Lords Sitting of 17 February 1993

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

Baroness Williams of Crosby
The Right Honourable Shirley Vivien Teresa Brittain Williams, having been created Baroness Williams of Crosby, of Stevenage in the County of Hertfordshire, for life—Was, in her robes, introduced between the Lord Jenkins of Hillhead and the Lord Rodgers of Quarry Bank.

Quangos: Expenditure
2.49 p.m.
Lord Dean of Beswick Lord Dean of Beswick asked Her Majesty's Government:
How much public money was spent on the authority of non-elected bodies (quangos) in the latest year for which figures are available, what percentage of total public expenditure this represented, and what were the comparable figures for 1979.
The Minister of State, Department of Transport (The Earl of Caithness): My Lords, gross expenditure by executive non-departmental public bodies was £6.15 billion in 1978–79 and £13.75 billion in 1991–92. Expressed as a percentage of general government expenditure, these figures are respectively 8.2 per cent. and 5.8 per cent.
Lord Dean of Beswick: My Lords, is the Minister aware that although he has given certain figures, those appearing in the Financial Times show that since 1979 the amount spent by non-elected bodies has increased to nearly £42 billion? The amount spent by those bodies in the public sector has increased by 20 per cent. —one-fifth. Is the Minister also aware that there is serious concern—not in political but in financial circles —that the spread of quangos, in responsibility though not in numbers, is so great that it has become almost impossible for the Secretaries of State officially to control them?
Bearing in mind the financial disasters that have just taken place in the Wessex Regional Health Authority and the West Midlands authority, either through lack of attention or something else, it is about time that the position was reviewed. Will the Minister take that message back to the Government in the interests of all taxpayers?
The Earl of Caithness: My Lords, I am happy to tell the noble Lord that the number of executive NDPBs has declined from 492 in 1979 to 369 in 1992. The figures I used come from the Cabinet Office paper Public Bodies 1992, a copy of which is in the Library of the House.
Lord Dean of Beswick: My Lords, the Minister should look at the figures quoted in the old government financial returns; they are far in excess of the figures he has given today.
The Earl of Caithness: No, my Lords, the figures quoted in the Financial Times are different. They are the government figures that I quoted.
Lord Hailsham of Saint Marylebone: My Lords, is there not a certain danger in the House of Lords equating quangos—and I understand that means "quasi autonomous non-governmental organisations"—with all non-elected bodies? Surely we are not a quango.
The Earl of Caithness: My Lords, my noble and learned friend is quite right to draw attention to the fact that we need to tread carefully in that area.
Lord Mellish: My Lords, is the Minister aware that in 1981 the Government set up a quango called the London Docklands Development Corporation? That money was well spent, but for 15 years local authorities had had it and did not build a single toilet. At any rate, in the period during which I was involved over 30,000 houses were built and we had to deal with 10 miles of derelict land. Will the Minister say that that was money well spent?
The Earl of Caithness: My Lords, I certainly compliment those concerned on what has happened in Docklands, which is quite a change from the previous situation, and the effort of the noble Lord was by no means unnoticed.
Lord Richard: My Lords, is the Minister aware that the figures given by my noble friend Lord Dean came not from the Financial Times but from Hansard of another place of 25th January? The figure that he gave of £41.7 billion expenditure by quangos at present is correct if we include the National Health Service, as we clearly ought. Does the Minister agree that accountability in public bodies is important, and particularly accountability to the taxpayer of those bodies which spend public money? If he does agree—as the Government should do—we have a situation where no less than 20 per cent. of government expenditure is being spent by unelected, unaccountable boards whose members are answerable only to their ministerial patrons. That is not a situation with which one can be happy.
The Earl of Caithness: My Lords, sadly I have to take issue with the noble Lord, Lord Richard, on that point. NHS bodies such as the regional health authorities are part of central government and are not classified in the same way as quangos. As to accountability, not only is there a Minister responsible, but most executive NDPBs operate under powers laid down in statute, and executive NDPBs' annual reports and accounts enable Parliament, the taxpayer and the customer to judge whether an NDPB is securing value for money. The accounts of all executive NDPBs are subject generally to audit by the National Audit Office.
Earl Russell: My Lords, when the Minister says that a quango is an arm of central government, does he perhaps risk impaling himself on the other arm of the fork, and inviting the question: "What degree of independence from the Minister do those bodies enjoy?"?
The Earl of Caithness: No, my Lords. I said that NHS bodies, such as regional health authorities, are part of central government.
Lord Shepherd: My Lords, if the noble Earl is correct that a quango—shall we say a health authority—is an arm of government, is it therefore acceptable, as was reported in the Independent newspaper last week, that a member of that quango was also a director of a company that was petitioning in tender form? When the tender was lost, it was referred back to officials for it to be renegotiated. If it is an arm of government, do the Government accept that that is a correct relationship between a health authority and interested parties in what is a sizeable contract?
The Earl of Caithness: My Lords, I was not aware of the specific issue raised by the noble Lord. It is considerably wider than the Question on the Order Paper.
Lord Bonham-Carter: My Lords—
Lord Stoddart of Swindon: No, my Lords, it is our turn.
The Lord Privy Seal (Lord Wakeham): My Lords, I am sure that the House wants to hear both noble Lords, and there is time to hear both. I think that the noble Lord, Lord Bonham-Carter, rose first, so that is probably the best way to deal with the matter.
Lord Bonham-Carter: My Lords, if the noble Earl says that quangos are an arm of central government, does he regard the BBC as an arm of central government, for that is surely the original quango? Further, does he think that those appointed to quangos should be appointed, as they have been under the present administration, on strictly political terms?
The Earl of Caithness: My Lords, members who serve on those bodies and who have done an excellent job are appointed as the best person available for the job.
Lord Stoddart of Swindon: My Lords, bearing in mind that the £41.7 billion is more than the health service budget and more than half the social security budget, are those organisations to be subject to the same rigorous expenditure review as are health, education, social security, and so on, under the present review by the Chancellor which is taking place?
The Earl of Caithness: My Lords, where there is ministerial responsibility of course there is very close scrutiny of all the finances; and rightly so, because it is taxpayers' money. I think that the noble Lord was again confusing central government with non-elected executive bodies.
Lord Carrington: My Lords, may I inquire about the position of the Commissioners of Customs and Excise, which is certainly a non-elected body? I am not at all sure whether they are answerable to Ministers.
The Earl of Caithness: My Lords, from personal experience I can tell my noble friend that they are.
Lord Sefton of Garston: My Lords, is the noble Earl aware that there are people and financial institutions in the City of London today having some concern about the quango that inflicted the unplanned effects of Canary Wharf on the City?
The Earl of Caithness: My Lords, that is a most interesting observation.

Oxford: Proposed Bypasses
2.58 p.m.
Lord Bullock Lord Bullock asked Her Majesty's Government:
Whether the two bypasses proposed for north Oxford and Headington, in order to relieve traffic congestion on the A.40, are intended to form part of a new trunk road from the east coast ports to the west of England, bringing up to 20,000 to 30,000 more vehicles a day into the outskirts of Oxford and the Oxford green belt.
The Earl of Caithness: My Lords, each of these schemes is free-standing, and designed to resolve different problems on the A.40. A study is at present in hand to identify the most suitable link between Aylesbury, the M.40 and the Oxford area. Any future increases in traffic in the Oxford area will be primarily as a result of general traffic growth.
Lord Bullock: My Lords, the noble Earl's Answer is reassuring, but does he agree that it still leaves unanswered the question as to whether the bypasses will be incorporated into, and are meant to be incorporated into, the east coast ports route, which connects the east coast ports with the west of England? Does he further agree that what interests people is whether they are to be confronted with the same as happened in the case of the road connecting the west of England with the channel ports? Will the Department of Transport repeat the procedure that was followed on that occasion, presenting the route in 30 separate schemes, including 21 bypasses, each of which was planned and assessed individually, without any attempt to carry out a strategic review for the whole route?
Noble Lords: Question!
Lord Bullock: My Lords, the question is whether the Department of Transport will follow the same procedure in this case, despite the fact that the Standing Advisory Committee recommended that it should not do that. It said that on all occasions there should be a strategic overview of the whole route and not just local schemes.
The Earl of Caithness: My Lords, I am sorry that I did not make the position clear to the noble Lord in my Answer. I shall repeat it. Each of the schemes is

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free-standing and designed to resolve different problems on the A.40. A study is at present in hand to identify the most suitable link between Aylesbury, the M.40 and the Oxford area.
Baroness Faithful: My Lords, does the Minister agree that already a great deal of land has been taken from the countryside of Oxfordshire and Buckinghamshire for the M.40 and its extension to Birmingham? Is it not the policy of Her Majesty's Government to persuade more people to travel by rail rather than by road?
The Earl of Caithness: My Lords, my noble friend and I share that route to Oxford. We know what land has been taken. I know that she will be equally concerned about the environment surrounding the long queues and the pollution caused at Headington in North Oxford by existing poor roads.
Lord Underhill: My Lords, referring to the actual Question on the Order Paper, can the Minister explain whether any environmental concerns were raised during the lengthy consultation period? Were any issues raised in regard to the position of the green belt? If so, what were they and what was the Government's reply?
The Earl of Caithness: My Lords, the noble Lord, Lord Underhill, is slightly ahead of the game in that the draft orders have not yet been published. The first will be published just before Easter and the second later in the year. Consultation will then take place where the anxieties expressed by the noble Lord —which are extremely valid—will be raised.
Baroness Nicol: My Lords, at what point will environmental impact assessments be carried out, or have they already been done?
The Earl of Caithness: My Lords, as I understand the procedure, environmental assessments will be made and laid with the draft orders.

Schools Maintenance Programmes: Funding
3.3 p.m.
Lord Judd Lord Judd asked Her Majesty's Government:
What was the latest aggregate total bid by local education authorities for funds for maintenance and repair programmes for schools throughout England and Wales and what is the total aggregate sum of the grants being made.
The Minister of State, Department of Education (Baroness Blatch): My Lords, there is no bidding process for repairs and maintenance as such. The resources made available to local education authorities for their revenue costs and their borrowing approvals to support capital programmes are not hypothecated to individual services or to areas within services. It is for local authorities and schools with delegated management to determine their expenditure priorities from the resources available to them.
Lord Judd: My Lords, how do the Government intend to build their brave new world of education if they allow the fabric in which it is to be housed to disintegrate? Why have the Government still not implemented the 1981 school premises regulations? For example, when Cambridgeshire asked for £22.7 million for essential work, why was it allowed only £7.6 million? That is £83 per head for each child in LEA schools. How does that compare with the money being made available to grant-maintained schools?
Baroness Blatch: My Lords, the noble Lord appears to be confusing capital bids with moneys for maintenance and repairs, which is the subject of the Question. As the noble Lord is aware, the school premises regulations are under review and we are considering the conclusions of that review. The details will be made available in due course.
Lord Parry: My Lords, is the Minister able to tell the House what proportion of the aggregate total or the total costs allocated to local government, will be allocated to the modification of existing schools that will become hosts for schools of specially-disadvantaged children?
Baroness Blatch: My Lords, I am not able to help the noble Lord. We do not aggregate the funds in that way. In addition to receiving the annual capital moneys referred to by the noble Lord, Lord Judd, local authorities also supplement that by using their receipts. As we know, this year the rules have been relaxed to enable local authorities to use 100 per cent. of those receipts. They can supplement that with revenue expenditure and within that, within local authorities and their departments, they can re-order their priorities. The money spent particularly on special needs and special schools as opposed to mainstream schools is a matter for each individual local authority.
Lord Parry: My Lords, I am grateful to the Minister for that full answer to my question. Can the noble Baroness give me a further assurance that an adequate sum of money will be allocated to provide the facilities that the host schools need? The headmasters will then not need to provide additional funds from boot sales.
Baroness Blatch: My Lords, I hope that the noble Lord will accept that, given a finite sum of money, it is important that the best possible value for money is achieved for any money spent by a local authority. Local authorities should order their priorities where there is a need. Should special schools have a particular need, then that is where the money should be targeted. Local authorities must meet their legal requirements and the requirements under the national curriculum.
Lord Judd: My Lords, is the Minister aware that there is real anxiety that the grants being made available to grant-maintained schools are running at a level around four times higher than those to local education authority schools? Where is the evidence of

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the Government's commitment to fair play and equal-handed treatment for LEA and grant-maintained schools?
Baroness Blatch: My Lords, the number of grant-maintained schools is growing all the time. The noble Lord, Lord Judd, is continuing to confuse repairs and maintenance with capital spending. If the noble Lord wishes to table a Question in regard to capital moneys, I shall address it specifically.
From the coming financial year local education authorities will have to delegate from the centre to their schools money for maintenance and money for school cleaning, which is an extra extension of the local financial management system. However, with regard to grant-maintained schools, as of today there were 712 yes ballots and 337 schools up and running. That number increases substantially on 1st April, again on 1st September and again on 1st January next year. The number is rising all the time. There will be a shift from one sector to the other to recognise that movement, and extra money to bid for this year, which is unsecured from the Treasury, to recognise the growth of the grant-maintained sector.

Israel and the Palestinians
3.7 p.m.
Lord Mayhew Lord Mayhew asked Her Majesty's Government:
How many Palestinian children have been killed or injured since 1st December 1992 by Israeli soldiers and settlers using live ammunition; and what they are doing to secure the implementation of UN Security Council resolutions relating to Palestine.
The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey): My Lords, 17 children have been shot dead and over 300 injured, mostly by gunfire, since 1st December 1992. We are urging on all parties the importance of an early resumption of the peace talks aimed at finding a settlement on the basis of Security Council Resolutions 242 and 338.
Lord Mayhew: My Lords, I thank the noble Baroness for that reply. Should not the Government and the other Community governments be taking a firmer line with those breaches of the Geneva Convention? Can the Minister confirm that in recent years more than 1,000 Palestinian men, women and children have been either shot dead or beaten to death by Israeli soldiers and settlers who have no legal right even to be in the territories? Is it not time, therefore, that the European governments, whose protests are consistently ignored, began to think in terms of stopping Israel's trade privileges in the single market?
Baroness Chalker of Wallasey: My Lords, we have indeed been discussing an EC démarche to the Israeli Government on the basis of those children who have been killed or injured. It will issue shortly. We have further made absolutely clear, as of 1st February this year, the Community's strong views about those
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matters. We have our differences with the Rabin Government on the occupied territories, particularly over human rights, but also over deportations. We leave them in no doubt about our views.
Lord Molloy: My Lords, does the noble Baroness agree that it is a very sad thing that a people who have suffered so appallingly from authoritarian governments are now inclined to behave like one themselves? Does she not further agree that if the United Nations Security Council does not intervene to stop this terrible situation between Israel and its Palestinian inhabitants and does not do what it was created to do there will be no point in having either a United Nations or a Security Council?
Baroness Chalker of Wallasey: My Lords, I agree that these are appalling figures and that the whole situation needs to be rectified. It is for that reason that on 12th February the President of the United Nations Security Council reaffirmed to the Israeli permanent representative in New York the need for Security Council Resolution 799 to be implemented. He welcomed the Israeli decision to allow 101 deportees to return but he urged Israel to follow this through and allow the return of all deportees as soon as possible. He has also noted that all members of the Security Council are convinced of the necessity of the Middle East peace process and he has urged everyone concerned to redouble their efforts to reinvigorate the process. Alongside that we will do everything we can bilaterally and with our partners in the European Community.
Baroness Blackstone: My Lords, when the President of Israel visits Britain at the end of this month, will the Government be impressing upon him the fact that continuing repression in the occupied territories, including the use of live ammunition against children, threatens to derail the whole peace process?
Baroness Chalker of Wallasey: My Lords, yes. I am sure that when President Herzog visits this country on a long-standing invitation it will be a first-class opportunity for the Prime Minister and my right honourable friend the Foreign Secretary to range over all the many problems in the region. We have in the meantime taken every opportunity to raise individual problems as they have occurred with the Government of Israel.

