he objects.
I have been a boxing fan for almost as long as I can remember. I was a pretty mediocre amateur boxer at school and at university, too often splattered with blood and horizontal. But, at its best, boxing is skilled, disciplined and sporting. Moreover, because it is a disciplined sport it does not perpetrate violence as has been suggested. Boxing does not beget violence; it channels violence.
There are features of professional boxing, as with almost any professional sport, which are less than attractive. The amateur or professional boxer would not get away with the petulant bad temper of some tennis players or the "professional foul" of football. In boxing, the simulated nastiness and needling insults which have become fashionable are supposed to sell seats and television time. The sport would be better off without such obviously bogus "hype".
Although, as I suggested, the essential arguments for and against boxing have not changed, those who enjoy and support boxing as I have always done no

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longer seek to justify its continuation simply by pointing to other dangerous sports. We can all see that there is potential danger in all sorts of other sports, some of which extends beyond the willing participants to endanger spectators; for example, in motor racing or rescuers in mountaineering. Nor, I suggest, is it particularly helpful to compare the statistics for fatalities or serious disabling injuries in other sports ranging from cricket to horse racing.
However, there is one comparison which can and should he made in looking at this Bill. Boxing is not the only sport in this country in which the aim is directly to hurt your opponent, although I should mention in passing that some of the best boxers seldom win—or have won—by a knockout. As my noble friend Lord Addington said, it would he very strange if professional boxing was abolished and kick boxing and the whole range of so-called "martial arts" involving kicking and otherwise striking the head were left as lawful pursuits.
Professional boxing has a responsible governing body—namely, the British Boxing Board of Control —which does, just as the name suggests, control the sport. As with all governing bodies, it is always looking at ways of minimising the risks and it must know that it cannot be seen to be doing otherwise. The changes over the years, such as fewer rounds and better medical scrutiny before, during and after fights can be pointed to. It is a continuous process which has undoubtedly been galvanised by recent events and renewed criticism. The board must know that at all levels boxing requires scrupulous medical checks, vigilant referees and careful matchmaking.
Boxing must continue to look at ways in which to improve its safety record, just as any other activity must. The weight of gloves may have to be reconsidered. There may need to be better rules to monitor and prevent rapid weight loss by dehydration before a fight; and better rules to stop fights going on too long, although it can be said, without complacency, that British referees are of a high standard, and more than willing to stop a fight when, as has been said, distress or an inability to defend oneself is seen.
There have to be more rules to stop fighters going on too long. Boxers are not always the best judges of what is best for them. Perhaps there should be a form of medical insurance to avoid strain on the NHS, and more encouragement to take professional advice on finance to limit fighters' temptation to put off retirement or to make a come-back to pay tax or regain a standard of living produced in earlier years.
There is also an attractive proposal for a boxing federation to regulate the amateur and professional sport, financed largely by the professional side, which would provide a continuous medical record from schoolboy boxing upwards.
Professional boxing should be allowed to continue. It will have to live with the fact that it will be attacked when things go wrong, and that things go terribly wrong in only a minute number of cases in relation to the number of rounds boxed. It is not just that boxing produces heroes and entertainment to largely well-behaved crowds; it is not just that it has provided
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a way out of poverty and a decent living for some of the most disadvantaged young men and their families; and it is not just that there must be a risk that professional boxing could be driven underground, with unregulated and unsupervised fights in remote places. To deal with the point made by the noble Lord, Lord Walton, I do not know whether unregulated underground boxing continues in countries where boxing is banned, but they are obviously countries with small populations and little tradition of professional boxing.
No one wants a return to the boxing booths of the past where Jimmy Wilde, that great boxer, was reputed to have had over 700 fights. It is not just that professional boxers will go abroad to fight in countries that may have lower standards of control and supervision than the high standards we have here. The Bill is a deliberate attempt to interfere with the freedom of people to earn a living, subject to the proper controls of its governing body. Even if professional boxing is seen by some of your Lordships as "on probation", it should be left, with the assistance of a strong and independent board of control, to keep its own house in order.
There may be a strong case for making unregulated boxing illegal. There may also be a need for legislation to enable the board of control to have greater powers so that it is less inhibited by the legal doctrine of restraint of trade. Those are matters which may be looked at again, but not in the context of this flawed Bill.
8.33 p.m.
Lord Dean of Beswick: My Lords, my noble friend Lord Taylor of Gryfe has done us a favour by giving us the opportunity to debate this subject. I wish to make it clear that, although I am speaking from the Dispatch Box, I am not speaking on behalf of my party. Like other parties, it does not have an official policy on boxing. My view of the subject will form the basis of what I shall say.
I do not cavil at any of the medical evidence that has been produced which shows that boxing is a dangerous and damaging sport. I do not take too seriously the figures produced by my noble friend Lord Brooks of Tremorfa. He said that only two people have been killed while boxing and that shows that the sport is not that dangerous. We cannot take that as an indication that the sport is safe, because we are talking about the number of injuries, not fatalities.
One should watch some of the rugby league matches, because I think that is the most dangerous sport. The game has become so demanding that some of the clubs are now asking for a pool of four substitutes rather than two. Many men are being seriously injured. One has only to think of two 16-stone men running towards each other at full tilt who meet head on. For instance, just two or three weeks ago the English captain Ellery Hanley had his jaw smashed in a number of places. The least said about what happened the better.
We are not talking about just one sport. It is well known that there are numerous lads who will be

