Lords Sitting of 23 January 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 St. Albans.

Lord Sterling of Plaistow
Sir Jeffrey Maurice Sterling, Knight, KBE, having been created Baron Sterling of Plaistow, of Pall Mall in the City of Westminster, for life—Was, in his robes, introduced between the Lord Goodman and the Lord Jenkin of Roding.

Unemployment: Statistics
2.50 p.m.
Lord Dormand of Easington Lord Dormand of Easington asked Her Majesty's Government:
What is the number of unemployed people at the latest available date and the number unemployed at the same date a year earlier.
The Earl of Strathmore and Kinghorne: My Lords, in December 1990 seasonally adjusted unemployment in the United Kingdom was 1,843,500 compared with 1,636,100 a year earlier.
Lord Dormand of Easington: My Lords, is not the most disturbing feature of unemployment seen in the scale of the increase in the monthly figures? Will the Minister confirm that when unemployment rose for the first time in March last year, the increase was 4,000, and that last month the increase was 80,000? When the noble Earl compares our employment position with other countries, as he undoubtedly will, he will not find that acceleration. It has been said many times from this side of the House that high interest rates are the main cause of unemployment, and that a change from that thoroughly misguided policy is essential if we are to avoid reaching 2 million or 2.5 million unemployed. When will the Government accept that?
The Earl of Strathmore and Kinghorne: My Lords, this month's rise should be seen in context. It remains the case that the United Kingdom has one of the lowest unemployment rates in the European Community. Furthermore, unemployment is rising in most major industrialised countries, including the United States of America, Japan, Canada, Italy and France.
Baroness Turner of Camden: My Lords, is the Minister aware of the prognostications for job losses in banking over the next two years? It is predicted that 300,000 jobs will be lost. When that figure is added to the loss of 78,000 jobs over the past year, we see a quite disastrous picture. Is he further aware that, according to press reports yesterday, the high interest rates at the present time are regarded as the main cause of banking redundancies?
The Earl of Strathmore and Kinghorne: My Lords, I must correct the noble Baroness on her figure of 300,000. I think she means 30,000.
Baroness Turner of Camden: No.
The Earl of Strathmore and Kinghorne: My Lords, these figures must be seen in context. They do not detract from the Government's considerable longer term achievements in improving the performance of the labour market. Employment is currently at a record level.
Lord Boyd-Carpenter: My Lords, do not these figures indicate, however, the importance that nothing should be done to increase industrial costs, either by way of trade union action or legislation?
The Earl of Strathmore and Kinghorne: My Lords, I can only agree with what my noble friend says.
Lord Molloy: My Lords, that was a terribly sad response from the Minister. Is he aware of the views of the Confederation of British Industry, banking experts and economists in the City that the rate of bankruptcies and the collapse of small businesses will increase enormously in the year ahead unless the Government change their policies? Does he not agree that this will also mean an equally massive increase in unemployment? What will the Government do about that?
The Earl of Strathmore and Kinghorne: My Lords, the Government are committed to a substantial reduction in inflation during 1991 as that is the key to achieving long-term economic success. In the labour market, the extent and duration of any increase in unemployment will depend crucially on pay. Excessive wage settlements will damage our competitiveness and threaten jobs.
Lord Young of Graffham: My Lords, does my noble friend agree that neither the Government nor the CBI as institutions actually create jobs, but inflation certainly destroys them?
The Earl of Strathmore and Kinghorne: My Lords, again, I can only agree with what my noble friend says.
Lord Barnett: My Lords, the Government are quite right in wanting to see inflation brought down substantially. Will the noble Earl tell us, as they have been pursuing a tight monetary policy, why inflation ever rose?
The Earl of Strathmore and Kinghorne: My Lords, the Autumn Statement forecast that the latter half of 1990 would be tough. Both the Chancellor and the Prime Minister have indicated that unemployment is likely to rise further in the next few months. However, we expect to see in 1991 both a reduction in inflation, which is the Government's top priority, and a resumption of economic growth.
Lord Cledwyn of Penrhos: My Lords, in view of the unquestionably grave unemployment prospects in this country over the next year or so, why are the Government cutting the unemployment training budget by £200 million over the next two years?
The Earl of Strathmore and Kinghorne: My Lords, let us be under no illusion. The Government are far from content with the current level of unemployment and certainly do not wish to see unemployment rise.
Lord Stoddart of Swindon: My Lords, have the noble Earl and the Government considered the political implications of the latest jobless figures? Does he realise that the greatest number of job losses is now taking place in the South of England—the Tory heartland—and in service industry jobs? Under those circumstances, and indeed for their own survival, will the Government not listen to pleas—and proper pleas —from all parts of the economy to reduce interest rates immediately?
The Earl of Strathmore and Kinghorne: My Lords, I hear what the noble Lord says. He is indeed right about the unemployment figures in the South-East. However, employment in services still currently stands at well over 16 million.
The Earl of Lauderdale: My Lords, does my noble Lord agree that the current high interest rate programme is intended to reverse the crazy credit boom of recent years? It is having its effect and is bringing inflation down.
The Earl of Strathmore and Kinghorne: My Lords, my noble friend is correct. The Government will reduce interest rates as soon as it is prudent to do so.
Lord Rochester: My Lords, will the noble Earl answer the question asked by the noble Lord the Leader of the Opposition as to why, as recession deepens and unemployment increases, the Government have made such substantial cuts in the training budget?
The Earl of Strathmore and Kinghorne: My Lords, that question is particularly wide of the Question on the Order Paper as it refers to training.
Lord Blease: My Lords, is there not a sad lack of committed communications between industry and the Government? What do the Government intend to do to promote co-partnership between the Government and industry at national level, and between Government and industry at regional level? An honest commitment is needed by those three partners to bring about a realistic approach to our problems.
The Earl of Strathmore and Kinghorne: My Lords, as my noble friend Lord Ullswater said at the Dispatch Box last week in answer to a similar question, the Government will listen to all points of view, be they from industry or any side of your Lordships' House.
Lord Blease: My Lords, I realise that the Government are listening, but we need a commitment. What are the Government doing to obtain that commitment?
The Earl of Strathmore and Kinghorne: My Lords, I do not have an answer to that point today. I shall come back to the noble Lord.
Lord Donoughue: My Lords, as the Minister agreed with his noble friend who said that unemployment is effectively a policy of correcting the crazy credit boom of a few years ago, and as that crazy credit boom arose
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from the failure of the Government's policies, does he not agree that the unemployed are now paying the price of the failure of the Government's economic policy?
The Earl of Strathmore and Kinghorne: My Lords, the United Kingdom still has one of the lowest rates of unemployment in the European Community. In 1979 United Kingdom unemployment was broadly similar to the EC average, but now it is considerably lower. Only Germany, Luxembourg and Portugal have a lower rate.
Lord Dormand of Easington: My Lords, is the Minister aware that few people will disagree with what he said about the need to pay attention to wages, although it would be much more credible if the Government said something about the obscene increases given to chairmen of companies, chief executives, and so on? Is he saying—because he has not answered the real question —that high interest rates have little or nothing to do with the present unemployment figures?
The Earl of Strathmore and Kinghorne: My Lords, as I have said before, high interest rates are a factor. On the noble Lord's first point about directors' salaries, it is up to individual companies to sort those out themselves.

Industry: Production and Investment
3 p.m.
Lord Hatch of Lusby Lord Hatch of Lusby asked Her Majesty's Government:
What are the latest figures for UK industrial productions and investment.
The Minister of State, Department of Trade and Industry (Lord Hesketh): My Lords, data for output of the production industries at constant prices are published in index form, with the average for 1985 equal to 100. The index for November was 106.7. Data for gross domestic fixed capital formation by the production industries alone are not available. But the figure for business investment in the third quarter of 1990 was £13.828 billion at constant prices.
Lord Hatch of Lusby: My Lords, will the Minister give the House the benefit of his knowledge and tell us how the figures which he has just given compare with those for the previous quarter—or, for the previous month if he wishes—and those for the same period in 1989?
Lord Hesketh: My Lords, the comparison with respect to 1989 is 109.8.
Lord Peston: My Lords, has the Minister seen the CBI figures which show that the United Kingdom invests less in fixed capital per employee than its major competitors? The confederation also states in its advice to the Chancellor of the Exchequer that such an investment gap cannot be afforded in the light of the growing competitive pressures created by the single market and ERM membership. Do the Government agree with what the CBI has said about investment? More important, are they likely to do anything about investment in time to save British industry?
Lord Hesketh: My Lords, the reality, which may come as a surprise to the noble Lord, Lord Peston, is that business investment has risen in real terms by about 50 per cent. since 1979. It is worth remembering that the average family in Britain is 31 per cent. better off now in real terms than was the case in 1979.
Lord Peston: My Lords, I appreciate the fact that the noble Lord may have difficulty in actually answering the question. However, perhaps I may put it to him again. There was a minor investment boom in the 1980s, as no doubt he is aware, which has now come to an end. The truth is that our industry is underequipped compared with those of our competitors. In an endeavour to defend themselves, it does the Government no good to fail to realise the needs of British industry. I am not pressing the point; it is the CBI that is doing so. Do not the Government feel that they should at least respond to the desires of their friends, even if they do not care for those of their critics?
Lord Hesketh: My Lords, if that investment boom was "minor", I fear that the noble Lord, Lord Peston, would be as surprised if he were to be run over by a double-decker bus.
Lord. Ezra: My Lords, following on from the supplementary question put by the noble Lord, Lord Peston, have the Government in mind, in addition to the eventual reduction in interest rates, offering some other assistance to industry to stimulate investment? For example, have they given any thought to improving investment allowances?
Lord Hesketh: My Lords, it is a fact that investment increased after the introduction of changes in the rules for capital allowances. It is also a fact that last year the motor car industry, against all odds, increased its level of exports to a record level not achieved since 1973. There has been virtually no fall in consumption. I am sure that the noble Lord, Lord Ezra, was one of the great supporters of our entry into the European exchange rate mechanism. We are achieving stability under a system which was promoted by both sides of your Lordships' House.
Lord Callaghan of Cardiff: My Lords, is the noble Lord aware that, in answering Questions, the Government's case is not strengthened by displays of either arrogance or ignorance? I refer especially to his previous answer.
Lord Hesketh: My Lords, since I first came to your Lordships' House I have always been willing to accept that I might not have had the greatest education. However, I have to say to the noble Lord, Lord Callaghan, that it has never been a desire or an intention on my part ever to show arrogance in your Lorships' House.
Lord Stoddart of Swindon: My Lords, with reference to Britain's entry into the ERM, does the noble Lord now accept that the stability to which he referred has come about as a result of falling production and rising unemployment? Does he accept that that is a result of our entry into the ERM?
Lord Hesketh: My Lords, even more important, and above any entry into the ERM, is the
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Government's desire to control inflation. That is our number one priority. I refer the noble Lord, Lord Stoddart, to my previous answer concerning output in the motor car industry: there is success and, at the same time, we are controlling the disease.
Lord Molloy: My Lords, does the Minister agree that there should perhaps be some alternative to the policy of always increasing interest rates which, most of all, seems to hammer those people who have decided to buy their own home?
Lord Hesketh: My Lords, it is worth pointing out that since we joined the ERM interest rates have been reduced by 1 per cent.
Lord Hatch of Lusby: My Lords, does the noble Lord agree that both production and manufacturing investment are declining drastically? Perhaps he may recall the answer of the previous Front Bench spokesman on employment when referring to the long-term economic success of the country. Does not the decline in investment in manufacturing industry cast a a very grave shadow over our prospects for any kind of economic recovery or economic success in the future?
Lord Hesketh: My Lords, business investment fell in the third quarter of 1990 by 1.9 per cent., which is the first fall since 1985.
Lord Bruce of Donington: My Lords, is the noble Lord aware that the supplementary question put to him by my noble friend Lord Hatch referred specifically to manufacturing industry investment and not to the rather larger term that he used—namely, "business"—which encompasses a whole series of other services? Is he also aware that investment in manufacturing industry is now showing a drastic decline and that at present it is running at a lower level in real terms than it was in 1979?
Lord Hesketh: My Lords, as always it is a pleasure to answer a question put forward by the noble Lord, Lord Bruce of Donington. However, I feel that I should draw his attention to the Question on the Order Paper which does not refer to manufacturing industry. It refers to figures for, "industrial productions and investment". Within that context, I have done my best to answer the Question.

Turtles and Terrapins: Imports
3.7 p.m.
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
Whether they will restrict imports of turtles and terrapins to prevent salmonella infection and cruelty to animals.
The Parliamentary Under-Secretary of State, Department of the Environment (Baroness Blatch): My Lords, there is no firm evidence about the extent of salmonella infection from turtles and terrapins, and the Government have no immediate plans to extend the existing import controls in respect of them. It is already an offence for traders to cause suffering or ill treat animals.
Lord Campbell of Croy: My Lords, I thank my noble friend for that Answer. Can she say whether the enthusiasm shown at Christmas for certain mutant turtles, described in press reports as "turtle mania", has increased the demand in this country for these unfortunate creatures?
Baroness Blatch: My Lords, there has been an increase as a result of the mutant hero turtle mania. However, I also understand that the Nature Conservancy Council is aware of a growing number of colonies in the country, the largest of which consists of only about six terrapins. They are omnivors and will therefore eat weeds and indigenous species of insects. But it is true to say that a cold weather spell would have the effect of killing them off.
Viscount St. Davids: My Lords, is the noble Baroness aware that any attempt to restrict the import of these creatures is now too late? Is she also aware that there are at least two species which are now feral in our waterways? Is she further aware that emys orbicularis, the European pond terrapin, thrives perfectly well as far north as northern Germany and that the American red-eared terrapin, which has also been released, has been seen happily disporting itself —and indeed, has been photographed—as far north as Wolverhampton?
Baroness Blatch: My Lords, I do not know what effect that final comment has on all my Scottish colleagues in the House. The banning of animals has more to do with endangered species. I should point out that terrapins are not an endangered species.
Lord Lyell: My Lords, can my noble friend try to alleviate my ignorance on the matter? Are not terrapins what I used to think of as tortoises? I understand that this particular class of animal covers a very wide range of size, shape and species.
Baroness Blatch: My Lords, I am not an authority on terrapins. My understanding is that they are not tortoises. They are more akin to turtles, and they swim.
Lord Hailsham of Saint Marylebone: My Lords, is not the difference between a terrapin and a turtle well described by Rudyard Kipling in the Just-So Stories?
Baroness Blatch: My Lords, it is indeed.
Lord Campbell of Croy: My Lords, will the Government publicise the fact that turtles and terrapins are difficult pets to keep and, if abandoned, damage the local ecology?
Baroness Blatch: My Lords, my noble friend makes an important point. The department writes continually to traders on the welfare of animals and ensures that people know their responsibilities under the Wildlife and Countryside Act.

Election Candidates: Party Expenditure
3.10 p.m.
Lord Holme of Cheltenham Lord Holme of Cheltenham asked Her Majesty's Government:
What conclusions they have reached on the possibility of limiting party expenditure nationally
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during a general election, as raised in the Home Office consultation document of 21st December 1989.
Lord Reay: My Lords, none yet. The consultation paper was the first stage of a review of the whole subject of candidates' expenses at elections. The second and final stage of the review is now under way. A consultative group has been set up under Home Office chairmanship and representatives of the main political parties and of local authority associations have been invited to participate. The group is expected to report to my right honourable friend the Home Secretary by Easter of this year.
Lord Holme of Cheltenham: My Lords, I thank the Minister for his full Answer. I am pleased that the Home Office is considering that serious anomaly by which candidates in their constituencies are severely limited as to the expenses that they can incur in an election while nationally there is no limit on what the parties spend. Does the Minister agree that it would be desirable for a conclusion to be reached on this important matter, especially given the early start that the Home Office made on it, well before a general election?
Lord Reay: My Lords, I am not sure that everyone necessarily shares the noble Lord's view that the present system requires to be changed. However, whenever the consultative group reports, the matter will be considered in the light of that review and the Government will make a decision.
Lord Morris of Castle Morris: My Lords, can the Minister assure the House that in the next general election campaign the Government will strictly observe the proper role of the government information services and will not use departmental resources to promote Conservative Party politics?
Lord Reay: My Lords, I am sure that we shall do so.

Business
3.12 p.m.
Lord Denham: My Lords, after the short debate on GATT and before that on health and safety at work, my noble friend Lord Caithness will, with the leave of the House, repeat a Statement that is to be made in another place on the missile attack on Israel.
With the leave of the House, I should like to say a word about the two short debates standing in the names of the noble Lord, Lord Williams of Elvel, and the noble Baroness, Lady Turner of Camden. As the mover is allowed 15 minutes and the Minister should rise to reply not less than 20 minutes before the scheduled end of the debate, in the case of the short debate in the name of the noble Lord this means that all other speeches should be limited to a maximum of six minutes and in that of the noble Baroness 11 minutes.
It may be right for me to remind the House that by the time the figures six and 11, respectively, appear upon the screen above, that speech has already exceeded its allotted time.

GATT Negotiations
3.13 p.m.
Lord Williams of Elvel Lord Williams of Elvel rose to call attention to the negotiations taking place under the auspices of the General Agreement on Tariffs and Trade; and to move for Papers.
The noble Lord said: My Lords, my noble friends and I decided to invite your Lordships this afternoon to debate the current GATT negotiations, known for the purposes of shorthand as the Uruguay Round, not merely by way of respite from the Gulf crisis but because the outcome of the round may in the end prove to be, in terms of the world economy, as important as the result of the conflict in the Gulf. Even in times of war we must give attention to the problems of peace. That is what we shall do today.
The Uruguay Round, as your Lordships will be aware, was given that name because it opened in Uruguay—to be exact at Punta del Este—in 1986. It followed previous rounds —this is the eighth—which have had as a common objective the liberalisation of world trade. Its predecessor was the Tokyo Round, which took from 1973 to 1979 to negotiate. The Uruguay Round is trying to deal with many of the issues left unresolved by its Tokyo predecessor, such as non-tariff barriers, agriculture, subsidies and safeguards. But it has also introduced some new elements: trade in services, trade-related intellectual property rights and trade-related investment measures. It is a full agenda.
In introducing the debate, I should like to comment briefly, since that is all that I can do in the time available, on some of those issues and to reflect upon the possible consequences of a failure of the round. At the outset I wish to make it abundantly clear that although this is not in any sense a party matter, we on our side will work in whatever way we can for its success. I can only echo the words of the General Secretary of the TUC, who said in Tokyo last month:
"Jobs in British industry depend increasingly on the expansion of trade and the growth of the world economy as a whole".
That is a theme that I wish to develop.
There is no serious analysis of the post-war world economy of which I am aware that does not recognise the importance of the liberalisation of trade as a motor for growth. There is no analysis of third world economies of which I am aware that does not recognise how vital it is that the present round is successfully negotiated. But I am afraid that we are some way from achieving that desirable end at the moment. The round was due for completion at 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 negotiation before the year end failed. We have to admit it; it failed. We are now near the absolute and final deadline for the fast track process to operate. That is why the next few weeks are so vital and why my party believed it to be right to bring the matter before your Lordships for debate today.
When I say "we" I have to make it clear to whom I am referring. It is no good me or any other noble Lord merely saying we want this, that or the other and expecting it to happen. Negotiations are conducted on our behalf and on behalf of all members of the European Community by the European Commission. So from the British point of view—the point of view of the House, if I may say so—there are, as it were, two steps. The first is to persuade our partners in the Community and then to help the Community negotiate constructively for all 12 member states. It would be naive to deny that both steps are fraught with considerable difficulty.
Apart from the politics, the issues themselves are of course extremely complex. In today's debate we shall not be able to do justice to them all. There are, after all, over 100 countries participating in the negotiations and 15 major areas upon which agreement is needed. I am sure that noble Lords who are to speak this afternoon will wish to roam over many of those areas, but I should like to identify the three issues which seem at present to be at the top of the agenda for negotiation and offer one or two thoughts on them.
The first, which will not surprise your Lordships, is agriculture. By way of background it has now become clear that the United States is determined to reduce not just its own agricultural subsidies, which are playing havoc with Federal finances, but, and perhaps more importantly, the subsidies paid to European and other farmers, and, in particular, subsidies paid to traders trading in European products on the international markets. The Cairns Group, as it is called, led by Australia, has the same objective, as indeed have those of the third world who wish to sell the produce of their lands; and let us not forget that in some cases it is the only product that they can export to the rich markets of the developed countries.
On the other hand (because in these matters there is always, I am afraid, 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 is by international standards extremely efficient—by reckless ill-considered action. I say, with all due deliberation, there is no doubt that the level of agricultural subsidy in Europe is too high. Moreover, we in Britain have a particular grievance. We are net contributors to the Community in agriculture and the CAP costs us dear. We pay through the CAP a social subsidy—there is no other word for it—to the small, continental, sometimes part-time, farmer. The Government, in my view, have been quite right to reject the most recent proposals for farm subsidies that have been put forward in Brussels in the past day or two.
But—and it is a large "but"—if we are to reduce subsidies to agriculture, it cannot be done indiscriminately and suddenly. We—by which I mean the Community—must be prepared to phase out subsidies over an extended period. If by doing so we can enhance the cleanliness of our environment and the beauty of our landscapes, that can only be a plus. However, it must be properly planned. Simple reliance

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on market forces will give us all the wrong solutions: a bankrupt agricultural community and a much poorer environment.
Nevertheless, some deal on agriculture must emerge if the round, at this late hour, is to have any hope of success. It would be agreeable—I put it no higher than that—if the whole common agricultural policy could be renegotiated. The Government would gain great credit if they could manage that. But we must recognise that the agricultural problem is not the only problem that is an obstacle to successful negotiation of the round. Indeed, some countries have blown up the agricultural problem in order to obscure the difficulties that they have in other areas. There are still formidable problems in the negotiation of a liberalised trade pattern in services. In particular, the United States have shown themselves very protectionist when it comes to two sectors of vital importance to us in Britain: telecommunications and banking. Bilateral deals in these sectors are apparently on the agenda, quite contrary to the spirit of GATT.
Therefore, the second issue to be addressed, the second major obstacle, is how to achieve freer trade in services. Ideally, this means quite simply freedom of establishment in all countries for service companies. We recognise that that will not be achieved overnight. Many third world countries, not to mention the United States and Japan, are instinctively hostile to the idea. But if we are to give on agriculture then they must give on other sectors. There is a trade off between the two issues.
The third issue that I wish to talk about is the integration of the textile and clothing trade into the general agreement. To date, as your Lordships will be aware, this trade has been regulated by the Multi Fibre Arrangement which has worked well in providing a framework for the restructuring of the textile industry worldwide. If the MFA is to be discarded—and it is perfectly reasonable to argue that it should be—there must be adequate safeguards in the form of a longish phasing out period. This is particularly important for us in Britain where we have nearly half a million people employed in the industry, frequently concentrated geographically in the north of England.
I have picked out these three issues not because they are necessarily the most important objectively, but because they give the most trouble in negotiations. There are many other points on which agreement is —or perhaps I should say was —near: protection of intellectual property, prohibition of local content requirements in inward investment, the settlement of disputes and the strengthening of the rules on what safeguards are available to signatories to the agreement. The progress on these issues seemed to form the basis for a sensible package if the three major problems that I have outlined could be solved.
However, alas, they were not solved. Last month was due to be the final month of negotiations; it ended in failure. The situation now is that we must try, the Community or the participants must try, to pick up the pieces. The simple fact is that we must come up
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with a better package on agriculture. That means that Germany particularly, and France as well, must be prepared to exercise the qualities of leadership for which we look. The German elections are now out of the way but it must be a major German and French contribution to the package that will make it successful.
I said that I would talk a little about the consequences of failure. I do not believe that I am over-dramatising the situation if I say plainly that those consequences would be quite disastrous. They would be disastrous for growth in the world economy, since there is no doubt at all that failure would spark off a trade war, as well as the formation of protectionist blocks such as the North America-Mexico block and, let us face it, perhaps the European Community. Not only would world trade suffer, but 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 parochially in Britain would be major sufferers since a high proportion of our national product goes for export and always has done.
Thus I believe it is in everyone's interest to bring these negotiations to a successful conclusion. But in this matter there is something more than simple self-interest. What is at issue is the kind of world we wish to live in. Is it to be a world that lapses into protectionism, lives by beggar-my-neighbour politics, where the richer countries show no responsibility at all for their poorer brothers? We had that kind of world in the 1930s and we know where it led us. Or is it to be a world in which we have the political will to reach over frontiers and across seas and to recognise that, with the advance of technology, the world economy is and must be single and indivisible, and that the world economic product must be shared equitably among all its inhabitants?
That is the underlying, rather philosophical question posed by the GATT negotiations that are at present taking place. However, unless that underlying question is recognised, I am very much afraid that the technical matters will reassert themselves and we shall fall at the last hurdle. It is to encourage the Government to redouble their efforts to see that this does not happen that we have the debate this afternoon. I beg to move for Papers.
3.28 p.m.
Lord Young of Graffham: My Lords, I am grateful to the noble Lord, Lord Williams of Elvel, for bringing before your Lordships' House this subject which I believe to be of the greatest importance in the world, certainly for the next decade. The noble Lord must be right in saying that this cuts across party lines for I must confess that rarely have I agreed with so much of what he said this afternoon.
I raised this matter previously in your Lordships' House at the time of our debate on the Queen's Speech. I fear that all the events which at that time I was afraid would happen have now come to pass. I believe that the future of the GATT Round is an event far more important than the events which we read about day after day in the papers or watch hour after

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hour happening in the Gulf. That will be settled, I hope, no matter how awful and terrible the task, in the months to come. Before we take the chance of putting GATT in jeopardy, we should consider, first, the benefits that it has brought us and, secondly, the penalties which we shall pay if we fail.
GATT has existed for 43 years. From 1947 until the end of the Tokyo Round we have succeeded, mainly as a result of GATT, in reducing world tariffs from an average level of 40 per cent. to 5 per cent. In that time the volume of world trade increased eightfold. I am told by those who can calculate these matters that another 30 per cent. reduction in the existing levels of tariffs would boost European Community exports by 1.5 per cent. and create some 340,000 jobs.
The Organisation for Economic Co-operation and Development states that the cost to the EC taxpayers of the common agricultural policy is close to 100 billion dollars a day. That is equivalent to the gross domestic product of Denmark for one year. When a halt was called in the talks in the European Community for any changes in the agricultural policy in the early part of December, it was more effective than any Patriot missile in bringing down the negotiations. What are the penalties of failure? To obtain the closest parallel we must go back to the early months of 1930 when the Americans introduced the Smoot Hawley Bill which effectively made the United States a protectionist nation. World trade in manufactures fell by 40 per cent. and world manufacturing output fell by 35 per cent. in three years alone. All of us know well enough what unemployment, misery and degradation resulted from those events. I believe that that situation led directly to the more awful decade of the 1940s. Lest we in this country think that all that is academic, I remind the House that today we still export more per capita of manufactured goods than Japan. We are probably more dependent upon exports than any other nation in the world for our survival and our standard of living.
The situation in the Gulf has certainly complicated the negotiations. If it were not for the Gulf, the negotiations would be headline news day after day. However, I believe the situation in the Gulf has also increased the stakes, for it has adversely affected the penalties of failure. Over the past few months I have spent a considerable amount of time in the United States. I was there only last week for a few days. Many people there, on the Hill and elsewhere, are looking at the contribution which Japan and Germany have made to the coalition forces in the Gulf. People have been telling me that Japan for one is a beneficiary of a free trade in oil and that Japan and Germany are probably the greatest beneficiaries in the world of a free track in manufactured goods.
This time we do not have the luxury of the seven years which were taken up by the Tokyo Round. American legislation is on a fast track. That effectively means that the Senate and the House of Representatives have to approve the round of negotiations as a whole or not at all. The time limit for doing that expires at the end of February. If we do not have an agreement that can effectively pass through
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Congress by the end of February, the Senate and the House of Representatives will cherry-pick away. Enormous pressure is mounting every day —it will increase even more when land fighting breaks out in the Gulf—for the United States to adopt a protective and defensive policy in the negotiations.
Is there a prospect of success? The penalties of failure are far too high. The existing common agricultural policy costs each family of four in the EC £13.50 per week on top of their food bills. That has to be measured against an average food budget of no more than £40 to £45 per week. The costs of the common agricultural policy are felt throughout the whole of Europe and the effect on poor countries is even greater.
Half of Europe's gross domestic product comes from service industries. Some 60 per cent. of Europeans are employed in the service industries, but that area is being placed in jeopardy. The multi-fibre agreement adds £70 per year to the clothing bills of each family of four in this country. It has been calculated that if we can conclude this round of talks successfully, the Community exports to the United States and to Japan would each increase by over 2.5 billion dollars over the next five years.
Lord Harmar-Nicholls: My Lords, when the noble Lord, Lord Young, and the noble Lord who opened the debate said that we were placing certain matters in jeopardy, were they referring to Britain or to the European Community? If the noble Lords were referring to the European Community, we should try to do something about it.
Lord Young of Graf ham: My Lords, I must make it quite clear that I was referring to the civilised and uncivilised peoples of the world. It is the 104 nations gathered together for the GATT talks which must face the consequences of what they are doing. Time is limited, but I must conclude by saying that as the terrible and awful events are being played out in the Gulf today, the real determinant of peace and prosperity in the world is being decided behind closed doors in Geneva. I hope that a signal can go out to those nations in Geneva from your Lordships' House. Unless we can put these negotiations back on the rails and reach a successful conclusion, I fear that the 1990s and the first decade of the next century may replay the awful saga of the 1930s and the 1940s.
3.36 p.m.
Lord Mackie of Benshie: My Lords, the main difficulty in this matter appears to be the position of agriculture, which is holding up progress in the negotiations. We on these Benches realise that the talks are enormously important for the future of world trade and world prosperity. As a farmer I fully appreciate the importance of the talks, as do the other farmers of this country. We know that the talks must succeed.
I wish to examine the position of farmers throughout Europe in regard to the common agricultural policy. I wish to determine what can be done to alleviate the position of farmers as we are