Business
3.12 p.m.
Lord Hesketh: My Lords, I should like to say a word about this afternoon's debates standing in the names of the noble Lord, Lord Addington, and my noble friend Lord Pearson of Rannoch. As the mover is allowed 15 minutes, and the Minister should rise to reply not less than 20 minutes before the scheduled end of the debate, in the case of the debate of the noble Lord, Lord Addington, this means that all other speeches should be limited to a maximum of six minutes and in that of my noble friend Lord Pearson

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of Rannoch, four minutes. If any noble Lord were to speak at greater length, he would be doing so at the expense of subsequent speakers in either debate.
Lord Tordoff: My Lords, I wonder whether your Lordships will forgive me if I comment for a moment on what the noble Lord the Chief Whip has just said. Four minutes is clearly an inadequate time for anyone to address your Lordships' House on a subject as important as Maastricht. I have to say, as part of the usual channels, that in no way do I blame the Chief Whip for what has happened. It is something that we have brought upon ourselves by having timed debates, which on the whole have been very successful. But it seems to me that we are moving to a situation where noble Lords are putting down subjects for two-and-a-half hour debates which are far too big for the time allowed. In a recent debate on defence noble Lords were restricted to six minutes. In today's debate on Maastricht noble Lords are restricted to four minutes. It is making a mockery of the debating ability of your Lordships' House.
What I suggest is that we take on a self-denying ordinance that, on the whole, we put down subjects of this magnitude for five hours or for an unspecified period and that we also ask the Procedure Committee to look into the whole question of the timing of debates.
Lord Bruce of Donington: My Lords, perhaps I may follow the remarks made by the noble Lord, Lord Tordoff, on this matter and at the same time congratulate the Government Chief Whip on successfully ensuring that no maiden speakers are to take part in this debate as otherwise the time of everyone would have been spent in congratulating them, probably with every justification, on the wisdom that fell from their lips.
Lord Boyd-Carpenter: My Lords, will my noble friend consider referring to the Procedure Committee the use of these short time-limited debates on major subjects of policy of which this afternoon's debate is an extreme example? Would it not be possible to evolve a convention or rule under which, if there was only to be a short debate, a limited subject, suitable to be taken within that time-scale, alone was permitted?
Lord Hesketh: My Lords, perhaps I may start on the smaller but nonetheless important point of congratulations which the noble Lord, Lord Bruce of Donington, mentioned. I think that he attributes to the Chief Whip powers of influence beyond those which apply.
I fully appreciate the point made by the noble Lord, Lord Tordoff, and I am sure that your Lordships will also believe that this is neither the time nor the place to debate the issue. I quite agree with the suggestion made by the noble Lord and by my noble friend Lord Boyd-Carpenter that the Procedure Committee is the correct place to review the subject. I would also point out though that in the case of balloted debates, which the two debates are today, there will always be an impossible problem of definition of subject which will always, I fear, prove to be a challenge to your Lordships.

Citibank Europe Bill [H.L.]
Read a second time, and referred to the Examiners.
Unibank Bill [H.L.]
Read a second time, and referred to the Examiners.

Business of the House
The Lord Privy Seal (Lord Wakeham): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That Standing Order 44 (No two stages of a Bill to be taken on one day) be dispensed with to enable the Consolidated Fund (No. 2) Bill to be taken through its remaining stages tomorrow.—(Lord Wakeham.)
On Question, Motion agreed to.

Students: Financial Difficulties
3.17 p.m.
Lord Addington Lord Addington rose to call attention to the financial difficulties of students; and to move for Papers.
The noble Lord said: My Lords, I must, first, thank all the many people who have put down their names to speak in the debate. I must admit, echoing the words of my Whip, that six minutes may be stretching the point of brevity on a subject as complicated as this, but I hope that noble Lords will be able to cover most of the points that they have in mind.
When we first started to discuss the Bill introducing student loans I exploited the fact that I was somewhat lacking in years by comparison with most of the rest of the House by saying that I had something of an advantage having been more recently a student than most noble Lords. I can no longer say that for two reasons. First, my noble friend Lord Redesdale stopped being an undergraduate in 1989 as opposed to 1988. The second reason is that we are now into a totally new system of finance. Before we progress any further into the subject we must, first, deal with those changes—where we have come from and where we are going.
The level of grant had fallen in real terms over a long period of time. There was a genuine case of student hardship. The grant was greatly subsidised by the social security system in a variety of areas and in a variety of ways, the principal one being that housing benefit was payable to students if they paid more than a certain amount of rent. That was a useful benefit for several reasons, the primary one being that it balanced out discrepancies in the cost of living as reflected in housing costs throughout the country. The people paying high rents had one advantage in that they could call upon the social security system to give them some support. Students in London, whose London allowance has never really made up for the extra costs, found that particularly beneficial as did students at my old university at Aberdeen, where people paid locally high rents for the simple reason that it happened to be the UK centre of oil production.
There were other benefits available to students, primarily during the summer vacation. Social security benefits were payable to those students who could not find paid employment. That meant that they had some social security income during the summer vacation, but at a very limited level. But it was there. Housing benefit was also still available to students throughout the holiday period if they happened to be living away from home.
When the student loan scheme came in, basically there were two problems to deal with. The first was an ideological one, which is slightly outside the scope of my debate today. So on that matter I shall restrict myself to saying that many of us felt that the idea of loans and of encouraging people to go into debt was not one that should be inflicted on students from the age of 18 onwards. It was something which not many people liked. There were dozens of other options open to the Government, such as increased grants or some kind of pay-back system, which is effectively a graduate tax.
These alternatives were not taken up and the Government adopted a loan scheme. The primary criticism of that scheme is that it does not provide adequate funding for undergraduates to have realistic living standards. It just did not happen. Initially the sum was £420. It might be said that that would be a benefit to the students because it would be on top of everything else. But it was not, for the simple reason that we removed students from the social security system.
I believe that the noble Lord, Lord Boyd-Carpenter, put the matter far better than I during the debates on the student loan scheme. We were saying that students were removed from the social security system but that they were not like other members of society. I still have been unable to think why they were removed. If we are paying them some kind of maintenance, we are assuming that their parents will not support them and therefore they are independent people. So why did we remove them from the system?
We have removed them from the system and we have not provided an adequate alternative. There is the access fund, which initially was about £25 million, for all students in the country in further and higher education and for postgraduates, plus the loan. On that loan interest is charged at the rate of inflation, which means that, even with stoppages for the periods when pay-back has to start, there is a debt accruing. Even if one charges interest at the rate of inflation, one is still charging a considerable amount of compound interest. That situation is continuing and we have nothing else to fall back on.
Now we have a situation where the classic student —that is, one who is aged about 20—has a guaranteed income which is less than it would have been if he were on social security benefits. His income is actually less than that which is regarded as being the bare minimum for living. Recent reports have severely questioned whether social security benefit is sufficient to enable someone to eat properly. We are saying that a student should survive on that.
The Government respond by saying that there has
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been extra money available and the student is available for work during the summer vacation. We have nearly 3 million unemployed—has the figure gone above that? If we had guaranteed full employment, the Government might have a point. I have not seen anything to suggest that the Opposition Benches are going to guarantee full employment for students or for any other section of society. As we have made a great deal of noise condemning the ex-regimes in Eastern Europe which guaranteed full employment, it would be rather strange if anyone here gave that guarantee. People become unemployed and therefore need something to stop them starving, because we do not want them to starve.
We are also speaking about students who are supposed to be an investment in the country's future. The only real natural resource which Britain in particular and the Western world in general enjoy over most of our potential competitors is that we have a better trained and better educated workforce. That is probably the only natural advantage that we can possibly expect to maintain, but we shall not maintain it for very long if we continue to restrict the student body.
Perhaps I may give noble Lords some figures. Students outside London can expect an income of £57.30 a week. That tries to back up the example which I have already given. On benefits, that amounts to £77.45. Such people are on less income. One must remember that students have higher living costs if they are to carry on with their studies. They occasionally need things such as more travel and books. Let us assume that an engineering student has £30 worth of textbooks to buy even if it is only two or three times a year. Where is he to find the money? To some extent the answer has been to borrow it from the banks. Overdrafts of £1,000 are regarded as being reasonably commonplace. The CVCP reckon that an undergraduate should regard an overdraft of about £400 as being part of his income. Taking the initial weekly figure that I gave noble Lords, £400 accounts for about seven weeks of a 14-week vacation at the same level and is below that of social security benefit. It is not that much money. We really have a problem.
There is then the access fund which started at the rate of £25 million, which is a sizeable sum of money until one begins to divide it between the hundreds of thousands of people who are eligible to claim on it. The general level of pay-out—I have taken an overall figure from the variety of figures that I have been given —suggests that about £300 to £400 is a fairly sizeable pay-out from the access fund.
Once again we must look to the person who does not have parents who are providing support. We have 3 million unemployed and many of them are white-collar and middle-class. That means that even students who have been traditionally thought of as being well-off, probably do not have parental back up. It is also worthy of note that the number of students who are not receiving a parental contribution has been increasing. One can combine that with another figure relating to the rolls of the public schools which are falling. That suggests that we have considerable financial problems even in that sector. The

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Government have been trying to encourage more people from non-traditional recruitment areas to come into higher education. These people are probably even more susceptible to unemployment and are less capable of getting part-time work or work in the holidays, which often comes from word-of-mouth contact. Therefore, we have a situation where we cannot fund people properly.
I have given noble Lords a series of statements about the level of funding. It can be said that that does not seem to make a great deal of difference because rolls are actually rising in a number of universities and other institutions. That is probably true as the Government have expanded ways into the universities, even if they have not expanded the ways in which students can afford to eat once they get there. What has come to light is that another body has become aware of student hardship. The citizens advice bureaux have found students becoming clients as the student loans legislation takes effect. That body stated that in the summer of 1992 41 per cent. of all the people inquiring of them for help, mainly about financial matters, were students. That was a section of the population which they were not seeing before the loan system came in. That was in July. In August the figure had reduced to 33 per cent. and in September to 26 per cent.
Students are having to meet the costs of holiday periods. Many have to pay rent on houses throughout the summer as well in order to guarantee themselves somewhere to live in the next year. It is sad that those institutions, which generally have enjoyed less prestige in the past, tend to be worse off when it comes to housing. Thus they cannot subsidise their students. So students who have not done so before, are going to citizens advice bureaux asking financial questions.
A series of striking examples of people who cannot meet their financial commitments because of the lack of vacation work was also given. One example was that of a 19 year-old student who had completed the first year of a three-year course. She visited a citizens advice bureau in Essex because she could not find a holiday job and her parents were on income support and could not afford to keep her during the long vacation. The current system means that we are effectively saying that that person must decide whether to starve during the summer or to leave the course. How else can people eat if they cannot get income support and cannot find a job? Other examples of that problem are also given. I could read out a list of them to your Lordships but that one example has probably made the point quite succinctly.
There is, however, another example of something else that has slipped through the Government's net. One citizens advice bureau reported the case of somebody on a sandwich course—that is, a student taking a year out between studies to work in industry. Such students are not entitled to claim benefit because they are on a course but they are supposed to be at work. However, there have been cases of students who have been unable to find jobs during that sandwich period. Not only were they sacrificing 20 per cent. of their degree course mark but they were unable to provide any income for themselves during that period.
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Other cases include that of the student who could only find a job for seven months of the year. Having been released to complete the project, that student was without any income at all for the other five months.
The final problem relates to a student who was sick during the summer vacation. A student with glandular fever was unable to claim benefit because he or she was still a student, despite having glandular fever and being incapable of working.
Surely this system has failed miserably. It depended on assumptions of parental support and people finding jobs, but we cannot guarantee that parents will have sufficient funds and will cough up the funding for their student children. I have not dealt with many cases because the variety of problems is so wide, but I hope that other noble Lords will deal with other problems. Unless parents can provide the money or the students can find work, students have no income. That is the difficulty. My Lords, I beg to move for Papers.
3.32 p.m.
Baroness Park of Monmouth: My Lords, I am very glad that the noble Lord, Lord Addington, has initiated this debate. Although there is much chapter and verse to be given, because of the shortage of time I shall address only some issues of principle, and in particular the problem of postgraduates.
Does the country need graduates? If it does, how can it best protect the national investment in the next generation of innovators and the creative talent which they represent? They are our brightest and our best, and we are in danger of wasting a priceless asset.
The present position is that the loan and a full maintenance grant together are not enough to enable those students without private means who formerly qualified for housing benefit and income support to live and work. A possible discretionary grant of £150 from the Access Fund does not close the gap. Employment in the long summer vacation to earn money has been hard and often impossible to secure for the past three summers. Unexpected redundancy has prevented parents from contributing to maintenance and has deprived some of a home to go to. The Vacation Hardship Allowance, described by the Government themselves as a safety net, was withdrawn in April 1991 before the new arrangement had been in place a year.
In my own university, Oxford, the 20 to 24 per cent. of undergraduates living in private rented accommodation (as a proportion have to do for one year out of the three), paid £2,132 in rent alone out of their total income (of full grant and loan) of £2,845. Those are the 1992 figures. They ended up with £3.06 a day for food, clothes, travel and books. They cannot get a bank overdraft of more than £400 and they can no longer count on earning money in the long vacation.
We are not talking about all students but we are talking about a substantial part of the student population. Much has been done to improve the school structure. Presumably when those taught there leave and enter higher education we intend them to do just that in the national interest as well as their own.

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However, under the present system they are expected to live on less than they would receive as young unemployed people.
The plight of graduates doing research is another matter of particular concern. They do not qualify for loans or benefits. The Access Fund can do relatively little for them. The median grant in Oxford is £188. They have the same serious housing bill as undergraduates and in many cases will already be carrying over debts from their undergraduate days. Moreover, those who receive grants from the British Academy and the research councils are seriously under-funded. The guidelines requires them to limit the work they do which is not connected with their research. Teaching and library work, or work as demonstrators, is limited and not well paid. Because they must work through the calendar year to complete their research, they cannot get—even if it were available—more lucrative work in the long vacation. To survive at all they are undoubtedly having to work for many more hours a week than a productive graduate student should.
The chief causes of general concern are, first, the high cost of rented accommodation and the absence of any targeted mechanisms to fund students who cannot afford to pay. Students cannot manage their finances if they have no money to manage. Housing is the one large cost they cannot control. They cannot begin to plan their finances if there are no certainties. A possible but unpredictable and insufficient discretionary grant from the Access Fund is not the same as a means-tested benefit. A second cause for concern is the very great stress and anxiety which are widespread among those students who have no money and who can no longer make up their shortfall by work in the summer.
Universities are deeply concerned about the effect which this palpable stress and anxiety must have on academic performance. I suggest that we, too, should be concerned. When we are investing taxpayers' money to spend extensively on higher education, we should spend enough. We are not talking about all students but about a very substantial minority. It seems plain good sense to ensure that the return on public investment in the education of our undergraduates is not diminished by the damaging effects of financial hardship and the consequent stress on students. It is already difficult enough to understand why a whole group of taxpaying citizens should have been arbitrarily excluded from access to benefits on the grounds that they had "opted out of the labour market" by "taking the decision"—which I should have thought that the country would want them to take—"to undertake full-time study". The argument is that the Government intended "to place the responsibilities for student support where it properly belongs—in the education system". I hope very much that in the light of the experience of the past three years that responsibility may be reassessed.
I have followed carefully, as I am sure has my noble friend the Minister, the work done by the Select Committee on Education in another place in the previous Session of Parliament. The evidence it
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received of student hardship from an extensive and fully representative body of opinion, which included the CVCP and, unusually, as the noble Lord, Lord Addington, said, the CAB, as well as the institutions, demonstrated clearly that there was both widespread and growing student poverty. We are now a year on and the situation is worse. It is my hope that my noble friend the Minister will, since I know that she cares about education, agree that there is now a need to take a fresh look at the mechanisms in place and to find a formula to provide targeted support within the educational system of funding—whatever it may be called—to alleviate the difficulties of those students who are in trouble.
Students are sensible people. They know that money is short, but they need to know also that their problems are recognised and that the Government will think again. I sat on the Hebdomadal Council with graduates and undergraduates and know them to be sensible, responsible, reasonable and brave. We should not destroy their spirit but be seen to listen to their just representations. They are citizens. They are also our future.
3.38 p.m.
Baroness White: My Lords, I, too, should like to offer my thanks to the noble Lord, Lord Addington, for initiating this debate which will be regarded with considerable interest in all the universities and colleges in this country.
In this time-restricted debate on the financial troubles of students, I shall confine myself to what I know best—namely, the position that we face in Cardiff where I have held various academic offices during the past decade or so. Our Welsh capital city accounts for not far short of 10,000 students in its main university institution, the largest unit being the Federal University of Wales. The Welsh College of Medicine, the nearby University of Glamorgan—formerly a polytechnic—the College of Music and Drama and other units of higher education add considerably to the total student population of the city. In other words, there are literally thousands of young people, not to mention more mature students, trying to find lodgings, trying to find opportunities to supplement their inadequate incomes and trying to span the hiatus when sources of income disappear in the long vocation.
I have recently consulted our experienced Dean of Students, senior members of staff in various departments and, of course, our student president and her able and dedicated colleagues. There is no doubt that the academic work of a significant proportion of students is suffering because of the time and effort needed under present conditions to make financial ends meet.
I shall not pursue the matter of student loans, inadequate and costly as they are proving to be. What is causing more anxiety, as was mentioned by the noble Lord, Lord Addington, is total personal indebtedness, especially the accumulation of bank overdrafts. As we all know, even two or three years ago some banks were all too ready to lend. Now some are cutting off credit quite savagely.