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sitting in wheelchairs for the rest of their lives because they have had their necks broken playing rugby. That does not receive the publicity that boxing receives.
My noble friend Lord Rea said that the Bill might reach fruition. I have to tell him that only three weeks ago in another place in answer to a question from a friend and colleague of mine who happens to be in the Gallery, the Prime Minister categorically refused even to consider banning professional boxing. That is an indication that even if we give the Bill a fair wind and a Second Reading, it will be stopped in its tracks at some time.
There is no question but that there are areas where matters could be improved. I wish to give my opinion as to why more boxers are being hurt now than in the past. I have not watched live professional boxing for a long time. I was weaned on professional boxing at Belle Vue, Manchester when there were some great boxers in the area. There was the great trio of McAvoy, Brown and King. I have seen the great boxers from Liverpool, including Nel Tarleton and Dick Burke, and I have seen some of the great Scottish boxers such as Jackie Patterson and Jim Brady. They were all skilled boxers.
I suspect that many of the head injuries being caused in boxing are due to the fact that the boxers of today—I do not want to appear to be wallowing in nostalgia—are not as skilful as the boxers of the past. The main reason for that is that the route to the top is quicker. Boxers have a few fights. They gain a reputation for heavy punching rather than skilful boxing, and in no time they are high money earners. They are taken over by the promoters and some of the matches that are arranged have to be seen to be believed.
There was a heavyweight contest in this country two or three weeks ago in which the participants were Frank Bruno, a person for whom I have a great respect, and another heavyweight. The inequality of that match was so great that had it been subject to the trade descriptions legislation the promoters would have been prosecuted. Injuries could be avoided if the BBBC ensures that both contestants are similar and that the match is not a one-horse race, designed only to produce a scenario to enable the following boxing match to be arranged with a much bigger fee for the winning participant. That position should be looked at.
I take the point about the medical evidence and doctors' opinions being ignored. I understand that the board's chief medical adviser advised it strongly not to give Frank Bruno back his licence to fight. There was a previous heavyweight Gary Mason, who experienced similar circumstances. He had a double operation for detached retinas. Anyone knows that after an operation of that kind, a tap on the head can destroy the sight of the eye. When the board's medical advisers say that a boxer is not fit to box he should not be given his licence. If the board does not have that power, it should make overtures to your Lordships' House and another place to obtain such a power.
Another point is that the noble Lords, Lord Rea and Lord Walton, referred to the advances that have
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been made technically in examinations of people for brain damage. I should like to see all boxers, irrespective of the number of their fights, regularly examined to see whether they are fit to continue in the profession. Members of your Lordships' House have talked about the tragedy of Michael Watson and the injuries he suffered in the fight, but two fights before that one, not such a long time earlier, he was involved in a fight for the world championship with a West Indian lad named McCallum. He was literally hammered for about 11 rounds and was finally knocked out. I suggest that that type of beating probably has a far worse effect. I am not talking about the later injuries to Watson but the effects were far worse than would normally have arisen from a quick knock out. I wonder whether Watson had recovered from the effects of that terrific pounding before he was allowed to fight Chris Eubank for the first time. This is another area which should be examined.
The noble Lord, Lord Meston, referred to people drying out. If a boxer fights at the lower weights, a flyweight of eight stone who is four or five pounds overweight the day before is squeezed as dry as though he has been through the old-fashioned wringer. I have seen world champions, and one fight involving a great champion, Jackie Paterson, when he was six pounds overweight the day before the fight. When he was finally put into the ring to defend his title, he could not stand up because he was so weak. I can see no justification for those fights taking place because severe damage is being done and beatings are inflicted on people who have had to make a certain weight in order to take part in the fight. They have then suffered the consequences.
Unfortunately, the promoters are not interested as long as they fill the halls and sell the seats. That is their objective. I have watched some of the great fighters of the past and the objective of each of them is to knock out his opponent. Quite a number of people who have held world championships at various weights over the years did not have a knock-out punch at all. I can think of one, the lad I mentioned from Liverpool, Nel Tarleton. I do not remember him knocking anyone out, but he won hundreds of fights. There was also a featherweight just after the war in America, a fellow named Willie Pep, who hardly knocked anyone out.
These were all clever men who knew how to avoid punishment. One of the sad facts about today's fighters is that, if we watch them, we can see that they appear to think that there is nothing wrong in keeping on hitting their heads on the other fellow's gloves as long as they get close enough to deliver their own punches. I believe that standards have fallen.
We have had a good debate, I hope that it will engender in the boxing board the desire for a reconsideration of the situation and of its powers to act. Where it has the power to act in a positive manner, it should not defy its medical advisers but should give an indication that their advice will be totally accepted and not qualified. Otherwise, what is the point of having medical advisers on such a scale?
The board should also have the power, which it does not have at present, to decide when a match is a