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talking in terms of reducing support for farmers by a figure of approximately 40 per cent. That is a savage blow for any industry to face.
We need to examine the attitude of the United States. That nation is enormously pious with regard to EC subsidies when one considers that America subsidies agriculture and the export of food on to world markets to a considerable extent. The best figures I have found have been those produced by the Organisation for Economic Co-operation and Development. That body has worked out a formula which is referred to as the producer subsidy equivalent. The formula takes into account tariffs, the taxpayer and everything else. It has been broken down into subsidies per farmer. The figures are interesting and relevant. Australia forms part of the Cairns Group. The subsidy per farmer there is 4,000 dollars. In Canada the subsidy is 13,000 dollars, while in Finland it is 26,000 dollars. In Japan it is 15,000 dollars and in Norway it is 32,000 dollars. In Sweden it is 25,000 dollars; in Switzerland it is 26,000 dollars and in the United States of America it is 20,000 dollars. New Zealand is the only honest country in the Cairns Group and its subsidy is 2,000 dollars per farmer. The subsidy in the EC is 8,000 dollars. Those figures show that the problem is a worldwide one. It is not confined to the EC. That fact must be brought home to the US in the negotiations as that nation is the main pusher for a solution to the problem of oversubsidisation of the farming industry.
I happily admit that the failure of the Council of Ministers to follow the advice of the Commission as prices rose throughout the Community has in itself generated extra costs. A great deal of correction is needed in the EC at the moment. We must also realise that we in Europe are entitled to produce our own food and to protect our farmers. However, we are not entitled to produce a surplus with which to depress world market prices and ruin many third world farmers and whole countries. I firmly believe that such a practice is not permissible. The objective that we should set ourselves in the EC should be to reduce our production so that we produce what we need and can use ourselves, plus a reasonable carry over. If that happened we should solve the problem and we should not disadvantage the third world.
There is a lot of talk about the big farmer who is wallowing in money and drives a Bentley, and so on, and that the small farmer should receive the money. That is nonsense. In Europe a big farmer is considered to be someone with more than 100 acres. However, the man in the agricultural industry who is hardest hit is not the small part-time farmer who has another job. It is the man trying to make a living on between 100 and 200 acres. It is nearly impossible for him to make a living which is as good as that of the average industrial worker in this country.
There are many programmes in front of us to deal with the position but no definite policy. I suggest that the policy is a simple one. We have to reduce prices over a period of time, but we have to do so in a manner which is fair. We should use the present EC budget to alleviate the undoubted distress which will be caused
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to a great many people in the farming community. If we have a level playing field the best farmers can produce and make a living. We should do so in such a way that we preserve the land so that it can be used if the droughts which have reduced world stocks below the safety level in the past five years return.
If we do that I believe that we might solve the problem. We might produce an agricultural industry which is competent. However, the policy will need to be thought out and applied sympathetically over a period of years. If that happens there should be every prospect of industrial prosperity.
3.42 p.m.
The Lord Bishop of St. Albans: My Lords, despite the clarity of the opening speech of the noble Lord, Lord Williams of Elvel, I cannot help saying that the Uruguay Round has been described as the most complex set of trade negotiations of the post-war era. Therefore, it seems unwise for the Churches to make any contribution and I hope noble Lords will forgive me if I rise to my feet to say a few words. As the negotiations have proceeded over the past four years they have raised important issues of social justice and human responsibility which the Churches cannot ignore—social justice because trade is the lifeblood of many of the world's poorest countries and vital to their well-being; human responsibility because policies in the industrial nations, including our own, mould the external trading environment of the South.
My concern in this subject was prompted by a meeting which I had in this House some four years ago with the Anglican Bishop of Jamaica. We discussed the possibility of establishing a partnership between my diocese of St. Albans and some dioceses in the Caribbean, of which Jamaica was one. To my surprise his reaction was to say that although we could have a friendship expressed in reciprocal visits, correspondence and prayer, there could be no partnership unless we could play our part in seeking justice for the people of Jamaica in the face of massive debt problems and trade sanctions which effectively crippled his country's ability to grow to maturity and which ground many of his people into a humiliating poverty.
Therefore my modest and highly amateur contribution to this debate is to express my concern that the Uruguay Round may miss a vital opportunity to change the present inequality in international economic relations and that its outcome may undermine rather than enhance the prospects for sustainable economic growth and food security in developing countries which are in an even worse plight than Jamaica.
For the world's poorest countries the past 10 years have been a lost decade. It has been a decade of falling living standards, deteriorating human welfare and declining investment. Of all the indices confirming that worsening human situation perhaps the most graphic is the rise in infant mortality evident throughout the developing world. According to UNICEF the reversal caused by the economic slow-down was claiming the lives of an additional 10,000 African children daily at the end of the 1980s

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—though we can easily be blinded by figures that represent a large number of families in the congregations of my brother bishops.
It is not for me to discuss the reasons for that or the appropriate strategies for recovery. However, there is a widespread consensus that a worsening trade environment has played a major role in the crisis and its improvement is essential to renewed growth. The one plea that I want to make is to stress the importance of the industrialised countries undertaking substantial initiatives to address those twin problems of commodity trade and debt.
Perhaps I may make a specific reference to agriculture, which, as has already been said, is the most contentious item of unfinished business in the talks. From the outset the GATT deliberations on farming policy and reform have been dominated by the United States and the European Community. Their failure to overcome their differences remains the greatest obstacle to a settlement.
Paradoxically, however, agriculture is of relatively marginal significance to the economies of the United States and the European Community, accounting for about 4 per cent. of employment and GDP. That contrasts sharply with the situation in developing countries where it typically accounts for more than 60 per cent. of employment and a quarter of GDP. Despite that fact developing countries, so I am told, have had almost no influence on the GATT agricultural trade negotiations. The fact that a reformed GATT will for the first time exercise a major influence on their farm policies surely makes that unacceptable.
Last month in Brussels Church leaders from around the world rejected the free market position as a basis for GATT rules extending to developing country agriculture. A statement issued by the European Ecumenical Commission for Development, endorsed by the World Council of Churches, the Caribbean Council of Churches and a number of bishop; and archbishops, both Catholic and Protestant, from Europe, North America and Africa, urged the negotiators to reflect on the very different circumstances which face farmers in the North and in the South. The statement said:
"As Christians, we cannot accept that the most basic right of the human community, the right to food, or our collective responsibility to prevent hunger, should be subordinated to … the arithmetic of the market place".
The statement went on to urge governments in the North to recognise the distinction between subsidies such as those applied in the United States which result in over-production and distorted world markets and subsidies in the South which are aimed at enhancing food self-reliance and protecting employment. With the Geneva talks resuming against a background of famine in sub-Saharan Africa and growing malnutrition elsewhere, that is a distinction which I believe the GATT must accept as a basis for securing the most basic of all human rights—the right to food and thus to life itself.
3.49 p.m.
Lord Bruce of Donington: My Lords, I do not often find myself in agreement with the noble Lord, Lord Young of Graffham. However, in his reference to the long-term consequences of a failure of the GATT negotiations he was dead right. The consequences will be most grave for the world as a whole, particularly for third world countries and not least for ourselves. It is important that we should realise the reasons for the breakdown of the negotiations on 7th December last year.
There were references by my noble friend Lord Williams of Elvel to the outstanding matters relating to the Multi-Fibre Arrangement and the necessity for a freeing up in the financial services area. Of course, the latter occupies only an insignificant amount in terms of world exports (about 7 per cent.), and even though progress there is desirable it is obviously not of such vital importance as the trade in merchandise.
There can be no doubt that the negotiations broke down quite simply because of the European attitude as expressed by its representatives in relation to the Common Agricultural Policy. The noble Lord, Lord Young of Graffham, has already referred to its cost to us of £15 per week per family of four. He could also have mentioned the fiscal cost to us in terms of £2,000 million per annum of extra taxation out of the Consolidated Fund. There can be no doubt that it is the breakdown over the whole structure of the CAP that is at stake.
As The Times put it in its issue of 8th December:
"The EC's refusal to dismantle the fraud-ridden market-rigging cartel it calls the common agricultural policy … drove the talks on to the rocks. The world is poised to enter a cycle of protectionism and 'managed' trade which will exact a dreadful price in jobs, inflated consumer prices and market opportunities, and cripple the economic advance of the Third World and Eastern Europe".
The Times puts it in even more moderate terms than I would in normal circumstances.
The CAP as such has never had any friends in this House who are prepared to justify its structure or results. In fact, the House has been almost unanimous in its condemnation of the whole structure of the CAP, and that is also true in the case of the European Parliament. Everybody agreed that it was wrong but nobody was prepared to do anything about it.
In the limited time at my disposal I propose to make a few suggestions as to what might conceivably be done. Obviously it is no good looking to the Council of Ministers under conditions where by a qualified majority the Germans and the French together would be quite sufficient to secure any rejection of the CAP's amendment, or where by unanimous vote even the vote of Luxembourg would be sufficient to veto any change. It is quite clear that given its present mood, particularly in France and, I regret to say, in the United Kingdom, the attitude of the Council is most unlikely to change. We cannot change the situation there.
What about the Commission? The Commission has had a go, but I cannot recall M. Jacques Delors breaking his deafening silence over the past two months to make any constructive suggestion for resolution of the problem, although there has been

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some revised plan which according to today's press our Minister of Agriculture and the French have already rejected. Quite clearly, we are unable to look for very much help from the Commission itself, despite the fact that the CAP contributes only 3 per cent. to EEC GDP at an annual cost of 100 billion dollars.
Can we expect anything from the European Parliament? I have listened to many speeches in the European Parliament on the necessity of reform, but it cannot initiate any proposals; it can only discuss and act on such proposals as the Commission permit it to. In any case, out of the 518 Members, only 300 (some 60 per cent.) take an active part in the proceedings of the Parliament as a whole. Indeed, on the Motion on the Gulf last week, 311 out of the 518 turned up.
We come back to the Government. What can the Government do? The Government can and should tackle the matter root and branch. At the moment the Government are involved in an intergovernmental conference in which amendments are sought to the Treaty of Rome. They should use their power now to insist on amendments to Articles 38 to 47 of the Treaty of Rome and go for a radical restructuring of the whole of the common agricultural policy. As a Government, they should adopt at home such suitable income support measures as are necessary for the preservation of our agricultural community and the standard of life to which it is entitled.
3.56 p.m.
Lord Sanderson of Bowden: My Lords, I thank the noble Lord, Lord Williams, for bringing this debate before the House today. As a former agriculture minister I will resist the temptation to become involved in that part of the discussion which is already occupying your Lordships, but I declare an interest as a director of a United Kingdom textile company which relies heavily upon exports of high-quality goods. It is to that area—the area to which the noble Lord, Lord Williams referred—that I wish to address my remarks.
The importance of the GATT Round to the textile industry in Great Britain cannot be over-emphasised. We need to ensure free and fair competition throughout the industrialised world in this regard. As has already been said, the price of failure could mean real problems for that industry. Time is running out. The Congress deadline for report by 1st March, if the fast track approach is to have any success, is very important for this House and, beyond this House, for every party to these negotiations to understand. I refer to the Punta del Este Declaration of 1986 that the textile and clothing trade should be integrated into GATT, which is EC-speak for phasing out the MFA. I do not object to that. I congratulate the Government on that declaration and the work they did to get that declaration, but it was based on the strengthening of GATT rules and disciplines.
I hope that my noble friend the Minister in replying to this debate will give us an assurance that that declared intention has not been overcome by events.
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United Kingdom industry will compete on free and fair terms, but where is the fairness in excessive tariff rates, which for the export of some textile goods to Australia are more than 50 per cent? There are penal import duties (now running at 36.1 per cent.) on the United Kingdom export of cloth to the United States, as I have known only too well to my cost for many years. South Korea's £2.5 billion subsidy scheme for textile and clothing does not seem to me to be free and fair when it comes to competition in the ultimate result. There is also Turkey, a producer which gets subsidies and cotton supplies at below world prices. I do not want to see any eleventh-hour compromise which torpedoes that declaration on strengthened rules and disciplines.
I agree with the noble Lord, Lord Williams, that if the MFA is to be phased out, let us do it on a timescale to which the industry itself can adjust; let us not bring it in at a politician's whim and in circumstances where the industry has had no time to adjust. But I believe it is more important still that effective means of enforcing and respecting those strengthened GATT rules are agreed and applied. We are talking about an industry which exports £4.5 billion worth of goods. It is not an old-fashioned and outdated industry any more. It is an industry which produces some of the finest quality goods in the world.
I believe that we have a fight on our hands. That fight may well be most difficult with the strong developed countries in the world. In the end, they could undoubtedly be the biggest stumbling blocks to achieving success in free and fair competition for industry in this country and many others.
4 p.m.
Lord Donoughue: My Lords, nobody can doubt that the breakdown in the GATT talks was very worrying and that a successful resumption is critical to the future welfare of world trade. If GATT finally collapses, there will be acute danger of the world drifting into three protectionist blocs—North America, Europe and Japan—with the poor South excluded, and a growing danger of trade wars between the blocs.
As the world slips into recession it is inevitable that calls for protection will grow. We must resist them. In fact trade liberalisation offers the best non-inflationary way to restore growth to the world economy. It is especially in the interests of Britain which, as a major exporter, is dependent on international trade for its economic prosperity.
Certain items under discussion in the Uruguay Round also offer great benefits to us. I have in mind the proposed liberalisation of services, the proposals for intellectual property, and of course any prospect of modifying sensibly the European agricultural policy (which was at the heart of the breakdown in the talks in December). The gaps between the sides on agriculture remain great. It is tempting to join the USA and perhaps some others in denouncing the EC for its inflexibility. It is especially tempting to those who believe that European agricultural policy contains much nonsense and should be radically changed. However, having accepted all the familiar

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sins of European agriculture, it does not follow that the EC should be battered into massive concessions; nor is there in reality any prospect of that happening in the short run. If the resumed talks depend on that, they will fail.
The central political point to remember (and for the USA to bear in mind) is that the EC is in a very difficult negotiating position on agriculture. The Commission represents twelve partners with very different interests who often basically disagree on agriculture policy. Having reached a precariously agreed position, it is difficult to become flexible in the GATT negotiations without splitting the unity of the EC. That is the political reality.
Quite apart from the structural problem, which will persist, is a profound problem relating to policy; namely, that the EC is being pressed—as we ourselves press it—to make changes in its fundamental agricultural support system. I and many other noble Lords would welcome such changes. But that is not the point at this moment. The political fact is that the Commission in Brussels does not yet have a mandate for such fundamental changes. The Government should take this opportunity to press for such changes, but we must accept that countries such as Ireland, France and Germany will not easily give up the benefits of the present system. The USA must accept that reality in the present talks. They must not have exaggerated expectations. They should recognise that demands for cuts of 90 per cent. in subsidies and 75 per cent. in farm support are probably unrealistic.
On a more positive note, and looking for ways forward, we should be actively thinking—there has been some thinking already—of policies which will meet some of the genuine anxieties of our EC partners who support the present system, in order to make it possible for them to accept change. I have little sympathy for the French desire to keep their so-called small farmers comfortably subsidised by the British taxpayer. We need a stricter definition of what is a genuine small farmer. But I sympathise with the French fear, which is shared in Scotland, Wales, Ireland, parts of Italy and Germany, that genuine rural life will be destroyed if we do not continue to give significant agricultural support. However, we need to address that problem with particular solutions. Current thinking about setting aside farmland to protect the environment and encourage leisure employment in rural society is promising.
Whereas the EC has suffered most attacks for the failure of the talks so far, we should note that the negotiating position of the United States is not wholly virtuous. Interestingly, the Japanese representative put most blame for the breakdown on the United States. One particular problem of the December talks was the regrettably hectoring and bullying tone of the United States trade representative, Carla Hills. Perhaps we can gently indicate to our American allies that a more diplomatic style would help the talks along and what we might call the Schwarzkopf approach is more appropriate to Baghdad than to Brussels.
Nor must we forget the dilemma for the third world. Poor agricultural countries often suffer in these
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talks. We should remember that to a poor developing country the liberalisation of trade may mean more of a threat than a promise. Poor agricultural countries need to protect their food production. Developing countries need protection in the services field. How can they ever develop indigenous banking or computing facilities if the American, European and Japanese giants are already there on the ground?
However, our main anxiety is that the GATT talks should resume successfully. It will require compromise and I trust that our Government will put maximum pressure on our EC partners and our American allies to achieve that aim. The best hopes for compromise seem to lie in the Europeans applying specific limits to food exports, allowing greater food imports and perhaps in a move away from variable levies toward fixed tariffs. As for the United States, they must be more flexible and less bullying. They must be more realistic in their demands for concessions from the EC. Her Majesty's Government must use their special relationship with Washington to press for that. Then it is to be hoped that we can achieve success which in the long term, as my noble friend Lord Williams rightly said, may be as important as success in the other more dramatic battles in the Middle East.
4.7 p.m.
Lord Cockfield: My Lords, there is an obvious flaw in the drafting of the Motion. It refers to negotiations taking place, yet the whole problem is that negotiations are not taking place. They have been deadlocked. They have been deadlocked primarily because of disputes over the international trade in agricultural products.
I hold no brief for the United States of America. It is a highly protectionist country. It shows scant regard for its obligations under the GATT. Its negotiating tactics leave much to be desired and it subsidises its own agriculture to a very substantial degree. Nevertheless it is absolutely clear that unless the question of subsidisation of agriculture is addressed and solved, there is no hope of relaunching the negotiations and achieving success.
The problem is perfectly simple: namely, that prices in the Community have been set at an excessive level. That leads to excessive production. The excessive production is reflected in stockpiles. The stockpiles can be sold only by heavy subsidisation. That disrupts international trade and gives rise to the kind of problems that we face.
The extent of the reductions that would be necessary in order to clear the market—that is, to achieve a balance between production and consumption—are very great indeed. The proposals that were tentatively put forward over the weekend by the Commission and on which a discussion started in the Council of Ministers yesterday—although it had to be adjourned because of a certain tragic event—envisage a 50 per cent. reduction in the guaranteed price for wheat, a 30 to 40 per cent. reduction in the price of other cereals, a 15 per cent. reduction in the price of butter and a 10 per cent. reduction in the price of milk. Let me say that these proposals were put forward not in the context of the GATT but in the context of time

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to avoid a further financial crisis facing the Community. But the reductions that would be necessary to achieve a market clearing basis for the GATT negotiations would be every bit as big as this.
The effect of these reductions, which would clearly have to be spread over time, would be appalling for agriculture in this country and probably in many other countries is concerned. The problem so far as we are concerned is that successive governments in this country, ever since we joined the Community, have tried to face both ways at once. They have denounced the CAP for excessive expenditure and they have given their own farmers every possible encouragement to expand their production in order to take advantage of this huge flow of fool's gold which they could see running in front of them. The effect has been greatly to exacerbate the problem in the Community itself.
When we joined we were 50 per cent. self-sufficient in temperate foodstuffs. Today we are 100 per cent. self-sufficient in temperate foodstuffs. In effect, we have greatly contributed to the build-up of the surpluses ourselves. But in addition we have ploughed up our grasslands, we have extended agriculture into land not suited for it and we have used vast quantities of fertiliser which have had all sorts of deleterious effects. This has driven up the price of land, it has driven up rents and it has meant that the farmers are now heavily in debt to the banks.
The farming industry in this country already faces a financial crisis. The position will become infinitely worse if the problem is addressed in the way that it has to be addressed. Nevertheless there will be no solution if we back away from the necessity of dealing with it. Anything which has to be done to protect the individual farmer, whether in this country or in the Community generally, must be in a form in which does not encourage additional production.
The greatest problem of all here is that these matters are dealt with by agriculture ministers and the duty of an agriculture minister is to look after the interests of the farmers, not to look after the national interest. This is true not only in this country; it is true in every other country as well. In 1982, when I was talking to "Mac" Baldridge who was then the Secretary of Commerce in the United States, he said,
"These problems will never be solved as long as they are left to ministers. At the end of the day they will have to go to the heads of government to be solved".
That, I believe, is what will have to be done.
4.14 p.m.
Lord Jay: My Lords, in my six minutes I would say, first, that the refusal of the EC to make more than inch-like concessions on the common agricultural policy is the real obstacle at this moment to a new GATT agreement. Of course the United States has made difficulties over financial services and other things. But, though they are important, they represent only a fraction of the total value of trade damaged by the common agricultural policy.
The primary harm done by the CAP is not the surpluses and subsidies about which we hear so much but rather—and here I am glad to agree with the noble Lord, Lord Cockfield—the excessively high prices
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caused by import restrictions, quotas and outrageously heavy import levies which almost prevent food from the outside world being imported into the EC at all. There are no surpluses in the real sense of more food being produced than people can consume. The trouble is that the prices are so high that the consumer cannot buy the food that he otherwise would buy.
The United Kingdom is of course hit worst of all. In a world of free trade the UK would import very little food at all from the EC. But we are now forced to buy high priced EC food by this whole system of import levies and quotas and, in the case of Australian and New Zealand food, outright restrictions and vetoes on imports. In the 1980s, on average, food cost the EC consumer 70 per cent. more than consumers outside.
In recent years the import levy in the UK for wheat and barley stood at 150 per cent. of the import price, for meat it was over 50 per cent. and for dairy products it was as high as 200 per cent.; and this, as the noble Lord, Lord Young, said earlier today, is costing the UK consumer something like £4 or £5 per week per head of the whole population in this country. Altogether the CAP is costing the EC taxpayer about £20 billion sterling per year. Nor is it true that subsidies in themselves are the cause of the evil. There is all the difference in the world between the deficiency payment or the income support paid to the farmer, which works on the whole as a subsidy to the home consumer, and a subsidy to the exporter to sell his goods abroad below world prices with great damage to other countries.
The EC subsidies, which they politely call "restitutions', are the consequence—I think that the noble Lord will agree with me here—of the intolerably high internal prices which generate the apparent surpluses, which then have to be sold abroad at one-half or even one-quarter of the EC prices. The EC subsidies are almost wholly of this kind.
The real choice, as I see it, from the farming point of view is between supporting the farming community by deficiency payments or income support, and import restrictions and taxations which force up prices. Indeed, the deficiency payments in force in this country right through from 1947 to 1972 allowed free importing and ensured low world prices for the consumer and a fair living for the efficient farmer at the same time.
I believe therefore that the interests of the UK in these crucial negotiations are very much in line with those of the United States and of the other great food exporting countries in the Cairns Group. For it is not just the United States today which is lined up with the Cairns Group against EC protectionism but a number of other countries, including Canada, Argentina, Australia, New Zealand and indeed some third world countries.
Our interests in the UK, whatever is true of the EC, are almost wholly identical with this large and representative group of countries. However, I fear that the Government have given too much the impression in these negotiations, particularly the present Minister of Agriculture, that they have been bullied by EC

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protectionist pressure onto the wrong side and have come very near to fighting for the narrow interests involved against most of the rest of the world.
I hope that that is not true. But the Government can prove that it is not true by fighting vigorously, even at this twelfth hour, in the resumed negotiations —and I presume that they will be resumed—for a far more liberal solution and for really major cuts, no doubt over a period, in EC price levels which alone will make a new GATT possible. But there is very little time left.
4.20 p.m.
Lord Boardman: My Lords, I congratulate the noble Lord, Lord Williams of Elvel, on having introduced this debate because it is a most important subject to us all. I agree with a great deal of what he said, although not all of it. He said that there were three particularly sensitive issues and I have an interest to declare, either past or present, in two of them: in farming, where I have a small interest in a farming partnership, and in banking, where I had some previous involvement. However, there is not time in six minutes to put right the problems involved in both major sectors, and so I shall confine myself to agriculture.
My concern over what the noble Lord has said, and which has been echoed in other places if not in here this afternoon, is that, to use his words, there must be "a trade off''. It worries me that in order to secure the agreement which we seek someone has to suffer and something must be sacrificed. The general message which has come from many quarters, both today here and from other quarters, is that it is agriculture that must be sacrificed to reach this agreement.
I believe that is a danger of which we should be aware, and certainly it is one which I feared when earlier our Government offered a 30 per cent. reduction in subsidies, over a period, which was not agreed by the other members of the Community and which of course was turned down by the United States of America and the Cairns Group. In isolation we are doing that at a time when farming is going through a tremendously depressed period.
The noble Lord, Lord Williams of Elvel, said—and of course he was right—that we need to get agreement from two sectors: from the Community and from GATT. Neither of those will be easy. Within the Community we have had and continue to have massive problems under the CAP. I am convinced that this country has failed to get its fair share of what has been going round, whether it be excessive or not, for a long time. We have only to look at what has happened and is still happening as regards the green pound where, despite the efforts made last year by the Minister of Agriculture, Mr. Gummer, to get some reduction and some alleviation of the penalty, it still will be the end of 1992 before we get on level terms.
Perhaps I ought to correct—if I am right, as I think I am —something that was said by my noble friend Lord Cockfield a few moment ago when he referred to this country as being self-sufficient in food. According to the ministry publication, Agriculture in the United Kingdom 1990, which has just been issued, the UK
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self-sufficiency of food, as a percentage of all food, is 56 per cent., and of indigenous-type food and feed is only 73.3 per cent.—not, as I understand it, the 100 per cent. to which my noble friend referred. I think it is important, if I am right, that that point should be made.
The United Kingdom agriculture industry is going through a very depressed time. This year alone, as the book shows, 6,000 farmers have left the land. Farming incomes are down by 22 per cent. These are very severe blows on an industry which was already suffering, however prosperous it may have been in the past. I shall not attempt to apportion blame or to say what the remedy might be as between the CAP or GATT or indeed the United Kingdom Government, but I should like in the few moments I have left to say something about the importance of British agriculture to our economy.
I believe it is too often taken for granted and perhaps too often overlooked as regards what it does contribute. I believe we have one of the most, if not the most, efficient agriculture industries in the world. Certainly we employ only 2 per cent. of the population, or something just over that, whereas Germany employs more than 5 per cent. and France nearly 7 per cent.; yet in rural areas the population dependent directly or indirectly upon agriculture varies between 15 and 30 per cent.—so many cities the whole length and breadth of the country, such as Lincoln and York, Market Harborough and the like, are dependent upon a prosperous agriculture. Woe betide any government who forget that message and allow the industry to go into a deep recession.
What other industry in the country can show a labour productivity to match that of agriculture? What other industry over 10 years has kept price increases to something under 40 per cent. of the general increase in the RPI? During that period water has gone up 162 per cent. and rail by 142 per cent. The RPI has gone up by 103 per cent. and yet food at the farmer's gate has gone up by only 44 per cent. Food represents a very small part of the total household budget. Out of a total expenditure on food and drink of more than £78 billion, food at farmer's gate prices represents, at gross product output, something like £7 billion. Prices for food from the farmer's gate have tended to go down and down in real terms and they have to be compared with prices which appear in the shops. As an illustration of that, today beef prices are down very substantially whereas the price of beef in the supermarkets has gone up. Agriculture and the farmer must not be blamed for that.
I see that my time is up, but I should like to urge that the Government, in their continuing negotiations in GATT and within the Community, are mindful of the contribution made by UK agriculture to our economy and that because of its importance it will be allowed to prosper.
4.27 p.m.
Baroness Lockwood: My Lords, the crisis arising from the suspension of the GATT talks has focused on agriculture as that appeared to be the crucial issue causing the suspension of the talks. However, like