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I have seen documented cases where properly negotiated overdrafts have been slashed without notice or consultation. What does one do if one's grant cheque, paid in at the start of a new term, is used to clear the overdraft without notice, leaving an impossibly small sum to meet essential expenses? For students receiving full grant, it can be fairly assumed that parental help is unlikely to be forthcoming. Students can wear themselves out taking early morning or late evening jobs, or in many instances both, at very low rates of pay. Some resort to undesirable work which interferes with academic studies and have to miss lectures or tutorials every so often. I cannot believe that spending hours, even days and nights, as subjects for relatively well-paid drug testing in the local hospital is the best use of academic time, especially when there are plenty of unemployed people to provide that service.
As long ago as May 1991, our principal, Sir Aubrey Trotman-Dickenson, currently Vice-Chancellor of the University of Wales, wrote to the Department of Education saying:
"The pressure of recession, redundancies and unemployment are putting great strains on the family unit, so that students receive less support, both financial and emotional, from home".
Nothing has improved since that was written. The stresses increase almost daily.
In the current academic year more than half the students attending the Dean of Students' office are seeking financial guidance. An additional member of staff has had to be engaged merely to deal with money management problems. That has nothing to do with academic work or accommodation. Last term there were also almost 2,000 written applications for access grants.
Students have not just lost vacation allowances and seen the value of grants diminish. They are even more depressed by the knowledge that after successful graduation there is nowadays no certainty of a job, however hard one may have worked.
I conclude by reading the final sentence of one of the letters sent to me recently. Mr. Frank Harris-Jones, the Dean of Students at Cardiff, writes:
"I am sorry if my comments sound bleak, but I feel especially depressed by it all, because I have R. A. Butler and the 1944 Education Act to thank for funding my university course and in consequence my whole career".
I do not know what the Minister thinks of R. A. Butler, but some of us respected him as a person who really cared about education and student welfare.
3.45 p.m.
The Lord Bishop of Newcastle: My Lords, I join in expressing gratitude to the noble Lord, Lord Addington, for having initiated the debate. All noble Lords will be aware of the difficulty because there may well be:
"no serious alternative to the introduction of a major contribution from private, as opposed to public, funds".
Those words were taken from an article written by the vice-chancellor of one of our universities located in Newcastle.
The debate will no doubt concentrate upon the most equitable and generally fair means of arriving at the appropriate public and private contributions and
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will also seek to establish the point that cases of hardship are by no means so few and far between as is sometimes implied. The chief problem about which one hears in every part of higher education is the conjunction of two factors which, like the handles of a nutcracker, hold many students in their grip; namely, the loss of long vacation housing benefit and the discontinuation of social security benefit for full-time students. That affects their finances during the long vacation in particular.
If there could be just one change to the present arrangements, the most generally helpful one would be funding for the whole year, thus providing for the cost of maintenance during the summer vacation. That said, I should like to develop two other general points upon which noble Lords have already touched. The first is difficult to establish statistically, but there is some evidence that the present system acts as a deterrent to entering higher education for young people who come from families and areas which have not traditionally sent sons and daughters to university. There has been a remarkable increase in the proportion of young people in higher education in recent years, but that increase may not be so marked, or as marked as we should wish, in those families where the parents' income leads to the award of a full grant to a student.
No student can any longer manage on a full grant alone. The very fact that a full grant has been made means that the student may feel compelled to take out a loan. But debt culture and credit cards are thought by some to be characteristic of the affluent. Many of those who have few financial resources have a laudable abhorrence of debt. So, on the one hand, we may still be unable to attract into higher education bright children from such families, children who could well profit from a university education and as a consequence make a better contribution to the country's well-being, and, on the other hand, by making student indebtedness an almost inevitable part of the culture of those who gain a place we may he threatening standards of thrift, carefulness and honour which we lose or weaken at our peril.
The second consideration is different. I listen to my godchildren and young friends at university when they talk about their work. Sometimes I do not know whether they are referring to the work they have to do in connection with their course—writing their next essay or conducting their next experiment—or whether they are referring to the work they do perhaps in the vacation or more probably in the evenings, say, in a bar or some other place of entertainment. Surely in sending young men and women to a university we are not providing them with part-time education, a sort of liberal arts programme in which they can dabble if they please; we are hoping that they will engage in it with heart and mind and find it absorbing and compelling because, properly speaking, a university course should provide more than enough work for the ablest student. How regrettable it would be if study came to be thought of as a luxury or a pastime, to be contrasted with the real work which students do to keep body and soul together.

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We all know that for years many undergraduates have had paid employment during the vacations. But there comes a point when the amount of such work interferes with their studies. Then the general public do not receive value for money in providing grants which enable young people to study. No doubt more detailed points will be raised during the debate. Particular difficulties are experienced by research students, mature students, those on sandwich courses and candidates for longer courses which have a clinical element.
We all know that it would not be realistic to expect the Government to go back on their general policy on the whole matter. However, I hope that the Minister will be able to express the Government's willingness to consider modifications to the present arrangements and say that they will take account of some of the more acute difficulties to which noble Lords will have drawn attention.
3.51 p.m.
Baroness Darcy (de Knayth): My Lords, I too thank the noble Lord, Lord Addington, for providing us with an opportunity to discuss the problems facing students. Your Lordships will not be surprised if I concentrate on students with disabilities or if I say that they too have financial problems. However, I should like to start on a positive note.
The increase in 1990 of the disabled student's allowance has meant that many students with disabilities have been able to go on to higher education. SKILL, the national bureau for students with disabilities of which I have the honour to be president, states that the City Lit Centre, which provides support for deaf students in London, has seen sharp increases since 1990 in the number of deaf students. That applies in particular to those who use sign language, because in the first year the number doubled from eight to 16.
However, despite the increased allowance, some students find themselves in considerable difficulties. The first group comprises students who need more than the maximum amount of the disabled student's allowance. There are a small number of profoundly deaf students on lecture-intensive courses who are finding themselves out of pocket or missing out on lectures. The RNID has evidence to support this claim. A qualified sign language interpreter costs £15 per hour plus expenses. The non-medical helper's allowance pays for about 10 hours interpreting per week. At that level of education one needs highly-skilled interpreters and note-takers. They will probably need to take part in workshops and seminars if the student is to obtain the maximum benefit from the course.
In Scotland the problem has been overcome by discretionary top-up grants from central budgets. However, that is not possible in England and Wales because discretionary grants are the responsibility of the LEAs. It is not that the allowances have not been uprated; they have. Rather it is that for that small number of profoundly deaf students on lecture-intensive courses the maximum amount of grant has
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never been enough. I hope that the Minister will give some thought to that problem and how to solve it so that those students may obtain the maximum benefit from their education.
My second point relates to the means testing of the disabled student's allowance. I agree that it is reasonable that better-off parents should have less government help with students' living costs. But however well off the parents are they should not be expected to pay extra to put a student with a disability on an equal footing with his peers. Loans were introduced because it was recognised that many parents did not make up their contribution. Yet loans are insufficient to pay, for example, for an adapted computer for a student with MS or for readers for a blind student. If parents do not make up the contributions, students can be thousands of pounds short of the cost of their additional support needs.
Thirdly, I turn to part-time students. The welcome increase in the number of opportunities to study part time has been of particular value to students with disabilities because, as a result of the nature of their disability, some cannot study full time. Obviously, those students may be among the most severely disabled and therefore most in need of the disabled student's allowance. However, they are unable to claim that. I plead, as I am sure will many other noble Lords, for the Government to look into the question of help for part-time students.
Fourthly, I turn to students in further education. The problems with the withdrawal of support for students with disabilities and learning difficulties when they reach the age of 19 should lessen when the Further and Higher Education Act 1992 begins to take effect. The good news is that last week the FEFC told college principals that from September 1994 such students will be covered for the whole course if they are below the age of 19 on 1st September of the year in which they start the course.
I also welcome the establishment by the FEFC of the specialist committee. It is important to monitor the impact of the new legislation on students with disabilities. I imagine that the committee cannot look at the problems which remain for part-time FE students or those who start their courses after the age of 19. They will have recourse only to discretionary grants, which are the LEAs' responsibility. If the committee cannot look at that issue I put in a plea to the Minister to consider who might be able to do so in order that those students too can benefit from the increased opportunities now available to students with disabilities.
3.55 p.m.
Baroness Seccombe: My Lords, I should like to add my thanks to the noble Lord, Lord Addington, for giving us the opportunity to debate this important subject. I am sure that all of us share the desire to see as many of our young people as possible leaving secondary education fully equipped to enter the higher educational institutions and with the necessary resources to do so.
It seems a very long time since my student days but even so my memory is crystal clear on the financial

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difficulties that I experienced at that time. But I believe that it was ever thus. Students from every generation have always felt under-funded and financially stretched—or perhaps in today's jargon and to be politically correct I should say "financially challenged". Students have always had to come to terms with the reality of deciding on priorities. That is not an easy thing to do but it is essential if one is to make ends meet.
I believe that from time to time we should remind ourselves of the very real strides that have been made to increase the number of young people who are fortunate enough to go on to further and higher education after leaving school. In 1989 the number was one million; that was an increase of 36 per cent. since 1979. In simpler terms the figures show that in 1979 one in eight young people went on to higher education. Today the number is one in four and it is increasing every year.
Of course, that can bring transitional problems at the beginning of the academic year while students try to find appropriate accommodation. But only about half of all students need to find private rented accommodation because 37 per cent. are placed in colleges and 11 per cent. live at home with their parents. In order to alleviate some of those problems, exciting initiatives have been taken by universities and colleges. For example, Sussex University is creating an extra 550 rooms by teaming up with the Kelsey Housing Association and the Bradford and North Housing Association. Stirling University has joined forces with the district council, Scottish Homes and the Dunfermline Building Society to build 185 rooms. Of course I could quote other examples.
It is for the universities to concern themselves with accommodation appropriate for and affordable by their students. The institutions are, after all, autonomous bodies responsible for deciding their own priorities within their available resources. The support given to students through grants and loans is now nearly 40 per cent. higher than when the grant only was available three years ago. That will be increased next year, thereby maintaining its value in real terms.
As the noble Baroness, Lady Darcy (de Knayth), said, it is good to know that students with extra needs—that is, the disabled and those with dependants—receive supplementary allowances such as housing benefit and income support. That gives special support and encouragement to those who might otherwise be unable to consider taking a course. I believe that it is for each individual to decide whether to invest in his or her own future. It seems to me that taking such decisions should not be based on reliance on the welfare system. Dependence of that nature is completely inappropriate, in particular as those who have qualifications almost always have a higher standard of living than those who choose to enter the labour market on leaving school.
There has been criticism about the whole system of student loans. However, I believe that the policy has been successful and has broadened the base of student support. I know that some Members of your Lordships' House believe that the top-up loans act as a disincentive to many potential students. That is
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difficult to believe when the number of full-time students has increased by 20 per cent. in the three years 1989 to 1991, doubling the figure for the previous three years.
There has been much discussion of the drop-out rate, but it is interesting to note the tables in the educational statistics for the United Kingdom for 1991. The data show that the UK ratios are among the highest in the 13 countries quoted, with only Canada and Germany exceeding the UK rate of 90 qualifiers per 100 new entrants. Italy has a record of only 33 per 100. Perhaps the grants-only system which they have in Italy is not the best way to ensure academic success.
Of course I understand the very real difficulties which a comparatively small percentage of students suffer, and we should see that they receive wise counselling. However, I feel that we can acknowledge the significant achievements gained and the initiatives taken in recent years to support and encourage young people to seek qualifications, an opportunity denied to so many earlier generations.
4 p.m.
Lord Cocks of Hartcliffe: My Lords, I too should like to thank the noble Lord, Lord Addington, for introducing this debate on the financial difficulties of students. By the time we reach the end of the debate, some latter-day Charles Dickens may find that he has enough material on the sufferings of students to write some fresh novels. The noble Baroness, Lady Seccombe, was right to remind us that those who suffer those appalling hardships—if they are successful—end up with a qualification which is the Open Sesame to a very rewarding career, often substantially remunerated. That is in sharp contrast to the position of those who do not have access to higher education and may spend their entire lives doing a repetitive clerical job or working on a factory production line. Therefore let us try to maintain a sense of proportion.
Two years ago I visited China on behalf of the Docklands Development Corporation. In conversation with my hosts, the two aspects of this country of ours which they mentioned were football hooliganism and homeless people. Perhaps a steady diet of CNN news is not the most objective way to learn about a country; but, nevertheless, the question of homelessness is serious. It places a great burden on councils. Not only councils such as Westminster but also boroughs in the East End of London such as Newham are facing appalling problems with the influx of homeless people.
That problem is not unrelated to our debate today. Most of our debates in your Lordships' House in the end boil down to one word: resources. When I explain our higher education system to people from abroad, they think that we are quite mad to pay out to send students away to study instead of them studying while based at home. They simply cannot understand it. One does not have to go abroad to find that, because in Scotland many students in higher education live at home. In Strathclyde the number is as high as 90 per cent.
There is no evidence to suggest that academic results are better if a student studies away from home

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rather than while living at home. If there was any such evidence, it would have been produced a long time ago to rebut the argument that I am putting forward. There is no suggestion that Scottish university education is in any way inferior to English university education.
I have made speeches on these lines before. I have been lobbied by students about my reactionary views. They tell me that going away from home is part and parcel of growing up, maturing, ripening and so on. When I suggest to them that they must therefore, apart from their own needs, also be pressing for the return of national service which extends that benefit of maturing away from home throughout the nation, they react with horror. I am written off as Genghis Khan. However, the same arguments apply.
I am grateful to the noble Baroness, Lady Seccombe, for putting the figures in simple terms. There are 1 million students in higher education, of whom half are in the private rented sector. Anybody who has been a Member of another place knows that probably a good half of one's casework relates to housing problems. That is not essentially a Member of Parliament's responsibility but that of the local council; but one cannot turn away people who come with such problems because if one does so that simply reinforces their whole experience of life up to that date. Therefore one does what one can. Of those 1 million students in higher education, approximately half are accommodated in halls of residence and other university accommodation and half are thrown on to the private rented sector. There they compete with people who, if they cannot compete successfully, join our monstrous queue of homeless people. Therefore, a very serious social evil is directly linked to the tradition in this country of sending students away from home to study if at all possible.
I have researched the subject over a period of years with the assistance of young people. If only 50 per cent. of our students in higher education lived at home and took the nearest available course, we could virtually clear up the problem of homelessness in three years, the duration of a normal degree course. We are asking for what might be considered a sacrifice on the part of the ablest and most gifted in our society to help the most deprived. Some £3 billion to £4 billion of resources would be tied up in a change of that nature and would become available for other uses.
It is very difficult to get the argument across because most of the opinion-formers and decision-makers in society are successful products of the system and cannot contemplate a change of this nature. Also, they want their own children to go through the same process as they went through. But I ask your Lordships to consider the proposal seriously because it would help to solve one of the gravest problems in our society today.
4.6 p.m.
Lord Broadbridge: My Lords, I too am grateful to the noble Lord, Lord Addington, for bringing forward this important debate. The financial difficulties of students is a subject close to my heart
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because I have two daughters in, respectively, their third and fourth years of higher education. That means that they both started in the now seemingly halcyon days of unfrozen student grants and the availability of housing benefit, income support and unemployment benefit—all now withdrawn. Those four measures—the freezing of grants and the withdrawal of social security benefits (students no longer get an interview at social security offices)—have made what was often for many students a precarious financial situation with them a wholly untenable situation without them and are, either individually or collectively, the main causes of student poverty.
Hardship is increasing in both severity and breadth. The Committee of Vice-Chancellors and Principals believes that the current financing shortfall for a standard single student after receipt of full grant and loan is approximately £1,100 per annum in the Home Counties.
Nor is the availability of emergency funds certain. The last resort funds—the access funds administered by the student's institution—have recently become far more uncertain as a prop. At the end of 1991 the number of awards was up by 80 per cent., but the amount paid in total rose by only 15 per cent. so that the average payment had fallen drastically.
The final twist to the financial screw has been the withdrawal of the Government's safety net for the financially bewildered, the local education authority paid vacation hardship allowance. That was withdrawn in March 1991 after only eight months of the new system of student support, which was then still an untried scheme, and against a background of great difficulty in finding vacation jobs, as many noble Lords have already said. That left many students technically bankrupt but had even worse overtones of governmental moral bankruptcy since the scheme's availability had been used to reassure—or perhaps bribe would be a better word—those in this House who were concerned about the loss of other benefits, for example, social security benefits. The allowance was pledged in this House on 15th May 1991. I ask the noble Baroness, Lady Blatch, not why her Government withdrew it, but rather: how could they bear to withdraw it?
I am thoroughly against young people ending their education and starting out in life in debt. According to a survey carried out last autumn by Barclays Bank and the National Union of Students, the average student will leave college with debts of £2,200. Four years ago, average debts were closer to a few hundred pounds. A majority of students cannot manage without some form of borrowing. The Barclays/NUS survey found that almost 50 per cent. had taken out government student loans, but the loans scheme does not yet account for as great a proportion of student borrowing as many believe. Last autumn it represented 31 per cent. of money owed; another 25 per cent. was owed to banks; 21 per cent. was owed to families, and six per cent. to credit card companies.
The problems arising from financial stringency are severe. Students at Anglia University are said in The Times Educational Supplement of 9th October last not only to work in vacations but in term time too. They