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mismatch and one boxer is far inferior to the other fellow who is being thrown in against him and may suffer a beating in consequence.
All these points must be considered. Enough has been said by Members of your Lordships' House to give the boxing board cause for serious thought. I have no doubt that the board must in some way diminish the power of promoters in the boxing game and make sure that the board is able to control it in an objective manner.
I shall not vote against the Bill although I am not particularly in favour of it. I cannot see a situation in a society like ours where one could get away with banning boxing, as the Bill suggests. It may well be that if it reaches the Committee stage we can have a further debate with people from outside your Lordships' House who are interested in the game. They may suggest amendments which may be extremely helpful to the game.
The boxing board itself should consider what has been said by various Members of your Lordships' House. If the board's own house needs putting in order and it requires additional powers to do that, it could let us know quickly. I do not believe that it will find your Lordships' House and another place wanting in that respect. On that basis, I hope that the noble Lord obtains a Second Reading of the Bill. Then perhaps we may debate the matter further in Committee.
8.45 p.m.
Lord Cavendish of Furness: My Lords, first I thank the noble Lord, Lord Taylor of Gryfe, for the manner and the obvious sincerity with which he presented his Bill this evening. I assure your Lordships that the Government share his concern for the safety of boxers. However, we do not believe that the sport should be banned.
Boxing as a sport has a history stretching back over hundreds of years and it is without question part of this country's sporting heritage. It is an established and properly regulated sport at both amateur and professional level and has a wide following among the public. In addition to the 1,000 or so licensed professional boxers in Britain, there are an estimated 35,000 participants of the amateur code. These individuals, at all levels of skill and expertise, share a common love of the sport. They devote considerable amounts of time and energy to their chosen activity. The Bill before us would effectively prevent them from participating in the sport of their choice. It would ban boxing wherever a match was organised for profit, regardless of whether the boxers themselves stand to gain financially. I am sure that your Lordships would agree that, in a free society, we need to think very carefully indeed about introducing such measures.
In presenting his Bill, the noble Lord has placed much emphasis on the safety of boxing and its potential effect on an individual's health. Of course, in any activity—and particularly in those involving physical contact—there is always the possibility of accident or injury, no matter how strict the safeguards
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are. But I believe that a careful assessment of the evidence suggests that his fears are unfounded and, consequently, that this Bill is unwarranted.
Perhaps I may first deal with fatalities. In giving my statistics, I shall be interested to read tomorrow whether my list matches that of the noble Lord, Lord Brooks; my list is shorter. The figures supplied by coroners to the Office of Population Censuses and Surveys show that there have been only three deaths in England and Wales from boxing since 1986 and— happily—none since 1987. By means of comparison, in the same period there have been 62 deaths in motor sports; 59 in air sports; 48 in mountaineering and climbing; 36 in ball games; and 23 in horse riding. It can be seen from this that boxing presents only a very minor threat to life, especially when compared with other hazardous activities where safety is of paramount importance. If we are to ban boxing on the grounds of the risk it poses to life, where are we to stop? Perhaps we should ban cricket too, on the grounds that the same number of individuals died while participating in cricket matches over the same period!
Many noble Lords had anecdotes and personal reminiscences of fighting and watching fighting which I cannot match, having only once broken my jaw when playing "Kick the Can".
If these figures suggest that the risk to life has been exaggerated, then I am pleased to say that the picture is similar when we examine the statistics for injuries obtained as a result of boxing. I draw your Lordships' attention to the results of a recent analysis by the Sports Council into sports accidents, which was derived from the general household surveys of 1987, 1988, and 1989. Despite a small sample there was remarkable consistency across the three years, which allows one to accept the average figures for the three years with some confidence. A standardised risk factor for each sport was calculated by representing the number of sports accidents as a factor of the number of occasions in which individuals participated in each sport. Sports were then placed in one of four categories, ranging from high to negligible risk. The salient finding was that boxing was placed in the negligible risk category.
Another issue that has been raised tonight is the long-term damage to an individual's health that might be caused by boxing. The Government have no hesitation in accepting that, sadly, there are instances where long-term medical problems can be attributable to boxing. Careful monitoring of boxers' health can reduce these risks. But boxing in any event is not unique in this respect. There are, regrettably, a large number of people who suffer from injuries obtained from participating in different sports.
The noble Lord, Lord Rea, blamed the Whips' Office for his lateness in coming to the Chamber. I am sorry if the noble Lord was ill-advised, but I hope that he will understand that the matter he complained of is his responsibility and not that of the Whips' Office. The noble Lord used a lot of medical terms when telling the House about the dangers that boxers could face. However, he did not give much indication of how