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other noble Lords, I believe other interests were also at work, and not least in the United States, which were tending to hide behind the agricultural issue.
I want to follow the speech of the noble Lord, Lord Sanderson of Bowden, and talk about the position of the textile and clothing industry in the light of the phasing out of the Multi-Fibre Arrangement in July of this year. Because of past crises in the textile industry many people in this country seem to think that there is no such thing as the United Kingdom textile industry left. That is quite wrong. On the contrary, as has already been indicated, the textile and clothing industries together have a workforce of under half a million people. It is the fifth largest sector in manufacturing industry in the United Kingdom. The annual sales of the sector last year amounted to some £15 billion, of which £5.4 billion is added value. Its exports in the last year were something in the range of £4.5 billion. That indicates the importance of the industry to the British economy and in the present GATT round, if it resumes as we hope it will, these interests must not be minimised by the Government.
The ending of the Multi-Fibre Arrangement is causing concern to the industry in terms of employment. As we are all aware, the employment force in the textile industry in particular has been seriously depleted by past crises in the industry and there are fears that it will be further depleted by the phasing out of the Multi-Fibre Arrangement. There are some differences of opinion as to the extent of the employment problem. Professor Silberston, reporting under a commission from the Government, estimated possible losses in the industry of 33,000 people. The industry itself is more pessimistic and feels that the Silberston report is flawed. The TUC suggests that more than 100,000 jobs will be lost and the European Textile Industry Association estimates that in the Community as a whole more than 1 million jobs will be lost. Therefore, it is a problem. The problem in the UK is worse than in Europe as a whole. Industry in the United Kingdom was slower than the rest of its European competitors in restructuring and modernising, although in the past five years it has made substantial investment.
The position now is that, although low-cost imports from the developing countries are still a critical problem for industry in the UK, more than half our imports come from EC countries. Therefore, it is essential that, first, the GATT rules are adequate to cover the situation in all ways and, secondly, that British industry receives the same support as other European industries.
As the noble Lord, Lord Sanderson, indicated, not all the problems we face lie with the developing countries. He gave indications of evasion of the disciplines which should apply under the MFA. However, in relation to the developing countries we need to distinguish between those developing countries such as Lesotho which need help and protection, and other countries such as South Korea which are now in a position to take care of themselves.
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That distinction should be made in whatever emerges from the new arrangements which we hope will be made.
Although the Government seem now to have stiffened their position on the GATT talks in relation to textiles and clothing, I should like the Minister to give us an assurance today that they will press for a minimum of 10 years for the phasing out of the MFA and that they will support the proposals of the European Commission that increases in import growth rates will be limited in the first stage of the phasing out period and then increase gradually. We need assurances from the Government on those points and their assurance that the new arrangements will be even stronger than those which are being phased out.
4.32 p.m.
Lord Wade of Chorlton: My Lords, I should like to add my thanks to the noble Lord, Lord Williams, for introducing this debate. I intend to restrict my remarks to the food trade. I should explain that I have an interest in that I have been a farmer all my life and still try to make a living from that now very precarious occupation. If anybody would like to talk about buying a farm, perhaps he would meet me in the Peers' Lobby later. I am no longer commercially involved in the food business but I have been for most of my life.
Before we entered the EC we had other financial systems supporting agriculture—the price support system. Under those systems farmers received a payment which made their income up to what was considered to be a satisfactory amount. However, the products were sold into the market place at the market price, which fluctuated up and down according to supply and demand. The food trade bought its products from the farmer at normal market prices which were heavily influenced by world market prices.
Since moving into the EC there is now a different system. I wish to make a point which is sometimes not appreciated—namely, no farmer ever receives a cheque from the EC. All the money paid by the EC to support food prices is paid through the trade. The food trade receives money either in terms of internal subsidies or for export refunds which help to adjust prices to what would otherwise be world price levels.
That means that the food trade in this country is now able to operate on a world trade basis. That system, which I admit is extremely complicated and into which I shall not go here, enables the food trade to sell at world price levels the food bought from the farmer. If one looks at the European food trade, of the 20 top food companies in Europe, 14 are British. Of the top 100 food and drink companies in Europe, 23 are British. Therefore, we have many more food and drink companies than any other country. People in the textile industry talk of how big their industry is, but the food industry is by far the largest. It operates 14.5 per cent. of total manufactures in food and drink and some 600,000 or 700,000 people are employed in it. One sees the scope and the scale of the business about which we must be concerned. The key issue from the food trade's point of view is that, if we are to maintain that strong position in Europe and continue to export about £2 billion worth of products outside the EC, it

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must still be in a position to buy its raw materials at world prices, which it now does through the EC intervention system.
My noble friend Lord Cockfield explained the latest MacSharry proposals which will have a drastic effect upon the agriculture industry. If one ties those in with the United States proposals in the GATT negotiations, then most of the export refunds will be abolished. I must make clear that those refunds are not a subsidy to the food trade, but they make it possible for the food trade to sell and manufacture its goods at world prices.
As regards the current negotiations, I am concerned that, on the one hand, the food trade is losing its opportunity to buy products at world prices and, on the other, we continue to find systems of supporting the marginal food producers in terms of agricultural producers. Therefore, we shall end up with a system where in Britain particularly and in Europe generally we shall not be producing our food at world prices. Therefore, the food trade must buy its raw materials at inflated prices but will be expected to compete with a world market based on world market prices.
The impact will be that the UK producer particularly will not have the enormous market in the food trade which he now has. The food trade buys 70 per cent. of all food produced on British farms. What concerns me is that the latest MacSharry proposals, so well defined by my noble friend Lord Cockfield, will make life difficult for the more efficient producers while placing more money with the less efficient producers. However, if we are to solve the problem, we need to take out the marginal producers so that those who are producing our food—and it will be an enormous quantity of food—are at least producing it in the most efficient manner possible. If British farmers are able to produce in the most efficient manner possible, the food trade can buy its food from them very competitively and we can maintain our market.
Another point which I must make is that the food trade is not exporting goods in order to get rid of them. We have no more than our accepted share of the world trade, which, as your Lordships have rightly said, is a growing business. We should continue to share in that growing opportunity.
Therefore, I should like to say to the Government that in these negotiations it is very important that we do not end up with a system which takes away the food trade's ability to compete on the world market while at the same time maintaining support of agriculture which makes it impossible for our food producers to run as efficiently as they should. In other words, they will all become 50 per cent. producers. We cut back here and cut back there and give financial support to the marginal producers which, quite frankly, should be out of business altogether. We are now wending £22 billion per year on supporting the CAP. That money could be better used to take out from business marginal producers.
4.40 p.m.
Baroness Carnegy of Lour: My Lords, I wish to turn your Lordships' attention, I hope quite easily, from food to whisky. I want to say a word about GATT in regard to the Scotch whisky industry and other spirit drinks industries in the EC. I wish to mention the industry's most recent submission to GATT, and ask the Government whether they are prepared to back that submission.
In world markets Scotch whisky and the other Community-produced spirits face a considerable array of tariffs and tariff-based barriers to trade. It is a significant problem for the Community as a whole as well as for the UK. Scotch whisky volume sales for export exceed those of all other Community-produced spirit drinks put together and are six times those of cognac. Within the UK, with 85 per cent. of sales exported—£1.4 billion worth —Scotch whisky is among the top five UK export earners.
Because negotiations on spirit drinks are part of the GATT agricultural negotiations, there has always been the danger that they will not receive adequate attention amid the wider agricultural debate. That is the reason the European Community association of spirit producers, on the initiation of the Scotch Whisky Association, has consistently pressed our Government, the Commission and the GATT secretariat to ensure that the industry's problems are properly assessed.
I am advised by the Scotch Whisky Association that detailed evidence was submitted in 1987 identifying a vast range of barriers to trade. Those barriers existed in 84 GATT countries. There were more than 40 instances of tax discrimination in favour of countries' locally produced drinks. There were more than 130 examples of discrimination by means of excessive customs duty, and, most insidiously of all, some 200 non-tariff barriers ranging from import embargoes or quotas to monopolies, systems of prior deposits, restrictive import licensing or analytical procedures.
An example of a GATT contracting partner which protects its own domestic spirits in that way is Korea. Its liquor tax on home-produced soju is 35 per cent.; on whisky it is 200 per cent. On top of that it adds value import duty of 25 per cent. on imported brandy and 40 per cent. on Scotch whisky and other spirits.
Since 1987 the dossier containing that evidence has been constantly updated and discussed with our Government, with the Commission and with GATT. Most recently, on 10th January this year, a fresh submission was made. It was specifically tailored to 27 markets which the Commission had identified as its priorities. The submission reiterates the industry's principal objectives. They are, first, the elimination of all import duties and equivalent charges on a reciprocal basis between countries; secondly, the levying of excise tax on the basis of alcoholic strength and at the same rate whether the spirit is domestically produced or imported; and, thirdly, the removal of all non-tariff barriers.
Neither the Scotch Whisky Association nor the European Community association has ever sought protection in domestic or other markets. They have

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consistently backed the reciprocal elimination of the European Community's common customs tariffs on imported spirits or, should that prove unattainable, the bringing into line of the present differing CCT rates at an identical and reasonable level on the basis of alcoholic strength and to the exclusion of all other import duty equivalent charges.
In view of all that perhaps I can ask the Minister, first, whether the Government would agree that the submission to GATT on 10th January by the Scotch Whisky Association and others seems likely to secure fair trading in export markets for those industries. Secondly, are the Government prepared to support that initiative? I hope that when my noble friend responds he can give me an answer.
4.45 p.m.
Lord Pitt of Hampstead: My Lords, I should like to join other noble Lords in thanking my noble friend Lord Williams of Elvel for introducing the debate. The crisis that has developed in the Uruguay Round of multilateral trade negotiations is much more serious than generally realised. The blast of publicity which accompanied the disagreement on agriculture, particularly between the United States and the European Community, may have distorted the general perception of the crisis, presenting it as one which has arisen mainly among developed countries.
The issues at stake are much wider and more fundamental than is generally assumed. They include the question of whether the developed countries will give effect to the virtues of free markets at those points where it would require some painful adjustment. The real crisis is how the developing countries will overcome the serious difficulties of adjustment which their fragile economic structures will face if they are exposed to the full impact of market forces. It is that which will be crucial to the future development of those countries.
As has been said, the Uruguay Round is the most comprehensive and complicated system of trade negotiations that the world has ever seen. It includes issues that have been brought into a GATT round for the first time even though developing countries have never been enthusiastic about undertaking the GATT negotiations in those new areas. The question needs to be asked whether those countries in the third world, particularly the least developed among them which have not shared adequately in the expansion of world production and trade during the past decade, and many of which are still burdened by heavy indebtedness, can reasonably be required to undertake new commitments in the current negotiations. That will require even more difficult adjustment.
I am grateful to the right reverend Prelate the Bishop of St. Albans for his contribution. The issue of development has been prominent in the negotiations. Developing countries have agreed all along that the agreements to be concluded on the various items should be such as to promote and not inhibit their development objective. They supported their objective by reference to the mandate agreed for the
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negotiations in which, among other things, the parties agreed to the principle of differential and more favourable treatment for developing countries.
It was also agreed in the course of negotiations that the developed countries will not expect the developing countries to make contributions which are inconsistent with their individual development, and financial and trade needs. While several provisions in the draft final act submitted to the meeting in Brussels reflected those anxieties, they generally fell short of what had been envisaged in the negotiating mandate. That is an area where the developed countries can and should be more forthcoming. It will certainly be a key factor in persuading the developing countries to subscribe to the final act.
Reconciling the difference which exists between the developed and the developing countries will require among other things more liberal offers by developed countries on market access. That covers a whole range of issues including tropical and natural resource-based products. It also requires more determined efforts to submit trade in textiles and clothing to GATT rules and disciplines and more flexibility in dealing with the outstanding issues concerned with safeguard provisions, trade-related intellectual property measures, trade-related investment measures and services. A start has been made, albeit a small one, by the EC in its acknowledgment that more needs to be done on access for tropical products. That is only a small step. The next few weeks will be crucial for the negotiations.
Since, rightly or wrongly, agriculture has become the linchpin on which future progress in the round depends, an early breakthrough in this sector will be crucial in carrying forward the negotiations. It will not of itself assure a successful completion to the negotiations. For the developing countries the central issue is the alleviation of poverty. That has been stated in the World Bank's statement to the Brussels meeting. It is the contribution of the round to that objective that will be the yardstick by which the developing countries will judge whether or not it is a success.
4.51 p.m.
Lord Mottistone: My Lords, I wish to thank the noble Lord, Lord Williams, for introducing this most important debate at a very important moment in the history of the GATT negotiations. I apologise to the noble Lord, Lord Pitt, for not being able to follow up the points that he was making. When one has a tight timescale one has to concentrate on what one is going to talk about. I shall limit most of my remarks to the need to protect the payment of export refunds on exported processed foods to which my noble friend Lord Wade of Chorlton made quite considerable reference. In doing so, I have to declare an interest as I continue to work for the biscuit, cake, chocolate and confectionery industries.
Before explaining the vital importance of export refunds for processed foods, I must emphasise the equal importance to all industries—especially British ones because we depend absolutely on the freest possible trade—of a successful conclusion to the GATT Uruguay Round. That was emphasised in

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particular by the noble Lord, Lord Williams, and my noble friend Lord Young of Graffham. It is indeed a misfortune for the food processing industry that its raw materials are subject to the rules of the common agricultural policy. As a result, the prices of those raw materials are deliberately higher than world prices, making the resultant processed products such as biscuits uncompetitive in their world markets unless the manufacturer receives a refund equivalent to the excess raw material price. As your Lordships will appreciate, that refund is in no way a subsidy.
Last December I wrote about that to my noble friend Lord Hesketh. I was delighted to receive a reply earlier this month from his colleague, my honourable friend Mr. Tim Sainsbury, explaining clearly that the DTI understood this absolutely. I am grateful to Mr. Sainsbury and to my noble friend the Minister.
In 1982, at the invitation of the Japanese Government, I led a delegation of medium-sized biscuit and chocolate manufacturers to see how the mutual trade in these products can be improved. At that stage the Japanese tariff on each product was between 30 per cent. and 40 per cent. My noble friend Lord Young of Graffham told us that that level had been reduced to 5 per cent. in the preceding 30 years, but it had not been for agricultural-based products. That enabled such products to be sold only as luxuries in Japan.
I sought to explain to the Japanese that British biscuits and chocolates are high quality products, efficiently produced for the mass market. I managed to get them to recognise that the British food processing industry, in the 30 years from 1947 to 1977, was the most successful in improving its efficiency of all British industries. My noble friend Lord Wade of Chorlton expanded on that by saying that it is also one of, if not the, largest of British industries. I told the Japanese that the food processing industry therefore needed to be seen as comparable to the Japanese car industry and not to their very backward food processors.
At that stage the EC tariff on motor cars was of the order of 5 per cent. and I aimed at that as a yardstick for biscuits and chocolates. I am delighted to say that the Japanese saw the point and decreased the tariff on both biscuits and chocolates to 20 per cent. and below. They might have come lower still if both products had had no sugar components. The Japanese farmers were very hung up about sugar at the time because of a deal that had been done by the Australians which people did not believe to be completely fair. But that is by the way.
That brings me back to the misfortune of Britain's most efficient manufacturing industry having its raw materials subject to the common agricultural policy. Quite clearly, there needs to be appropriate protection for EC farmers (several noble Lords have made that clear) especially in the short run. It would be disastrous for the countries of Europe if their farmers went broke in large numbers, quite apart from the adverse effect on the farmers themselves.
Though none of my farmer friends seems to be very keen on the idea, I believe that the noble Lord, Lord
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Bruce of Donington, and my noble friend Lord Cockfield might be. Like my noble friend Lord Wade of Chorlton and, I believe, also the noble Lord, Lord Jay, I feel that the success of the food processors in earning valuable export money would be greatly improved if the machinery of the common agricultural policy were replaced by something like the old British system of deficiency payments. The processed food exporters, whose value added is vastly more than that of the farmers, could then be freed from high cost raw materials and the image of being subsidised when in fact they are not.
I commend that approach to my noble friends in the Department of Trade and Industry and also in the Ministry of Agriculture, Fisheries and Food. I hope that something on those lines might be advanced, though I fear that it cannot be in time for the conclusion of the GATT negotiations. However, if we were working in that direction perhaps our critics on the other side of the Atlantic would be mollified and agree to some conclusion that goes in that direction.
4.58 p.m.
Viscount Montgomery of Alamein: My Lords, in a splendid opening speech the noble Lord, Lord Williams, said that the liberalisation of trade would be the motor for growth. He is quite right. No more is that so than in Latin America, where access to free trade with Europe is one of the keys to economic recovery. Latin Americans have unfortunately tended to view the completion of the single market in 1992 as Fortress Europe turning in on itself, whereas the reality is, or should be, quite the reverse—that is to say, Europe will become an area of huge opportunity. However, for that to happen this GATT round must succeed. Their apprehension is quite understandable.
In the very brief time that is available I should like to turn from the general to the specific and outline the situation for bananas, which is a classic case affecting both Latin America and the Caribbean. Bananas are among the most protected products in Europe and have so far received only peripheral attention in the current GATT round. The present UK regulatory arrangements prevent Latin American bananas competing on equal terms with those from the Caribbean. Latin American imports are controlled by quota and tariff restrictions which provide preferential access to Caribbean banana producers.
As I understand it, the United Kingdom quota for "dollar area" bananas, for that is what the Latin American product is called, is governed by the Banana Trade Advisory Committee. This is a group set up by MAFF officials and comprises Caribbean producers but no consumers and no Latin Americans. By the same token, France provides preferential access for Cameroon and the Ivory Coast, and Spain for the Canaries; and so it goes on. By contrast, Germany has a free market for bananas. That is particularly interesting as in Germany per capita consumption of bananas is much higher, prices are much lower and the consumer has already shown a preference for Latin American bananas, something with which I entirely agree.

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As a result, in the UK, where the producer cartel is in full swing, the consumer has less choice and pays higher prices. Free trade would introduce dynamism in the static UK market and offer consumers greater choice and higher quality—exactly what this Government have stated they have set up and intend to do.
I appreciate that there is a problem for the Caribbean—this point has been referred to by other speakers. In another place last July, Lynda Chalker spoke of possible aid to help the Caribbean banana producers to improve efficiency and diversify into other products. Like other statements by Mrs. Chalker, who is an exceptionably able and talented Minister, that seems eminently sensible. However, it is very important not to lose sight of the original objective of the GATT, which seeks to establish rules which are equal for all. This is clearly not the case with tropical agricultural products and I have cited one particularly glaring example. We need this round—we all need this round—to succeed, and must continue to strive for freer trade in all products and in all countries.
5.3 p.m.
Baroness Seear: My Lords, it is a pity, not to say an absurdity, that a subject of this supreme importance should be dealt with in a two-and-a-half hour debate in which speeches are limited to six minutes. It is, as the noble Lord, Lord Young of Graffham, said, a matter of the greatest possible importance. When the Gulf war is behind us it will still be of the greatest importance; and it will still be with us. If we fail to renew GATT and if we fail to bring the Uruguay Round to at least a relatively successful conclusion, the consequences could be far more serious than any consequences arising from the war. It is not surprising that I take this line, speaking as I do for the only party which has shown consistent and unswerving support for free trade. I am delighted to find a number of converts to free trade from the most unexpected quarters in today's debate.
Unless we get an agreement on the continuation of GATT and on the liberalisation of trade through GATT—in other words, should this round fail—there is a very serious danger of retreat into protectionism, the results of which will be far-reaching and devastating. We in the industrialised countries are already in a recession. A retreat into protectionism would deepen and lengthen that recession, with consequences of poverty and social disruption of a very grave kind.
The second reason why the subject is extremely important was referred to by the noble Lord, Lord Pitt, and other noble Lords. One of the major issues facing the whole world is the plight of developing countries in trying to grow out of poverty. They must do so because of their population problems, because of their social needs and also because they are potentially very important markets. They must do so for their own sake and for the sake of the rest of the world.
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Unless the Uruguay Round develops in such a way that markets in the developed countries become increasingly open to the developing countries, that will not happen. Many of those countries will sink from a level of poverty, already by our standards unbelievable, to a standard that is totally intolerable. The future of the developing countries—one of the world's great issues for the next decade—will depend to a considerable extent on the way in which we handle the Uruguay Round.
It is of the greatest benefit to consumers that the Uruguay Round—and the liberalisation of trade which depends on it —should go ahead and go ahead fast. The developed countries have been held back by the policies of parties in this country and elsewhere in putting the interests of producer groups—be they employer producer groups or employee producer groups—ahead of the interests of consumers. We have to reverse that policy and make sure that policies are developed first and foremost for the benefit of consumers and not for the benefit of any of the producer groups. Of course the interests of producer groups must be taken into account but they can never dominate, as they have dominated far too often in past policies and as they are dominating now in the difficulties confronting the Uruguay Round.
These are issues of the very greatest importance. If at this last moment, at five to twelve or five past twelve —I know that difficulties have come from elsewhere and that in some ways the Government have attempted to make the round successful—the Government cannot revive the Uruguay Round, the consequences for this country and for the world as a whole will be very serious.
Agriculture is experiencing great difficulties. We have heard a great deal about it during the discussions on the Uruguay Round and in today's debate. The farming interest must of course be taken into account. But there is not just one farming interest. There are a great many different farming groups with different problems. Surely it is possible to break down the policy in such a way that one does not have to subsidise successful farmers in some areas. One drives through France and sees extremely wealthy farmers in Picardy. They are doing very well indeed out of the common agricultural policy. It is ridiculous that we should go on supporting people of that kind.
I refer not only to little farmers. The noble Lord, Lord Mackie, referred to little farmers. His idea of a little farmer is not a very good representative of little farmers and is not the same as other people's. Some small farmers do have particular problems; but not all small farmers are poor. As the noble Lord, Lord Williams, said, many small farmers have other sources of income. Their farming has become little more than hobby farming. They do not need the same kind of support. Surely we can find ways of easing the problems of farming. This is a small issue in comparison with what is at stake in the Uruguay Round for the world as a whole.
5.8 p.m.
Lord Peston: My Lords, anyone who has studied the economics of free competition and of free trade is aware that many arguments have been put forward to justify protection in specific cases. The point of a special case is that it is special; it is not the general rule. It is a contradiction in terms if every case is a special case. Those who have experience of these things in government are aware of the paradox that all sections of industry and commerce are ardent free traders except when it comes to themselves. They are then able to justify all manner of restraints on trade and restrictive practices and want the Government to aid and abet them. The noble Lord, Lord Young of Graffham, with whose contribution I so much agreed, when he was Secretary of State had ample experience of this. But it is not a party matter. All Ministers are subject to the pressures of those who want to be able to buy everything they need in the cheapest competitive markets here and abroad but also want their own home markets protected. Therefore, my judgment, without totally rejecting the theory of protection in particular circumstances, is that, overall, the bias must be in favour of free entry into markets and that the special cases—one or two of which have been referred to today—must be very special and very rare indeed.
In the present context the problem is more complicated. Every country supports GATT and is in favour of free competition—except when it comes to its own vital interests. It is important, therefore, that the Government of the United Kingdom should recognise where our interests lie. Our national interest as a trading nation in goods and services must push us in the direction of free trade. However, given the scale of protection elsewhere, our negotiating position along with that of the Community must be to demand fair trade; in other words, we must have a level playing field.
We must remove trade barriers as rapidly as we can. But it would be foolhardy to remove them more rapidly than our competitors. That would complicate government policy, perhaps much more so in the case of the present Government than for the next Labour Government. If other countries find ways within the GATT rules to help their industry and commerce, fair competition requires us to do the same within reason. For example, fair competition implies that the tax burden placed on our firms cannot differ markedly from that placed upon our competitors. I shall give your Lordships a present example. I think we all agree, with the possible exception of government Ministers, that the Statutory Sick Pay Bill is intrinsically pretty silly. But one overwhelming reason for opposing it is that it imposes costs on our firms which are unnecessary at this time. The same point applies to the scale of industrial training and to the way it is financed.
I change tack slightly. Perhaps I may refer to the problem of agricultural protection support. The cynicism implicit in my earlier remarks is multiplied severalfold when it comes to farmers the world over. I take it for granted that there will always be farm
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subsidies. I am duly grateful, as several noble Lords have pointed out, that one thing which we in the advanced world—I emphasise the term "advanced world"—have not suffered for many decades is a shortage of food; indeed, it is a blessing. However, I am equally aware that the Cairns Group, whatever its rhetoric on fair competition and efficiency, is certainly negotiating in its own interests. We must bear that fact in mind. Nevertheless, having said that, the group's criticisms of the CAP, and those made today by several noble Lords, are all valid. From our point of view the CAP is a wasteful use of public funds, falling down both on the criterion of equity and also on the criterion of efficiency. There is no need for me to reiterate the point that a system as arcane and bureaucratic as the CAP is ready-made for fraud.
My hope, therefore, for agricultural policy is as follows. I believe first that we must respond to external criticism of the CAP and that we should remove those elements which excessively distort world markets in agricultural products. Secondly, we must grasp the opportunity which this gives us to reform our system of agricultural protection. Certainly the system in operation before the CAP, to which several noble Lords have referred, is, I am convinced, the correct way forward. But, thirdly, in the overall negotiations, I believe that we must give nothing away for nothing. I refer to remarks made by the noble Lord, Lord Boardman. I stand second to no one in my support for principle. However, the word "negotiation" actually means negotiation; in other words, it means giving up some things in order to obtain others. We must face that reality in this GATT round as well as in everything else. While we must make some concessions in this part of the GATT round, we must not be so naive as to make them in ways which grant us nothing in return.
Perhaps I may now turn to what I believe to be a much more important aspect of the GATT round which has not received sufficient attention thus far. I refer to the part dealing with international transactions in services. They are extremely important to the United Kingdom as services now contribute a very large proportion to the GDP. And they will become even more important as we move towards completion of the single market and towards EMU.
I agree that services create special technical problems. That is partly because they involve the direct use of labour and therefore create problems in regard to work permits and immigration. Services are also "invisible" at national barriers. This means there are serious problems in enforcing any GATT arrangements which come into existence. However, I am convinced that none of those problems is unsolvable.
In the case of services—whatever you think about the problem of goods—we have an enormous range of protection measures which need to be removed. I do not hesitate to say that they need to be removed in Britain's national interest. It is certainly true that important questions of regulation arise dealing with investor protection, the quality of services, and so on. I am not convinced that free competition between

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regulatory systems will lead to a fully satisfactory outcome. However, I believe that, taking the lead which we gave with respect to the single market and the services, we can apply that general approach on a world scale.
Therefore, my view is that in trying to succeed in what remains of the GATT round—I am rather more pessimistic, I think, than most noble Lords about whether it has any chance of success—we must try to create the equivalent of a single market in services. We must liberalise transactions in them, ensure that non-discrimination is an essential part of any agreement and, finally, seek to achieve full market access.
I agree very much with the noble Baroness, Lady Seear. It is a great pity we do not have more time to discuss the matter. There are many more technical points to be made. Nevertheless, my conclusion is a simple one. It is to the advantage of the United Kingdom, of the European Community and of the world at large that the Uruguay Round should be a success. Perhaps I may add a consideration which has not been raised, partly, I imagine, on the grounds of lack of time. Nearly all the leading experts in the field also agree that free trade is most essential to Eastern Europe. The competitive route is certainly a prerequisite if those economies are to be revitalised.
Far too little progress has been made in too many areas. The danger of collapse is still there. The forces for protection in the United States are stronger and becoming more so. However, they are not negligible in this country. Moreover, they are always strongest when there is a recession. It would help if the Government could switch to sensible economic policies, but they seem determined not to do so. Notwithstanding that, it is the duty of Her Majesty's Government, with their European Community partners, to make one last valiant effort to help restart and then successfully conclude the Uruguay Round.
5.18 p.m.
Lord Hesketh: My Lords, I think that it would be entirely appropriate if I were first to declare an agricultural interest, especially in the light of today's valuable debate for which we are most grateful to the noble Lord, Lord Williams of Elvel. I discussed the matter with my noble friend the Minister of State for Agriculture, Fisheries and Food. She addressed me in terms that she felt that the common agricultural policy and agriculture would be the salient and main features of the debate. I assured her that that would not be the case. However, I could not have been more wrong.
These are times of great uncertainty, when the structures that underpin world growth and world peace are being tested to their limits. Freedom and democracy can be undermined in more ways than one. Economic freedom and economic growth are essential to the survival of any nation, to its peace and prosperity. Democracy cannot flourish without them, nor they without it. But the future of the multinational trading system, on which continuing world growth and development and our own prosperity as a major
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trading nation depend, are under threat. Pressures towards protectionism are once again building up around the globe. Nations are succumbing to the temptation to take disputes into their own hands rather than abiding by agreed multinational procedures designed to ensure that the weak are not victimised by the strong and that all nations share in the benefits derived from progressive market opening.
The GATT has been the foundation of the growth in world trade from which we have all benefited since the end of the Second World War. It has presided over an unprecedented expansion in world-wide wealth creation. But its foundations are now buckling under the weight of its responsibilities. We are faced with the task of rejuvenating the GATT to face the challenges of a new century, on pain of seeing it collapse.
The benefits that the Uruguay Round could confer are particularly necessary at such a time as this. The world economy badly needs the sort of noninflationary stimulus a successful GATT Round can provide: encouraging trade and competition through lower tariffs and the removal of trade barriers. In addition, the round is concluding at a time when the Western alliance faces two great challenges: in the Gulf and in the Soviet Union. If the round succeeds it can reinforce the partnership of nations on which our responses to those crises must be based and give us a solid basis from which to tackle the economic problems that they may pose. If, on the other hand, the round is allowed to fail, we risk sending the message that the principles we espouse are too weak to face the challenge of national self-interest, let alone anything larger. That must not be.
As a major trading nation, the UK stands to make very important gains from the market opening and strengthening of multilateral rules that a successful round would produce. For instance, our service industries (which account for 55 per cent. of our GDP) stand to gain by the creation of an agreement on trade in services which will for the first time be able to provide a framework of agreed and equitable rules for trade in that important area and progressively enable world markets to be opened up. Trade in services now accounts for over 20 per cent. of all trade, and yet it is still governed by the law of the jungle. An agreed and equitable system of rules is in everybody's interests.
Our exporters also stand to gain by agreement on minimum standards of protection from piracy and counterfeiting where that protection does not already exist. At present our drug industry loses £50 million a year through such practices and our record industry £1 billion. An agreement to prevent counterfeiting and protect patents, copyright and trade marks is a high priority for us.
More and better opportunities for UK firms to invest overseas will also be opened up if we can achieve an agreement on removal of trade-distorting restrictions and conditions on investment. Our exporters will be able to obtain greater market access for their products world-wide through the removal and reduction of tariffs. If we are able to attain the Uruguay Round goal of a further 30 per cent. cut in