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not only do bar work and early morning sandwich making and cleaning, but several work night-shifts in a local jam factory. This must surely leave them exhausted at the times when they do do academic work, quite apart from the fact that for much of the time spent in the occupations quoted they should be working or, in one case, sleeping. The same source points out that accommodation costs, which can swallow up more than 70 per cent. of a student's weekly income, rose by 12 per cent. last year. Many have to rent a room in the private sector for the majority of their course, and to rent it for 52 weeks of the year.
Meals and books are probably the next greatest absorbers of overstretched funds. Many students, perhaps particularly the men, are poor cooks and rely on supermarket-type prepared meals for variety. These are inordinately expensive compared to staples and represent an unbalanced diet. But man cannot forever live on peanut butter sandwiches. Even second-hand academic books are surprisingly expensive compared to new ones; and, even worse, they are usually in rather short supply. However, they are essential for proper participation in an academic course and many of them have to be bought right at the year's start, often before a grant has arrived late.
Finally and intriguingly, our student loan system, which looks set to absorb more and more of student debt, seems to be a copy of the widely successful United States Guaranteed Loan Program. In a journal article on student loans, subtitled Throwing out the Baby to Keep the Bathwater, an American now studying in the United Kingdom writes that:
"A true comparison of the two schemes, as implemented, is instructive since it provides a classic example of the present Government's proclivity for examining a foreign situation, and then deciding to create a British analogue which incorporates the worst aspects of the original model".
In the USA the interest is, first, not applied until the loan becomes due nine months after the student finishes his or her course. In the United Kingdom it accrues at the moment a loan is taken out. Additionally and comparatively, the moneys loaned to supplement the United Kingdom student grants are meagre and bear a market-based interest rate. In the United Kingdom if a student takes out a government student loan in year one then during year one interest is being charged although not yet payable. In year two a further loan bears interest, plus interest from year one's interest, which has effectively become part of the capital loan. In year three a loan bears interest, plus interest on year two's interest, plus interest on the interest arising from year one. My mind boggles at continuing this to year four. But I thought that students went into higher education to learn their chosen subject, not to have to become a latter-day John Maynard Keynes.
4.14 p.m.
Baroness Perry of Southwark: My Lords, I too would like to thank the noble Lord, Lord Addington, for giving us an opportunity to debate what must be one of the more urgent topics facing us. As the expansion of higher education has been unprecedented in the last few years, some way must be found to
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sustain those students during the time they are in higher education. That there are many students now in higher education who are facing real hardship is undisputed. Of course the Government's access funds are very welcome indeed and they have helped very many students. But they have not been able —nor I believe, will they be able—to expand at the rate at which student numbers are expanding.
There are many contributory factors to student hardship which I would call unnecessary factors and which I believe could be tackled. It is not always a question of more money but of better management. One major contributory factor to student hardship has been the delay in the receipt of LEA grants from many LEAs where students have been left without help for long periods—for weeks or even months. A case came to my attention in my own institution only a week or two ago. It concerned a young civil engineering student who had not yet—this was on 4th February—received his LEA grant either for the autumn term or for the present term. He has been living on loans and hand-outs from other students throughout the whole of that period. I believe that this is unacceptable and the Government should put much more pressure on LEAs to pay students promptly.
Mature students with family responsibilities, of course, face particular difficulties and hardships. I was talking to a 26 year-old woman working for a degree in architecture in my own institution a few days ago. She tells me that she has a two year-old daughter whom she is supporting herself while undertaking full-time study. In order to do that, in addition to her grant she is working four nights a week, and there is no question that she is falling behind in her work and in her ambition to make herself independent and self-supporting.
The banks also have been far from sensitive to students' needs in recent years. It frustrates me that at one point they seem to be encouraging overspending and the taking out of large loans through credit cards and other facilities, and then at the drop of a hat when students, who are often inexperienced and unwise, overspend and run up debts, they foreclose in a totally arbitrary and very damaging way.
I have been given the story of another student at the new University of Plymouth, a second-year student who could not get a summer job and ran up an overdraft during the summer and at the beginning of the autumn. When her grant arrived the bank took the whole of it and withdrew her credit. Her tutors found her recently begging in the streets to enable her to continue her course. Again, this is totally unacceptable.
Students who have failed part of their course and have to retake it are in a particularly difficult position because they get no grant whatsoever. Again, from Plymouth I was given the story of one student who is struggling to live on a £715 student loan for the year, with £300 a term from the Access Fund, and is now telling his tutors that he will drop out of his course because he is quite unable to keep going.
These are real stories, and we all know that this hardship exists. However, I would suggest that the public purse is not limitless. We cannot go on simply

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demanding more and more money from the British taxpayer to support what is always going to be a minority and, as others have said, a privileged group, even though they do not feel very privileged at the time they are going through their undergraduate studies. Nevertheless, as others have said, they will become the better paid and the higher earners of our society.
The problem of how they should be funded both for maintenance and perhaps in part for the costs of their tuition requires a radical solution. It is a major problem. We have increased the expectations of young people and of mature students in society. Ways must be found to make it possible to meet those expectations without endlessly drawing on the public purse. I would commend to my noble friend the Minister at least an investigation into the Australian system, which has been introduced with apparent success in recent years. It involves the imposition of a 2 per cent. graduate tax, whereby students repay part of their maintenance grant from the Government. This seems to have been working well. It is ideal in the sense that it allows the repayment of the cost not to be spread throughout the whole tax system and to all taxpayers but only to those who have benefited.
I would also commend a recently published book by Nicholas O'Shaughnessy of Cambridge and Nigel Allington of Cardiff. The title is Light, Liberty and Learning: the idea of a University revisited. In fact the book is very largely about that title but it strongly recommends also a system whereby universities would receive a voucher for each student who came to them which would in part—though only in part—go towards the payment of fees, because tuition is rightly supported in large part from the public purse. Part is also passed on to the student as a maintenance grant. It is suggested the students repay this either through the imposition of a graduate tax or perhaps through their national insurance contributions. I know that the Inland Revenue always resists the idea of a dedicated tax, but I would argue that higher education is a private as well as a public benefit. It is a private benefit to those who will enjoy the benefit of it throughout life.
I particularly like the idea of repayment of money undertaken not as a huge and unbearable loan but rather in the form of a graduated payment which would cease entirely if the person paying it became unemployed or was obliged to stay at home raising a family. It would be matched entirely to his or her ability to pay. As the writers of the book say, it would be not a tax but a user payment simply administered through the tax system. I urge my noble friend to think of other ways to meet this increased demand—and it is an important demand—from our young people.
4.21 p.m.
Lord Redesdale: My Lords, I, too, wish to thank my noble friend Lord Addington for initiating this debate. I took great pleasure in thinking that I could speak on this subject with some genuine knowledge. As my noble friend has pointed out, I graduated from Newcastle University only in 1989. However, as regards the issues involved in this debate I know as
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little as most other people who have not graduated from university recently because of the changes that have been brought about through the reduced availability of student grants and the introduction of student loans. Many of the benefits that helped my student friends and flatmates to survive at university have disappeared. Perhaps we should consider what benefits have disappeared.
I accept that the majority of students will be able to fund their education. It is right that that should be the case as those students will then earn high salaries through having been students. I trained as an archaeologist. Therefore I do not think I could obtain a job which would pay off a student loan immediately. However, we are discussing the students who will find it increasingly difficult to avail themselves of higher education because they do not have the funds to repay a student loan. Others whose parents can support them financially will view student loans in a totally different way.
In the past seven years the Government have gradually eroded the resources available to students through alterations to the grant system and changes to the state social security and tax systems. Students have lost reclaimable travel expenses above the provision in the grant. The reclaimable travel expenses were introduced to help students who lived far from university and whose travel costs to and from home and during term exceeded the £139 allowed for in the grant. The reclaimable travel expenses were lost to students in 1986. The special equipment grants were also lost to students in 1986. Those were grants available to students in laboratory or studio-based subjects who had to pay for special equipment.
In 1988 tax covenants for students ceased. That step has placed additional burdens on parents who have to contribute to students' maintenance. Also in 1988 short vacation, unemployment and supplementary benefit were lost to students. Students' grants have to cover their living costs over the Christmas and Easter vacations in addition to the basic 30 weeks and three days for which they are intended. Also in 1988 the long vacation housing benefit paid during absence from term-time address ceased. As has been pointed out, students have to rent houses for the full year. No landlord will rent out a house on the understanding that it can be sublet to another tenant during the summer holiday.
Most students attend universities outside their home towns as those are the universities of their choice and also because the courses they wish to follow may not be offered in their home town universities. Some students therefore have to leave their home towns to study. Students who are obliged to carry on renting accommodation over the summer vacation when they are not there find that a great burden.
In 1988 and 1990 the entitlement in certain cases to free prescriptions for dental and optional treatment was lost. In 1990 social security benefits for full-time students were lost. Students can no longer sign on during the summer vacation if they cannot find work, even though the basic grant is not intended to cover that period of time. In 1991 the vacation hardship grant was lost. It seems that the safety net that could

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have protected students who are at the bottom end of the scale, who are vulnerable and who will be forced to consider leaving their courses if they find themselves in financial difficulties will be lost to the very students who will be most affected by the loss of benefit.
I do not believe student loans will compensate for the loss of benefit I have mentioned. That has been shown to be the case by the fact that the Access Fund had to be introduced. But that fund is woefully inadequate to cover the problems that many students face. In Newcastle there are 9,500 students who potentially could apply to the Access Fund. Some 1,000 students applied for help from the fund last year. If each of those students received £171 from the Access Fund, that fund would be entirely used up. That shows that the Access Fund system is not working.
4.27 p.m.
The Lord Bishop of Guildford: My Lords, previous speakers have already established beyond dispute that students are suffering financial hardship. I do not wish to repeat that point but I shall underline it by drawing attention to one or two less commonly mentioned areas. University chaplains report an almost universal increase in the number of students approaching them with debt problems. There is a corresponding increase in the number of students who approach welfare officers and others. There is further corroboration of student financial hardship from an unusual source. I am told that the profits from student union bars are down. That is the clearest evidence of student impoverishment.
I have received information on student financial hardship from my local university in Guildford, the University of Surrey. The cost of living in Guildford is every bit as high as it is in London; but the cost of living allowance for students in Guildford is an out-of-London allowance and that imposes financial hardship on students. A survey indicates that 24 per cent. of students are now taking part-time employment that lasts more than 10 hours a week. That is not only an indication of hardship but it is also an indication, as the right reverend Prelate the Bishop of Newcastle said, that students may not be giving their full attention to the rigour of academic discipline. They may be distracted and they may not be giving themselves to that leisured analysis of the world's problems which is part of the benefit of a university education that many of us have enjoyed. It is easy to blame the Government for this situation. That, after all, is one of our major national industries and it is one totally unaffected by the recession.
However, it is not adequate just to say to the Government that they ought to be producing more money. They have made mistakes, and the withdrawal of the vacation hardship allowance is an unhappy episode. Nonetheless, we cannot blame just the Government. We need a much more corporate response from many different elements in society. As the noble Baroness, Lady Perry, pointed out, the LEAs carry a substantial responsibility. I was appalled to read that over 24,000 students had to wait
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at least a fortnight before receiving their grant at the beginning of the academic year. That is inexcusable; and we ought to say that quite bluntly.
Again, student unions, though it is quite right that they should put before us the needs and anxieties of students in relation to finance, could do more in ensuring that students have access to debt counselling, financial advice, and proper budgeting. I was particularly impressed to see, for instance, a leaflet issued by the York university students' union helping people in this direction, and I hope that is reflected in other student unions in universities across the country.
Mention has already been made about the banks and how they could do much more to help students. It is sad that they seem to show a lack of sensitivity to the particular problems of these students, and not least mature students, where there seems to be evidence that they experience hardship even greater than others.
The noble Lord, Lord Cocks, thought that the problem might be solved in large measure if everybody went to their local university, and he hoped that might be resolved in three years. I think he would find that a number of universities would have significantly to change their arrangements, because there are many universities, such as the University of Surrey, which do not offer a complete set of courses across the subjects. Many students in our area would necessarily be trying to study technological subjects which are totally beyond me, and I suspect beyond a great many of them as well.
I do not think that is a solution. We need far more radical solutions than we have yet faced. I was particularly glad to hear the noble Baroness, Lady Perry, also say that. I do not think that just modest adjustments to the present position will meet the situation. We have to be prepared to look much more radically at the situation. Is it not possible to think in terms of a graduate tax, or some other such process whereby the money can be recouped? It is right that we should try to re-establish the fact that higher education is not a right to which people have access, although I wish them to have access to it. It is a privilege, and we need to make that quite clear. Because it is a privilege, people should be ready to contribute towards the cost of it; but the present loan system is not satisfactory. As the Committee of Vice-Chancellors and Principals say, it is not adequate, not certain, not simple and not socially just. We need a much more radical solution.
I hope that the noble Baroness the Minister will be able to say that such investigations are being inquired into, because we need to ensure that there is increased access for people to higher education and that they should be ready to contribute in some way to the cost of it.
4.33 p.m.
The Earl of Limerick: My Lords, as others before me, I acknowledge the noble Lord, Lord Addington, for the opportunity to discuss this important subject. In so doing I declare my interest as the chairman of the London Guildhall University. In the limited time I shall concentrate on two topics. One is the issue of

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hardship itself, and the second, the Government's proposals, so far as they can be determined, for revising the financial arrangements for student unions.
The leading article in Higher of last Friday opened with the question, "What is student hardship?" and offered this answer:
"The most often cited measure is the growing volume of student debt."
There is logic in that. And this hardship is increasing. There are reasons for this, and there is evidence in support.
Let me cite just three reasons out of many. The first is the increasing number of students who, to my knowledge, are receiving their grants late—a point already twice referred to—by weeks or even months. It seems that the London boroughs are the worst offenders in that regard. Almost one quarter of our own students sharing their problems with our student adviser last term cited that as a reason for their problems.
It is not for lack of self-help on the part of the students. The second reason is the increasing difficulty of supplementing income by working. In summer last year only 31 per cent. of our students were able to get vacation work. The average wage they received was £64 per week, of which on average £45 went on rent. That is not even a break-even situation to enable students to reduce their overdrafts. The third reason is that, despite the best efforts of staff, many sandwich course students do not get paid placements. If they can afford it they will take unpaid placements; if not, they must take placements unrelated to their courses.
A further consequence is the increasing number of students driven to seek earnings during term time and not just in the vacations, to the obvious detriment of their course work. Our student union now, from their own funds, pay for a full-time counsellor, and in the university we employ one and half people full-time equivalent on that work. Certainly no one is suggesting that students should be feather-bedded, coasting along without effort, and the students themselves are not suggesting that. But they do—and reasonably—expect to be able, with frugal living and good husbandry, to complete their courses. Increasingly, and tragically, increasing numbers are unable to do so.
Let me offer some quantification by reference to our own experience with the Access Fund. In the last academic year, using round numbers, my university received £160,000 of access funding. With 5,150 eligible students, that would enable support of 60p. per week if evenly spread. Of course it was not evenly spread. Nine hundred applied for assistance, and almost exactly half received some help in amounts varying from £50 to £1,200, the average being £380. About half of the awards went to students who were either totally self-supporting, generally in fact not receiving the assessed parental support, or to help with child-care costs, more than half of our students being mature. The evidence, as always, is inconclusive, but it is our belief that many of these students would have
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had to abandon their courses without a helping hand from the Access Fund. I hope that this will be well in mind when the fund is reviewed for next year.
I shall spend the remainder of my time on the question of student unions. My right honourable friend the Secretary of State for Education has promised some changes in their basis of financing. He has not spelt out the basis of his concerns so it is hard to offer intelligent comment. I can only speak for my own institution, where our student union provides, on a consistent and responsible basis, services well used and well valued by its members, being services which otherwise would have to be provided by the university itself.
In the process the students managing the union's finances acquire valuable experience, and they address their duties very seriously. By no definition that I can find could that part of their expenditure classified as "political" be said to exceed 2 per cent. If that is the focus of intended change, let us deal with it on a more rational basis than throwing out the baby with the bath water. Legislation certainly is needed to define the status of student unions, and no one would deny that expenditure from public funds should be subject to rigorous scrutiny.
However, references to the voluntary principle are no substitute for consultation on desirable changes; and it would be ironic indeed if the pursuit of freedom of speech were the occasion for producing far-reaching legislative proposals without proper discussion. If legislation is produced which is not preceded by such discussion, I believe that it might have an awkward passage through Parliament.
4.40 p.m.
Baroness Lockwood: My Lords, as the noble Lord, Lord Addington, indicated in his opening remarks, the truth behind today's debate is that, unlike other members of the community, there is no safety net for students. The assurances of the Minister for Social Security at the time of the Student Loan Bill in 1990 have proved sterile. Universities are being left with growing costs in administering the Access Fund, a fund which cannot cope with the needs of students.
I give two examples of problems from my own experience. In the University of Leeds, after earmarked deductions and an average rent of £32.50 per week, students are left with £17.67 per week to live on. In Bradford with a rent of about £25 per week, they are left with £24 per week to live on. That is still well below the government poverty line of £33.60 per week.
Those are the lucky students who receive the full grant, including parental contribution, and who take up the full loan. The position of students who do not receive a full grant is even worse. Out of the amount that is left, students still have to pay for poll tax, water rates, heating and lighting, and any essential equipment needed for their course, as well as food. At Bradford University, which is attempting to be completely computerised, that is likely to mean an individual computer for each student. It is no wonder that the student welfare officer cites students not