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often such symptoms appeared. Therefore I did not feel he was very clear about the kind of medical risk that boxers face.
The simple fact is that there is a risk attached to any challenging activity. If this was removed, then much of the challenge itself would disappear. We live in a free society and an individual has the right to participate in the activity of his choice so long as it is within the law.
Those are the facts. In the light of these, it is difficult to see how the measures proposed by the noble Lord are warranted. If boxing were to be banned because of its perceived dangers, then are we also to ban other activities where death may result? I think not.
Despite that, I would like to emphasise that the Government are not complacent on the issue of boxing safety. They believe strongly that the utmost attention needs to be paid to safety not just in boxing but in all sports where risk is a factor. It may be helpful at this stage to remind your Lordships that the Government do not control boxing, or indeed any other sport in this country. That is the responsibility of the appropriate governing bodies. In the case of professional boxing, this responsibility is borne by the British Boxing Board of Control. For the amateur code it is the Amateur Boxing Association. Together, these organisations provide the framework within which tournaments are sanctioned.
Both the ABA and the BBBC are acutely aware of their responsibilities in protecting the health of boxers. They recognise that boxing, like any activity involving physical contact, has an element of risk attached to it. What is paramount is that the risk is controllable and containable. Medical safeguards are already in place to protect the health and safety of boxers before, during and after tournaments. These include full medical examinations with a detailed list of conditions which would preclude a boxer from holding a licence; brain scans; specialist examinations; and automatic suspensions and further medical examinations in the event of a boxer losing within the scheduled distance.
These safeguards underline the importance attached by the boxing authorities to medical issues. However, it is essential that these standards are kept under constant review and there is always scope for further improvement. The Government recognise this and have played their part in this process. Indeed, my honourable friend the Minister responsible for sport met the BBBC and a number of medical specialists to discuss this very issue as recently as October. As a result of that meeting, the BBBC has recently announced a number of significant improvements to its existing regulations. I believe that was acknowledged by the noble Lord, Lord Taylor of Gryfe, in his opening speech.
Some have also voiced objections to the sport on moral grounds. The thought of two people participating in a boxing match is abhorrent to some people. It is argued, for example, that boxing is the only sport where participants deliberately inflict injury upon each other. In responding to this claim, I would draw your Lordships' attention to one very salient point. Here I take issue with the noble Lord who said
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that boxing is the only sport that involves deliberate violence. Boxing is not the only sport which emphasises combative elements involving physical contact. All the martial arts are similar in nature. That point was made forcefully by the noble Lords, Lord Addington and Lord Meston. Boxing has been portrayed as a sport of brute force. We believe that boxing is a contest of skill where points are awarded in every round for defence as well as for strikes.
The argument has also been advanced that it is uncivilised for spectators to derive pleasure from watching boxing. Noble Lords who hold that view are entitled to their opinion, as is every individual. However, the Bill before us would remove the right of individual choice. The noble Lord, Lord Soper, and other speakers have said that boxing glamorizes and perpetuates violence. Boxing follows a set of rules and safeguards, and rewards skill and courage. There is no evidence that I know of—I do not think that any such evidence has been put forward tonight—which shows that boxing propagates violence in society.