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tariffs, our exports outside the Community will be boosted by at least 2 per cent.—a very large sum in real terms.
The negotiations in the Uruguay Round cover 15 separate subject areas; they are the most ambitious ever undertaken. Work has proceeded inch by painful inch over the past four years towards a revitalised trading order able to meet the challenges of a new century. We had hoped that those efforts would be brought to fruition last December in Brussels. I am very sorry that they were not. But we still have our shoulders to the wheel. If all participants show the flexibility and commitment the GATT deserves, we can still bring this round to a successful conclusion. The European Council at its December meeting reaffirmed the Community's determination to achieve success, and I believe our negotiating partners want that as much as we do.
As your Lordships are aware, the main stumbling block to success has been lack of agreement on the liberalisation of agriculture. No one has come well out of the debate on agriculture. The US has been too ambitious and offered too little on its own main form of trade-distorting agriculture support. Japan has shown no inclination to compromise; and others were too ready to suspend negotiations, so that the Community's scope for compromise was never fully explored.
Agriculture accounts for just 3 per cent. of the Community's GDP. Clearly there is no question of dismantling the CAP or leaving our farmers without any form of support or protection; but we must retain our sense of proportion. Is the whole of our economic future to be jeopardised by fear of rural change?
It is important to recall that in every past GATT round there have been industries which have feared the consequences of reductions in trade barriers. Their fears have proved greatly exaggerated. Indeed many of them are the principal champions of a successful outcome on this occasion. It is also important to recall the fact that the benefits of each successive round have always been even greater than had been hoped originally.
If the round fails we face the prospect of US unilateral action against EC agriculture trade barriers and a trade war in which EC trade interests, especially agriculture, would inevitably suffer. That is no solution. Far better to agree to sensible and evolutionary change, and do it through the GATT.
Rome was not built in a day. If our efforts succeed in bringing agriculture fully under GATT disciplines for the first time, that will in itself be a great achievement. We shall need to go on to build on it over the years and in the rounds to come.
Today, intensive work is continuing around the globe to try to rescue the round. The world at large could be forgiven for thinking that agriculture was the only subject under discussion. Let me spend a few moments at least to tell your Lordships what else is at stake. There are some important subjects which form part of the total package that I have already mentioned: services, intellectual property, investment
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and tariffs. Some of those areas taken alone represent vast and ambitious efforts for which we have good prospects of success—the massive 107-way negotiation on tariffs, and the even more Herculean task of devising a regime for services from scratch, to cover everything from tourism to tax consultancy, from aviation to architecture.
There is more within our grasp. We are on the verge of an agreement to liberalise world trade in textiles. Here is a subject of great importance to the UK. There will be adjustment costs over a reasonable transition period to be borne by all those countries that have been keeping out the competition. But there will also be great new opportunities for the efficient and competitive UK firms which have so far found many markets shut against them. We look forward to free and fair trade in textiles, which will allow each country to exploit its natural strengths and give the consumer the benefit of lower prices and wider choice.
Let me touch on one more important subject. Under present GATT rules the findings of a dispute panel require the consent of all parties before they can be implemented, and so can be blocked by one of the parties to the dispute. That fundamental weakness has been steadily sapping the authority of the GATT over the years, and with it nations' loyalty to the multilateral system. The United States infamous Section 301 crowbar is only one example of what nations have been driven to by the GATT's failings. At last it seems that we shall be able to put that right. Reforms are within our grasp which would give the GATT real teeth at last and bring all justification for unilateral initiatives and alternatives to an end. What a gain that would be, especially for the poor countries of the world which inevitably lose out against the economic giants.
My noble friend Lady Carnegy of Lour referred to the position of the Scotch whisky industry. We have not seen the Scotch Whisky Association's latest submissions, but I stress that the Government are well aware of the importance of gaining improved access to third country markets not just for Scotch whisky producers but for spirit drink producers throughout the EC and further afield. We have consistently supported the Scotch Whisky Association's line that market access for such products should be improved and have frequently made representations to the European Commission to that end.
The right reverend Prelate and the noble Lord, Lord Pitt of Hampstead, referred to the Church's position with regard to the free market in agriculture. It is fair to say that if one goes to Eastern Europe there will be many who will say that a right to food, which does not exist there, would exist if there were a free market in agriculture. The noble Lord, Lord Donoughue, quite rightly pointed out to your Lordships that the extension of trade was the best non-inflationary way of the world avoiding a recession by extending the economy. I am sure that we all agree with that.
The noble Lord, Lord Wade, and my noble friend Lord Mottistone referred to the interests of the food industry. The European Community has throughout

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the GATT negotiations on agriculture made it clear that there can be no question of dismantling the CAP or completely abandoning particular policies such as export refunds. European Community markets will continue to be supported with regard to these products and processed products because when they are exported they are initially bought at the EC/CAP price for the product that goes into the can.
The noble Lord, Lord Cockfield, referred to the US showing great disregard for the GATT rules. Unilateral action taken by the United States to settle trade disputes is, we believe, a serious problem. The noble Lord, Lord Sanderson of Bowden, referred to the confirmation that he would like as regards the MFA; namely, that it would only be phased out on the basis of strengthened GATT rules and disciplines.
The fact is that Her Majesty's Government and the European Community remain committed to phasing out the MFA as part of the overall Uruguay Round settlement on the basis of strengthened GATT rules and the disciplines. The important sectors are the effective and lasting opening of markets, the creation of fair competitive conditions and the improved safeguard discipline.
The noble Lord, Lord Bruce of Donington, has always provided your Lordships with a unique insight into, as he sees it, the problems and difficulties that exist within the European Community and particularly with the CAP. He takes a radical view, admirably as always, but I am not sure that I can go so far as his desire for the abolition of Articles 38 to 47 in their entirety. However, I shall certainly pass on his comments to my right honourable friend the Secretary of State.
The noble Lord, Lord Jay, mentioned the possibility of the United States' system of deficiency payments being preferable to those export subsidies that exist within the European Community. I do not believe that we can agree with that because at the end of the day they are a panacea, a different subsidy: but the final result is that a subsidy is a subsidy is a subsidy.
The noble Lord, Lord Williams of Elvel, referred to favours granted to part-time farmers—favours which are granted essentially in other parts of the Community. This is an area where we always need to move with a certain amount of caution. It is perfectly possible to say that the 50 acres which were no longer viable yesterday and the 100 acres today may be the 200 acres of tomorrow. The argument that he deploys does not work in a world with a fixed acreage. It may become a floating and not so flexible friend in his argument in the longer term.
The noble Lord, Lord Mackie, dealt with the OECD figures on farm units. There is a case for taking the real cost or the volumetric cost of a particular commodity. He produced figures which showed that the EC, under the CAP regime, had the least subsidised farmers. However, if we take a volumetric figure, we come out with a different set of figures as regards the level of subsidies which is worth comparing with the noble Lord's figures. We start at
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the top with Switzerland at 75 per cent., followed closely by Norway with 74 per cent. and closely thereafter by the Japanese at 72 per cent. Then we come to the European Community at 38 per cent. and the United States in volumetric terms—which at the end of day will decide the market—at 27 per cent. as regards overall subsidy.
The noble Baroness, Lady Seear, referred to the Liberal Party's unequal commitment to the free trade principle. With the greatest respect, I refer the noble Baroness to the immortal memory of Lord Peel.
Baroness Seear: The noble Lord would have to go back 150 years!
Lord Hesketh: My Lords, I only hoped to go to the fount of all knowledge. Perhaps I may return to the two figures mentioned at the start, both by the proposer, the noble Lord, Lord Williams of Elvel, and my noble friend, Lord Young of Graf ham. There is a historical memory that we must never forget which puts into context the importance of this GATT Round. I refer to the fact that in the great depression manufacturing output fell by 40 per cent. and the world manufacturing trade fell by 35 per cent. We must never allow that to happen again. The most important reason why it should never happen again was put forward by the noble Baroness, Lady Seear. The greatest loser of all, if we fail to achieve a successful result, will be the poorest of the poor. That should never be the basis of allowing anything as important as the GATT to fail.
Lord Williams of Elvel: My Lords, I am most grateful to all noble Lords who have taken part in the debate. We have covered a great deal of ground and I am grateful to the Minister, the noble Lord, Lord Hesketh, for his full reply. As all noble Lords have said in the debate, it is a most important matter. I was glad to see that the Government take this matter extremely seriously. All we can do as a House is express our hope that the Uruguay Round can be salvaged and brought to a successful conclusion. We wish the Government every success. Meantime, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

Israel: Iraqi Missile Attack
5.36 p.m.
The Minister of State, Foreign and Commonwealth Office (The Earl of Caithness): My Lords, with the leave of the House I shall now repeat a Statement made in another place by my right honourable friend the Minister of State for Foreign and Commonwealth Affairs in answer to a Private Notice Question. The Statement is as follows:
"Last night once again Tel Aviv came under missile attack from Iraq. Latest statements by the Israeli Government indicate that because of this attack three people are dead and 98 are injured.
"This House will endorse last night's statement by my right honourable friend the Prime Minister. He said that he was appalled by this further savage attack on civilians. He expressed this country's deepest sympathy to the bereaved, to those hurt and to their families. This House agrees.

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"The Prime Minister repeated our hope that, even now, the Government of Israel would show that forbearance that they have so far demonstrated and not give Saddam Hussein the satisfaction of drawing Israel into the conflict. This message was passed to the Government of Israel last night.
"Israel is of course entitled to defend herself: that is not at issue. The question is whether it is in her interest to retaliate. We believe it is not. To do so would be to play Saddam Hussein's game without in our view adding to Israel's security. I therefore hope that Israel, her government and her people, will continue to show the same patience and courageous restraint that she has already displayed in the face of outrageous provocation".
My Lords, that concludes the Statement.
5.38 p.m.
Lord Cledwyn of Penrhos: My Lords, we are grateful to the noble Earl for repeating the Answer to the Private Notice Question in another place. In our debate on Monday noble Lords deplored the Scud missile attacks on Israel and expressed their abhorrence at what can only be described as a crime against international law.
This further attack causing the death of three people and extensive damage is a wicked attempt to bring Israel into the war in the hope of breaking the coalition and undermining the United Nations itself. It will stand out in history as an example of inexcusable aggression against a civilian population.
The great majority of countries in the world have paid their tribute to Israel for its forbearance under pressure and provocation and hope that this will continue, although everyone appreciates Israel's difficult position. What Saddam Hussein is waging is not a war in the conventional sense but a campaign of terrorism against innocent and helpless people. This must not be forgotten when the conflict comes to an end.
No civilised person and no one with a sense of justice or compassion can find any justification for so cruel a campaign. This is yet one more reason why the United Nations should be fully supported and the conflict brought to a decisive conclusion in the interests of all the people in the Middle East.
Lord Bonham-Carter: My Lords, I too would like to thank the noble Earl for repeating the Answer to the Private Notice Question given in another place. I wish to associate myself and my colleagues on these Benches with the words of the Prime Minister and those of the noble Lord, Lord Cledwyn of Penrhos.
We have witnessed a mixture of indiscriminate terrorism and provocation. We can only admire the forbearance which the Israeli Government and the people of Israel have shown in response to this provocation. We cannot deny them the right of self-defence and we can only hope, for the reasons which have already been given, that they will continue to show that forbearance which we believe is both in their best interests and in the best interests of a successful outcome of the conflict in which we are now engaged.
The Earl of Caithness: My Lords, I am most grateful for the firm statements of support that we have received from the noble Lord the Leader of the
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Opposition and the noble Lord, Lord Bonham-Carter. Both noble Lords picked up two points: first, the immense provocation to which Israel has been subjected and, secondly, that this is a campaign of terrorism against innocent civilians. We deplore this quite outrageous action by Iraq and we commend the forbearance of Israel.

Health and Safety at Work
5.41 p.m.
Baroness Turner of Camden Baroness Turner of Camden rose to call attention to the case for further steps to improve provisions for health and safety at work; and to move for Papers.
The noble Baroness said: My Lords, I am glad to have this opportunity of introducing a debate on a subject which I am sure many will feel is of the utmost importance despite the fact that at the present time our thoughts are very much turned to events in the Gulf. However, health and safety at work is a matter of continuing concern.
Towards the end of the previous Session we had the publication of the annual report of the Health and Safety Commission—the body charged with responsibility under the Health and Safety at Work Act. The report shows that a great deal of important and necessary work was undertaken during the year. The job of the commission becomes increasingly complex. It must deal with the results of new technologies, substances and processes. The chairman stated in his foreword that the commission's methods and speed of reaction have had to be adapted to meet European requirements. That arises because of the decision to make occupational safety one of the areas for qualified majority voting under the Single European Act.
Despite the good and committed work of the commission—it is one of the remaining institutions based on the tripartite principle involving unions and employers as well as a commissioner representing the public interest—there is still great cause for concern. We read, for example, that in manufacturing industry the number of fatal injuries increased for the first time in a number of years from 94 in 1988–89 to 105 in 1989–90. Employment in the same sector increased marginally but not to the same extent.
The provisional figures for injuries to employees that cause an absence of more than three days was 5.4 per cent. higher than the final figure for the previous year and that in itself was 6.5 per cent. higher than the figure for the year before that. The trend is not a good one, even taking account of the fact that there may well be better reporting.
In construction the picture is bad. The fatal injury rate there is the highest for all sectors. According to the report, the number of major injuries to employees increased for the third successive year from 2,907 in 1988–89 to 3,166 in 1989–90.
On 20th June last year my noble friend Lord Dean of Beswick tabled a Question on health and safety and the Channel Tunnel workforce. There had been a great deal of public disquiet over a series of deaths and injuries on our side of the project. The situation on our

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side appeared to be worse than on the French side. At the time the debate took place, the consortium building the tunnel had been prosecuted three times by the Health and Safety Executive and on each occasion it was fined £10,000. The HSE is now prosecuting the companies in the consortium following investigations into the death of Gary Woodward, aged 32, who was killed in 1989.
In July 1990 an electrician, Charles McCourt, died while repairing a high voltage cable. We have recently heard that further prosecutions are in the pipeline. According to the HSC report, there have been discussions between the contractors and the Accident Prevention Advisory Unit of the Health and Safety Executive. As a result of those discussions, a safety monitoring system has been introduced. It is understood that the project, while being exciting and innovative, is clearly hazardous. It should not, however, be one that proceeds at the expense of the safety of the workers involved in it. The union organising the workforce believes that tougher penalties are required. The union points to the situation in the United States where company directors can be charged with the manslaughter of their employees if a fatal accident occurs as a result of negligence or the failure of safety measures.
As I said earlier, the construction industry generally has a bad record. It is a hazardous industry and that is why training is so important. I regret that the Construction Industry Training Board, which has done so much in this area and without which things might have been worse, faces a somewhat uncertain future. It has been granted a further three years of existence as a statutory body, but beyond that its future is obscure.
Apart from the nature of the job, there are additional reasons why there are particular problems in this industry. It is a fragmented industry with many small companies. This can lead to poor communication on site and poor management of sub-contractors. Then there is the contracting system itself with bonus payments and penalty clauses which can encourage the cutting of corners. In small companies the level of safety training is low. I shall mention small companies again in a moment. There is sometimes a fear of victimisation or intimidation as this fragmented industry is difficult to unionise. Unions active in the industry complain that there are insufficient inspectors and that when prosecutions are brought the fines are derisory when compared with the worth of the contract involved. The companies get off lightly.
Moreover, there is no safety culture in the industry. There tends to be a macho culture where safety is not given sufficient importance, either by management or sometimes by some of the workforce. Undoubtedly the disaster at work which had the greatest impact on the public in recent years was the Piper Alpha tragedy. I have read the report of Lord Cullen. It was a fascinating document in its way, if somewhat depressing. I do not intend to discuss it in detail tonight. Parts of the report are highly technical and it may well warrant a full debate in itself with participation by noble Lords who have a degree of
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technical expertise in that area. However, I believe that one of my noble friends may make some further reference to the report in the debate this evening. My reason for referring to the report is that some of the conclusions about safety seem appropriate not just in the hazardous environment of North Sea oil rigs but also wherever hazardous working conditions exist.
Lord Cullen, also refers to the need for the establishment of a safety culture. By that he means the establishment of the kind of working environment in which it is simply not permissible to cut corners and where everyone is constantly aware of the hazards which surround them and take the necessary steps to minimise them as a matter of course. Paragraph 18.45 of the report states:
"Companies with a good safety record are dedicated to the proposition that safety starts with the unfailing commitment of the most senior management, and that of the chief executive officer in particular. They are personally responsible for setting … the safety philosophy and communicating it to all the workforce. The latter may be expressed in such simple and easily understood concepts as 'nothing is so important that it cannot be done safely' or 'if we cannot do it safely we won't do it' but underlying those is the belief that safety is a basic element in conducting business and cannot be considered a discrete and separate activity".
Lord Cullen, further stresses the importance of the involvement of the workforce. He regards first-line supervisors as playing a key role and emphasises their need for health and safety training. He says:
"Possibly the most visible instrument for the involvement of the workforce is a safety committee system".
However, it became clear from the inquiry that the Piper Alpha management did not recognise unions. There were safety committees consisting of supervisors but not of elected employees. Unions can play a key role not only in training but in motivating the workforce, and the company had clearly not understood that.
Over the years, the Trades Union Congress has played a significant role in trying to build a training and safety culture. That is not always easy. During my years as a trade union official I have known situations in which the members themselves have been none too keen to highlight unsafe working practices or insufficient precautions in the handling of hazardous substances. There is sometimes a fear that there might be victimisation or a diminution of lucrative work in an area where there is no alternative. So unions have had an educational job to do and in the main have been doing it. My own union employs a health and safety officer who was formerly a factory inspector. We hold regular training sessions at the union's college at Bishops Stortford.
In 1968 the occupational health unit at the London School of Hygiene and Tropical Medicine was expanded into an institute on the basis of a donation and subsequent annual grants from the TUC. The school tried, without success, to get similar support from employers. Nevertheless, the work expanded and important research was undertaken. M.Sc. courses in occupational medicine and hygiene were commenced. Sadly, I am told, the institute closed recently.
I am told that one of the reasons for the closure was the lack of interest on the part of academia in health and safety at work. That is a great pity since, as has been said by Professor Schilling, well known for his

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commitment in this area, raising standards depends on health professionals being properly trained—hence the importance of academic centres. It is to be hoped that the efforts of Professor Schilling and his colleagues to establish a new academic department of occupational medicine will meet with success. However, I understand that the London federal health and safety service of the University of London has recently been closed as the result of cuts. The unit was carrying out very valuable training work in the safety area. It is a great pity when institutions of this kind, which are so necessary to future health and safety provision, become the subject of cuts and disappear from the scene. Important as the work of the HSE is, academic back-up and research is also important, particularly if we have to meet European standards in the future.
I said earlier that I would say something about small businesses. I am prompted to do so by an article which appears in the current issue of the Employment Gazette. This points out that employees working in small companies appear to run 20 per cent. more risk of major injury than those in medium to large establishments and some 40 per cent. more risk than those in very large establishments. When it is appreciated that, of the 2½ million employing establishments in the UK, 96 per cent. employ fewer than 20 people, it can be seen that this is a sizeable problem. Moreover, some 16 per cent. of major injuries in smaller establishments were to people under the age of 19 years, including six involving people under the age of 16. Also, there may be under-reporting, so the higher incidence of non-fatal injuries apparent in smaller establishments may be understated.
The article does not attempt to draw conclusions, but surely the statistics indicate the lack of a safety culture here, perhaps due to ignorance on the part of small company managements together with a greater incentive to cut corners for the sake of getting a job done and retaining profitability. It could also be argued strongly that a lack of inspectors with time to monitor what goes on in small companies is a contributing factor.
I am sure that the Government will say that the HSC's bid for resources has been met in full over the past two years. However, the fact remains that there have been cutbacks. The chairman's report states that nearly a decade ago—at the start of the Thatcher decade—the commission was told to cut staff radically, to improve efficiency and not to impose undue burdens on business. The chairman claims that that has been done, although he comments that the problems of the commission's growing effort in inflationary times remains a constant anxiety. Of course, there is the necessity to recruit and retain staff of sufficient professional standing.
Perhaps I may refer briefly to what is known as the European framework directive of the Community. So far as I can see, it imposes obligations upon all employers very much in line with our own legislation but in certain respects goes further. There is one provision to which I should particularly like to draw attention. It states:
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"Workers who, in the event of serious, imminent and unavoidable danger, leave their work stations and/or dangerous area may not be placed at any disadvantage because of their action and must be protected against any harmful or unjustified consequences in accordance with national practice".
If that means anything at all it means that in such circumstances workers who walk off the job are entitled to protection from dismissal or other intimidation.
To summarise, I believe that adequate resources must be available to do the job of monitoring or inspection. The workforce must be involved through safety committees and elected safety representatives, who must be given time off with pay for suitable and approved training. There must be an end to victimisation and intimidation. People should feel free to highlight unsafe practices without such fears. I emphasise the necessity of union representation, recognition and involvement to prevent that.
There ought to be tougher prosecution and enforcement policies. To date, fines have widely been seen as inadequate in the light of the injuries and fatalities involved. More must be done, through the HSC and elsewhere, to encourage the development of a safety culture. Of course the HSC must have the necessary facilities both to meet the needs it has already identified and to enable us to play a part in developing safety policies within the Community.
The Government should further emphasise their commitment to health and safety at work. Unfortunately, they have sent out the wrong signals as a result of their attitude to the industrial injuries scheme, which has gradually been eroded by successive social security Acts. One cannot help thinking that the Government would like to jettison it altogether. In doing so they seem to be indicating that they do not appreciate that some working environments are inherently hazardous and that the workers within them must have that additional protection.
I believe that this debate will provide an opportunity to highlight some of our anxieties and I await the Government response with interest. I beg to move for Papers.
5.53 p.m.
Lord Campbell of Alloway: My Lords, it is always a pleasure to speak after the noble Baroness, Lady Turner of Camden. Her exposition of some of the defects of the existing regime was authoritative and calm. Today's debate could lead to a limited health and safety reappraisal of industrial relations with the object of introducing recognition procedures, so establishing a new dimension of co-operation between employers and those who are employed.
That new dimension would have to be established in any event in order to implement certain recommendations—which I shall come to later—of the Cullen Report. As part of the reappraisal there could be a wider impact upon the improvement of safeguards for health and safety at work generally. If such were to ensue the gratitude expressed to the noble Baroness for having introduced the debate and for

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having afforded this opportunity for open and constructive discussion would extend beyond your Lordships' House.
It is appreciated that my noble friend the Minister —to whom we all extend the warmest of welcomes and whose contribution cannot but enhance this occasion —may well not be in a position to comment on such matters as the new dimension. By the form of the Motion as tabled the provisions to which reference is made would appear to be the series of statutory instruments and the structure under the existing regime. No doubt my noble friend the Minister will be able to deal with that in due course. We shall look forward to his contribution.
It is evident from the Cullen Report—it has been evident for a very long time—that as far as improved safeguards for health and safety at work are concerned, the issuing of these instruments can afford no substitute whatever for a new dimension of co-operation, such instruments being only part of the effective steps to be taken. The case for taking further steps raises questions of considerable importance affecting the welfare of those who work and their families, the continuity of production of goods and the provision of services and the safety of the public who avail themselves of such services.
Although responsibility for health and safety lies fairly and squarely on the shoulders of management, I agree with the noble Baroness that the trades unions have an important contribution to make. As she puts it, they have a key role in motivation; first, on training, which is essential, and, secondly, in some sort of advisory capacity on the board of management by nomination of members who have actually done the jobs on which health and safety depend.
Lord Cullen's report acknowledged at paragraph 21.83 that such controversial matters as industrial relations were beyond the scope of his terms of reference. However, paragraphs 21.73 to 21.87 recommend the involvement of the workforce and trade union participation. In addition, at paragraph 21.67 it is said that the regulations should require stated objectives to be met rather than prescribe detailed measures to be taken. At paragraph 21.84 there is reference to the appointment of safety representatives by the trades unions; at paragraph 21.79 reference to the problems of recognition. Since the 1971 Act there has been no machinery for the resolution of recognition disputes. The system of collective bargaining on conditions of service inevitably has proved unequal to the task on matters of health and safety at work.
This is not the occasion to consider recognition procedures under Sections 44 and 45 of the 1971 Act which, although complex and cumbersome, have worked tolerably well in practice. Perhaps the noble Lord, Lord McCarthy, who has great experience of these matters, and the noble Baroness will agree with my assessment. Indeed, it is not appropriate to comment upon the relevant paragraphs 8 to 15 of the code of practice provisions. The hope must be that as part of the reappraisal a simplified procedure can be
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worked out by government in consultation with the trades unions and the CBI, and that discussions take place soon not only in the context of the implementation of the recommendations of the Cullen Report, to which I have referred, but in the wider context of health and safety at work generally.
It is understood that under the 1974 Act it is the intention of government to issue a series of regulations which reflect the health and safety requirements of modern advances in technology. It is also understood that within the European Community framework the health and safety items of the social action programme are supported in principle, as is the case with the workplace directive, the personal protective equipment directive and certain other directives. But harmonisation and effective enforcement by the Commission are absolutely essential if unequal competitive situations between member states are to be avoided and the Council of Ministers must make due financial provision to those ends. I have no doubt Her Majesty's Government will take all possible steps to generate the necessary political will as between heads of state and the Council of Ministers. In the European Community context, I would be grateful if my noble friend the Minister could give some assurance on that point and on any proposals for statutory instruments to improve the existing regime.
On health and safety at work reappraisal of our industrial relations, all that I respectfully ask is that the papers on this Motion be given due consideration. This is not the pipedream of a visionary; it is a tentative application of common sense in the light of experience.
6.5 p.m.
Lord Rochester: My Lords, I am glad as always to follow the noble Lord, Lord Campbell of Alloway. I cannot go quite as far as he has, certainly not in advocating, if I understood him correctly, that union representatives, as opposed to employee representatives should sit on company boards to deal with the subject of health and safety. I am sure, however, that he was right to emphasise the importance of employee involvement in these matters. I shall have a word to say about that later.
As the noble Lord rightly said, responsibility for health and safety at work lies primarily with management. In much of manufacturing industry a considerable degree of risk is necessarily involved in producing the goods and services on which our standard of living depends. In practice, there is often a conflict between the interests of production and those of safety, particularly in determining how scarce resources are to be allocated. I well recall from my experience in the chemical industry how difficult it sometimes is to strike a proper balance between them.
I gladly pay tribute to what our best firms are doing to achieve safe working. For instance, the great company for which I worked has for long taken into account health and safety as factors in its management performance appraisal system. Indeed it now goes further and links managers' pay to success in meeting