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eating for days and fainting for lack of food. The collection and distribution of food parcels is now routine throughout the year.
That is the position of full-time students. But I wish to refer to another group of students who do not receive the mandatory grant or the student loan. They are part-time students, a category which the Government would like to see grow in number. A recent circular from the funding council for England indicated that there would be a financial incentive to those universities which increased their part-time student numbers. Currently, excluding the Open University, in England there are about 137,000 undergraduates and higher level sub-degree students and about 86,000 postgraduate students on a part-time basis. Despite the pressures under which they operate, part-time students do well academically. Most are working, or unemployed, or are women at home with children. Many are single parents. All those factors make full-time study difficult. They have to pay their own fees, and the cost of books, travel and essential equipment out of their already taxed income. Most seek to improve or establish career prospects. A decreasing number are able to obtain discretionary assistance from a local education authority. At Birkbeck College, about 12 per cent. of those students have their fees paid by employers. Ironically it is usually the more highly paid students who receive that financial assistance.
Birkbeck College, part of the institution about which the noble Earl, Lord Limerick, spoke, leads in the field of part-time study. It has its own long list of severe financial hardship among its 4,200 part-time students. Its fees range from about £500 to £1,000 per annum depending on the course. Add to that books and travel and one arrives at a minimum of £900 for an undergraduate student to £1,390 for a post-graduate student. The nature of the university scene has completely changed. More than 50 per cent. of students are mature students. A growing number are part-time or associate students. Modularisation of courses will enhance that process.
As the right reverend Prelate the Bishop of Guildford stated, we need a complete reappraisal of the student grant and support system. There must be a system which is both adequate and equitable to all students. We cannot continue with the present hotchpotch system which leaves a large proportion of students in such financial hardship that their studies are jeopardised.
4.46 p.m.
Lord Moore of Wolvercote: My Lords, I endorse the many expressions of appreciation to the noble Lord, Lord Addington, for initiating this important debate. I speak because I thought that it might be of interest to have some impressions from the viewpoint of a centre which sees a wide cross-section of university students.
At Cumberland Lodge in Windsor Great Park we receive every year over 3,000 undergraduate and postgraduate students, including many from overseas, from about a dozen universities. We therefore obtain a good overall picture of the financial circumstances of
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today's student. Based on that experience I wish to make two points. The first concerns UK students. When I was at school in the 1930s hoping to go to university there were no grants and only two ways of getting to university: either to have parents who could afford to pay for you or to win a scholarship—and scholarships did not cover the full cost. As a result, many who should have gone to university did not do so, and the country was the poorer. I met many such people among my RAF aircrew friends during the war.
After the war, grants were introduced and the whole scene changed. Those deserving of going to university were able to do so without being prevented by lack of money. That was the position until about 10 years ago, when grants began to fall behind the cost of living. I do not argue for lavish style for undergraduates, but lack of money is now beginning to be a deterrent to undertaking a three or four-year university course.
The position of undergraduates and postgraduates has become much more serious as a result of unemployment making vacation jobs more difficult to find. Already we are in a situation where undergraduates are expected to take loans amounting to £2,000 over a three-year course in order to top up their grants. Even so, they are getting further into debt. At the age of 26 I came down from university and married, having to live on my salary of £396 a year as an assistant principal in the home Civil Service. I do not know what we would have done if we had been faced with paying off a loan as well.
For the sake of the future of this country we desperately need young men and women with university training. I ask the Government not to let the level of grants drop so much that money again becomes a real bar to university education.
My second point concerns overseas students in this country, and especially those from the Commonwealth. British university education has always been enormously attractive for students from the Commonwealth for three reasons: the English language, the quality and worldwide standing of our universities and the traditional links with Britain. Many of these students have gone back to occupy influential positions in their countries and their good will has proved invaluable to Britain. But fewer potential Commonwealth leaders are coming to university in Britain today. The disastrous decision in 1980 to introduce full cost fees for overseas students resulted in a large drop in the numbers coming from the Commonwealth. In terms of numbers, the position is now better, but the Commonwealth students are coming in the main from those countries where parents can afford to pay the UK fees—from Malaysia, Singapore and Hong Kong. Those from the poorer countries—Africa especially—in many cases cannot afford to come. That means that in the long run we shall inevitably have fewer links with such countries.
By contrast, students from EC countries get lower rates. These EC students are welcome and their presence is further evidence of the high standing of our universities, but we must not lose the Commonwealth

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students. The most helpful thing the Government could do is to extend the EC concessionary rates to students from the Commonwealth. The present situation, giving EC students preferential rates over those from the Commonwealth, is very difficult to justify and I hope that the Government will give careful consideration to making that concession.
4.51 p.m.
Lord Renfrew of Kaimsthorn: My Lords, in his useful speech introducing the debate, the noble Lord, Lord Addington, made a number of important points. One which I think is generally agreed is that most students today finish their degree courses substantially in debt. That is scarcely surprising, when they are invited to fund their courses through a student loan scheme. There is not necessarily anything wrong with that. Debt is not necessarily hardship and sometimes, in the course of the debate, in my view one is blurring the distinction between debt and hardship. But it is also clear, as we have heard abundantly documented, that there are many cases of hardship. The withdrawal of housing benefit, income support and so on has meant that many students, even when they have drawn on the financial resources available to them, find themselves on the margin. That is a cause for concern.
We live in a new world for students, a world where they have to concern themselves with the financing for their courses. It is a world, therefore, of financial uncertainty. I give the Government great credit for expanding the higher education sector and I do not think that they are in an easy position—it would not be easy for any government. Clearly the education budget is not infinitely elastic. Today we must probably accept that, if we are expanding education at such a rate in the higher education sector, it cannot all be free, with grants on a scale which we feel are adequate. That is to say, an element of self-financing is inevitable. So I respect the Government's dilemma and think that they have been right to try to move in that direction.
However, I wish to emphasise one consequence of the present arrangements which I find very worrying. It is a point already emphasised by the right reverend Prelate the Bishop of Newcastle. It is the extent to which these adverse financial circumstances deter pupils from low income families from entering the higher education sector at all. For that reason I fear that some of them will not show up in the statistics of student hardship because they do not even enrol as students. There are good arguments to suggest that it is precisely students from low income backgrounds who are reluctant to take on a debt burden in order to undertake or complete their courses. Students from more affluent backgrounds are perhaps more easily persuaded of the merits of low interest loans and, of course, there are real merits in them.
I know that the colleges in Oxford and Cambridge experience considerable difficulty in attracting appropriate numbers of students from lower income backgrounds, although the colleges' endowment funds allow them to offer significant hardship grants. I
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believe that it is the case that a lower proportion of such students enter higher education in this country than in various other education systems.
The suggestion that, quite apart from the grant problem, some universities are thinking of charging "top up" fees is deeply disturbing, since once again it is students from low income backgrounds who are most likely to be deterred.
The Government have grasped the nettle and introduced an element of self-financing. I do not feel that that is wrong in itself, but we are not at present getting it quite right. The burden of debt introduces hardship for some, and that has been the main theme of this debate, and appropriately so. But equally important, it is introducing a deterrent for many.
A number of noble Lords suggested that the situation needs reviewing and I think the time has arrived when that is the case. The solution may well be a graduate tax. I think that the noble Baroness, Lady Perry, made a good point in emphasising that. It was advocated by a number of groups, including, I believe, the Committee of Vice Chancellors and Principals, at the outset. The Government would do well now, in reviewing the matter, to ask other groups—including the National Union of Students and the CVCP—how, within an overall budget figure, they feel the system could be better operated. I am sure that there is a case for increasing the budget figure in view of the hardship element, but self-financing is here to stay. However, it must be a self-financing system that does not introduce the deterrent element, for I fear that there is a real danger that our fine record in developing and maintaining a higher education system open in practice to all—that is, to all students suitably qualified—may not be sustained. It would be a sad day if university education in this country were felt to be available once again only to those with the means to afford it.
4.56 p.m.
Lord Butterfield: My Lords, I wish to open by re-emphasising our debt of gratitude to the noble Lord, Lord Addington, for this debate. As is so often true when one is batting late in the batting order, I am delighted with the many points that have been made.
I spend some time, in my decrepitude and old age, being attacked by people who say, "The students are a dreadful lot, some of them were drunk the other day", and similar remarks. I wonder whether it would be appropriate if I could use some of the ripostes that I have had to use in the field to support and encourage the Minister in the battles that she must have in the Department of Education, standing up for our students and no doubt letting her maternal instinct towards them express itself.
Minister, I wish first to say: please close your ears to some of the things that I hear: for example, "I believe that the bar takings in your college bar went up last year. How on earth can you say that any students are hard up?" Of course, some people drink and others do not have enough money to drink. Please do not be wooed by that argument. Others will produce all kinds of arguments such as: "We know that some of your hardship funds were not taken up last year.

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What on earth is this cry that the students are hard up, if they can't even be bothered to apply?" There are two reasons for that. One is that it becomes common knowledge among the porters and in the common rooms if people apply for grants. Some of them, bless them, are too proud to come forward if they can possibly manage. I admire them for that, but I see that the door is being left open for the thought that they cannot be very hard up if they are not prepared to apply.
I was terribly hurt, worried and distressed to hear of a girl who has been begging in the streets. Cambridge streets are full of musicians, I do not know whether any are musicians from the colleges but they certainly play very well. I give them my 10p whenever I can.
Minister, I wish to encourage you in your struggles on behalf of our seed-corn, the young people who are well endowed and reaching out for the future. They will need every skill they can produce when the financial situation begins to change and the sunshine industries look for the likes of our present students. Incidentally, do not forget that those sunshine industries may also include the leisure industries where those much-reviled young people on the arts side may come forward and be able to show the rest of the world that we still have great young artists in the making.
I was very taken with the powerful argument of the noble Lord, Lord Cocks, which I have heard before, encouraging people to stay at home and go to university. I would not be opposed to that. I think that some feel a desperate need to get away from home and try their wings, but I believe that the great civic universities might well increase their public relations effort to get people to stay at home. We have with us a member of the Committee of Vice-Chancellors and Principals, and I have not had a chance to take that up with her. But I do not think that the Minister should completely neglect the noble Lord's proposals but should see whether that is a way of reducing the overall demand on student funds.
In my remaining minute, I should like to tell noble Lords that when I was at Nottingham I had one lady student who came to see me to say: "Vice Chancellor, I think you should know, and I would like to give you warning, that I am going to have my common-law husband in my room with me next year". She was appalled when I replied: "My goodness, you will be my heroine. If you can take two people into your room, it can become a general rule and we will have double bunks everywhere". I heard no more about the matter. I do not know whether it is a possibility—I am not suggesting that there should be mixed rooms. But it is true that in American rooms there are two young men or two young women in many bedrooms. We should not forget that as a possibility. Perhaps the universities would be willing to look into it. I am not sure what the educationists might say to me, but I am old and decrepit and before long I shall slip away out of their grasp.
Finally, I was in Australia at the meeting of the Association of Commonwealth Universities when the then Minister of Education for Australia was
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beginning his drive for the 2 per cent. tax on the loans the students were to get. He was reviled by the academics. Now it appears that it has worked. It is awful to think that one will have the first tax aimed at a certain repayment, but I hope that we can encourage the Minister to give serious consideration to it. We are talking about a very important part of our society. It is worth cutting new ice to try to support our young students.
5.1 p.m.
Lord Gainford: My Lords, my gratitude to the noble Lord, Lord Addington, is based on the opportunity to pursue my concern about student finance which began last November, when I asked a quick question about the possibility of student fees being tax-deductible. I declared my interest as a student of the Open University and was grateful for the good wishes and encouraging noises from noble Lords.
The Open University is an educational institution which is part-time and self-funded. Students study at home but attend tutorials and summer school. The only qualification for entry is the ability to read and write. Students are of all ages. All want to better themselves, either to improve their present careers or, in the case of unemployed, retired or senior citizens, to seek new directions. Great encouragement and assistance are given to handicapped students. I will give a small example. My own wife is handicapped, and it was arranged that we (I am her helper as well as a fellow-student) did not have to attend an exam centre. With an invigilator present, we wrote our exam answers sitting across our dining-room table.
To obtain a degree a student must obtain six credits. Most students study one course a year. A pass is obtained not only by sitting an exam, usually held in October, but on the marks obtained with written assignments. A pass provides the student with a credit. There are shorter courses which produce just half a credit. The majority of Open University students pay their own fees, but loans and grants—as has been said —are not easy to obtain, particularly if one is over 50 years of age. In order to meet shortfalls between income and expenditure, the Open University has had to raise its fees by well above inflation rate. Since 1979, tuition fees have risen by more than 70 per cent.
The estimated average cost to a student for a six-credit course at 1992 prices is £2,500. On top of that sum is the cost of the set books and the week's attendance at the residential summer school. That is further expense. There is the matter of travel to tutorials, and costs for stationery, use of computers, telephone calls and postage. Parent-students have to arrange childcare in order to attend tutorials and the handicapped students have their own particular problems and expenditure. It all adds up.
The university operates a means-tested financial assistance fund. The fund has to be cash limited. Since 1990, awards to new students for their initial tuition fees increased by 70 per cent. For 1993 the Open University has budgeted over £2 million for financial