Let me make some other relevant points clear. The participants in a boxing match do so of their own volition —this was pointed out by the noble Lord, Lord Belhaven, and others; they do so within the strictest of medical safeguards imposed by reputable governing bodies; they do so within a sporting code that places the emphasis on skill rather than aggression and which contains inbuilt safeguards for the boxer. Moreover, boxers pose no threat to the safety of the general public. I believe that to deprive them of their right to participate in the sport of their choice, within the stringent safeguards imposed by the boxing authorities, is a dangerous precedent and a serious threat to civil liberties. Moreover, to do so would only serve to drive boxing underground—as has been said—and to deprive the boxers themselves of the very safeguards designed to protect them.
In concluding, I would like to draw your Lordships' attention to the immense and deep-rooted popularity of boxing in this country. A recent contest was watched by a truly massive television audience of around 13 million people. That represents around one out of every three adults.
Pugilism took hold of the nation's consciousness in the 18th and 19th centuries during the heyday of the prize-fighter. The game was cleaned up in the 1800s, culminating in the drafting of the Queensberry Rules, which underpin boxing to this day. Our boxing administrators were in the lead then, as they remain now, in doing their utmost to ensure that the sport is as safe as possible. The safeguards imposed by the BBBC contrast vividly with the unsavoury conditions in unlicensed boxing tournaments, which only a fortnight ago were exposed in a television documentary programme.
I hope that what I have said will have persuaded your Lordships that the Government are by no means complacent on the matter of boxing safety. Boxing, like countless other activities, will never be absolutely safe. But, given the evident determination of the boxing authorities to make the sport as safe as possible, we feel that the proposal to ban boxing is both unwarranted and unreasonable.
8.57 p.m.
Lord Taylor of Gryfe: My Lords, I believe that every noble Lord who has spoken has declared his allegiance. It would be difficult for me to convert noble Lords to a different point of view. However, I feel there are one or two points that require further clarification. I congratulate the noble Earl, Lord Shrewsbury, on his work with boys' clubs which is admirable work. But why is boxing justified in those clubs? There is a great deal of constructive work and sport which can be organised in boys' clubs that does not involve introducing them to a sport such as boxing.
Thy Earl of Shrewsbury: My Lords, boxing is introduced into boys' clubs because such sports as tennis and squash are not played in the deprived areas where these boys live.
Lord Taylor of Gryfe: My Lords, I give full marks to the noble Earl once again for his work. However, I believe that it is not necessary to introduce boxing into boys' clubs. In this Bill I am dealing with professional boxing. Professional boxing is far removed from the boxing that is organised in boys' clubs. If the noble Earl feels that the Bill is badly drafted and does not cover some of the aspects of the sport that he would like to see covered, he has an excellent remedy in seeking to give the Bill a Second Reading. If it receives a Second Reading, the noble Earl will be able to table amendments in Committee. I hope that he will pass through the Lobby to that end.
I would say to the noble Lord, Lord Addington, that it is true that there are other martial arts. However, let us start with boxing as it is clearly defined. If I had introduced a Bill to cover all aspects of physical contact sports, your Lordships would have been rightly critical of me. I am dealing with professional boxing and I seek to ban it. That is what the Bill is concerned with. That should be clearly understood.
It was said that we must not pass a law—
Lord Addington: My Lords, I referred to other full contact, professional martial arts which are on the increase. If they involve kicking, they are more dangerous. The Bill does not address those aspects. That is why I raised the point and that is why the Bill is not appropriate.