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environmental targets. Having said that, I am sure that further steps can and should be taken to bring employers generally up to the level of the best.
In preparing for this debate, I turned, as did the noble Baroness, Lady Turner, and the noble Lord, Lord Campbell of Alloway, to the last annual report of the Health and Safety Commission. In the foreword to the report the chairman observed:
"The European Community has now to be regarded as the principal engine of health and safety law affecting the UK".
The chairman noted that directives concerning occupational safety may now be introduced on the basis of qualified majority voting under the Single European Act.
I was glad that he went on to say:
"We have made clear to our European friends some of the difficulties we see in an over-hasty provision of new law, particularly without assurance that it can be enforced with equal determination in all Member States. We have also sought to insist that Member States should make their own arrangements for subsidiary detail, subject to European agreement on general principles".
In my view the Health and Safety Commission has struck just the right note. There is a danger that in this matter the European Commission could overstep the mark. For instance, Sub-Committee C of your Lordships' European Communities Committee, on which I have the honour to sit, recently considered a draft directive on working time. The proposals include provisions relating to minimum rest periods and limits on night work, shift work, overtime and even annual holidays. The European Commission maintains that those proposals are justified on health and safety grounds. On that point the committee received conflicting evidence. However, what I found most disconcerting was that before issuing the draft directive the Commission had not even consulted the Community's own advisory committee on health, safety and hygiene about its proposals. Against that background I welcome the aim of our Health and Safety Commission to try to ensure that new Community based legislation, like new UK legislation, is properly proportioned to the risks with which it deals.
Like the noble Baroness, Lady Turner, and the noble Lord, Lord Campbell of Alloway, I have read —at least in part—the Cullen Report on the Piper Alpha disaster. I was struck —fully in line with my own experience, if I may say so—by the way in which Lord Cullen referred to training as a key point in both his summary and recommendations. For example, he said:
"Evidence as to training for emergencies showed that the induction was cursory and … the training of persons with special duties in an emergency did not take place with the frequency laid down".
He noted:
"Management … failed to ensure that emergency training was being provided as they intended. The safety policies and procedures were in place; the practice was deficient".
I suggest that some at least of those dicta could well be transposed and applied with equal justification to other recent disasters.
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What can the Government do to help? Only a month ago this House held a debate on training. Like other noble Lords I expressed regret that in the absence of a government lead it had been left to the CBI to arrange for representatives of the TUC, the chambers of commerce, training and enterprise councils, local authorities and educational organisations—almost everyone except the Government—to meet in an effort to draw up national training targets. The CBI's initiative followed the Government's decision not merely to withdraw support from the targets previously set for the 1990s by Sir Norman Fowler when he was Secretary of State, but to abandon any further attempt to set such objectives. As I see it, there is no reason why national targets should not encompass health and safety as much as other matters. In this there is no need for legislation but the Government should be prepared to give a lead.
That brings me to the point which the noble Baroness, Lady Turner, and the noble Lord, Lord Campbell of Alloway, raised; namely, employee involvement. At paragraph 18.48 of the report, Lord Cullen, says,
"It is essential that the whole workforce is committed to and involved in safe operations. The first-line supervisors are a key link in achieving that as each is personally responsible for ensuring that all employees, whether the company's own or contractors, are trained to and do work safely and that they not only know how to perform their jobs safely but are convinced that they have a responsibility to do so".
Lord Cullen—the noble Baroness, Lady Turner, has already made some reference to this matter—goes on to stress the value of a safety committee system as a means of providing for new ideas and solutions to safety problems to be brought up and for passing verbatim and uncensored safety comments up the management line. He says also that the system helps to reinforce the principle that each employee is responsible for his own safety and that of his fellow workers.
I do not think that that paragraph can be improved on as a statement of the importance of involving all employees in seeking to promote health and safety at work.
Is there more that the Government should do to promote employee involvement in this area? On a number of occasions in the past I have argued that the time has come to make it a statutory requirement that in every organisation which employs more than a certain number of people there should be consultative bodies of some kind. Within them, health and safety are certainly matters which should be discussed.
In this Chamber we can only talk; it is for others to act. But at least our contributions to this discussion will provide evidence of the importance that we attach to the matter of health and safety at work. After all, it is a subject which should not give rise to political controversy. Indeed, the noble, Lord, Lord Strathclyde, when replying to the debate initiated by the noble Lord, Lord Dean of Beswick, last June on the Channel Tunnel workforce, reminded us that the 1974 Health and Safety at Work, etc. Act is itself an outstanding example of the common ground on which we can all stand, for it was a Conservative government

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that drew up that legislation and a Labour government that enacted it. I am sure that that is the best way by which further steps in this field should be taken.
6.20 p.m.
Lord Mellish: My Lords, it is some time since I spoke in this House, and I am delighted to be involved in a debate which concerns health and safety in industry. First, perhaps I may congratulate my noble friend Lady Turner of Camden? She really adorns that Front Bench very well indeed and she introduces subjects which are worthwhile discussing. I have nothing but admiration for her.
This is a non-political matter—an absolutely non-party matter. Anybody who is not concerned with health and safety at work must be stark raving mad. So it is a question of what is the right approach, what is the best bet and what is the way in which to deal with this subject? I agree with the noble Lord, Lord Rochester, that this is a non-party matter. That is about the only point on which we agree.
I am taking part in this debate because of my personal interest in the construction industry. I was 37 years in the other House, during which time I was a junior Minister of Housing; I knew something of the construction industry. Later I became Minister of Public Building and Works and I really came to know the subject well. It was at that time that I learned about the Construction Industry Training Board. I discovered what the best elements of that industry were trying to do. Certain parts of that industry are a credit to the nation, but certain sections of it are a discredit.
I once inquired into the whole building industry and discovered that 52 or 53 per cent. of it consisted of a man with a boy and a bucket. That part of the industry is absolute rubbish. We are not concerned with those people. We cannot do much with them and we cannot control them. But the other 50 per cent. or so can be controlled—not necessarily by legislation from this House, but by contracts. The employers in those decent firms say exactly what should be done and how it should be done.
That brings me on to the industry's approach to this matter. I have mentioned about the 50-odd per cent. of good firms that are worth talking about. I should like to put it on record that I have no vested interest in this matter. I do not get paid by anybody. I have been approached many times but no individual firm pays me. So I speak without any interest at all, purely impartially, and I know of the background.
The Construction Industry Training Board is a good example of what ought to be done to try to help in health and safety at work. One of the courses that it runs is about health and safety. It is part of the training. That is why I want to explain why the CITB should be encouraged and extended and why this Government, above all governments, should try to make certain that the CITB and all it stands for carries on doing what it is doing now.
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The board was originally set up in March 1964 under the Industrial Training Act 1964 which was subsequently amended by the Employment and Training Act 1973 and the Industrial Training Act 1982. The three main objectives of the Industrial Training Act were to ensure an adequate supply of properly trained men and women at all levels of industry; to secure an improvement in the quality and efficiency of industrial training, and to spread the training more evenly across firms. That was the object of the establishment of the CITB, and health and safety at work was part of its attitude to industry generally.
I should like to talk about the membership. Today there are 56,000 local firms associated with the CITB, so I am not talking about rubbish. How does the board get its members? In the main, the board is appointed by the Minister and at the moment it is employer-related. That means that the chairman is related to the employers' side which suits them fine. It is their business anyway. However, the board represents the interests of those who work in the industry. It represents the trade unions. The Transport and General Workers' Union and UCATT have a seat; and, believe it or not, the educationists, whoever they may be, also have a seat. I suppose that they are people who can read and write. So it is a board which is truly representative.
I should now like to turn to how the board gets its money, because if we talk about health and safety we must also talk about those who work in the industry being conscious of health and safety in their job. My noble friend Lady Turner said that the construction industry has the highest percentage of accidents of any industry in the country. That is why it is imperative that the CITB is encouraged. At the moment, 42 per cent. of its income comes directly from the membership by voluntary levy. The remaining 58 per cent. comes from the government of the day. We are talking about £173 million which is no mean figure. It is not something to be ignored and thrown away. The Government ought to recognise that in this body they have the potential for a good job of work on safety.
It is important to state how many are undergoing training. During 1989–90, a total of 22,000 young people started their training under the CITB youth training scheme. Another 16,000 took part in the CITB National Training Centre Courses of various types. What are the courses? They are piling, plant operation, steeple-jacking, motorway barriers and, much more important, health and safety at work. That is where it spent the £173 million.
How long does a course last? Some courses last only two to three days, while others go on for over a year. The pattern is very varied. Let us now see how the £173 million is spent and what are the results. It is estimated that two-thirds of the trainees under instruction complete their two-year training and are taken on by employers. This compares favourably with the national picture over the years. A large proportion of those trainees become apprentices and continue their training after completion of the youth training programme.

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I have another interesting figure which I was given the other day about youngsters. In 1988–89, the number of school-leavers decreased, but the number on youth training schemes formulated by the CITB went up. The board took over 22 per cent. of the entire output of schools for its training schemes. The young people on youth training courses are likely to be taken into employment with indentures, and increased earnings during apprenticeship are linked with satisfactory progress at six-monthly intervals.
I appeal to the Minister. If he has anything worthwhile to say tonight then, for goodness sake, will he say something about the CITB? The Government keep poking their nose into this subject and reforming it. The CITB was reconstituted following a major review of the remaining ITBs during 1989. Industry pressure for the retention of the statutory level was the principal reason for the construction industry being the only industry to retain its ITB as a statutory body.
I am asked to say that the CITB welcomes the fact that the new board is employer-led, which enables it to work more closely with the employers' federations. But the government department responsible for the CITB is now that part of the Employment Department known as the Training Enterprise Education Department—formerly the Training Agency, and before that the Manpower Services Commission.
I understand that that body has been investigated again and again and we now have the situation regarding the CITB that the Government of the day have agreed only to prolong its existence for a further three years. After three years it will be reinvestigated —and that means 1992. However, the industry is convinced that construction will need a statutory levy in future to support its training. This can be operated only through a statutory ITB, and its training requires stability and long-term investment to be effective.
Now that a new employer-led board has been created, the Government should show their confidence in the industry's employers by ensuring the long-term future of the CITB. Is that too much to ask? We are asking the Government to say they have great confidence in the CITB and that its future is assured. If the Minister does not do that, let me tell him that the employers who are there now will say, "You do it, brother: somebody else work it out". That is rather sad because that training—and here I am back to my original point—is at the heart of all that my noble friend has been talking about: the whole question of whether or not health and safety can be part of the workforce.
The construction industry—I speak here without any vested interest—is worth supporting. We must remember it is a barometer of this nation: if it is doing well as an industry, the nation is doing well but if it is not, the nation is doing badly. That is a fact of life. I know very well—and of course I shall put this on the record straight away—that the first priority for Britain today is to beat the wretched man called Saddam Hussein. That takes precedence over everything—over everything I have said and uttered today. But the great thing about our democracy is that we can talk about
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other matters while we are in the middle of a crisis. I am very much aware of the time I have taken and all I can say is that I beg this Government now to make certain that they look after the CITB and give it the assurances it wants to enable it to continue its job of work.
6.33 p.m.
Baroness Nicol: My Lords, may I first welcome the noble Earl, Lord Strathmore and Kinghorne, to his new and, I think, rather difficult brief. I wish him success but since I am in Opposition not too much success.
The aims of the Health and Safety Commission and the Executive, formulated as a result of the 1974 Health and Safety at Work etc. Act, have never seriously been challenged, as we have heard from other speakers, and today they enjoy widespread acceptance and support. Public awareness of the HSE's role is reflected in the increased number of complaints which are received. In the 1989–90 report, to which my noble friend Lady Turner referred in her excellent introduction, the director general reports an increase of 50 per cent. over the two years to 1990 and an impressive 130,000 telephone inquiries per annum.
It is disturbing to learn from that same director general's report that in the London area responses now have to be restricted to cases which on the basis of verbal complaint are judged to be strongly based. Many complaints by members of the public are not investigated at all. As the chairman points out in the same report, 10 years ago the Health and Safety Executive was bigger than it is now and yet it had fewer responsibilities.
No one objects to a requirement on public bodies to make efficient use of resources, but these items in the report would seem to indicate that the resources now available are not sufficient for the task to be done properly. Surely the investigation of complaints is the first requirement for such a body. The maintenance of public confidence demands that this should be so, and the fact that it is not so must cast doubt on some of the statistics in the report. If not all the complaints are investigated, not all legitimate complaints are recorded.
The chairman's remark about increased responsibilities brings me to one of the two areas I am concerned about today. One is the problem of GMOs —I am sorry, I have forgotten the actual words and I am using the acronym, but they are genetically engineered organisms which are released into the environment. During the passage of the Environmental Protection Bill (which is now an Act) questions were raised on the control and monitoring of GMOs. It emerged from government replies at that time that this work would be undertaken by the Health and Safety Executive, although the Minister said that at that time its inspectors lacked the appropriate environmental expertise.
The noble Earl, Lord Arran, concluded that HSE inspectors, subject to additional recruitment and

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training, would be well placed to gain the necessary additional expertise. He said (at Col. 2002 of Hansard) on 2nd July 1990:
"All things considered, the most sensible and efficient arrangement therefore seems likely to be one in which HSE acts on behalf of DoE and other departments under an agency agreement".
He continued:
"The Committee will be pleased to know that we already have arrangements for such an agreement well in hand".
Later on the same day, when he was questioned about the level of resources available to implement this part of the Act, the noble Lord, Lord Hesketh, said, (at col. 2003):
"The Government have repeatedly made it clear that resources will be made available to do the work required under the Bill. That applies as much to Part VI as to the rest of the Bill".
Can the Minister say what has happened in regard to Part VI of the Act? Has recruitment been achieved and has training been put in hand? Have adequate resources been made available for all the new HSE requirements under the Environmental Protection Act? A whole raft of new responsibilities was placed on the HSE.
As a vice-president of the Institution of Environmental Health Officers, my second area of concern is that of local authority environmental health officers. Local authority environmental health officers have had a considerable input into the enforcement of health and safety at work in particular sectors as defined by the Health and Safety Enforcement Allocation Regulations. I shall mention just a few of them: retail/wholesale, exhibitions, office activities, catering services, residential accommodation—there is a list of 13 areas in which environmental health officers take on the role of the Health and Safety Executive inspectors.
The split of enforcement between the local authorities and the HSE seems to work surprisingly well. There is good local and national liaison between the HSE, the local authorities and the Institution of Environmental Health Officers. The local authority unit of the HSE is led by an EHO, and others work for the HSE on secondment. In addition, when appropriate the HSE staff will provide background knowledge for EHOs, for example, if there has been an accident involving an unusual piece of equipment. So altogether it works well.
However, in 1990 the local authorities took over responsibility for additional premises which were transferred to them from the HSE. These premises were low risk in relation to the HSE's work but compared with others in the local authorities' priority system they were often high risk. The effect of this was that often premises previously allocated to the local authority became less of a priority and therefore might be visited less frequently. We are back again to the question of resources. The increase in the number of premises coupled with the shortage of EHOs, which I understand is about 400 nationally—quite a significant number—is likely to have resulted in the work of the EHOs becoming more reactive. They can react
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only to complaints and often have no spare capacity to undertake visits and inspections to prevent accidents and improve safety.
Other noble Lords have mentioned EC directives which put extra burdens on the HSE. Indeed, eight are in transition at present. That will increase the burden on HSE inspectors and EHOs; for example—again I shall not read out the whole list—there is an EC proposal on VDUs (visual display units) and on part-time and temporary employees, personal protection equipment and so on.
The European directives do not comment upon who should enforce the legislation. Obviously for employees local contact with the enforcers is important and environmental health officers can undertake health and safety inspections in conjunction with other work, thus making them cost-effective. However, whoever undertakes the work, extra resources will be needed. Neither local authorities nor the HSE will be able to absorb them without support.
Finally, there is anxiety as regards home working. Currently factory type activities must be registered but office type work need not be. The use of VDUs in home working is becoming commonplace.
To sum up, the need for an efficient, comprehensive health and safety monitoring service is as great now as it was in 1974 when the Act became law. It is essential that we should continue to build on our existing system so that it can meet the new challenges of the next century and our much more complicated working environment.
6.42 p.m.
Lord O'Hagan: My Lords, I do not wish to lower the tone of what until now has been an excellent debate nor to spoil the Minister's first venture into these difficult areas. I wish him well, as I am sure do other noble Lords.
Much of what I wanted to say has already been said better by other noble Lords, particularly the noble Lord, Lord Rochester. He inadvertently stole the quotation which I had prepared from the Health and Safety Commission's latest report. In what remains of my speech, most of which has been confined to the mental wastepaper basket, I wish solely to concentrate on the European Community aspect by contributing, as it were, a postcard from Brussels to your Lordships' debate because I sit on the European parliamentary committee which deals with those matters.
The first point which I should like to report to the House is that the Health and Safety Commission and Executive are held in the highest regard by the institutions of the European Community. Not only do they have a comprehensive knowledge of how those institutions function but they have succeeded in conveying their views with a remarkably effective record of penetration. That should be noted and I hope that the Government will be aware of that when in the future policy making is required upon those complicated matters.
As the Commission itself notes, the whole centre of gravity in these very difficult issues—the interface between people and capitalism—is now moving faster

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and faster across the Channel. If we are to discuss those issues with any degree of first-hand authority, we must observe what is happening there rather than waiting until later on and then complaining about what is alleged to have been imposed upon us. People there would be willing to listen to us if we were to go there early. Indeed, Sub-Committee C here makes informed comments in detail at the appropriate time on these issues.
Other noble Lords have touched upon a number of proposals. I shall not dwell on any of them in detail except one by way of illustration. There has been a directive on exposure to asbestos which is a peculiarly cruel form of hazard to those who work in premises affected by it. The first irony to note is that the European Commission building in Brussels is riddled with the worst form of asbestos and is being evacuated. Therefore, the Commission is not complying with legislation on that topic which is already on the European statute book.
The second irony is that the country—and I shall not name it—which held the chair of the Council of Ministers when the modern consolidated legislation on this topic was being dealt with had neither enforced nor implemented the first piece of legislation which was passed some few years ago. Therefore, when examining what is suggested by the European Commission it is very important that at the same time, particularly in this country, we take a good look at what is being done to put into practice that which is already agreed. We should be prepared to give additional facilities, powers and bodies—people—to the Commission to make sure that European Community legislation is properly enforced throughout the European Community. Otherwise, as a nation we are Penalised because we enforce it and others do not. That is of particular relevance in this field. It is easy to make symbolic gestures on health and safety if you know that you are not going to enforce the legislation on your own people.
There has been much discussion about Piper Alpha and the subsequent report. The Commission is preparing legislation in this sphere—Community proposals on offshore installations—which is likely to be published shortly. I very much hope that steps will be taken to convey the remarks made in this debate to those drafting the legislation and that those in your Lordships' House more expert than I will make representations because the safety culture which is now developing as a counterpart to 1992 will not merely be British but will be European. We must endeavour to ensure that our best practices become part of what the Commission is putting forward on behalf of the entire Community.
I raise the subject of the Health and Safety Agency. I do not wish to ask my noble friend difficult questions on this occasion. However, it would be of great financial benefit to our country and the people in it if there was an inspectorate of inspectors and, on the lines of the inspectorate in the competition field, a European Community institution which had the right to see whether European Community law was being implemented on the ground, in the workplace, in the
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factory and on the farm. I believe that that would be very much in the British national interest and would add a great deal to the credibility of the European Community as an institution. I hope that the rather —and I am trying to be kind—tentative proposals put forward by my noble friends in this field and by their counterparts in another place will be greatly reinforced so that there is a proper enforcement of European Community legislation on a fair basis right across the Community, particularly in this sphere. I support all remarks made by my noble friend Lord Campbell of Alloway in that regard.
This country has a very high reputation on the Continent for the work done by governments of different parties and by different parts of our industry and trade unions in this field. That cannot be said about everything we do but it is quite true on this subject. We need not boast about it every day or run across to Brussels with a big flag saying, "We are the leaders in health and safety and nothing we do is wrong", because, of course, we can learn from others.
However, there is a great deal of respect for the relatively silent work which has been done by us. We should build on that because, if we use the evidence of efforts undertaken in this country, it will be much easier for us to amend and alter in a way which others will find acceptable those proposals which have yet to be put forward or which are already announced and published. For example, I received a letter from a distinguished doctor saying that certain parts of the proposal aiming to protect women in certain occupations may have an unnecessarily adverse impact on women's employment for various technical reasons with which I shall not weary your Lordships now. That may be a solid and valid point. However, if there is too great a tendency to treat the Commission in Brussels as though it were a Labour government in exile, then our points are unlikely to be accepted on their full merits. On that ecumenical note, I shall conclude.
6.50 p.m.
Baroness Phillips: My Lords, I am sorry that my noble friend Lady Turner had to wait so long to bring her excellent debate before your Lordships. However, I was delighted to hear her usual succinct and telling introduction.
I am reminded of the occasion when the Health and Safety at Work etc. Act was introduced by the noble Lord, Lord Crook. To my knowledge he had worked towards it for around 10 years. It is always exciting to see the fruition of one's labours. Prior to that, as many noble Lords will be aware, the legislation was very perfunctory; some dealt with railways, some with shops and some with factories. This Act was a consolidation of legislation which contained something good for every worker.
In Great Britain we are not very good at prevention. The accident never happens to us; it always happens to the other person. I like the philosophy of the TUC of establishing a safety culture; it is something we should cultivate.

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When I was a Lord Lieutenant and had to greet Princess Beatrice on the pier at Westminster one dear old waterman informed me that the pier was 100 years old, totally rotten and was suddenly about to sink into the river. I expressed the hope that it would not sink on that day. It was a cold November day and even to go down with the Queen would not have been exciting enough for me.
I mentioned the fact to a number of people, who thought it was some kind of joke. However, the more I thought about it the more I realised that all the piers along the Thames are old. One day, as with the "Marchioness", there would be a terrible disaster. That would be followed by the usual inquiry. I commend that point to the Government. I do not ask them to do too much, but they might like to consider it.
The noble Lord, Lord Mellish, spoke of the construction industry. He is quite right; the group he has worked so hard for is the best—but it also comprises a lot of the worst. I had an office in Buckingham Street and watched a beautiful Georgian house opposite being pulled down by a bunch of very cheerful Irish labourers. They were shipped in every Monday from Liverpool—they were obviously cheaper to employ than London workers—and shipped out every Friday. Where they stayed or what they did in between I do not know.
I cannot bear to see people not protecting themselves, and every morning I used to give them a speech as I entered my office. They did not wear any kind of safety harness. I pointed that out to them. I used an old teacher's trick and picked on one. I said, "You look to be around 23 years old to me"—in retrospect all men look 23 to me—"If you fall and break your back you will never work again; what is more, you will not receive a penny compensation". I gave them so many lectures I gather I was christened, "Our Lady". I do not think that phrase was used in an apostolic sense.
That was a clear example of lack of safety protection at work, but no one ever came to inspect the site. I contacted Westminster Council. A very energetic lady was sent along; she made so many recommendations that the next time anyone was asked to visit the site they sent a man—she had been promoted.
Many things must be done to put this wonderful Act into practice. Regular inspections of the workplace must be made. I ask noble Lords to inquire how many inspectors there are in their own boroughs. If an inspector attempted to visit every place of business and employment in the course of his career he probably would not make it; there are so few inspectors. We leave the inspections until there are complaints from the workers. That is not how the Act is meant to work.
Workers must be trained. I cannot stress too strongly how thrilled I was to see that recommendation high on the list of TUC priorities. People must be trained. I visited steelworks and watched men lifting enormous pieces of steel and pushing them into furnaces—that is going back a long way. I have
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watched people in the nuclear industry. I have watched many people doing jobs that I would not have the courage, expertise or any other reason to want to do.
Happily many conditions in industry have improved, but in its train there are other hazards. My noble friend Lady Nicol mentioned some of those hazards. We forget that technologically we have very advanced industries. However, that brings extra hazards which were unknown 30 years ago. Those hazards include the modern office; that dreadful edifice. We see ghastly buildings springing up everywhere. I believe a certain gentleman who was the architect of one office building may be joining your Lordships' House. It is a pity he is not present this evening. Perhaps I could speak to him on this point.
The buildings have brown windows—I have visited a lot of them. Hundreds of computers are being used by young women who sit alongside them. I asked about the hazard to their eyes, their ears and their brain. They said that it was quite all right. Is it? Nobody knows enough about the matter. The technology has not been in being long enough. I believe a hazard exists. Indeed, the sick building syndrome is being examined at the moment.
I have the privilege of being the president of the Institute of Safety and Public Protection. That splendid name encompasses a splendid bunch of people. They are professionals mainly from the boroughs who carry out the difficult task of ensuring public safety. They meet professionally because they want to improve their own skills and knowledge for the best reason of all; the same reason as people join trade unions. Their aims and objects are to provide a body of knowledge with expertise in all relevant aspects of safety and public protection.
I shall give your Lordships a quick run-down to illustrate the requirements needed to be a member. They must be engaged in industrial, commercial, administrative and retail enterprise—just for starters. They must also be familiar with licensing relating to entertainment, safety of sportsgrounds, home safety —many hazards to workers exist in the home—animal welfare and health and emergency planning. Yet there are not enough of them. We constantly introduce Acts of Parliament but never insist that the requisite number of enforcement officers are appointed.
I could say a great deal more but time is limited. I mentioned to my friend that females usually keep to the allotted time; I must therefore ensure that I do not break my own rule.
This is an important debate. I was saddened that more people were not present on the Government Benches. When we discuss money, farm animals or hunting the House is full. If we speak of people, people's accidents and deaths, it is not so full. There should be no deaths in the course of building motorways. It used to be said that every ton of coal carried the blood of a miner. We do not want that to be said of our modern industry. We must strengthen the working of the Act both by better training and by employing more inspectors.
6.58 p.m.
Lord Ardwick: My Lords, I attempted to persuade some of my noble friends to speak in the debate today using the experience they have gained in the industry in which they had worked for some years. I was quite unsuccessful. That is the reason I find myself, to my surprise, taking part in the debate.
Two years ago this House debated a report from the European committee on the effect of visual display units on the health of those who operate them. At that time I was surprised to find that practitioners of my vocation of journalism were among those affected. In my day those of us who had sold their heart to the old black art, as we put it, were immune from professional stress, we exclude the perils of excessive hospitality which we cheerfully faced. We wrote our copy and headlines with very thick black pencils. However, the younger ones learned to work a manual typewriter with two stabbing fingers. Progress was on the way. All that has gone.
Everything today is done by computer. The joking cry has not been heard during the past few days of these terrible events as they design the big black type. The joking cry, "Boy, send for the type that we used for Queen Victoria's funeral", has not been heard. There are no boys in Fleet Street any more. We got rid of that type long ago.
We live in a different age which has made the composition of newspapers simpler and cheaper, but it seems it is more dangerous. It is not only journalists and particularly sub-editors who are affected. Hundreds of thousands of office workers are now operating or working alongside visual display units. The alleged effect on such workers caused the European Commission to produce a framework directive setting general measures to improve the safety and health of workers in the workplace. They included a handful of directives. Our Select Committee considered that the directive concerning visual display units—VDUs as they are commonly known—warranted closer investigation.
The committee studied the problem carefully, as it always does study the problems put to it, but, alas, it turned the proposal down. It was thought that it was not sufficiently established that the health risks were heavy enough to cause concern or that such risks could not be met by good office management. In some respects the scientific evidence was inconclusive. The committee recommended that employers and trade unions should make every effort to educate those people required to work with VDUs.
It was an unusual, tentative report from the distinguished committee. There were not the hard, clear conclusions that one expects from it. It said that there was probably less risk of stress if the operator could control his workload. The committee did not believe that there was justification for establishing a formal system of breaks from VDU work. One could not escape the cynical feeling that the committee came to the nub of the matter when it said that only if the scientific case was strong was it possible to impose substantial costs on industry. In the present good
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office management and good explanation were the answers to the problems. That meant that bad office management was left to carry on.
However, the committee hoped that acceptable proposals would be made by the International Standards Association and the Comité Européen de Normalisations. It hoped that the last body, the CEN as it is conveniently known, had an acceptable approach because it preferred a code of practice to regulations. In the debate on the committee report my noble friend Lady Turner regretted its decision. She brought her special and profound union experience to the discussion. She told us that there are five main categories of possible hazard associated with VDUs. There are five main categories of possible injury and hazard. These are RSI—that is to say, repetitive strain injuries—musculo-skeletal strain, stress, skin rashes, eye disorders and possible reproductive hazards.
The committee accepted that most problems can be solved by good office management—and so they can, but, alas, good office management is not universal. There are still many unredeemed Scrooges in the commercial world. I hesitated whether to speak today because the situation now looks more promising than it did two years ago. Since our debate the EC has wisely re-examined the proposals for a Council directive on minimum requirements for work with display screen equipment. Since then the possible ill-effects of the exposure have been explored in Canada with worrying results about radiation.
Last month in another place a Question was put to the Secretary of State for Employment asking him what legislation he intended to bring forward to enable the United Kingdom to meet the requirements of the EC directive on the minimum safety and health requirements for work with display screen units. The Minister answered that the Health and Safety Commission is now currently discussing with the CBI and the TUC the most appropriate way to implement the directive. I do not know whether the Minister who is to answer in this debate has any information to give us about those discussions. It may be that these are early days since the legislation which the Community demands need not be completed until the end of next year. A directive is perhaps less draconian than its name would suggest. I hope that when we come to legislation it will be sufficiently tough and contain enforcement measures.
7.7 p.m.
Lord Dean of Beswick: My Lords, I rise to speak about the safety conditions and records in the building industry and the Cullen Report on the Piper Alpha disaster. The building industry featured heavily in the speeches made earlier by other noble Lords. I listened with interest to the powerful speech made by the noble Lord, Lord Mellish, because of his background with the major trade union involved in the building industry and also because of his loose association with the industry in a political sense. He referred in his speech to the Construction Industry Training Board.
It is as well to put the record straight. The CITB was on its way out. The Government had put their red