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awards. However, I am informed that the demand is so great that quotas are likely to be imposed to protect the interests of continuing students.
Her Majesty's Government encourage increased participation in higher education by opening opportunities for so many young people. But there is another category of persons who need assistance. Those are the mature and senior citizen professionals. Part-time education is a cost-effective way in which they can be encouraged to contribute valuable talents to industry and business. I therefore urge my noble friend the Minister to give serious thought to lessening the financial hardships of many adult part-time students.
5.6 p.m.
Lord Rix: My Lords, I am most grateful to the noble Lord, Lord Addington, for instigating the debate. I have already apologised to the noble Lord and to the noble Baroness, Lady Blatch, for the fact that I might now be considered to be a trifle tangential. I am aware of the romantic notion that poverty encourages study and that working late at night in a freezing garret by the light of a candle is good for the soul. But those who praise that lifestyle have not, I suspect, tried it. Certainly it is not one recommended by the CVCP, nor, I believe, by Dr. Faustus, who went to the devil in somewhat similar circumstances.
As a member of the Arts Council and as chairman of the Arts Council drama panel, I want to raise specifically the issue of discretionary awards granted by local authorities for courses concerned with dance and drama. I was delighted that the noble Lord, Lord Butterfield, touched on that.
In the time of good Queen Anne, as noble Lords may know, actors were still termed, in line with Elizabethan precedents, "rogues"—not "and vagabonds"—"rogues and sturdy beggars". We are rapidly returning to the time when those training for the profession will probably be known as beggars. I doubt the roguery, and the sturdiness will rapidly be undermined by lack of both food and funds.
I was personally lucky in that I never had to gain my training through being a student. The war was on and there was a desperate lack of actors. Those not fighting were either too young or too old or what was euphemistically known as "temperamentally unsuited for active service". I would like to assure noble Lords that I fell into the first of those categories. But, as in today's debate, I was in those days at the bottom of the bill.
However, young people now are faced with convincing hard-pressed local authorities to fund places at their discretion or with being pushed into degree courses which will gain them a mandatory award but which may be quite unsuitable.
In the field of dance and drama, training in the real world is probably more important than in many other areas, and it is that which is being lost. The Arts Council has been asked by the Department of National Heritage to look into the decline in discretionary awards from local authorities. I hope
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that I can have the assurance that the Department of Education will be just as interested as I am in seeking a solution to that problem.
While there are courses in dance and drama in universities, vocational training in that field is provided through independent academies or schools, none being centrally funded and all being dependent on student fees. Most UK students need a discretionary grant from their local authority in order to pay those fees. The number of students turning down places because of the lack of a grant for fees has increased significantly since last year. It is estimated that 40 per cent. of dance and drama students are unable to take up the places that they have been offered. We are facing a loss of revenue to schools and their possible closure—but how much talent is being lost?
More and more, only better-off families will see that kind of training as an option and as a result the profession will be impoverished. It would be an extremely unbalanced profession, with no recruits from ethnic minorities or working-class backgrounds. The system of discretionary grants is not working. It is not providing equality of access, guarantee of quality, economic efficiency or appropriate accountability. Direct central funding to the schools would ensure such outcomes. There would be an efficient and effective use of public funds and schools would be able to select students on the basis of talent and focus on raising standards.
With the rapid decline in the availability of local authority discretionary awards, many of us would like to know what the Government intend to do to protect and encourage funding for both dance and drama training. We are lucky in that we have progressed from an era when only the rich benefited from education to one in which some form of further education is at least known to exist by all. But can we all take advantage of that opportunity? Regrettably, I must conclude that we cannot.
On many occasions I have had the privilege of speaking on behalf of people with a learning disability—people who in many cases can and do speak for themselves when the educational opportunities exist to help them do so. Access to adult education for people with a learning disability is not a mere pastime but an essential step forward. It may seem less important to fund classes for basic cookery or simple numeracy, but in terms of producing full participating citizens in our society it is crucial.
I realise that the debate centres on the financial difficulties of students. But I wish to know from the Minister how the Government intend to ensure that sufficient education is available for people with learning disabilities and whether they intend to produce guidance for local authorities on the provision that must be made for people with learning disabilities if they are to learn the basic living skills of life. To me it would be a luxury to talk of the amount of money in the pocket of a student with a learning disability when the vast majority have no access to adult education at all and too often in the current climate have no hope of ever living off anything other than state benefits.

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It was Samuel Butler who wrote:
"An art can only be learned in the workshop of those who are winning their bread by it".
I was one of the lucky ones. There was a war on—I could practice my art. Now, thank goodness, peace reigns, but poverty for students—mature and teenage alike—plus poverty pleaded by local authorities, is denying a basic grounding for thousands of those eager to learn and then win their bread from the knowledge gained.
5.13 p.m.
Earl Russell: My Lords, in the past two weeks some 20 per cent. of my working time has been used in trying—usually unsuccessfully—to solve the problems of students who, through no fault of their own, are spending too long earning money to be able to do the amount of work the college would otherwise require of them. Some of them involve stories of hardship as great as any mentioned by my noble friend Lord Addington, including one student who has been attempting to live on £20 a week. On two occasions I have been faced with a situation so urgent that I thought it my duty to default on an ordinary commitment to the inconvenience of my other pupils in order to deal with the problem. It makes my point that those inconvenienced felt that I had my priorities right. Therefore in declaring my interest as a university teacher and as a parent I do so with some feeling.
I always admire, when there is a stampede in the House, those who stand against it, even though I may be part of the stampede. I congratulate the noble Baroness, Lady Seccombe, on her speech. But if she believes that it was ever thus she has no idea of the gravity of the present situation. I have been listening to student problems for 33 years and I have never known anything remotely like the present situation.
The average amount of work done by under-graduates has halved since I came back from the United States in 1984. Financial difficulties account for some 80 per cent. of that change. The two right reverend Prelates hit the nail on the head; it is students doing jobs during term time which is the hub of all our difficulties. The figure supplied by my own students' union is that 67 per cent. of them are doing jobs for an average of 10 hours a week in the term. It is a difficult subject on which to obtain honest answers to a survey. I believe that that figure is an underestimate and the accurate figure would be nearer 75 per cent.
It makes it extremely difficult for the students to do that for which they are obtaining their grants; in fact, it interferes with the object of the exercise. The noble Baroness the Minister will probably raise three arguments against what I have said. She will refer to the low take-up of student loans. I advise all my pupils individually to take the student loan, so I know something about it. I find regularly that they prefer to work during term rather than take up the student loan; they have just that dislike of going into debt which was expressed by the noble Lord, Lord Boyd-Carpenter, during the passage of the loan Bill in
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this House. That is not the noble Baroness's problem; it is my problem. But I ask her not to misinterpret that low uptake.
Secondly, the noble Baroness will probably point out that the proportion of first and upper second degrees has not fallen. In my opinion ability is constantly rising. I do not believe that I am the only academic who feels that penalising an undergraduate for not doing work that he could not do is a bit like penalising a dyslexic for his spelling. That therefore conceals a sharp fall in the amount of work done by undergraduates.
Thirdly, the noble Baroness will quote the continuing flow of applicants. I see them in their first week. It is clear that they do not know what they have let themselves in for. They think that the grant is still meant to cover the whole of their expenses. It may be worth remembering what Mrs. Rumbold said about child benefit; it is deep in the culture. So is the assumption that students live off grants. They do not.
The total amount of grants plus loan in London is £3,675 a year. The college advises overseas students that the minimum amount that they need to live on is around £5,000. That discrepancy may be £100 or £200 too high. But it is in the right target area. Mr. Nicholas Scott on 20th April 1990 admitted that student incomes are below social security benefit level, and the National Association of Citizens Advice Bureaux now calculates that in London they are £474 per year below benefit level and in the provinces £459 below. That is a national problem compounded during the recession by parental contribution cheques bouncing.
That is the sort of situation in which the social security safety net is vital. But it is not available. The noble Baroness will say that there is not enough money. But there is a point of economy beyond which the job is not worth doing at all. We have not only reached that point; we have passed it. I have advised sixth formers, and will advise them again if asked, that it is not worth doing if they cannot obtain any more money than the Government provide. I advise them to take a year off and earn money before they come up. If they cannot do that, they should not do it at all.
5.19 p.m.
Lord Judd: My Lords, I am sure that the House is deeply grateful to the noble Lord, Lord Addington, for having made this excellent debate possible.
Higher education should be a liberating experience for those enjoying it. It should enable them to throw themselves into their books and learning and to savour the stimulus of associated cultural and social activity in a community of scholars. It should be an enriching investment in talent, excellence and character, all indispensable and vital to our nation's future. Instead, as we have starkly been reminded, it is for far too many students a cramping, anxious time of acute financial stress, a time when potential is never fulfilled because of the basic struggle to survive.
This academic year the Student Loan Company recorded 89,000 applications by November 1992–60 per cent. up on 1991. One high street bank reports that 44 per cent. of students have overdrafts. Recent research at Leeds Metropolitan University reveals

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that expenditure exceeds income for 40 per cent. of students and that for half of these it exceeds it by more than £1,000 per annum. Across the country students fear that they will never be able to repay their debts and it is obvious that this discourages potential students from low income households.
The Committee of Vice-Chancellors and Principals is conducting a survey of student support. Its interim report reveals that the success rate in applications for access funds on the valid grounds of hardship dropped from 79 per cent. in 1991–92 to 60 per cent. in 1992–93. Indeed, the pressure on access funds has begun to call into question their effectiveness. One institution reported in the survey argued that,
"amounts awarded to individuals are often too small to deal effectively with their problems".
As announced in the last Autumn Statement the total resources for grant and top-up loans will be increased by 2.75 per cent. in line with GDP. However, consistent with government policy, the grant element will again remain frozen and the increase in resources will be reflected solely in the loan. Even with the loans the National Association of Citizens Advice Bureaux has calculated that a student receiving the maximum grant and loan for 1992–93 could receive almost £460 less than the basic income support level of an unemployed claimant aged under 25 receiving the lower rate of income support together with housing benefit, a level which is widely recognised to represent the poverty line.
Paradoxically, whatever the well-founded anxieties about the adverse effects on study of too much time spent earning, the financial difficulties of students are compounded by the increasing non-availability of vacation and term-time jobs, hitting sandwich course students especially hard, often leaving them with no prospect of alternative support. Medical students are at a special disadvantage because they have little time in which to earn. This inevitably favours those from more affluent families. Difficulties are also aggravated by the steady decrease in the number of discretionary grants which cash-strapped local authorities now make and by the decreasing number of grants for postgraduate studies.
The case histories of students facing difficulties are distressing. The special report of the National Association of Citizens Advice Bureaux made sober reading. The House will be grieved that some students, it seems, have even in desperation turned to prostitution. A student at Bristol University told the Guardian newspaper how she was paid £40 for her services, enabling her to survive financially for another two weeks. She had been £1,100 overdrawn, her bank was demanding payment of her overdraft and she had had three student loans. Her parents could not help.
There must be acute concern for the well-being of our student population. It is high time that the Government gave a clear indication of how, on a basis that is demonstrably fair, they intend to fund their much repeated commitments to higher education. As things stand, the whole sector is being undermined by an atmosphere of insecurity and, frequently, of sordid struggle to keep going. What should be creative years
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are for too many becoming desperate years. What should be a fulfilling experience is becoming a nightmare.
For the immediate future I hope that the Minister can give three specific undertakings which the Committee of Vice-Chancellors and Principals seeks. First, will the Government undertake to ensure that access funds become what they should be—namely, hardship funds—and that they will be increased in line with expansion of student numbers rather than just by the rate of inflation? Secondly, will they reinstate housing benefit as a targeted and therefore cost-effective benefit? Thirdly, will they extend the review of student support by the DFE to cover postgraduates and part-time students, with particular reference to the present ineligibility of part-time students for loans? Will the Government ensure that the DFE review covers the complete academic year, including the summer vacation?
I would suggest that in the context of this very poignant and indeed moving debate—indeed, in the name of civilised values—there is a need for urgent action.
5.25 p.m.
Baroness Blatch: My Lords, in the time available it will not be possible for me to do justice to this very important debate. But I shall do what I can to address the points made and I will of course write to noble Lords whose points I miss.
I am grateful to the noble Lord, Lord Addington, for choosing this subject for the debate because it gives me the opportunity to show how this Government can be proud of their achievements in higher education generally, despite what has just been said by the noble Lord, Lord Judd, and can take credit for the system we now have for student support, which is working well.
Let me deal first with our overall commitment to higher education. There are now more than one in four young people entering higher education compared to one in eight in 1979, when the Conservative Government came into office. That is a remarkable achievement. And beyond that, by the year 2000 we expect it to rise to one in three. Public funding for higher education now stands at record levels and will total over £4 billion in 1993–94.
The Autumn Statement provided for 8.5 per cent. growth in full-time equivalent student numbers next year which will enable the current record levels of participation to be maintained. Looked at in broad national terms, opportunities for participation in higher education have never been better.
But this debate is about the financial situation of individual students. I recognise that that lends a different perspective. Let us look at the realities. There are many misconceptions about the arrangements for student support. I hope the House will bear with me if I set the debate in context. We introduced the present student support arrangements in 1990, after announcing our proposals in the White Paper Top-up Loans for Students published in 1988. The previous system of publicly funded grants and parental contributions had

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been with us since 1962. A radical overhaul of the system was, I think all noble Lords will agree, by then long overdue.
Expenditure on grants had not kept pace with the increase in student numbers. There had been a fall in the real value of the grant to the individual student. Added to this the burden of the parental contribution had become increasingly heavy. That system was unsustainable.
In the absence of any other form of support from education funds, students were turning to the benefits system for extra help. But the benefits system was never designed to support students; nor should it have been. It was for the education system to find ways of funding students. The student loans scheme, introduced in 1990, provided the answer. It complements the existing awards arrangements in a way which largely eliminates the need for students to look elsewhere for help.
The declared aims of the new student support arrangements were: to share the cost of student support more equitably between the students, their parents and the taxpayer; to increase the resources available to students; to reduce the parental contribution over time; to reduce direct public expenditure over time on grants; to reduce students' dependence on benefits; and to increase students' economic awareness and their self-reliance. Those were the aims and I believe that we are well on the way to achieving them.
The cost of student support is now shared more equitably. Students—although they contribute nothing while studying —will contribute a fair share once they have graduated and started to earn a good income. That has reduced the burden that would otherwise have fallen entirely on parents and taxpayers.
The resources available to students have increased very substantially. Since the introduction of the student loans scheme, full year students can now receive nearly 40 per cent. more from grant and loan than they received from the grant alone three years ago. This increase has been achieved at a time when other members of our society, including those in employment, have not been as financially fortunate.
Parental contributions are now indeed falling in real terms. The introduction of loans has allowed us to reduce the burden on parents and that is, I believe, extremely important for many families in these difficult times. Those parents whose income has risen in line with the rise in average earnings have seen their contribution to their children's grant held steady in cash terms for the past two years.
In conformity too with the original objectives, students' dependence on benefits has been greatly reduced. But I would like to remind the House that we have not removed students' entitlement to benefit altogether. Housing benefit and income support remain available for students in vulnerable groups. Ending students' wider dependence on social security benefits, however, has, along with the introduction of the loan, contributed to an increasing economic awareness among students and a greater self-reliance—the final one of our original objectives.
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The arrangements we now have are true to the objectives we set for them. One of the strengths of the arrangements is their flexibility to meet individual circumstances. The present system not only consists of grants and loans. The Government have not neglected those students whose particular circumstances give rise to additional needs. As well as the main rates of mandatory grants and student loans, there is a range of supplementary allowances. Extra, means-tested allowances are available for disabled students. I take note of what the noble Baroness, Lady Darcy (de Knayth), said about that. It is about ordering priorities, and for the moment they are means-tested.
There are also allowances for students with dependants and for older students. These have continued to be uprated in line with the basic grant plus loan. In particular, the three allowances available to disabled students are widely seen as generous. They are £4,430 on top of the grant and loan system for the non-medical personal helper; £3,325 again on top of the loan advance system for major items of specialist equipment; and a further £1,110 available for other incidental expenses for a disabled person, again on top of the grants and loan system. Those allowances are in addition, as I have just said, to the main grants and loan system and any other allowances which may be paid.
On top of that, the Government have made available access funds worth over £26 million this year. These are for the minority of students who are in particular financial difficulty and need more help than the grant and loan system can provide. Mature students, many of whom have family commitments, students facing high accommodation or travelling costs and single parent families are among the principal beneficiaries from these funds.
In spite of that, we continue to hear calls from time to time for the restoration of benefits and the abolition of loans. Some people believe that this would alleviate student hardship. Perhaps I can put the record straight. When loans were introduced they were set at a level above that of the average amount of benefit claimed. Most students have more money available through grant and loan than they ever claimed in benefit. Under the present system support for students is now primarily and rightly directed through the educational programme. The benefits system exists to help those people in our society who are in involuntary difficulty, although, as I indicated earlier, access to benefits remains an option for the most vulnerable groups.
I believe it will be clear from this that there are substantial resources available to students and the Government have honoured their obligations to provide and, where possible, increase these funds.
What then are the facts about student hardship? Facts, unfortunately, are hard to come by. We all know of individual students who are in financial difficulties, but without wanting to seem unduly harsh about this, I agree with my noble friend Lady Seccombe that 'twas ever thus. Some students, for reasons that may or may not be within their control, always run out of money faster than others. There have of course been several surveys of students'