Lord Taylor of Gryfe: My Lords, again, I shall welcome the support of the noble Lord, Lord Addington, in the Lobby tonight so that he may improve the Bill in the manner that he suggests by introducing other martial arts which obviously concern him deeply.
Several speakers have said, "Don't ban professional boxing. It will drive it underground". It is a dangerous doctrine to suggest that we should not pass a law because some people will defy it. Once you give in to that kind of view, life becomes extremely difficult. If we ban professional boxing, it should not be too difficult to ensure that it is policed accordingly.
I was interested in the delightful description of the so-called noble art mentioned by the noble Lord, Lord
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Meston, who obviously enjoys his boxing. My neighbour, the noble Lord, Lord Cochrane of Cults, referred to a speech that I made in an earlier debate on this subject in which one of the great British heavyweights of the time, Billy Walker, was quoted as saying:
"I've no illusions about the noble art of self-defence or any of that kid stuff. That's all right for the amateurs. But from now on I'm paid to hurt. The more I hurt, the more I'm paid".
On the same occasion—the last time that I raised this matter—I referred to a newspaper report about a fight involving a man called Tony Sibson. The report was simply headed, "Bloodbath". It went on to say:
"Tony Sibson retained European middleweight title at Wembley last night with a breathtaking, awe-inspiring display of primeval savagery".
That is what we are talking about. We are not talking about all this stuff about the skill of boxing. We are talking about real life boxing.
When I entered Glasgow City Council, one of my fellow councillors was the doctor for the Board of Control. He took me to one or two fights. We used to go in before the fights and look at the boys who were about to appear. They were trained to the limit. The doctor passed them as being fit to enter the contest. Some minutes later, those boys would be carried back to the dressing room, eyes closed and blood flowing from them.
That is not a noble art. We have no right to inflict that kind of punishment on other human beings. I strongly believe that our lives, the intricate mechanisms of our brains and our intellects are God-given and that we have a responsibility to use those faculties in his service. It demeans people and is uncivilised conduct for people to knock one another unconscious. Perhaps we should look at the matter this way: if two men were to do outside the ring what they did in the ring before 13 million spectators—that was the figure quoted—they would be arrested and put in prison for assault. However, it is in the ring and people pay money to see those two young athletes punch each other unconscious. That is uncivilised. It is a black mark on our society.
If noble Lords believe that the Bill is not perfect, I encourage them to come into the Lobby and to make it perfect in Committee. They must face this moral challenge: are we entitled to perpetuate those acts? I hope that as many noble Lords as possible will enter the Lobby to support the Bill.
9.5 p.m.
On Question, Whether the Bill shall be now read a second time?
Their Lordships divided: Contents, 17; Not-Contents, 20.

Division No. 1

CONTENTS

Airedale, L. [Teller.]

Kagan, L.

Belhaven and Stenton, L.

Kinloss, Ly.

Cochrane of Cults, L.

Lockwood, B.

David, B.

McNair, L.

Dean of Beswick, L.

Masham of Ilton, B.

Dormand of Easington, L.

Rea, L.

Ewart-Biggs, B.

Taylor of Gryfe, L. [Teller.]

Graham of Edmonton, L.

Tordoff, L.

Hylton, L.

319

NOT-CONTENTS

Addington, L. [Teller.]

Howe, E.

Astor of Hever, L.

Long, V.

Balfour, E.

Mackay of Ardbrecknish, L.

Beaverbrook, L.

Mancroft, L.

Clanwilliam, E.

Meston, L.

Crathorne, L.

Monson, L.

Greenway, L.

O'Hagan, L.

320

Reay, L.

Strathmore and Kinghorne, E.

Seccombc, B.

Thomas of Gwydir, L.

Shrewsbury, E. [Teller.]

Willoughby de Broke, L.

Resolved in the negative, and Motion for Second disagreed to accordingly.
House adjourned at thirteen minutes past nine o'clock.