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pencil through it. What finally convinced the Government to continue with the training board was the pressure applied by the big builders themselves through the Building Employers Confederation, other associations and trade unions. It is no accident that the president, Sir Clifford Chetwood, was made the chairman. A great deal of credit must go to him for the fact that the training board was retained. I say no more about that.
Unfortunately I was not here to listen to previous speakers. I expect that they made the point that the building industry now has the worst accident record of all industries. It is important to look at the enormity of what is happening in that industry with accidents. On average there is a fatal accident each week. There are about 150 deaths a year. If that figure is multiplied over a decade, just over 1,500 people have been killed in the building industry. That is carnage by any standard. It is the equivalent of five major pit disasters.
Lord Mellish: My Lords, I do not dispute the noble Lord's figures. However, does he understand the need for training in order to make sure that safety is understood?
Lord Dean of Beswick: My Lords, I was going to make that point. Accidents which took place last year and which were reported to the Health and Safety Executive totalled 21,000. That is a substantial increase. In addition, a substantial number of accidents are never reported. One reason suggested for the substantial increase is the financial position of the industry. Competition for work is so tight that the first casualty is safety conditions. I do not know how the problem can be solved but it is a fact of life that this is happening.
At a TUC sponsored conference a few weeks ago more than a little evidence was given of victimisation on some sites. People who were rigorous in their defence of safety measures were given short shrift by their employers when they found it possible to do so. I take the point made by the noble Lord, Lord Mellish, that one of the best ways to prevent accidents is to make sure that every operative is aware of the dangers and fully trained in avoiding them. But one fact comes across quite clearly: most accidents are due to operator negligence, and many of them could be avoided if a more rigorous education system existed.
I hope that the Government will reconsider their reluctance to involve trade unions at almost every level, although I know that the trade unions are represented on the training boards. The key to safety lies mostly on the sites. The lads on the site, and not full-time trade union officials, should be the guardians of safety. I hope that the Government will give that greater priority than they have in the past.
In the final part of my speech I should like to deal with the Cullen Report. I am an engineer and a member of the AEU, which lost a good many members in the Piper Alpha disaster. The Cullen Report on this terrible tragedy contains serious criticism of the oil company and of the Department of
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Energy's safety activities. In the view of those representing the employees, the report vindicated the stance taken by the trade unions over a number of years in respect of health and safety in the North Sea. The series of massive explosions which destroyed the Piper Alpha oil platform on 6th July 1988 caused the loss of 167 lives—the highest death toll in any industrial accident in living memory. There was a mining tragedy in Wales in the early 1930s but the Piper Alpha tragedy was by far the greatest industrial disaster this nation has experienced. We have a duty to ensure that nothing like it ever happens again.
The unions have stressed time and again that where they are prevented from functioning normally, health and safety is one of the casualties and is not given the priority it deserves. There must be a counterbalance to the employers' motivation to maximise production so as to achieve maximum profit—which sometimes leads the most honest of men or women to cut corners and to say "Oh, it will be all right", when very often the reverse is the case. It is blatantly obvious that a very rare, occasional visit from an overworked inspector from the Department of Energy, which equally wishes to maximise production, will in no way provide such a counterbalance, especially when we remember that the inspectors have to rely on the operators to provide them with transport. Even these rare visits are telegraphed to the companies well in advance and a surprise inspection to catch someone doing something unauthorised or dangerous goes by the board.
Too many people in government have allowed a dogmatic dislike of trade unions to blind them to the obvious fact that the dangerous bucket shops, the frighteningly unsafe sweat shops the world over, are places where trade unions are, in one way or another, prevented from functioning. We dealt some time ago with the conditions of machinists in sweat shops. The Government would not listen.
There is a clear correlation between the prevention of trade unionism and poor safety records. The reason is quite simple. Only an employee with the strength of a trade union behind him or her will feel safe to challenge the employer and insist that unsafe working conditions are corrected. The fact that these comments apply to the offshore industry is proven in many ways. One is that the noble Lord, Lord Cullen, found it necessary in his report to recommend protection for safety representatives against victimisation. The noble Lord must have been convinced that such practices were taking place. The slightest hint that such protection is needed clearly illustrates the 19th century attitudes of some employers in that highly dangerous industry. If that seems harsh I ask the House to consider the chronic safety record in the North Sea, with fires, explosions, deaths and disasters. What kind of employer would want to take even the slightest chance that this could occur?
Another indicator is to compare the better safety record in the Norwegian sector of the North Sea with the British one and keep in mind the fact that the same companies operate in both sectors. Where the company involved is the same, the poorer British safety record must be due to other factors. The two

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main differences are that trade union involvement is bitterly opposed in the British sector—I know that from my own inquiries—while it is encouraged by the Government in the Norwegian sector; and the Norwegians have an independent regulatory body which oversees health and safety. When making a Statement in another place the Secretary of State, Mr. Wakeham, indicated that the Government had accepted the Cullen Report and would make certain recommendations in the future. Over two months have already elapsed and no changes have taken place. My union tells me that there is still the practice that if someone is keen on safety he may be given only a fortnight's contract. The company can get rid of him in that way.
I asked a question of the Minister a few weeks ago. I was very disappointed by his answer. I put that question because I believe that the key to the safety issue lies in the appointment of safety committees. The Cullen Report recommends that responsibility for safety should be taken away from the Department of Energy and given to the Health and Safety Executive. The report also recommends that representation on the safety committees should be divided between employers, the inspectorate and the trade unions. I urge the Government to follow that recommendation with the utmost zeal and introduce it as quickly as possible. On the trade union representation there should be a preference for men on the site who work in the industry. When appointed, those people should have full rights not only to debate and to make suggestions but to vote. They should have equal rights with the employer for whom they work. No one is yet convinced that there is a safety drive in the North Sea.
One death in the oil industry in the North Sea is like the death of a miner; it is one too many. As a nation we have a duty to try to eliminate the possibility of such deaths to the best and maximum of our ability. If the Minister does not have the time to reply to me on this issue tonight, I hope that he will take on board what I have said and draw the matter to the attention of the appropriate Ministers in the Cabinet so that they can deal with it.
7.20 p.m.
Lord Meston: My Lords, I am sure that we were all pleased to hear that the noble Baroness, Lady Phillips, thinks that all men look about 23 years old. That confirms the view that when she was advocating the replacement of old piers she was really talking about the River Thames and not Members of this House.
In calling attention to the case for further steps to improve health and safety, the noble Baroness, Lady Turner, reminded us that this would never be an area for complacency. I especially welcomed her emphasis on the construction industry and on the problems created by smaller firms. The debate makes one realise the sheer size of the topic, covering as it does everything from AIDS to asbestos. It reminds us of the truism that illness and accidents account for far more lost working days than strikes ever have or indeed ever will.
In this country we are fortunate in having a reasonably modern framework of legislation. The
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Robens Report concluded that there was too much law. The resulting Health and Safety at Work etc. Act 1974 was therefore largely an enabling Act. The general duties imposed upon employers by Section 2 of that Act are not absolute duties, nor are they duties to do what is required so far as is practicable. Employers have the less onerous duty to do what is required,
"so far as is reasonably practicable".
That phrase appears six times in Section 2. However, the prevalence of the phrase must not be allowed to blur the impact of stricter duties when they are stipulated in regulations, nor to weaken the effect of guidance notes and codes of practice issued by the Health and Safety Executive. All such material should be scrutinised to ensure that the blurring is not happening.
The norm upon which the Robens Report was based was the directly employed and unionised workforce. Since that time, there have been changing trends in employment relationships and in the traditional workplace which require a review of how safety systems and policies should adapt. Homeworkers have already been mentioned. There are also seconded workers, temporary and part-time workers and job sharers. These are all people who can be especially vulnerable.
There are two particular problems in respect of these workers. The first is the availability of remedies for breach of common law duties which depend upon the existence of a traditional contract of employment. The so-called "marginal" workers do not fit easily into the traditional model and the self-employed do not fit in at all. I am sure that it is not only lazy lawyers like myself who groan when having to advise on a typical accident to an ostensibly self-employed construction worker who has fallen from some faulty scaffolding. One has to unscramble the inter-relationships and duties of the main contractor, a chain of subcontractors and the independent contractor. It is salutary to read at page 60 of the 1989–90 report of the Health and Safety Commission of the increase in self-employment in the construction industry and also of the increase in accidents in respect of such people. That topic has already been covered in the debate and it is one that cannot be emphasised too strongly.
Questions of compensation, indemnity and insurance which arise in such situations should not, I suggest, depend upon artificial legal labelling as to whether someone is employed or self-employed. Any changes in that direction will be consistent with the main scheme of the 1974 Act, which extends benefit of some duties to the so-called "self-employed".
The second problem in the development of a so-called flexible firm or marginal workforce is enforcement. Different hazards in different settings are less easy to identify, evaluate and control. It is essential that employers are educated into identifying hazards, that they develop procedures to protect their non-core workers and that they do not see such workers as somehow being second class employees who are not entitled to insurance and indemnity.

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Enforcement also depends upon manpower. The increase in legislation and the increasing encouragement of the proliferation of small businesses must put a greater burden on the inspectorate. That point has already been mentioned. An inspector's exercise of his discretion to prosecute or to persuade should not be governed by manpower commitments and limitations. I ask whether the Government are satisfied with present staffing levels and present staff retention.
I must also express my concern that the transfer of responsibilities from the Health and Safety Inspectorate to local authority inspectors should not become a short-term expedient to cope with the pressures on the former. The noble Baroness, Lady Nicol, expressed the view that the present division of responsibility between the Health and Safety Inspectorate and local authority inspectors works well. I hope that she is right. I say that because the division of functions between the two can, especially when pressures mount, create the potential for silly demarcations schemes as to who is responsible for what. I have some experience of that in relation to the responsibility for inspecting an office when an office happened to be apparently within a factory. I defy anyone to unscramble the provisions of Section 85 of the Offices, Shops and Railway Premises Act 1963 and Section 175 of the Factories Act.
The growing number of small firms, the reduction in unionisation and the financial pressures on all employers increase the need to encourage employers to plan and budget for health and safety. In a recession it is all too tempting to cut back on maintenance of equipment and on the use of safety experts. Small firms must have access to expertise. It is also tempting to rely upon the fear of unemployment in the workforce in order to suppress claims for compensation.
The foreword to the 1983 annual report of the Health and Safety Executive contained a warning of that risk. It stated that,
"in hard times it is training and supervision generally that are the first to go. The raw recruit is set to work almost immediately".
It then related the following story:
"The extent of the fear of the loss of one's job may perhaps be gauged by the parents who offered to pay for damage to a conveyor when their 17-year old son jammed his shovel into it to stop it after his arm became trapped at the tail drum. They offered to waive their claim for compensation if only their son could continue in work".
Where there is no union organisation, it is more, not less, important to have recognised employee elected safety representation. That point was made by my noble friend Lord Rochester. In that context the repeal in 1975 of Section 2(5) of the 1974 Act was a retrograde step. I hope that the Government will now look again at the matter.
As my noble friend pointed out and as the noble Lord, Lord O'Hagan, restrained himself from repeating, the foreword to the 1989–90 report states that the European Community has now to be regarded as the principal engine of health and safety law. One sympathises with the view expressed in the
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memorandum of the Department of Employment dated March 1989 that much of what is coming from Europe is already implicit in our law. That leads us to consider whether, and to what extent, it is necessary to make explicit the requirements coming from Europe, thereby running the risk once again of having too much law. However, the belief that the 1974 Act is a good enough basis for many of the European directives can be no excuse for not responding positively to the massive programme which is under way in Europe.
As a lawyer one is, I suppose, inevitably concerned primarily with the rather negative aspect of health and safety; namely, compensation when things go wrong. I had to struggle for three days to obtain a pitiful sum for an exemplary worker who lost his eye in the service of his employers, who had not provided him with proper protective goggles. It was especially irksome to receive on his behalf —on the basis of full liability —a miserly sum while other public figures were receiving enormous sums from libel juries. I do not apologise for saying that damages, especially for the smaller type of injury, are not high enough.
In an Adjournment Debate in another place last week, it was interesting to read that the Government may be looking again at no-fault compensation. Even if I am wrong about that, it is a topic which needs further consideration, especially now that structured settlements have come into being. I ask that the opportunity be taken for the House to debate that topic once again.
7.32 p.m.
Lord McCarthy: My Lords, I thank my noble friend for putting down the debate today and I should like to join previous speakers in welcoming the Minister to our debate. He is fortunate indeed to be starting with the relatively low-temperature subject of health and safety rather than with our annual bun fight over the birth of yet another of the sons of Frankenstein. We believe that we may be saved another son of Frankenstein in the immediate future, and so we can concentrate on the far more important issues involved in tonight's debate.
We have so far had 10 speakers in the debate. It seems to me that they have all testified to the case for the Motion put down by my noble friend. There have been three themes in the debate: that there are signs of deterioration in the position on health and safety after 20 years or so of advance; that there are serious limitations in the institutions for dealing with health and safety after their reconstruction in 1974; and that there are a considerable number of practical, modest proposals, many of which have been put forward by previous speakers, for improving our health and safety record.
For the deterioration I would advance—much of this is merely a summary of what others have said —four pieces of evidence. First, there were all the statistics quoted by the noble Lord, Lord Mellish, and my noble friends Lord Dean of Beswick and Lady Turner: the fact that the accident rates, after improving significantly in the 1960s and rather more

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significantly in the 1970s, suddenly became stuck in the 1980s—they showed only slight improvement throughout the 1980s—and have not improved at all since the mid-1980s.
Everything that we know about the industrial mix in this country—the decline of the smoke-stack industries; the decline of iron, steel and coal and so on —would make us expect to see a decline rather than a stagnation in accident rates. No one can seriously doubt—I do not expect the Government to admit it tonight—that some of the major reasons for the decline in the rate of improvement have been the pressures of increased competition, the pressures of the recession and the many cuts the Government have made in the various provisions for social services, and health and safety, and, in particular, cuts in the Health and Safety Commission's budget. We have the figures and they give us good reason to feel worried.
There has also been an increasing number of major accidents which seem to us to be rather worse and rather more extensive than accidents in the past, occurring in industries and occupations which we had been brought up to believe were relatively safe; for example, British Rail and the London Underground. Thirdly, there have been new threats at work and new fears of danger or violence at work; for example, among librarians, in schools, on buses, and in places where we believed that violence was not normally seen. Finally, and this has been mentioned by several speakers, there are the consequences of 1992.
In his report, the noble Lord, Lord Cockfield, made it clear that a substantial majority of the existing non-tariff barriers in Europe were defended by arguments relating to health and safety. They are all supposed to go. That of course is why the Health and Safety Commission is being inundated with one draft directive after another from the European Commission. One of the most remarkable figures I have seen in a public document for a long time is contained in this year's Health and Safety Commission's annual report in which the commission says that there has been a 60 per cent. increase in the number of meetings in Brussels or overseas. If that rate of increase continues, it will be no wonder that we shall see fewer safety inspectors; they will all be in Brussels. I do not say that they should not go to Brussels; I say that that is one of the reasons why we must have a re-think about the resources that we put at the disposal of the Health and Safety Commission.
I pass to the second line of argument that we have had in the debate. It has been put forward most recently and convincingly by the noble Lord, Lord Meston. That second line of argument is that we should look at the policies that we have been following in this country since 1974, which come out of the great —we can say this in retrospect—Robens Report. The noble Lord, Lord Rochester, was wrong. It is even better than he suggested. Lord Robens was appointed by Barbara Castle. He investigated and reported to Maurice Macmillan who introduced the Bill which was passed by Michael Foot. It was a wonderful example of what we had in industrial relations legislation in those days—consensus. It was a fine
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report. As has been said on the other side of the House, it put us in advance of most other countries on health and safety. Even in 1991 most of the points that the Robens Report made are seen to be true: simplification, unification and self-regulation.
We created an excellent agency which we have systematically underfunded ever since. We now know that the Robens Report had a number of post hoc defects that we can now see. It underplayed the role of conflict. As has been said, it failed to advance participation and it left a consistently under-resourced set of institutions because it did not talk about money. One did not talk about money when one produced reports in the 1970s.
The point about conflicts is important. It is true, as my noble friend Lady Phillips said, that there are considerable areas of agreement on health and safety. Everyone wants to get the workers to put on goggles and to wear helmets. Everyone wants to get them to carry through the procedures. The employer is especially keen that they should use all the expensive equipment that he has provided for their use. However, as my noble friend Lord Ardwick said, when it comes to visual display units and whether the workers need to interrupt the flow of their work every 15 minutes in order to have a break, there is a cost involved, and the TUC naturally says one thing and the CBI says another. When it comes to which carcinogenic substances should be included in a schedule against which workers must be protected, the employers will make a short list and the unions will make a long list.
I refer for a moment to Piper Alpha and the amazing list of defects which Lord Cullen listed: the permanent works system; the low standard of fire fighting; inadequate training; the absence of monitoring; and bad management. I do not say that those were the results of the company not spending enough money nor that the company was mean. I say that if the company were ever to carry out half the proposals in the report, it would have to spend a great deal more money than it spends now.
There is a conflict as regards health and safety and therefore we must have legal regulations. As several noble Lords have said, Lord Robens overplayed the self-control, the joint investment, the common interest. There need to be tough measures, some law and some fines. I remind the noble Lord, Lord Rochester, that even ICI was fined £250,000; Tate & Lyle was fined £250,000. The average fine is less than £1,000 and it is much too low.
I turn to the situation of inspectors on which I wish to make a number of points because it concerns practical proposals. I calculate that we now have 554 inspectors in the field force. They visit 175,000 places a year—316 each. I calculate on this year's report that for 16 million workers the inspectors make 316 visits —one per day. That is farcical. It is not true that the numbers have risen. The maximum number of inspectors was 759 in 1980. In 1988 it was 592. This year I read in the annual report that the field force is 554. That is a decline. In the report this year the director-general, John Rimington stated that renewed growth had come after nearly a decade of increasing

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difficulty—in other words, cuts—as the functions laid on them had multiplied while their core of experienced staff had dwindled in numbers. That is the position today and it has not been arrested. John Rimington goes on to say that the major recruitment effort they are having to make consumes large resources—he does not say that the men or women are there, he says that they are being recruited—and it means that they are carrying a burden of experience which is making a reduction in the amount of effective work which inspectors can achieve on average. Thus the position is not yet better. My question to the Government is: when will it get better?
I also agree that we ought to have further integration of the inspectorate. As has been said, the Cullen Report makes that suggestion. I do not suppose that the Government can tell us tonight, but I hope that they will tell us soon that they accept that. I agree also with what was said about local authorities. The local authority inspectorate should be integrated with the rest of the inspectorate because at the moment we are starving local authorities. There has been a 24 per cent. reduction in the past two years in the number of officers with that function. Even if they were the right body to do this, it does not have the money.
I also believe that there should be an integration of the railway inspectorate. There is a widespread feeling, not merely confined to the railway unions but among many people in British Rail, that we need to see the full declared independence of the railway inspectorate. We shall not see that until it is fully integrated and made part of the present inspectorate.
Lastly, what about the cost of all this? Most of the cost of what has been suggested tonight would be borne by bad employers and would come out in fines. The rain would rain upon the unjust and there is nothing wrong in that. The direct cost would be very small; I know that is so because I have asked people in the House and they tell me that it is right. The way I read the annual report of the Health and Safety Commission, the cost is £119 million per year. If we double that, in five years it would only be £200 million per year. If we focus on the field staff and on the people behind the lines, it would not cost us more than £150 million per year. That is £10 million a year to do something about health and safety. It is pitiful; it is extremely small. I hope that the Government will tell us that they can do it.
7.45 p.m.
The Earl of Strathmore and Kinghorne: My Lords, I have listened to the concerns about health and safety at work expressed by noble Lords during this debate, and I can assure the House that this Government are committed to seeing that workplaces enjoy the highest standards of health and safety that are reasonably practicable. Workplace accidents and ill-health can indeed have tragic consequences and are matters which touch us all. I am sure that we are all well aware of the effects of even minor workplace injuries or
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exposures to harmful substances or processes; and many of us have personal experiences that reinforce our concern.
Health and safety is an area where a degree of common ground should, and I believe does, exist between all parties. The 1974 Health and Safety at Work, &c. Act is an outstanding example of that common ground. The legislation was drawn up by a Conservative Government and put onto the statute book by an incoming Labour Government.
The noble Baroness, Lady Turner, and other noble Lords have referred to the unacceptable level of accidents in certain industries. The Government are determined to reduce accident levels, although I should point out that viewed over the long term the trend is encouraging. The latest fatal injury rates are at a level less than a third of that 30 years ago and less than half of that 20 years ago. Within manufacturing industry the rate is also only about half that for 1970. I also point out that the available statistics suggest that fatal injuries in the United Kingdom are among the lowest of all EC member states. There is, however, certainly no room for complacency.
With regard to major accidents, the overall picture is that we seem now to have reached a kind of plateau, but there are variations between industries. For example, reported major injury rates in the construction industry have again risen. In addition, we must not forget that health at work is as important as safety and that many illnesses caused by work-related activity can have long latency periods. The Health and Safety Commission's current best estimates suggest that ill-health caused by work gives rise to at least 2,000 premature deaths each year and contributes to a further 8,000.
The noble Baroness, Lady Turner, referred eloquently to the importance of safety management in industry. Time and again official reports of disasters across the world—Three Mile Island, Challenger, Bhopal and closer to home Zeebrugge, King's Cross, Clapham and Piper Alpha—have drawn attention to failures by management to ensure adequate control of the risks associated with their organisation's activities. Studies by the Health and Safety Executive have shown that the vast majority of fatal accidents and those causing serious injury could have been prevented by management action. Accidents are not inevitable matters of chance but are subject to management control. It should therefore be possible virtually to eliminate them.
The HSE's accident prevention advisory unit has identified certain common features among organisations which are successful in achieving low levels of accidents. These include a conviction that high standards are achievable; a management which adopts a proactive approach and sets realistic and monitored objectives for health and safety for which managers at every level are held accountable; the systematic identification of hazards arising from the organisation's activities; and the devising and maintenance of systems which ensure that the hazards are eliminated or controlled.

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It is worth noting that practitioners of such an approach believe their programmes to be cost-effective, especially within the context of an overall loss control programme. I am sure noble Lords will agree that as we enter the 1990s the pursuit of business excellence demands much more than maximisation of profits and is seen by forward looking companies to embody the total well-being of the individual employee and environment, together with the production of total product quality.
Attention has quite rightly been drawn to the importance of training in improving health and safety at work. The 1974 Health and Safety at Work Act requires employers to provide the training needed to ensure so far as is reasonably practicable the safety and health of employees. Nor is the UK alone in recognising its importance. European Community directives also place on employers the responsibility of providing adequate training in safety and health.
Training is higher than ever before on the nation's agenda and as a topic for boardroom discussion. This results from a growing recognition of its benefits and from what has been described as a revolution in the field of training. The Health and Safety Commission and Executive are determined that this revolution should bring about improvements in health and safety; effective training is one of the most important ways of developing a safety culture and hence a safer and healthier working environment.
The commission and executive have, therefore, been looking recently at policy and practice on health and safety training. The HSE considered in particular the extent to which national standards and syllabi could increase the effectiveness of health and safety training; how national government training bodies, accrediting bodies and training providers could help promote health and safety training; and the requirements of different groups such as employees, managers, health and safety practitioners and young people. As a result a range of measures will be taken over the next few years to raise the profile and increase awareness of the importance of health and safety training. Ultimately, however, the responsibility for ensuring adequate training must rest with the employer.
The noble Baroness, Lady Turner, and the noble Lord, Lord Mellish, referred to the Construction Industry Training Board. The CITB has reviewed its structure and approach over recent years to improve its effectiveness in the future. It maintains a high health and safety profile and seeks to improve standards of health and safety through training packages, advice and courses which plug gaps in the existing training provision.
The noble Baroness, Lady Turner of Camden, referred to Lord Cullen's report on the Piper Alpha disaster. I share the welcome given by the noble Baroness to that excellent report. The Government have accepted the report's recommendations and work is in hand to implement those recommendations as rapidly as is consistent with effective implementation. I hope that that also answers the point that the noble Lord, Lord McCarthy, made.
Lord Mellish: My Lords, the noble Earl made some nice remarks about the CITB, but the review that is now being carried out is causing anxiety. Can the Minister offer the CITB some assurances?
The Earl of Strathmore and Kinghorne: My Lords, I have some further comments to make on the CITB later in my speech. The noble Baroness, Lady Turner, referred to penalties for Channel Tunnel contractors. The Health and Safety Executive has successfully prosecuted contractors three times, and a further four prosecutions are currently in progress. Cases of manslaughter brought against senior management of companies are possible under existing law, but it is often difficult to prove a link in court between senior managers and individual accidents.
The noble Baroness also referred to small businesses. The HSE is concerned about accident rates in small businesses. It has recently produced a report for small firms entitled Safety Pays. That report emphasises the benefits of an effective health and safety policy. A recent HSE initiative in Yorkshire and the North-East targeted small firms' premises resulting in a range of enforcement action and substantial local and national publicity.
The noble Baroness, Lady Turner, also referred to the framework directive. The Government are a party to adopting the directive and proposals for implementation are being developed. There have been increases in provision from the Government, who have met the HSC's public expenditure survey bids in full in recent years. The Government increased gross provision to the commission and the HSE by £9 million in 1989–90 to a total of £118 million; and in 1990–91 by £40 million, including £22 million for nuclear safety research, to a total of £158 million, with an additional £2.5 million being provided in the Winter Supplement. As a result of this the chairman of the Health and Safety Commission, Dr. John Cullen, was able to write to the Secretary of State at the end of last year,
"I am naturally very pleased that the resources the Commission asked for to take forward our programme of work will be forthcoming in 1991/92. The Commission wish to express their thanks to you for the efforts you made to achieve that outcome".
Those are reassuring words indeed.
In common with other government departments, there was a decline in HSC resources in the early 1980s. However, this trend was reversed in 1988–89. The HSC now has 8 per cent. more inspectors than in 1988–1989, and further increases are planned. However, there is a limit to the number of trainees which the HSC can absorb in any year. That is why the increases are gradual.
The noble Baroness, Lady Turner, referred to penalties. I agree with the noble Baroness that one of the problems with prosecution as an enforcement weapon has been the low level of fines imposed by the courts. This gives the wrong impression to defendants and to employers generally about how seriously we regard health and safety offences.
In its annual report for 1989–90, the Health and Safety Executive noted signs that the courts were