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finances in recent months, some of which were referred to today. But these have generally been based on small or partial samples from which it is hard to draw any reliable conclusions. Such evidence as they have offered certainly has not pointed conclusively to widespread hardship. I will place greater reliance on the comprehensive survey of student incomes and expenditure, following up earlier such surveys, which the education departments have commissioned. The survey is now well under way, and we shall have the results later in the year.
That will give us hard data. In the meantime, all I can say is that other broader indications do not support the argument that hardship is widespread. For example, still under half of eligible students are actually taking out the loans on the very generous terms which we are offering. I suggest to the noble Earl, Lord Russell, that some of his energies could be directed to persuading those young people to take advantage of what I believe is a generous loan.
Earl Russell: My Lords—
Baroness Blatch: I appeal to the noble Earl. Time is extremely short and we have not one minute more allowed to us in the course of the debate. I will take up the noble Earl's particular point after the debate.
It may come as something of a surprise to the House, but it does suggest that more than half of the student population is finding it possible to manage on their grant alone, supplemented by any other income they may have. The fact is that far from students being hard up, many of them do not seem to need all the resources that we have provided. Of course, cautiousness about debt may play some part in students' avoidance of loans if they can get by without. It is right that they should think twice about these things. But any who look into it will know that the student loans scheme has generous provisions to defer repayments until the former student's income has risen to a point where repayment can be afforded.
Another indicator that hardship is not as widespread as some would have us believe is the sheer growth of student numbers that I referred to at the beginning of my remarks. Young people are certainly not being deterred from entering higher education; and from what we can tell they are not having to give up because of financial difficulties on any large scale either. My noble friend Lady Seccombe gave us the figures. We are third in the international league not only for the number of students entering higher education but also staying to the end of their courses.
Drop-out rates from universities remained broadly stable between about 10 per cent. and 12 per cent. throughout the 1980s and early 1990s and there are certainly no grounds for thinking that the new student support regime has driven them up.
It may be worth putting on record exactly what students are receiving. With grant and student loan combined, it amounts to £58 per week for 52 weeks of each year. If one takes the number of weeks for the average course, it is £99 per week for students during course time. Any course which lasts more than 30 weeks is given extra funds pro rata to that. That is for
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students out of London. In inner London students receive £70 per week for the full 52 weeks in the year and £120 per week for term time weeks, which again, if it is more than 30 weeks, increases pro rata according to the length of the course.
The actual burden of repayment also needs to be well understood in this Chamber. No student is required to pay during the period of taking the loan. It starts in the April after the course is completed and no student pays one single penny back to the Government until he is earning at or above 85 per cent. of the national average income, which at this moment is £13,560. Until a person is earning £13,560 he does not begin paying but when he does he pays over a five-year period. That is not burdensome.
What is more, if a student wishes to remain partially in the voluntary sector or to take low-paid work, or for one reason or another does not ever earn £13,560, which is indexed for inflation each year, then he will not have to pay that back if he either reaches 50 years of age or he has been within the system for 25 years. Loans can be deferred year after year if young people are not earning sufficient to pay them back.
As regards the point made by the noble Lord, Lord Moore of Wolvercote, I believe I have dealt with it in saying that the system is not a deterrent to young people. The value of the grant plus loan in 1979 has been fully restored today. The noble Lord, Lord Cocks of Hartcliffe, has spoken before on the point that he believes that if more students—he did not say all students—took courses in universities and institutions closer to home, it would have some impact on the issue of homelessness. It has been said that that is not an entirely straightforward concept. I understand that the savings in money are not great in that we give a disproportionate grant to those students who learn from home. Nevertheless, it is indisputable that if fewer students required housing, more housing would be available for the homeless. That can certainly give us all food for thought.
The right reverend Prelate referred to counselling and advice. I agree absolutely with his point and am pleased that most university and higher education campuses have systems for offering counselling to students who may need it.
My noble friend Lady Perry, the noble Lord, Lord Broadbridge, the right reverend Prelate the Bishop of Guildford and others were concerned about local authority inefficiency. I agree absolutely. It is monstrous for students to have to wait a day longer than is absolutely necessary to receive what is their due, especially when we are talking about something that involves only a mechanistic function for local authorities. I promise the House that I shall redouble the efforts of my department to put pressure on local authorities to make sure that young people receive their grants on time.
My noble friend Lady Perry, the noble Lord, Lord Butterfield, and other noble Lords have pressed me to reconsider the idea of a graduate tax. This was discussed previously and we have been urged to consider also the idea of collecting payments through the national insurance system rather than the loans scheme. That has been studied carefully and in some

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detail. Collecting loan payments through national insurance would not be straightforward. In particular, it would pose real problems for employers in collecting and accounting for payments from graduate employees. Payment through the national insurance system would not necessarily be able to deal with the problem of graduates with low incomes.
The difficulty with a graduate tax is that it would not distinguish between those graduates who receive public support for their higher education and those who do not. A system which was so sensitive and which did distinguish in this way would be administratively extremely complex. A loan, on the other hand, relates only to those who have made use of the facility and gives the student the choice of how much to borrow.
The noble Lord, Lord Addington, drew comparisons between student support and income support. I should say, first, that that is not a legitimate comparison. Students are expected to bear some of the cost of their support themselves on the ground that higher education is an investment in their own interest. Income support is designed for those who are involuntarily dependent on resources provided by the Government. However, I should add that, as the grant is equivalent to £58 per week for 52 weeks per year for students out of London and £70 per week for 52 weeks per year for students in London, a student's income probably compares favourably with that of someone on unemployment benefit.
Like other noble Lords, the noble Lord, Lord Broadbridge, was concerned about vacation hardship. It is alleged that the withdrawal of the Vacation Hardship Allowance in 1991 subsequently contributed to student hardship in the summer vacation. However, the fact is that that is simply not so. The allowance was withdrawn because it was no longer needed. Very few students ever claimed the allowance before it was withdrawn and the Government's new support arrangements make more resources available to students to compensate for the loss of that part of their assistance.
I believe that I have dealt with the point about students not being asked to pay back the loan until the April after they have finished their course. I do not believe that the burden of repaying the loan acts as a deterrent.
The right reverend Prelate said that the loan system was not adequate, not certain, not simple and not just. We could argue for a long time about what we all believe is adequate, and the Government have taken a view about what should be borne by parents, students and taxpayers. We rest our case on that judgment. Students can be certain—if they qualify, the loan is certain. I believe that the system is simple. It is not difficult for students to apply. I believe also that the system is just.
The noble Baroness, Lady Darcy (de Knayth), was concerned about means testing. As I have said, it is a matter of priorities.
My noble friend Lady Park of Monmouth spoke about the disproportionate effect on postgraduates. Again, most postgraduates are not eligible for loans,
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but those who are supported by central government, bursaries or the research councils have continued to have their maintenance allowance uprated each year.
The noble Earl, Lord Limerick, referred to the proposals for student unions. I understand what he said. He expressed his concern about the maintenance of services for students. I can advise him that that matter will be taken into account in the proposals.
The noble Lord, Lord Addington, was also concerned about sandwich students. Institutions are responsible for doing all that they can to obtain placements but can, if necessary, make alternative arrangements for full-time provision on college premises, thus entitling students to grants and to loans.
Time is running out. Unlike many others in this recession, students' income and status have been protected. I believe that we have reason to be proud of this country's flexible and relatively generous student support arrangements. They are all of a piece with our wider achievements in higher education.
Lord Addington: My Lords, I thank the noble Baroness for her reply, although it fell far short of the mark and misinterpreted the situation. The noble Baroness claimed that a student on a full grant with a loan would receive £58 per week. Perhaps I may remind her that somebody below the age of 24, living away from home and receiving social security benefit could expect to take home about £66 per week. Bearing that in mind, I beg leave to withdraw my Motion for Papers.
Motion for Papers, by leave, withdrawn.

Maastricht Treaty
5.46 p.m.
Lord Pearson of Rannoch Lord Pearson of Rannoch rose to call attention to the constitutional effects of ratifying the Treaty on European Union signed at Maastricht; and to move for Papers.
The noble Lord said: My Lords, perhaps I may start by apologising to all of your Lordships who are to speak this afternoon if I have chosen an inappropriate subject for a short debate. I am painfully aware that the large number of speakers means that each may only speak much more briefly than me, when nearly all are far better qualified to open the debate than I am.
My only qualifications for doing so are that I have had the honour to sit on your Lordships' Select Committee on the European Communities for about a year, and I have worked in Europe and elsewhere as an international insurance broker for some 30 years. In this latter capacity, I have formed strong commercial friendships in every country in Europe, and I have close personal friends in most of them. In that sense, my Lords, I am a good European.
Some of your Lordships have asked me what is a "constitutional effect". I am advised that the answer is anything which affects the Constitution of this country or the absolute sovereignty of the Queen in Parliament. To quote from one of your Lordships' Select Committee reports:

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"The supreme authority in the internal order of the United Kingdom is the Queen in Parliament. The doctrine that Parliament has an unfettered legislative power is the fundamental principle of the United Kingdom's constitutional law".
So the question is: how would the Treaty on European Union, if ratified, affect the sovereignty of the Queen in Parliament? In other words, since it does not appear to add any useful powers to our parliamentary democracy, what further powers would the treaty cede to Europe which have not already be ceded by the Single European Act and the Treaty of Rome?
I must say, my Lords, that reading this proposed treaty and its predecessors, and attending your Lordships' Select Committee, have opened my eyes. There seems to have been a relentless march towards a federal European union for many years now, to an extent which I for one have found quite shocking. I am sure that the vast majority of the British people would also be similarly surprised.
Reading back over some of your Lordships' debates, particularly your debates in 1986 on the Single European Act and in 1990 and 1991 on political union with Europe, it appears that your Lordships have been increasingly reluctant to move towards this federal goal. It appears to me—and I may be wrong—that most of your Lordships seem to have favoured ceding only that part of our sovereignty to Europe which was necessary to achieve the single market, which is now in operation. The main exception to this general rule is that we gave powers over some environmental matters to Europe in 1986, under Article 130R of the Single European Act. But by and large we only ceded our sovereignty to create the single market, which most people agree is an important achievement.
However, it seems to me that the Treaty on European Union goes much further than that. It seems to be a positively gigantic step towards a federal Europe and the cession of our parliamentary sovereignty to Brussels and to Luxembourg.
To start with, it is actually called the Treaty on European Union, and its very first sentence in Title I establishes a European union amongst the parties to it. I know there is controversy about the meaning of the word "union", but Article 8 of the treaty proceeds to set up citizenship of the union for every person holding the nationality of a member state. We are all to be subject to the duties imposed by this new status, but those duties are not spelt out.
I wonder whether my noble friend the Minister could tell us what these duties are likely to be, and how we are to square them with our duties here, if they happen to be in conflict. Also, and I hope that your Lordships will not regard this as an offensive question, could my noble friend go further and tell us whether Her Majesty the Queen is to become a citizen of the union, and, if so, what that does for the supremacy of the Crown in Parliament?
I suppose the most obvious way in which our sovereignty is ceded to Europe under these treaties is when we agree that certain areas of decision making will be taken over by qualified majority voting in the
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Council of Ministers. The 12 Community countries have 76 votes between them, of which 54 constitute a qualified majority. Britain has 10 votes. I am advised that the Luxembourg court is likely to uphold the decision taken by qualified majority voting in the Council.
The powers of the Council to take decisions by qualified majority voting would be much extended by this treaty. Some of them are included in Articles 102 to 109 which would give the Council new powers intended to lead to economic and monetary union, and to an independent European central bank. Britain has reserved its position on monetary union, and the Germans have said that they want another look at it before finally signing up; so perhaps it will not happen anyway.
The turmoil in the foreign exchange markets and the shambles of the exchange rate mechanism make the prospect of economic and monetary union less likely now than when the treaty was negotiated. This is very significant because these aims were perhaps the treaty's most important. With such prominent aims in doubt, one must begin to wonder whether it is worth pressing on with the treaty at all.
Be that as it may, the union treaty would introduce the competence of the Council by qualified majority voting, or by co-decision, into areas of education, culture, public health, consumer protection, trans-European networks and development co-operation. It would extend such competence in the fields of transport, research and technological development, the environment, and our old friend social policy, out of which we may, or may not, have opted—I am not quite sure.
I submit that all these areas represent a substantial extension of Community power at the expense of our national sovereignty.
I come then to Titles V and VI of the treaty which further pool our sovereignty with the proposed union in foreign policy, defence, justice and home affairs. The most worrying article I find here is Article J, which deals with security and defence. On my understanding of this article, it appears to allow the Council of Ministers, by qualified majority voting, to start, or at any rate to continue, military action against our wishes. The relevant paragraphs are J.8.2 and J.3.2 which appear to say that, although the Council will have had to be unanimous when deciding, shall we say, to send troops somewhere, it could act by qualified majority voting in the development of the ensuing action. I hope that my noble friend the Minister can put my mind at rest on this point.
The rest of the clauses in Titles V and VI, or J and K of the treaty, would contribute to the march towards federalism in foreign policy, justice and home affairs. This is reinforced by such items as the "Declaration on Voting" in the field of the proposed common foreign and security policy. Here, Britain would agree that we—and I quote—
"will, to the extent possible, avoid preventing a unanimous decision where a qualified majority exists in favour of that decision".
The drift towards federalism in this vital area of our national interest is to be further encouraged by what are known as "common positions", agreed by the

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Council. The elaboration of common positions already takes place in the framework of political co-operation, but they are not now regarded as legally binding. However, I understand that the Foreign Office has recently made clear that common positions will be legally binding in future in international law. At the moment we do not have have the machinery to scrutinise them. I wonder whether my noble friend would care to comment on this development.
Before I leave the detail of the Treaty on European Union, I should perhaps mention "subsidiarity", which is to be found in Article 3b, and which is supposed to safeguard our sovereignty from the further erosion I have mentioned. To refute this claim I can do no better than to quote the clause in question:
"In areas which do not fall within its exclusive competence, the Community shall take action, in accordance with the principle of subsidiarity, only if and in so far as the objectives of the proposed action cannot be sufficiently achieved by the Member States and can, therefore, by reason of the scale or effects of the proposed action, be better achieved by the Community".
The weaknesses inherent in this clause are plain for all to see. They have been much debated publicly, and so I shall not dwell on them now. The question is, of course, who decides? And the answer is the Council, often by qualified majority voting.
I am aware that "interpretive declarations" on the meaning of this clause were issued after the Birmingham and Edinburgh Summits last year, but I am advised that they have done nothing effective to remedy the deficiencies in Article 3b of the treaty text. So I am afraid subsidiarity offers little protection to our sovereignty; it merely emphasises the member states' role as agents in carrying out Community policy.
To conclude on a general note, I have to ask if we really need this union treaty. Do we not have enough on our plate with the Single European Act and the Treaty of Rome? After all, even if this union treaty is not ratified, we shall still have the single market, the effects of which are difficult to judge. I say this because we still put more in than we take out, and because in at least one important field (insurance) in which I work, I think it unlikely that we will gain the advantage which we sought through entry. This is not the fault of the single market so much as it is of the fact that for many years British insurance companies have not enjoyed a level playing field with their European competitors in their reserving and distribution policies. The result is that our competitors are now very much stronger than we are, and better able to take advantage of the single market. Yet insurance is one of our industries which was always supposed to be going to benefit most from our entry into Europe. I have to tell your Lordships that I am afraid that it may not.
Other problems arising from what we have done so far with Europe are emerging. Of course it is fun to laugh at Europe when it tells us we cannot shoot vermin out of season, or when it decrees that carrots are henceforth to be a fruit, or when it prescribes in law the length, curvature and thickness which cucumbers must possess before they may be sold in the single market.
But it is not quite such a joke when one learns of the many billions of pounds which are stolen annually through fraud in the Community, and when one reads your Lordships' report to the effect that the political will to stand up to this immense scandal simply is not there. Nor is it so funny when Europe tells us where we can, and where we cannot, put our roads, and what the quality of our water should be. The time and energy wasted by our Ministers and others in Europe must be very expensive and debilitating. Public opinion against the treaty is mounting daily.
I have mentioned just some of the problems which result from our present involvement with Europe. These are far from resolved, and will require all the stamina and wisdom of my noble friend on the Front Bench and her colleagues in government. Are they sure that it is really wise to press on with a new treaty which must surely exacerbate the problems we already have? Of course, I know that their colours are somewhat nailed to the mast, but might one way out not be to offer the British people a referendum? Like most of your Lordships, I dislike referenda—I dislike them very much—because I trust our system of parliamentary democracy to take our national decisions, and to protect the sovereignty of the Queen in Parliament. But it seems to me that that trust can no longer hold when the decision in question would undermine the very system upon which we otherwise rely. In my view, the Treaty on European Union, signed at Maastricht, would, if ratified, so start to undermine our parliamentary democracy as to make it eventually worthless.
That is why I very much hope that the Government will not proceed with it. My Lords, I beg to move for Papers.
6 p.m.
Lord Stoddart of Swindon: My Lords, I thank the noble Lord, Lord Pearson of Rannoch, for giving us the opportunity to discuss this important matter. I congratulate him on the competent and concise way in which he introduced the subject. I too am concerned that every citizen of this country is to be forced to become a citizen of the European union without consent and without consultation. There is no provision in the treaty for any person to renounce his citizenship of the European union unless he also renounces his British citizenship.
In my view, the benefits of the European union are chimerical and the duties are unspecified. They are to be written in at some time in the future. In that respect I believe that we may be buying a pig in a poke. The noble Lord, Lord Pearson, asked whether Her Majesty the Queen would become a subject of the European union. I believe that that question was answered in another place by the Home Secretary; she will become a citizen of the EU. She will, therefore, become a citizen of an embryo superstate and will owe a duty to its constitution and to its institutions. Many Royal Prerogatives will no longer he exercised solely by the Crown but by a foreign-dominated junta sitting in a foreign capital.
As regards economic and monetary union, it may well be that the whole scheme will collapse; but it may