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beginning to act severely in cases of serious dereliction of health and safety responsibilities. In 1989–90 provisional figures show an average fine for all courts of £877, a rise of over £300 on the previous year's average. Some exceptional individual fines were also imposed, such as the £250,000 levied against Nobel Explosives in April of last year for the explosion in Peterborough on 29th March 1989.
However, the Government and the Health and Safety Commission and Executive all consider that the average level of fines remains too low. This problem is being tackled on two fronts: by administrative changes to the maximum fine and by HSE inspectors explaining to the courts the seriousness of the health and safety cases they hear. Naturally, if these measures are to be fully effective, magistrates will have to be fully committed to them. Early last year my right honourable friend the Secretary of State for Employment wrote to the chairman of the Magistrates Association expressing his concern about the low level of fines for health and safety offences. At the invitation of the association, he later published an article in the August edition of The Magistrate. This is an encouraging sign and we hope that magistrates will continue to give health and safety the priority it deserves.
My noble friend Lord Campbell of Alloway referred to the Cullen Report. The recommendations in that report on the Piper Alpha disaster were accepted by my right honourable friend the Secretary of State for Energy. The Health and Safety Commission was asked to take on responsibility for regulating offshore oil and gas safety. It is intended that the transfer of functions from the Department of Energy to the commission will take place in the spring and arrangements are well in hand. Until then the Department of Energy and the Department of Transport will retain responsibility for offshore safety functions.
HSC's priority will be to make a rapid and effective start on implementing Lord Cullen's recommendations for a new safety regime. This will be a major task. The Government are committed to seeing that this is done promptly, comprehensively and effectively.
The noble Lords, Lord Campbell of Alloway and Lord Rochester, again referred to the Piper Alpha tragedy. Lord Cullen recognised the benefits which trade union involvement in health and safety can bring. Indeed the primary responsibility for health and safety offshore must lie with the operators and their employees who work in the North Sea. Lord Cullen concluded that it would be inappropriate to change the offshore regulations for safety representatives. These regulations will nevertheless be reviewed this year after two years of operation.
The noble Lords, Lord Campbell of Alloway and Lord Rochester, referred to technological change and Europe. Technological developments expected in the 1990s will have a significant potential to benefit but also, unfortunately, to threaten health and safety. One illustration is the continuing rapid growth in the
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application of computers to the design, operation and maintenance of plants. which presents positive opportunities for removing people from risky locations, strengthening control and reducing human error. It also shifts the onus for decisions from plant operators to designers, reducing the scope for human intervention in a crisis or unforeseen circumstances. In other areas, such as the growing use of biotechnology, we are constantly being presented with new challenges and new potential hazards which must be fully assessed and controlled.
As noble Lords have said, this is a European phenomenon. The Government are committed to furthering health and safety on a Europe-wide basis and ensuring that our own high standards are not only maintained but shared by other member states. That will not only reduce the toll of human suffering but will also reduce the scope for competitive distortions which disadvantage our industry.
The noble Lord, Lord Rochester, referred to European Community developments. It is European Community initiatives which have had by far the greatest impact on our domestic legislative programme on health and safety. It is therefore fortunate that the high esteem in which the Health and Safety Executive is held throughout Europe allows the United Kingdom to play a highly influential role in those developments.
I now return to the point raised by the noble Lord, Lord Mellish, regarding construction. As I have said, training is a key element in managing a safety culture and I know that the Health and Safety Commission shares that view. The noble Lord is right to draw attention to the importance of health and safety training in the construction industry. The construction industry is a key area of concern and health and safety remain a major problem. The industry has invested much time and money in trying to improve its health and safety performance. Some larger companies in particular are behaving in a highly responsible manner. It is also heartening to know that our fatal accident rate is better than those of many other European countries. However, all fatalities represent a personal tragedy and there is no scope for complacency. The Government and the HSC regard the fact that there are still about three deaths each week in the industry as totally unacceptable. Improvements in safety standards must be achieved.
Prime responsibility for bringing about improvements rests with the industry itself. However, as part of the continuing process of promoting long-lasting improvements in standards the HSC has proposed new legislation to strengthen the management of health and safety on construction sites. That is now being developed in parallel with a recently proposed European directive which also addresses the organisation and control of safety on site.
The noble Baroness, Lady Nicol, referred to the investigation of complaints. Public concern over health and safety issues has grown rapidly in recent years. The noble Baroness referred to the increasing volume of complaints received by the HSE. Noble Lords will realise that those complaints will vary in

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their seriousness and the HSE must judge what action to take, according to which cases are likely to be strongly based. All fatal accidents are investigated. However, noble Lords may be assured that HSE's inspectors will pursue complaints and take enforcement action to the highest levels in companies not measuring up to the standards expected of them.
The noble Baroness also drew attention to the health and safety of home workers. I remind your Lordships that the Health and Safety at Work etc. Act applies to all employers and employees alike. Enforcement action has been taken in respect of home workers at risk.
My noble friend Lord O'Hagan mentioned the subject of European Community initiatives, which have had by far the biggest impact on our domestic legislative programme on health and safety. It is therefore fortunate that the high esteem in which the Health and Safety Executive is held throughout Europe allows the United Kingdom to play a highly influential role in those developments. The Government are pressing for European directives to be properly implemented throughout Europe.
The noble Lord, Lord Ardwick, mentioned the subject of VDUs. I shall touch briefly on that issue. As noble Lords have indicated, an EC directive on the use of VDUs was adopted last year. Work has now begun to determine how that directive can best be implemented in the United Kingdom. The Health and Safety Commission will issue a consultative document later this year.
The noble Baroness, Lady Nicol, also referred to genetically modified organisms. HSE inspectors receive a high standard of training and already include experts in the appropriate areas. They comprise the widest group of expert professionals in the public service inspectorates. It is for that reason that they will deal with environmental matters in co-operation with Her Majesty's Inspectorate of Pollution.
The noble Lord, Lord Meston, mentioned marginal workers. I can assure the noble Lord that health and safety at work regulations apply to all working people —temporary, part-time, self-employed or on contract. New control measures are being developed to deal with the special problems of workers on sub-contracts.
The noble Lord, Lord McCarthy, referred to violence at work. Employment Ministers share his concern. They have spoken out in support of the HSC's committee on violence to staff at work which is looking at ways to reduce violence and to care for staff affected by it.
The noble Lord, Lord McCarthy, and other noble Lords referred to HSE resources. I can only repeat that the Government have met the HSC's budget requests in full year after year. I think that that includes the past four years.
Lord McCarthy: My Lords, will the noble Lord give way? I understand what he is saying. But I am not quite clear about what he said earlier. Can he enlighten me? I thought that he said that the HSC was committed to reversing the decline in the number of inspectors. According to my evidence, that has not yet
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taken place. In 1988 we had 592 inspectors and in 1989 we had 554. When will that reversal take place? Will it reach the point where we have 759 inspectors, as we had in 1980?
The Earl of Strathmore and Kinghorne: My Lords, perhaps I may deal with that point later in my speech.
The Health and Safety Executive will continue to expand its programme of preventive inspections, which are planned using a rating system based on inspectors' judgment of risks, site standards and management control and the interval since the last inspection, thus ensuring that the frequency with which particular premises are visited takes due account of the risks at those premises. Particular attention will be given to occupational health issues and management arrangements for health and safety and also to the protection of the public. Noble Lords may be assured that the HSE's inspectors will pursue complaints and take enforcement action to the highest levels in companies not measuring up to the standards expected of them.
The Health and Safety Commission and HSE will certainly be doing their best to ensure that the message of the importance of health and safety gets across to everybody. They will be building on their successful approach, demonstrated during implementation of the Control of Substances Hazardous to Health Regulations, of using a variety of media to get key safety messages across to small firms and other groups which are sometimes hard to reach. They will also be playing their full part in planning for success in 1992, which, I remind noble Lords, is to be European Year of Safety, Health and Hygiene.
Returning to the last point of the noble Lord, Lord McCarthy, perhaps it would be better both for the noble Lord and for me if I write to him on the subject.
Of course the Commission and the HSE will not be working alone but in concert with representatives of the TUC, CBI, local authorities, consumer interests, safety organisations and experts. Their aim will be to achieve lasting improvements in the United Kingdom health and safety system. The Government fully support all those involved in that task and I hope that noble Lords will endorse their efforts.
Lord Mellish: My Lord, before the Minister sits down perhaps I may ask him one question. He said nice things about CITB. Is the message from him and his department that the CITB has nothing to worry about for 1992?
The Earl of Strathmore and Kinghorne: My Lords, the noble Lord is quite rightly very persistent on this matter. Again, I believe that it would be better if I write to him in due course.
8.9 p.m.
Baroness Turner of Camden: My Lords, I should like to thank all noble Lords who participated in an excellent and wide-ranging debate in which your Lordships drew on a wide range of expertise in this area. I should also like to thank the Minister for his speech on his first appearance at the Dispatch Box on this subject.

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In particular I welcome his assurances that the Government are determined to reduce accident levels and that there is no room for complacency. However, in certain respects I found some of his responses a little disappointing, particularly concerning the Construction Industry Training Board and its future. On the other hand, I note that as far as the Cullen Report and the framework directives are concerned, we may, I suppose, expect to have the opportunity to look at some new legislation in this field. Certainly it is the view of those of us on this side of the House that there is room for much tougher legislation, as I think we have indicated in a number of speeches. In particular, in our view there is a case for an increase in the number of inspectors, because it seems incontrovertible that there has been a decrease in the inspectorate since the early days of the 1980s.
That being so, while I thank the Minister for his contribution to the debate, I hope that the Government will take seriously the issues we have raised this evening. I look forward to hearing more as to what the intentions are following the Cullen Report, the framework directive and the present consideration being given to the VDU directive. That will give us an opportunity to come back for a further discussion. In the meantime, having thanked everybody, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

Sri Lanka: Human Rights
8.11 p.m.
The Lord Bishop of Ripon The Lord Bishop of Ripon rose to ask Her Majesty's Government what action they propose to take to help to end hostilities and to restore human rights in Sri Lanka.
The right reverend Prelate said: My Lords, the crisis in the Gulf has obscured events elsewhere in the world, and of those events perhaps few are so tragic as the situation in Sri Lanka. Two violent conflicts have riven the country: the JVP, or People's Freedom Party, uprising and the Sinhala-Tamil conflict. The consequences of these conflicts have been a steady increase in the level of violence, widespread abuse of human rights, including killing, torture, imprisonment without trial, a steady erosion of the democratic process and, most recently, a massive number of refugees in the wake of the war now raging in the north and east of the island.
The JVP uprising primarily affected the south of the island. It was a movement largely of the young rural poor, mostly Sinhala Buddhists, who created anarchy by widespread killing and threats and who for the moment have been put down by an equally violent government response. The number of JVP killed is not known for sure, but the figure of 30,000 is widely quoted. Many were young people whose bodies were thrown into rivers or burnt at the side of the road.
With the death of the JVP leaders little over a year ago, the south is now relatively quiet. Nevertheless, the underlying causes, especially of rural poverty, still remain and the movement smoulders and is not
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quenched. A climate of violence has been created by that conflict and the on-going Sinhala-Tamil conflict which has begun to brutalise a formerly civilised people so that killing becomes commonplace. I had personal experience of this when I visited the island last May. I had lunch with the Tamil member of parliament for Batticaloa, Sam Tambimuttu. He talked about the danger to himself and his family from other Tamil groups and how he had brought his family to Colombo for safety. Three days later he was shot and killed outside the Canadian embassy in Colombo. The killing was attributed to a rival Tamil group. But the government in Sri Lanka is not above such actions. The killing of the journalist Richard de Soyza, which received widespread international publicity, is by many in Sri Lanka laid at the door of the government, and pressure for an inquiry into his death has still not been successful.
The situation in Sri Lanka has deteriorated massively with the resumption of civil war between government forces and the Liberation Tamil Tigers of Elam (LTTE). The Sinhala-Tamil conflict is a long-running one. For 35 years Tamils in Sri Lanka have been pressing their demands for the integrity of the Tamil homeland, substantial autonomy for the Tamil region, equal rights for the Tamil language and rights of citizenship. Successive Sinhala governments have agreed to some or all of these principles, but of whatever political complexion they consist they have not implemented them. The will to do so has been lacking.
A senior politician in Sri Lanka said to me in 1987 that weak government had been the basic cause of conflict. I have deplored the steady growth of violence, especially by the Tamils, but I have to say I understand the reasons which have driven members of the Tamil community to take that course.
With the departure of the Indian peace keeping force in March last year, an uneasy lull began which was broken in June when the LTTE recommenced hostilities. Since then, a fierce military conflict has been fought in the north and east of the island. Caught in the middle is the civilian population. The government's policy of bombing towns and villages has resulted in great numbers of families leaving their homes. Currently, the number of refugees in the island is put at about 1 million; that is, one in 15 of the population. In addition, fuel is in short supply, electricity is cut off and there has been much destruction of property, businesses, homes, schools, hospitals and churches.
Aid for the refugees has been supplied by religious and non-government organisations. The British Refugee Council believes that as a result of that aid the situation among the refugees, although desperate, is not disastrous. Among many responses, my own diocese has contributed many thousands of pounds of aid through the Bishop of Colombo. We have received graphic accounts of lorryloads of food and other aid being driven to the north, sometimes having to be left in a church or school because the road beyond is closed. In spite of this aid, the situation in the north

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and east is appalling, and we have received heartfelt cries for help from those caught in the middle of the battle.
Although it was the LTTE who commenced hostilities in June, it seemed that until recently the Sri Lankan Government was intent on a military solution to the conflict. Having succeeded in the south against the JVP, they believed they could do so in the north. The LTTE have offered a ceasefire, and latest reports indicate that the government have now accepted it. In that context it is imperative to preserve the cessation of hostilities between government forces and the LTTE, to create conditions within that space in which refugees may return to their homes, and finally—this is the most important and difficult thing—to work out a political resolution of the conflict.
Given the complexities, it is extremely difficult to see what can be done from outside the island. Nevertheless, international scrutiny can affect the situation. There is evidence that the Sri Lankan Government have moderated their bombing campaign because of fear of international opinion. Churches and religious bodies have helped to bring the international gaze to bear on Sri Lanka. I was a member of the World Solidarity Forum on Sri Lanka for Justice and Peace—a shared Buddhist-Christian initiative which drew together religious figures, non-government organisations and politicians from some 20 countries. That has resulted in an increased awareness of the situation and the building of a network of links with those in Sri Lanka who are calling for a change of direction.
In those circumstances, the attitude of governments is crucial. I was in Colombo in May last year when the Prime Minister of Japan visited the island. There was intense interest in his attitude. He made it clear that Japanese aid would be dependent upon the human rights situation in Sri Lanka. The government in Sri Lanka must not be above the rule of law, and aid is one of the few sanctions that can be brought to bear on a government which sets itself above that rule.
The European countries have made a similar declaration. I hope that the noble Lord who is to reply on behalf of the Government will be able to give an assurance that the Government will take a firm stance. Will the Government insist that aid is dependent upon the restoration of the rule of law and human rights? Will they refuse to give aid if they are not satisfied that such conditions are met? Such aid does not go to the refugees but to government programmes. We should have no compunction in making clear our abhorrence of events in Sri Lanka, a major responsibility for which must be laid at the door of the Sri Lankan Government.
All possible pressure should be brought to bear on the Sri Lankan Government to pursue a political solution to the Sinhala-Tamil conflict. The Australian Government support a proposal that the Commonwealth Secretariat should be invited to mediate in talks between the Government and the LTTE. Will Her Majesty's Government give the strongest possible support to such an initiative and
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take a share in insisting that a political and not a military solution is the only one which can give a secure future to both Tamil and Sinhala in Sri Lanka?
Sri Lanka is an island of great beauty with a people of great ability, hospitality and charm. Those of us who have lived in the island and count Sinhala and Tamils among our close friends are deeply grieved at the tragedies and horrors that they have experienced and continue to experience. We yearn for an end to their sufferings. We shall ourselves do—and press others to do—whatever helps to achieve that end.
8.22 p.m.
Lord McNair: My Lords, I am grateful to the right reverend Prelate the Bishop of Ripon for asking the Question on the civil war in Sri Lanka. He speaks with great personal knowledge and breadth of vision. I endorse everything that he said. I should like to add as an aside that I cannot help but feel that in considering the problems of that tragic and beautiful island we should remember our inability to resolve the conflict much nearer home.
In Sri Lanka we see entrenched positions and attitudes, bitter hatred and a sense of the enemy group as excluded from the human community—as dispensable. Those feelings are common to such situations. Analysing the history of the conflict is useful only if the purpose is to examine the essential needs of the protagonists and use that knowledge to persuade them to move away from entrenched positions. As I understand it, the problem in Sri Lanka is that the national, now mainly Sinhalese, government want to maintain a unified state, while the Tamil minority which forms the majority in the north east of the island wants some degree of autonomy but not necessarily a separate state.
While English was the official lingua franca of the island, although perhaps all the communities had a grievance, at least it was a shared grievance. When Mrs. Bandaranaike rose to power on the promise of granting autonomy to the Tamil area and then reneged on that promise, she opened a wound that has festered ever since with differing degrees of inflammation. I believe that it was also she who changed the official language of Sri Lanka from English to Sinhala, making it much more difficult for the Tamils to participate in the national administration. That in turn fuelled the desire for separation.
It must be said that while horrific atrocities were committed by both sides in the years that followed, the national government have taken a very hard-line approach. They have come in for a great deal of criticism which I think is largely justified. I should point out that atrocities have been committed by both sides. As so often happens, one side blames the other. It is said that so and so started the conflict or that it started when such and such an incident occurred. It is futile to take that path. We must first have a cease-fire and then look at the political problems.
The Question asked by the right reverend Prelate is thoughtfully phrased. The denial of human rights is a function of the state of armed conflict. Hostilities will have to subside before we can hope to improve the

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human rights situation. In fact the two propositions mentioned in the Question form part of a continuum: as life returns to normal, ordinary social existence will re-establish itself. It is a truism that peace and justice are inseparable. One cannot have the one without the other. If there is peace without justice conflict will arise. If there is justice but no peace, that justice will soon be swept away.
In this conflict the total number of dead and disappeared—what in Latin America are called los desparecidos—can now easily have reached 200,000. It could be more. The refugee problem is immense. Normal life has ceased in many parts of the north east. I have read articles which refer to the law of the jungle. We see only too clearly the escalating spiral of violence. The Sri Lankan Government are buying weapons from China. According to reports in major newspapers, the Tamil Tigers may be funding their arms purchases by smuggling drugs. It is a tragedy in so many ways.
But there are many good things that happen in Sri Lanka. I should like to bring in a note of normality. The Intermediate Technology Development Group does sterling work in Sri Lanka. That is the sort of work that can continue when the political and military situation has stabilised.
I urge the Government to support all initiatives toward peace in the island. I understand that an approach has been made by Norway and that certain Commonwealth countries, at the instigation of Senator Robert Hill of Australia who helped to draw up a substantial and substantive peace proposal, were to have attended a meeting of a high level appraisal group. Unfortunately owing to the situation in the Gulf that has been postponed until June. I cannot see why the postponement was necessary.
Will Her Majesty's Government urgently seek to have that meeting brought back to its original date? Other government and international business continue during the present conflict. Surely it remains important to end the bloodshed and suffering in Sri Lanka as soon as possible.
8.26 p.m.
Baroness Masham of Ilion: My Lords, I thank the right reverend Prelate the Bishop of Ripon for bringing to the notice of your Lordships tonight the plight of the war-torn country of Sri Lanka. My noble kinsman and I spent a holiday in Sri Lanka just before the problems started in the south. Perhaps it is because I spent the most enjoyable holiday that I have ever had in the beautiful country of Sri Lanka that I want to support this debate tonight. But also it is because last Sunday I met an Anglican priest from Sri Lanka who was visiting the local Anglican church. He came with his wife to visit us at our home. He gave me a copy of the report, World Forum on Sri Lanka for Justice and Peace.
I found Sri Lanka a magical place, with delightful people. There are kingfishers and brightly coloured parrots flying about. When, as a Roman Catholic, I attended mass I felt very much part of the community.
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We were invited to the parish to see some of the social work that was organised for young people who were getting into trouble. They were taught how to grow vegetables. The girls were taught how to sew and be self-sufficient. We visited some of the village homes. The people whom we met were delightful. Many of them were very poor.
I was dismayed when I heard that such a wonderful place as Sri Lanka was being ravaged by war. With the Gulf war upon us, the very real troubles of Sri Lanka may be forgotten and passed over. I hope that that will not happen. I should like to ask the Minister whether there was going to be an Australian peace initiative and if so what has happened about it.
With our own problems in Northern Ireland, we are very well aware of how difficult these internal situations are. But because Sri Lanka is a Commonwealth country with close ties with Britain I hope that the Commonwealth will be able to help it solve this terrible situation.
Let me bring to your Lordships' notice some of the things which are happening to innocent civilian people. There are over 1 million displaced people, many of them having lost their homes. Some of them are living with relatives or friends, but many are in refugee camps. Food is very short. Sometimes it comes in only one week in three. About 30,000 people died in the early problems in the south, but now the problems are in the north and east of the country.
In the report there is an appeal from Jaffna, which is one of the problem areas. It reads:
"The present war is being waged in a country where ordinary people are everywhere helpless, the universities are silent, the politicians are confused and the best the churches would allow themselves to do is to render some humanitarian assistance. The wound continues to fester. There is greater misery compounded by revenge killings. It is a situation that calls for a committed, principled response. The alternative is a progressive disintegration of the country".
As a member of the British Red Cross Society for many years, I should like to tell your Lordships that the ICRC, the International Committee of the Red Cross, and the League of the Red Cross are helping with relief services in Sri Lanka. The league, which deals with natural disaster, is helping with the refugees in the north and east. The principles of the Red Cross are basic humanitarian needs. The ICRC and the league are working together to help with these problems —problems of lack of medical supplies, food, fuel, fertilisers, money, household provisions and even cooking utensils.
The Red Cross helps with tracing lost people. With so many people dead and 100,000 Tamils having fled to Southern India, this must be a very difficult task. The Red Cross visits detainees. This is one of the valuable tasks undertaken by members of the ICRC in so many troubled parts of the world. This is why the neutrality of the Red Cross emblem is so important, and all countries which have Red Cross or Red Crescent societies have to see that their emblem is used only for the work of the Red Cross.
The Red Cross is appealing for more funds to help with this very needed work. This work in Sri Lanka must be difficult because relief has been hampered as the army puts up barricades. When the war is over

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there will be much to do in relief and rehabilitation. One has to ask the question: why is there so much disharmony in a world which should be working for the good of each other instead of destroying and hating one another?
I end by saying that very bad monsoons are now hitting Sri Lanka. Snakes come into houses and last week 17 people died from snake bites. I hope that the Minister can give us some good news about some Commonwealth peace initiatives, which I trust will come sooner rather than later.
8.35 p.m.
Lord Taylor of Gryfe: My Lords, like others I should like to express my appreciation of the initiative taken by the right reverend Prelate the Bishop of Ripon tonight. There are strong Commonwealth ties between Britain and Sri Lanka, and there is considerable respect for the proceedings of Parliament in Sri Lanka. I am quite sure that many people in that tragic island will feel indebted to the right reverend Prelate for expressing his concerns this evening about the future of their country.
The Gulf war tends to occupy all our attention at the moment, but it is interesting to note that this has its repercussions in Sri Lanka. Over 4,000 Sri Lankans were repatriated from Basra, Iraq, in November by the International Organisation for Migration. Over 47,000 have been returned to Colombo from the Gulf since Iraq invaded Kuwait, and there are reported to be a further 50,000 Sri Lankan workers remaining in Kuwait. So the Gulf war has serious repercussions for some of the poorest sections of the community who will be repatriated and for some of the families who depend on the remittances from workers in the Gulf in order to relieve their poverty.
When I returned from Sri Lanka last year I put down Questions to the Government on the subject of respect for human rights and on what their attitude was. I am happy to say that I received reassurances from the Government of their concern about this matter, and I am quite sure that the Minister will tonight repeat the assurances that were given by his predecessor.
But I want to pay a special tribute tonight to the representative of Her Majesty's Government in Colombo. I want to pay a tribute to David Gladstone, who is our High Commissioner and who has not been afraid or intimidated in standing up for human rights. David Gladstone has been threatened. One Member of Parliament in Sri Lanka, taking advantage of the privileged position of a Member of Parliament, went so far as to accuse him of drug trafficking in order to diminish the standing of Her Majesty's Government and their representative. But I am glad to say that David Gladstone has maintained his firm line publicly.
When I was there I was interested in the case of a young man who had just disappeared. I was associated with the religious Society of Friends and still am. They have a Quaker mission engaged in medical work and reconciliation in the island. When one of the workers suddenly disappeared, I went to David Gladstone to
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ask him to make representations. The Swedish Embassy also made representations, and I stated that I would raise the matter with the Foreign Secretary on my return. Mr. Gladstone was summoned to the Foreign Office in Sri Lanka and was asked, "What is all the trouble you are making about this chap? We will make sure that he is returned". But like so many others who are caught in that conflict, he has never been seen since.
The problem about a mission of reconciliation is that you have to get the confidence of both sides of the argument. But as soon as you get the confidence of the leaders of the JVP, inevitably you are in conflict with the government and are suspect. The leader of our mission there last Christmas went to church in the morning and on returning from church this young man with his wife and two children who had been in Sri Lanka engaged in reconciliation for four years were advised by neighbours as they approached their home, "You had better not go home because there are two gunmen sitting outside". Whether they were from one political group or from the government, I do not know. But they took refuge immediately in the Swedish embassy, packed their bags and came home to this country. This is the difficulty of seeking reconciliation and I am sure that the right reverend Prelate will support this experience of the difficulties of establishing an understanding between the warring factions.
When the Indian troops withdrew in March last year there was suddenly a flash of hope. The government said to the Tamils, "All right, you can have a government up there in the north east". The Tamils in turn agreed to go legitimate, to cease civil war practices and to seek to have representation in the parliament, with a good deal of devolution in the north-east provincial council. Unfortunately, a small incident happened about that time which set the place alight again. The government army were going to carry out largely civil duties, but as a result of this incident and consequent misunderstanding 600 policemen were rounded up by the Tamils and they disappeared. There followed more violence and yet more conflict. This is an extremely complex situation in which both the Tamil Tigers and the government have responsibility.
What is wrong with the situation and how can we help to deal with it? There is a great deal wrong with Sri Lanka and it is difficult to see how we can contribute to a solution of some of the problems. In the case of the Tamils there is a very special situation, as the right reverend Prelate indicated: racial, religious and so on. The JVP's leaders have been murdered and they have, temporarily at least, been suppressed, but there is still great underlying reason for dissatisfaction. There is no doubt that there is a loss of faith in the government. There is a feeling that the government are corrupt, and there is no doubt that with the powers of patronage possessed by the government and politicians it is difficult to change the government. Too many people are on the civil service payroll. Money is frequently wasted on overmanning. There are state industries—after all the state of Sri Lanka is the

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Socialist Republic of Sri Lanka—and there is no doubt that the nationalised industries and the intervention of government in the economy have not been helpful to economic growth and stability.
So there are a number of things which require to be changed, and perhaps the power of the World Bank, which is now negotiating to give Sri Lanka 1 billion dollars of economic assistance, can bring pressure to bear on the government on the economic front. There is no doubt that the lack of respect and lack of faith in the government so widely felt is a destabilising element in the situation. Again I was happy to note that the EC, when considering its aid budget, has imposed certain terms with regard to human rights, and it is in this area that we can bring pressure to bear.
Unfortunately, the people who may suffer from a suspension of aid may be the poorest in the community; that is the difficulty. But there is no doubt that aid and assistance from World Bank loans and so on are very important to the economy of Sri Lanka. Apart from anything else, the mere cost of this civil war is bearing heavily on the budget. Therefore economic pressure should be all the more effective. To give support in our aid programme not simply for large economic projects but for the work that is carried out by the NGOs is very important. Perhaps a good deal of our aid might be directed towards strengthening the influence of the NGOs which are courageously working in a very difficult situation.
I am happy to think that this discussion tonight will be reported in Sri Lanka and that people there who have perhaps given up hope will know that there are people in the United Kingdom Parliament who are concerned about their tragic situation and we will continue to press for respect for human rights in that island.
8.46 p.m.
Lord Wilberforce: My Lords, I should like to add just a few words in warmhearted support of the initiative of the right reverend Prelate in raising this subject this evening. Both my wife and I have a 20 year-long and very close connection with Sri Lanka and its people. Indeed my wife is there now. Had the Motion of the right reverend Prelate come on next week, I should perhaps have been able to supply some up-to-date information as to the state of affairs in the country at the present time. As it is, the information that I am able to contribute is based on a telephone conversation and on my own rather fragmentary knowledge of the present state of affairs.
I intend only briefly to summarise the two orders of problem which are facing Sri Lanka at present. The first is the problem of law and order in the country as a whole, arising mainly from the JVP revolt and its suppression by the government. There is no doubt—many speakers have drawn attention to this—that there have been acts of violence, and unjustifiable and excessive violence, on the part of the government in suppressing the revolt. That is perfectly clear; but what I do not believe is entirely appreciated in this country, and certainly it has not been reported at all
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in the media, is the extent of the threat which the JVP movement constituted to lawful government in Sri Lanka.
The JVP was an extremely well organised, skilful and well equipped body which had the avowed object of creating chaos in the country; and it largely succeeded in its aim. Transport was completely disrupted; doctors were unable to get to hospitals; hospitals and schools were closed; the families of the forces of law and order were murdered; individual houses were attacked and their belongings looted —all this on a very well planned and organised scale. If, as unfortunately was the case, severe and heavy-handed methods of repression were used, one has to view those against the background of the threat with which the authorities had to contend.
What should we do now? I find myself very much in agreement with what was said by the noble Lord, Lord Taylor of Gryfe. At the present time I believe we have to accept the fact that the government of President Premadasa is in control of the country and that he should be given support in so far as he continues on a course of law, order and human rights. I believe we can give valuable support in this country, as his friends. This country has a long, strong tradition of friendship with Sri Lanka, and I believe that visits by prominent people from here, whether politicians, churchmen, lawyers, representatives of NGOs or members of human rights bodies can be of very great help.
Among other things, Sri Lankans are a most law-abiding people and they are very good lawyers. A Sri Lankan has just been elected to the International Court of Justice. I believe that my continual appeal as to the necessity of observing basic principles of law and human rights will not fall on deaf ears. It is said that we should bring pressure to bear upon them and refuse any aid if they do not mend their ways. That is one way of looking at the matter. However, against that, one must bear in mind that many of the tragedies and excesses—the breaches of human rights —which are occurring there are due, as more than one noble Lord has said, to economic causes. Therefore, another way of approaching the same problem may be to give whatever help we can to alleviate economic problems and distress, making clear, of course, that we hope that progress along the path of human rights may continue, but we should not use the word "pressure" nor make the furnishing of aid conditional or dependent upon a compliance with certain standards which can only come later in the day.
The World Bank was referred to by one noble Lord. I believe that President Premadasa has succeeded in establishing a certain degree of credibility there. We should do well to support his application for aid and particularly we should do well to support any help to deal with the vast number of refugees resulting from the Gulf crisis. I need not expand upon that because the noble Lord put it extremely well and no doubt others will make the same point.
The second order of problem is the Tamil problem. I hope that the noble Lord who is replying will be able to give us the latest information about the progress of

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the LTTE ceasefire and whether that still holds. We hope that that may be a successful prelude to ending the problem in the north, although one has also read with some disquiet of the arrival of some 200 Indian trawlers off the coast—a phenomenon which we have seen on previous occasions.
I am sure that the noble Baroness was absolutely right to underline this as a Commonwealth problem. It is one in which many Commonwealth countries have shown an interest and one where they are capable of giving support. Reference has been made to the Australian initiative and Canada and other countries of the Commonwealth have at times shown themselves willing to give their encouragement to the forces of right in Sri Lanka. I hope that the Government will join with them and that, through the new Secretary General of the Commonwealth and together with our friends there, particularly the major countries I have mentioned, we can try to help the Indian government to do what they can to diminish the problem.
Let us not forget that the Indian government have their problems in relation to this matter. Forces are supplied through the provincial government, over which central government does not have total control. Therefore, support and influence from the Commonwealth will probably be welcomed by the Indian government.
I thank the right reverend Prelate for asking this Question and I hope that the Minister will be able to give us some comforting information when he replies.
8.53 p.m.
Lord Avebury: My Lords, we are greatly indebted to the right reverend Prelate the Bishop of Ripon for drawing our attention to the miserable state of affairs in Sri Lanka and for trying to focus our minds on what could be done by the international community to restore the rule of law in that unhappy country. He painted a grim but nevertheless accurate picture of the state of affairs there.
Unfortunately this tragedy is self inflicted. My noble friend analysed some of the political reasons which led to the development of that state of affairs. It is very tempting to go into an analysis of those factors and to explain what is the aetiology of the state of violence and the reasons behind the emergence of the JDP as an armed opposition in Sri Lanka, to which the noble and learned Lord, Lord Wilberforce, referred. It did not come out of a political vacuum but emerged in 1971 when I first visited Sri Lanka as a representative of Amnesty International to inquire into the situation in which 14,800 people were detained by the government of Mrs. Bandaranaike without any process of law and where disappearances were already widespread and torture endemic in the establishments run by the police and security forces. Therefore, that is not a totally new phenomenon, but one that had emerged 20 years ago.
Some of the measures taken by governments in the intervening 20 years have encouraged young people to turn to violent instead of constitutional means of expressing themselves. For example, there were the actions of the government of President J.R.
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Jayawardene from 1977 onwards when he had a five-sixths majority in Parliament. He gave himself presidential powers armed with that majority. He charged his political opponents before a special tribunal and imposed punishments on the former prime minister and minister of justice for acts which had been lawful at the time at which they were committed. He held a referendum to double the life of his parliament from six to 12 years, rushing through the referendum as being urgent in the national interest and the text was unavailable to voters.
During the campaign, he enjoyed a virtual monopoly of radio and television and the press, which was largely state owned. He imposed emergency regulations which were used to shut down the main Sinhala language opposition daily. He closed printing presses operated by critics of the government and arrested or threatened opposition leaders. There were raids and apparatus was destroyed in the headquarters of the main opposition party. Meetings were prevented or disrupted and campaign literature was seized and confiscated. That was how President J.R. Jayawardene won the infamous election of 1982. During that time I was present in Sri Lanka and I say without hesitation that the proceedings were fraudulent and unlawful.
In 1983 there was a pogrom against the Tamils in Colombo including a massacre of Tamil prisoners held in the principal jail. Not a finger was lifted by the government to stop the atrocities which clearly had political backing from somebody high up. However, those events were used as an excuse by the government to proscribe the JVP, which until that time—as I remind the noble and learned Lord, Lord Wilberforce—had been returned to constitutional politics, as well as two other parties and some individuals, including persons who had protected Tamils at risk to their own lives.
At that point the JVP reverted to terrorism and the government embarked on a programme of counter-terrorism which has continued ever since, even after the leadership of the JVP was totally destroyed as it was last March when the leaders were captured and murdered in custody, which the noble Lord, Lord Taylor, has already mentioned. The brutality of the security forces more than matched that of the terrorists, and those whose responsibility it was to uphold the rule of law against the rule of the bullet and bomb actively incited the criminal activities of their servants. J. R. Jayawardene exhorted the security forces to "kill, kill, kill and kill the brutes", and legislation was enacted exonerating the security forces and police for any criminal offences they might commit in the course of their duties. In the meanwhile, on the other side of the question, J. R. Jayawardene had totally ignored the Tamil United Liberation Front between 1977 and 1983, when it constituted the main opposition in Parliament. The TULF was a conventional political party, and by undermining its credibility among the Tamil people, J. R. Jayawardene made it inevitable that terrorist groups would supplant them. He did not honour his election promise of more autonomy for the district development

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councils, but instead unleashed violence against the Tamil people and their priceless assets which included the famous library of Jaffna, which was totally destroyed.
Having lost control of the north, J. R. Jayawardene then invited the Indian peace keeping force to restore order, under the Indo-Sri Lanka accord of July 1987. But the Indians proved to be even more destructive and murderous than the Sri Lanka armed forces. The accord also handed a major propaganda weapon to the JVP, which it was not slow to exploit. When President Premadasa came to power he asked the Indians to withdraw. But by the time they complied the damage was already done.
The Premadasa election victory in 1988 was also of dubious validity, marred as it was by widespread violence and intimidation, as was the parliamentary election of 1989 at which I was present. There were dozens of political murders including those of nine opposition candidates and many officials. The turnout in both elections was sharply down, particularly in areas of traditional opposition support. At one polling station I attended in the south, in a constituency of strong SLFP support, nobody voted. At another polling station I came to there was the body of a terrorist laid across the threshold. He had just been killed by the security forces. Obviously people did not come out and vote when that kind of thing was happening and when shots could be heard throughout the whole area.
Thus, although some of the violence was indeed perpetrated by the JVP—as the noble and learned Lord, Lord Wilberforce said—the effect of the violence during those elections was to improve the results for the reigning government. The presidential majority was small enough to have affected the result in a material way. President Premadasa probably would not have come to power if there had been free and fair elections.
The Indians, meanwhile, had completed the militarisation of politics in the north and east, and set the scene not only for conflicts between the Sinhalese and Tamil communities, but also for the bloody struggles within the Tamil communities themselves; between Tamil and Moslem and, as has been said, between the LTTE and the government. President Premadasa naively thought that he could use the LTTE, and there was a honeymoon period after the Indian withdrawal. But the Tigers, having forced the regional super power, as they saw it, out of their territory, were not going to share power with Colombo. They inflicted heavy losses on the Sri Lanka armed forces in the north, which is now de facto under LTTE control. The response of the authorities in Colombo has been to create yet another armed group to seek out and kill suspected members of the LTTE in the south. It is very sad that President Premadasa, as a Buddhist, should ignore the Buddha's proposition that hatred is never appeased by hatred. The Tigers, on the other hand, masters of cruelty as the Tamil Times described them, have perpetrated the most revolting atrocities against Moslems in the north and
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east. The entire moslem population of the north—10 per cent. of the total—have been driven mercilessly from their homes and hundreds massacred in the east.
According to the official figures of the Rehabilitation Ministry, reported in the newspaper Island on 22nd December there are 928,954 internal refugees. In the 60 camps in Batticaloa, eastern region, there are 222,161 people, all but a handful of them Moslems from the region. In Britain, Canada, the United States, India and Australia there are several hundred thousand more refugees, many of them highly qualified professionals whose skills are going to be desperately needed in the reconstruction of Sri Lanka's shattered economy and public services. The other minority which is overlooked too often is the community of Tamil plantation workers, who have very little in common with their remote cousins in the north and east but whose existence is harsh and whose rights as descendants of fourth or fifth generation immigrants transplanted as serf labour by the British are ignored. If there is to be a separate Tamil state in the north, they would be no more at home there than in the land of their ancestors, Tamil Nadu.
In the south generally the pattern has been one of kidnappings and disappearances. According to a report by two British MEPs who visited Sri Lanka in November 1990, together with a Belgian and a Dutch lawyer, an estimated 60,000 people—as my noble friend also mentioned—have disappeared in the south since 1987, many of them after being taken into custody by the police. Recently there have been several bizarre cases of detainees pleading with the judges not to release them on remand after bailed prisoners were picked up by masked gunmen in unmarked jeeps and subsequently disappeared.
Christopher Bigsby, writing in the Independent of 6th January, says that 120 students disappeared from Sri Lanka's universities since they reopened after a two-year closure last September. Sixteen lawyers who were also human rights activists have been murdered since 1988, and 36 fled the country after threats to their lives and those of their families. The noble and learned Lord, Lord Wilberforce, is absolutely right. There are many distinguished lawyers in Sri Lanka. However, more and more of them are having to seek exile abroad, 24 in Britain. Those gross violations of human rights are continuing long after the government claimed to have disposed of the JVP in December 1989 when Rohana Wijeweera, the JVP leader, and the entire central committee, with the exception of one man, were unlawfully killed while in the custody of the police.
As far as I am aware, and I stand to be corrected by the Minister, there have been only two cases brought against servants of the state in regard to the crimes committed. In the first case, the torturing to death of the human rights activist lawyer, Wijedasa Liyanaaratchi, the superintendent and two police constables who arrested him were charged with murder two years ago. But they are out on bail and there is no sign of the case being concluded. Meanwhile the lawyer who acted for Liyanaaratchi's

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family was driven out of Sri Lanka by death threats following the murder of two colleagues who acted with him on the case.
In the other case, that of the shooting of a student at the Teldeniya Central School, Kandy, one prosecution lawyer has been murdered. Five of the witnesses have also been murdered. The trial judge fled the country and has changed his name. Senior counsel for the prosecution has sought asylum in Britain. Since it became impossible for litigants to retain lawyers in human rights cases, the Bar Association agreed, after consultation with judges and the Attorney-General to act on behalf of litigants nominating one of their members to conduct each case. The two most recent asylum seekers in Britain are lawyers who were so nominated but who nevertheless received death threats that they could not ignore. No doubt the government would like to create the impression that the rule of law prevails and that everyone has access to the courts. However having created an autonomous machine for murder and intimidation they cannot easily stop it when acts that are extremely harmful to Sri Lanka's image abroad are perpetrated.
On 30th November I had the honour of chairing a meeting organised by the Campaign for Democracy and Human Rights in Sri Lanka at St. Martin-in-the-Fields. The remarkable feature of that meeting was that the 300 people who attended came from all communities, including some from the armed opposition groups. Yet they managed to reach a unanimous resolution outlining a solution to the frightful problems facing their country. They declared that the help of the United Nations was necessary to develop proposals for constitutional electoral reform and to secure the withdrawal of the huge quantities of weaponry which remain in private hands, most of it distributed by the government. Coincidentally, I understand that the civil rights movement in Sri Lanka itself has made a similar proposal.
Recently the Australians proposed that an interim UN administration should take over in Cambodia because the government and the armed opposition there were unable to agree on a peace formula which would enable the people to decide what kind of government they wanted for themselves. A surprisingly large number of states were prepared to agree a more active role for the UN which would involve even a short-term transfer of sovereignty. In Sri Lanka the problems are not the same, but perhaps there are additional reasons for envisaging such a UN role. Colombo will not be able to re-establish direct rule in the north, and if the Tigers control the electoral machinery, no other point of view will be allowed. So the only chance that the people have is if an impartial outside body comes to restore law and order and to supervise elections. Ideally, the United Nations should also help those who fled the north to return to their homes. I certainly go along with those who think that perhaps the Commonwealth Secretariat might have a similar role.
All observers of the situation in Sri Lanka agree that the huge arsenal of weapons in private hands must De recovered. Recently the government
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themselves have said that one of the essential conditions for peace is that all who are not legally authorised to carry arms should hand them in. They might have been thinking of the Tigers, but in the south it is the death squads which are doing all the killing. It is theoretically within the government's power to disband them. Here again, I believe that outside help will be needed because the culture of violence has so deeply infected the security forces that orders to hand in unauthorised weapons would not be obeyed. Again, perhaps the Commonwealth Secretariat might be able to help reconstruct the uniformed services and weed out the killers.
Ideally, the government should also bring proceedings against officers who have committed offences and suspend others who may be strongly suspected of having committed criminal offences where there is insufficient evidence to prosecute. The problem is that over the years these officers have acted with the tacit approval and encouragement of the government. One of the highest ranking officers in the police force conspired to commit criminal offences on a very large scale in the south. As is generally known, the same officer was actually found by the Supreme Court to have violated fundamental rights in the notorious "voice of the clergy" case; yet that man was promoted by the government.
So the state owes a debt to these criminal officers and will not readily ditch them. Some people believe that if they were deprived of their weaponry and thus unable to deploy their private armies, they might be prosecuted. But here there may be scope for the donor countries to exercise some persuasion by saying that next year they want to see firm action taken, as has been said, to dismantle the death squad structures and to remove their patrons from office. At the aid meeting in Paris last November, the consortium made some general observations about human rights which have been referred to, but they need to be much more specific if results are to be achieved.
As the noble Baroness, Lady Masham, said, there is a danger that, preoccupied with the war in the Gulf, we shall lose sight of the sufferings of people elsewhere in the world. The ordeal of the people of Sri Lanka has lasted for many years and there is no immediate sign of relief. This debate may help to show that we are conscious of their plight and that we long to help in reaching a solution. We are unlikely to have analysed in an hour the problems which the best minds of Sri Lanka have addressed for years, but we stand with those who combat oppression by peaceful means.
9.11 p.m.
Baroness Ewart-Biggs: My Lords, I know that we are all very grateful to the right reverend Prelate the Bishop of Ripon for having brought before the House this evening this enormously important but very troubling subject. As many previous speakers have said, what accentuates the importance of discussing this subject this evening is that most troubled areas, apart from the Gulf, are now no longer before the public eye. The right reverend Prelate asked for many assurances from the Minister. I look forward very much to hearing the answers.

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There have been some wide-ranging speeches which have covered many different aspects of the back-ground and the historical reasons for the present conflict and described the deteriorating situation in Sri Lanka at the moment. I wish to comment briefly on three reports. Their contents confirm most of the details which the right reverend Prelate and other speakers gave this evening.
The noble Lord, Lord Avebury, mentioned the report from Amnesty International, which, sadly, among other human rights organisations is banned in Sri Lanka. Amnesty International describes how the human rights violations by the Sri Lankan government forces reached a peak in 1989 and how in the south thousands of people disappeared or were victims of extra-judicial executions. Further, it describes how, following the reimposition of the state of emergency in June 1989, government security forces made little attempt to conceal their resort to widespread murder. It also describes how the Sri Lankan government persistently denied that they sanctioned illegal killings by the security forces, claiming that they killed only in combat. That point was clearly made by the noble Lord, Lord Avebury. A recent member of the Sri Lankan security forces is quoted as saying:
"rather than finding measures to reduce the violence, the Government has sought to wipe out the JVP with widespread repression".
The noble Lord, Lord Avebury, also noted the report made by a group of four Members of the European Parliament who visited Sri Lanka from 27th October to 4th November 1990. Their mission was to compile a report on the violation of human rights and the disappearance of Sri Lankans. They reported that various estimates received suggested that at least 60,000 people had disappeared in the south of Sri Lanka since 1987. That represents about one in every 250 of the population. While they were there they received reports of continuing disappearances. Indeed it was reported that up to 50 killings a week had been reported in the Kundi area in the past two months.
They went on to describe that many groups were now restricted in their operations. They gave the example of trade unions' which can no longer operate in the free trade zones and in many cases are intimidated if taking part in industrial action elsewhere. They concluded that, although the army and authorities deny responsibility for the killings and disappearances, the scale is such that the state cannot be absolved from responsibility. The state has either failed in its duty to maintain law and order or has condoned the activities of the security forces. The fear of economic collapse has fuelled the intimidation and the continuation of the underlying climate of violence and repression. The growth of human rights groups has shown that many people in the country are now entirely sickened by the conflict. Groups such as the Mothers for Human Rights and the Sri Lankan Freedom Party have been established to campaign against human rights abuse.
The European Parliament delegation recommended the visit of the United Nations sub-committee on
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disappearances and human rights which had been accepted by the ministry of defence for February 1991. It also supported an investigation into disappearances by an independent body and said that it would support the resolution of the Sri Lankan Bar Council for an inquiry by an independent commission. The delegation also wished to encourage increased co-operation between the Sri Lankan government and the international Red Cross, a point to which the noble Baroness, Lady Masham, referred.
The third report was made by the programme committee of the United Nations Children's Fund. It made quite clear that the conflict and the consequent switching of funds towards defence expenditure and away from social programmes was having an adverse effect on the welfare of children in Sri Lanka. That is particularly sad as Sri Lanka had achieved very encouraging progress over the previous decade. Infant mortality had declined and a very high immunisation coverage had been achieved. However, malnutrition is now a very serious problem with children. At least half the children under the age of five suffer from malnutrition. The report says that nearly 100,000 families and about 400,000 people are homeless, that the psychological effect of the conflict on the children has become very severe and that those who have been orphaned or lost a parent now number thousands. Children of pre-school age are in an even more precarious position.
Health services have now completely deteriorated and diseases which had been wiped out are now returning. There has been an increase in malaria, and polio cases have been reported among the children of refugees. The incidence of malnutrition has very much increased.
When one looks at the economic cost of the war, that is hardly surprising. It is estimated that the conflict is costing the government about 500,000 dollars a day. The war has caused widespread disruption to the Sri Lankan economy which had previously exhibited signs of recovery. Forty per cent. of the island's rice production is in the east and the harvest in August was badly disrupted. Seventy-five per cent. of the fishing industry is concentrated in the LTTE controlled northern district.
The burden on the economy is being exacerbated by the Gulf crisis, which, as the noble Lord, Lord Taylor, said, deprives Sri Lanka of vital revenue. Prior to the crisis there were over 100,000 Sri Lankan migrant workers in Kuwait who were annually sending home £75 million. That constituted Sri Lanka's largest source of foreign exchange revenue. Now rather than receiving that revenue the country is expending a great deal of money on reintegrating those refugees on their return from the Gulf.
The situation is very serious and, as previous speakers have asked, what can Britain do? I should like to ask the Minister a few questions about certain movements which are about to take place. I should first like to ask him whether the proposed visit of the United Nations Sub-committee on human rights to Sri Lanka in February is still scheduled to take place and, if so, whether there will be any delegates from Her

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Majesty's Government on the committee. Secondly, can the noble Lord tell us when Her Majesty's Government will next meet representatives of the Sri Lankan government to discuss human rights abuses in that country? Thirdly, can he confirm that he will make urgent representations to the Sri Lankan government to ask them to reconsider their decision to resume military operations against the Tamil Tigers? Further, can he say whether there will be initiatives to secure an effective ceasefire which can be independently monitored between the Sri Lankan government and the Tamil Tigers? I should also like to ask the noble Lord whether the Government have sold military equipment or dual-purpose equipment, such as computers, to the Sri Lankan government. I believe that it is most important to know what kind of military equipment is entering the country at this time and whether we are training any members of the Sri Lankan army or security forces.
Most previous speakers talked about aid. I very much agree that if we were to cut off aid to the people of Sri Lanka it would be the poorer people who would suffer the most. Therefore, can the noble Lord say what is the figure of gross British bilateral aid for 1990–91 and whether we are to maintain it? Can he also say whether the World Bank has warned that in future its aid will depend upon improvements in the Sri Lankan human rights record? I believe that the World Bank aid group has agreed on an amount of money, but I should like to know whether it has attached conditions such as that there must be improvements in the human rights situation in Sri Lanka.
I very much hope to hear some news or some form of assurance from the Minister. This is clearly a most heart-breaking situation where, as usual, it is the civilian population who are caught in the crossfire; indeed, the Sri Lankan people are suffering the most.
9.25 p.m.
Lord Reay: My Lords, I listened with great interest to the words of the right reverend Prelate the Bishop of Ripon and those of other speakers. The right reverend Prelate knows Sri Lanka well. He has lived and worked there for several years. It was plain from his speech that he feels a real affection for the country and the people. Affection for that beautiful country also shone through the speeches of other speakers—notably those of the noble Baroness, Lady Masham, and the noble and learned Lord, Lord Wilberforce. It is just such an affection that has long characterised relations between innumerable people in this country and Sri Lanka. We in Britain have therefore felt a particular concern for the pain and suffering that Sri Lankans have experienced in recent years.
The political situation in Sri Lanka is indeed tragic. The quantity of blood shed during the past seven years has been appalling. Great harm has been done to a society which would otherwise be peace loving, humane and, as the noble and learned Lord, Lord Wilberforce, reminded us, law abiding, by two ruthless terrorist uprisings and a government response to them which has often paid little heed to the sanctity of basic human rights and the rule of law. I well
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understand the concern of many people in Britain who have friends or relatives in Sri Lanka, or who merely feel deeply affected by what they have heard of the situation there. The extent of that concern is well known to the officials and my ministerial colleagues in the Foreign and Commonwealth Office, who have received a great many letters about Sri Lanka from Members of another place and your Lordships' House, and others in this country.
I do not propose to take up the time of the House by speaking at length on the history of the violence in Sri Lanka. Most of it will be well known to those who have followed events there over the years. I should, however, like to set out the Government's view of the present situation.
We support the government of President Premadasa in its efforts to defeat the terrorist threat from the Liberation Tigers of Tamil Eelam (the LTTE) in the north and east of the country. Similarly, we recognised the Sri Lankan Government's need to defeat the Sinhalese nationalist terrorists of the JVP in the centre and south of the island. We are not sorry that the JVP appears to have been defeated. As the noble and learned Lord, Lord Wilberforce, so eloquently explained, it was an extremely dangerous threat to Sri Lankan society. No democratic government can allow itself to be dictated to by threats of violence. On the other hand, we have also consistently condemned some of the means used in confronting those threats, especially the violation of basic human rights which has occurred all too often.
The right reverend Prelate asks what action we propose to take to help to end the hostilities in Sri Lanka. I wish that there was something that we could do to achieve that end. The sad truth is that in order for peace to break out, both sides must want to stop fighting. Regrettably, that does not appear to be the case at present.
We regret the fact that the Australian-inspired Commonwealth initiative, referred to by the noble Lord, Lord McNair, and the noble Baroness, Lady Masham, has not yet been followed up. The main responsibility for reinstating that initiative at present lies with the Sri Lankan Government. But should circumstances change, I can assure noble Lords that we shall be ready to help where we can, either directly or by encouraging other parties acceptable to both sides in Sri Lanka to offer their services.
In June last year, the LTTE abruptly broke off talks with the government which were aimed at resolving their grievances peacefully. At that time the differences between the two sides seemed small. The government had made considerable efforts to seek a peaceful settlement with the LTTE. However the LTTE abandoned the talks and resumed fighting, rejecting two ceasefire proposals put forward by President Premadasa.
At the beginning of this month the LTTE itself initiated a unilateral ceasefire. The Sri Lankan Government responded by itself calling a ceasefire; but after 10 days in which 34 violations were attributed to the LTTE, the government decided that it had no choice but to resume the fighting. We much regret that the ceasefire did not prove to be longer

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lived. We shall continue to urge the Sri Lankan Government to take whatever opportunities present themselves for putting an end to the bloodshed.
The right reverened Prelate has also asked what action we propose to take to restore human rights in Sir Lanka. We are of course deeply concerned about the reports of widespread violation of human rights by members of Sri Lanka's security forces. It is distressingly clear that far too many of those whose task it is to fight terrorism have in the past themselves adopted the behaviour of the terrorist.
We have made our anxieties clear on many occasions to the Sri Lanka Government both bilaterally and with our partners in the European Community. I should like to give some examples. In October, European Community Heads of Mission in Colombo jointly urged the Sri Lankan Government to observe internationally accepted human rights obligations. In the same month we and our EC partners made it clear at the Sri Lankan Aid Consortium Meeting that future decisions on aid to Sri Lanka will take into account its human rights record. A decision will be made shortly on whether to go ahead with £3 million of British bilateral aid to Sri Lanka next financial year. Sir Lanka's human rights performance will certainly be one of the major factors which we will take into account. I think that that deals with one of the right reverend Prelate's concerns.
On 3rd December our High Commissioner in Colombo met President Premadasa, and my honourable friend the Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs discussed developments with the Sri Lankan High Commissioner in London on 19th December. On both occasions our views on human rights violations by the security forces in Sri Lanka were very clearly expressed. My honourable friend told the Sri Lankan High Commissioner that we see only one way in which his government and its security forces can regain the confidence of the population of Sri Lanka and of the international community. The whole government, particularly those ministers and officials who are directly responsible for the security forces, must make public their determination to use lawful means in the fight against their enemies. To take up the point made by the noble Lord, Lord Avebury, in addition it must be clearly demonstrated that individual members of the security forces who indulge in unacceptable behaviour will as a matter of government policy be brought to justice.
There is some evidence that all this pressure is bearing fruit. In mid-November the Sri Lankan government appointed its own special task force to investigate human rights questions and report direct to President Premadasa. Just last week President Premadasa announced the creation of a commission of inquiry to examine individual complaints of disappearances. We see the appointment of these bodies as steps in the right direction and are encouraging the Sri Lankan government to do all it can to allow them to work effectively. We shall be watching closely to see just how effective they are.
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The noble Lord, Lord Taylor of Gryfe, raised the matter of help for Sri Lankans stranded in the Gulf. We responded quickly with a contribution to the cost of repatriating refugees from the Gulf, including many Sri Lankans. This contribution, including Britain's share of European Community assistance, now amounts to £11 million. The noble Lord also referred to the NGOs and their activities. We have provided over £440,000 in the past 12 months to support emergency relief work by NGOs in the north and east of Sri Lanka. We also support the NGOs, including the Intermediate Technology development group which was mentioned by the noble Lord, Lord McNair, in other activities in Sri Lanka.
The noble Lord, Lord Taylor of Gryfe, paid tribute to the British High Commissioner in Colombo. I am sure that the House would agree with the noble Lord in the kind and fitting tribute to the work done by our High Commissioner, David Gladstone, in Colombo in circumstances which are often not easy. I can assure the noble Lord that his words will be much appreciated.
At the end of her speech, the noble Baroness, Lady Ewart-Biggs, fired off a battery of questions. I shall do my best to answer a few of them. She asked about arms sales: all arms export licence applications are carefully scrutinised, case by case, taking all factors, including human rights, into account. Sri Lanka is not a major market for British defence equipment.
As concerns military training, we provide some military training for members of the security forces. We do not undertake training in cases where we believe that those trained might subsequently be involved in what we would regard as unacceptable practices. Our training is designed to instil the discipline and high professional and ethical standards of our own forces. There are no British military personnel involved in training in Sri Lanka.
The noble Baroness also asked me about United Kingdom representation on the UNCHR working group. The composition of the group is not yet decided. She also asked me what contacts Britain would have with the government of Sri Lanka in the near future. My honourable friend the Minister of State hopes to visit Sri Lanka later this year. He will no doubt raise human rights questions at that time.
The noble Baroness asked about the proposed visit of the United Nations Commission for Human Rights to Sri Lanka. A visit is proposed for September 1991. That date was suggested by the Human Rights Commission itself.
Some progress is being made, albeit not yet enough. President Premadasa and his government are very well aware of the deep concern felt in this country and in many others around the world over the situation in Sri Lanka. We continue to encourage, urge and occasionally cajole the Sri Lankan government to do its utmost to resolve the country's problems peaceably. We are prepared to offer our services wherever they may be of assistance. But in the end the problems can be solved only by a determination by Sri Lankans themselves, of all opinions and ethnic groups, to settle their differences around the negotiating table.
Baroness Masham of Ilton: My Lords, before the noble Lord sits down, I wish to inform him that I received a fax from the Red Cross today. The fax came from Geneva and it stated that the Red Cross has started an appeal for Sri Lanka. Is it possible that some of the £3 million that has been referred to could
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be given to the International Committee of the Red Cross to help the Sri Lankan Red Cross society undertake humane relief work?
Lord Reay: My Lords, I am not sure whether that is a matter for Her Majesty's Government. I shall, however, certainly look into it.
House adjourned at twenty-four minutes before ten o'clock.