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well not do so. The fact is that EMU transfers economic, financial and monetary power to EC institutions thereby reducing and in some cases eliminating parliamentary control of Britain's economic well-being. The opt-out of Stage 3 is a meaningless concession because Stages I and 2 inevitably lead on to Stage 3, complete with a single currency. Furthermore, convergence will cost the United Kingdom taxpayers thousands of millions of pounds extra with consequent damage to our own economy, infrastructure and social services. British people are not being informed of the additional costs arising out of the treaty.
The fact is that the Maastricht Treaty takes a large step towards a federal European state. Of course the Prime Minister and his Ministers assure us that that is not so and Erskine May lays down that Ministers do not lie to Parliament. But they can conceal the truth and I believe that they are doing just that in respect of the Maastricht Treaty. The sad thing is that we shall not know the truth until it is too late. But Herr Kohl, Martin Bangemann, M. Mitterrand and many more people in Europe know the truth. They have no doubts about the meaning of the treaty and they have proclaimed the treaty as federalist. Indeed, they exult in that fact.
Finally, I wish to protest once again at the failure to involve the people in decisions which have far-reaching consequences for their future and that of their children. The Government have no mandate to force the treaty through. At the general election in April the English text of the treaty was not available. As all the political parties were agreed about the treaty, there was no real discussion during the general election campaign. Noble Lords should remember that when the Front Benches are harmonised the British people are disfranchised. That is why there must be a referendum. Without that the people of this country will never finally accept the binding shackles of the Treaty of Maastricht.
6.4 p.m.
Lord Moore of Wolvercote: My Lords, I am grateful to the noble Lord, Lord Pearson of Rannoch, for initiating this debate. It cannot be disputed that the constitutional implications of the Maastricht Treaty are considerable. One has only to read the title; "Treaty on European Union". Surely there can be no doubt that the original drafters of the treaty were envisaging ultimately a federal European state? It will be said that such was the purpose of the Treaty of Rome and the Single European Act. No doubt there is truth in that. However, I do not believe that when the majority of people in this country voted in the referendum to join the European Economic Community they envisaged that Britain might end up as part of a European federal state.
The argument for joining Europe was an economic one. The Treaty of Rome had been most successful in establishing a powerful new economic bloc. Britain, as a trading nation on its doorstep, could not afford to stay out. The opinion in financial, industrial and commercial circles was pretty unanimous. The
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Commonwealth hated the decision and, as a result, Britain's relationship with the Commonwealth will never be the same. However, Britain could not stay out of the European Economic Community.
But that was a vote to join an economic bloc. Today the future as presented by the Maastricht Treaty looks very different. A majority of the member states of the EC, led by France and Germany, want to move towards a political union. Only skilful and determined negotiation by the British Government has prevented that from being spelt out in the Maastricht Treaty. But the long-term aim has been made clear. People in this country have become aware that a major constitutional issue may be at stake in deciding whether to approve the Maastricht Treaty. Referenda have been held in Denmark, France and the Republic of Ireland. Denmark rejected the Treaty and France approved it only by a whisker. To add to the public's confusion, Britain has been forced to leave the exchange rate mechanism and even the ERM is in jeopardy.
In those circumstances I submit that the British people should be allowed to vote in a referendum on whether this country should approve the Maastricht Treaty. I was interested to hear that the noble Lords, Lord Pearson of Rannoch and Lord Stoddart, share that view. No question of principle is at stake because in recent years we have had referenda on Europe, Scotland and Wales.
I also have the impression that such a decision by the Government would be very well received in the country. The Government may well be right in proposing to go ahead with Maastricht with the safeguards for Britain that they have managed to have built into the treaty. But the threatened collapse of the exchange rate mechanism, such a vital part of the way ahead as envisaged in the treaty, has created serious doubts and great anxiety, even among those most pro-European. The closeness of the vote in another place at the end of last year was a vivid illustration of that general unease.
My conclusion is that the issues are too important and recent developments are too serious for the Government to take such a decisive step without a new endorsement by the people which a referendum would give.
6.8 p.m.
Lord Ridley of Liddesdale: My Lords, I too thank the noble Lord, Lord Pearson of Rannoch, for introducing the subject. The fact that it is so popular that we are allowed to speak for only four minutes each forces me to concentrate on only one point. It does not give me time to say all the things that I think about the Maastricht Treaty. That point is the relationship between what is happening in regard to the Maastricht Treaty and the confidence which is necessary to bring about an industrial recovery in this country. I am talking not only about special interest groups such as the farmers, the fishermen, those who have abattoirs and those who suffer from the myriad regulations which come from Brussels. I am not even talking about the sovereignty issue per se. I want to

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talk about the damage and demoralisation which has been inflicted on British business as a result of trying to move to fixed parities and a single currency.
In relation to the ERM, I agree that it may have been necessary to have high interest rates to reduce inflation. However, unemployment is now nearly 1 million higher than two years ago. The effect of unemployment has been to make people fearful of spending, borrowing and consuming, thus deepening the recession. There are record numbers of bankruptcies and there has been a horrible fall in the level of industrial investment as a result of the unprofitability of British industry. Asset values have fallen disastrously, again making people frightened to spend and to borrow.
Worst of all, we have lost about four per cent. of our gross national product as a result of membership of the ERM. That stores up huge problems for the public sector borrowing requirement. It is an extreme worsening of the state of the nation's wealth.
It is to be hoped that that is all behind us because we have left the ERM. However, the Government keep saying that they want to rejoin at some stage. If we proceed with the Maastricht Treaty, we shall have to rejoin. That inspires the opposite of confidence among investors and businessmen. Wherever one goes people say that they do not know what the Government's economic policy is. Is it to go back into the ERM eventually, with fixed exchange rates operating under the single currency, or is it to remain out of the ERM and have our own economic policy? That doubt is worsening the prospects for recovery.
I also draw attention to the fact that the fall in our gross national product means that this coming year our borrowing requirement will be 8 per cent of GNP. The Maastricht Treaty requires it to be 3 per cent. Therefore, we have to cut our public sector borrowing requirement from 8 per cent. to three per cent., a sum of approximately £30 billion. What shadow does that cast over the future of British business? We joined the Community in order to become better off. We prospered until 1990, but ever since we stopped pursuing the single market as our main objective and started to pursue the single currency we have become worse off. Surely it is time to recognise that it is the single market which matters and that the single currency does not.
6.14 p.m.
Lord Healey: My Lords, I fear that I shall break the happy consensus which has united the previous speakers by trying to make one simple point. That is that Britain's influence in Europe has been gravely impaired in the past two years by a civil war inside our government party over the Maastricht Treaty, a civil war in which both sides have grossly exaggerated the importance of the issues at stake and often misrepresented the facts.
Seven years ago, in 1986, Parliament passed a Single European Act which committed Britain to work for European Union, including a common foreign policy, a common defence policy and economic and monetary union. That Act was forced through another place on a guillotine Motion by the
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noble Baroness who sits opposite me today, who was then at the height of her powers, with the noble Lord, Lord Tebbit, acting as her familiar. It was a real witches' sabbath.
As the noble Lord, Lord Cockfield, has pointed out to us on many occasions in the past few years, there is nothing in the Maastricht Treaty, now so strongly opposed by those who supported the Single European Act, which is not already in the Single European Act except a timetable and conditions for European monetary union which is now universally accepted as quite unrealistic, as the European finance Ministers made clear on Monday. Incidentally, this is the third time in the past 20 years that a target date for EMU has been missed. I suspect that will happen again before it finally comes about. If Britain fails to ratify the Maastricht Treaty that will be seen by all its partners in Europe as a gross breach of faith.
There has also been some argument in the government party about the protocol which lays down procedures for operating the social chapter of the treaty and which specifically excludes Britain. Those who oppose the Maastricht Treaty have tended to describe the social chapter as a Marxist invention, although it is strongly supported by every Conservative Government in Europe and by all the parties with which the Conservative Party associates at Strasbourg. In fact the only party in Europe which takes the view of the opponents of Maastricht in the Conservative Party is the National Front of Monsieur Le Pen in France.
The noble Lord, Lord Wedderburn, made it clear in a letter today—and I shall not repeat his arguments —that the scope of the protocol which governs the operation of the social chapter offers nothing which anybody in Britain, employer or worker, should fear. However, the past week has seen the Government express four contradictory views on the legal consequences of deleting the protocol. The latest view is that it makes no difference if Parliament decides to delete it. The Government have spent a year opposing a referendum in order to protect the sovereignty of Parliament, and now they are destroying the sovereignty of Parliament to protect their own face.
Equally serious is the fact that the Government are devoting nearly two years of precious parliamentary time to discussing arguments over the Maastricht Treaty in a period when Britain's own economy is in ruins, when unemployment is at unprecedented levels throughout the western world, and when the ex-Communist world faces terminal collapse. Meanwhile, the Government are wandering in a wilderness of mirrors; the Prime Minister is continuously uncertain whether he wants to be at the heart of Europe or is the greatest Euro-sceptic of them all. Our partners in Europe do not know whether to laugh or to cry. There is one point on which I hope we can all agree: the generalship shown by the Government in dealing with the Maastricht Treaty makes Fred Karno look like the Duke of Wellington.
6.18 p.m.
Lord Reay: My Lords, unlike some other noble Lords who have spoken, and in particular my noble friend Lord Pearson of Rannoch, to whom we are indebted for this rich foretaste of great days to come, I am not a Euro-sceptic. I believe that if we had not already joined the European Community we would, like almost every other European country not already a member, be seeking to join today, even though it would be to a Community less to our liking than the one we have now since our influence would not have been exerted, as it has been, on its development.
I believe that the single market was a great achievement, not least for my noble friend the former Prime Minister. It brought the prospect, which is still barely in place, of the largest free market in the world for goods and services and the movement of people —a thoroughly desirable objective and one close to our liberal tradition. Similarly, the Treaty of Maastricht represented a negotiating triumph for my right honourable friend the Prime Minister and at the time, little more than a year ago, it was generally so seen.
Of course the Maastricht negotiations presented a different type of problem from those for the single market. Unlike the single market, which was a concept we could wholeheartedly embrace and use our influence to advance, the impetus behind the Maastricht Treaty was something for which we had, and today still have, less enthusiasm: the desire by other member states for economic and monetary union. My right honourable friend the Prime Minister therefore set out to achieve a compromise we could live with, and in this I suggest he has succeeded. The Maastricht Treaty presents a framework in which the Community can develop.
Political co-operation, for the first time given legal status, will proceed outside the treaty framework, as will defence co-operation. Within the treaty framework the principle of subsidiarity has been given legal recognition. It has been accepted that national powers should be the rule and that Community powers be the exception which need justification. The treaty gives the courts new powers to act against non-compliance with Community regulations by member states, for long a bone of contention with us. Also there are the opt-outs for us on the social chapter and the single currency.
All that was achieved after many months of effort and skilled diplomacy. But has the time come for us to throw out the treaty? Has the world changed so much in a year? In both cases I do not think that it has. If Maastricht is not ratified the Community will still continue to move ahead without us. All member states, save ourselves and Denmark, have ratified the treaty and it is a Community which they expect to be governed by Maastricht that the EFTA countries today and other countries tomorrow are seeking to join. The Community will certainly proceed along alternative but similar lines if this treaty falls as a result of our not ratifying it.
The difference is that we shall be outside those developments, looking on without influence and having brought much odium upon ourselves for forcing this course upon the Community. Indeed, not
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only should we have lost influence on the future development of the Community but we should have lost influence where it is still needed to protect what we might have thought to be already achieved, as currency instability threatens the single market. We should lose out not merely relatively but also absolutely, as inward investment to this country dried up, deprived of the certainty of access to the rest of the European market.
So I suggest that we need to remain at the heart of Europe, as my right honourable friend the Prime Minister and my noble friend the former Prime Minister before him have said. We must use our undiminished influence to fight for what we believe to be in the best interests both of ourselves and of Europe: free trade, a community open to the world, a community of nation states co-operating to meet their responsibilities in the world and acquiring greater strength by so doing. I do not believe that we should invent new reasons for succumbing to an old temptation, the temptation to believe that we can so organise our lives as to remain unaffected by what happens on the Continent. We are perhaps the first generation to learn that that cannot be so, and to see that lesson applied. Let us not start to unlearn it now.
6.24 p.m.
Lord Bruce of Donington: My Lords, I must venture to dissent from my noble friend Lord Healey, who asserted to the House that the Treaty of Maastricht contained no new powers that were not already enshrined in the treaty establishing the single market. I have no time now, but I will take him through the treaty clause by clause and, believe me, I can point them out to him.
What is really important is this. I cast my mind back some 50 years or more where we had unanimity between the parties: Liberals, Conservatives and Labour alike. That was in the face of an outside danger and my own party was non-party enough to assist in Mr. Winston Churchill (as he then was) in becoming Prime Minister. We were united as a nation, and in Parliament all the parties were united behind that. Since then there has been no unanimity among the parties in the United Kingdom, until now. It is rather ironic that there is one thing on which the Conservative Party, my own party and the Liberal Party can agree; namely, that it is necessary in formal terms to limit the authority of another place to deal with the affairs of this country.
There can be no doubt in my mind that that stems in part from a lack of confidence in politicians of all political parties who progressively, and in the face of the events that have occurred over the past few years, find themselves in the position where they cannot entirely cope with the problems that have arisen in the modern age—partly, I am bound to say, of our own making but partly due to events outside. And of course no party and no country can remain immune from the effects of living within a wider society.
The supporters of the Maastricht Treaty point out that to that extent we have lost sovereignty. That is because they do not understand what sovereignty means. I and most of my friends would agree that we

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operate within areas that are from time to time constricted by trade, finance, movements of capital and other things. None of us can be immune from those, but we can retain our own ability to work within those constrictions; whereas Maastricht creates a formal and legal limitation to our own powers to deal with the difficulties that we face.
I believe that it is not too late to ask the leaders of all political parties to start thinking in terms of purpose and conviction again rather than in terms of what the public opinion polls tell us are popular with the people at large. There ought to be sufficient political courage on all sides of the House to work out our own solutions within the constraints within which we operate. Are we that low that we have to rely upon civil servants in Brussels—a growing band of foreign civil servants—as well as on international bankers to do the job for us? I believe that we can do it for ourselves. For that reason I think that the Maastricht Treaty ought to be consigned to the dustbin of history.
6.29 p.m.
Lord Blake: My Lords, I wish to make one point and one point only: the debate is about the constitutional effects of ratifying the Maastricht Treaty. I strongly believe that whatever those effects may be they should not occur without the endorsement of a referendum. I happen to have the honour of being president of the Campaign for a British Referendum, or CBR in the acronymic world in which we now dwell. This is not an organisation which is either anti- or pro-Maastricht. No doubt some members have strong views one way or the other, but they are united by the view that whether one is for the treaty or against it the issue is of such constitutional importance that it ought to be submitted direct to the popular vote.
The referendum is not, as some claim, un-English and unprecedented. Mr. Harold Wilson, as he then was, promised in 1974 a referendum on the renegotiated terms of Britain remaining in the EC. That was duly held in 1975, very much on a cross-party basis. Referendums have been held on other matters, as noble Lords have said.
We shall no doubt be told that there is no need for a referendum because all three parties supported Maastricht at the general election in April last year. But that, of course, is precisely why we should have one. The issue was never properly discussed. In any case, elections turn on a host of other matters such as Mr. Major's soap-box or the war of "Jennifer's ear". One can never, or hardly ever, have a single issue election. Nor, in general, would one wish to have such an election. However, there are single issues of such importance that they deserve to be put not only to Parliament, which is elected on a multitude of issues, but to the people as a whole. That particularly applies to major constitutional changes which are in effect irreversible. I am not saying that irreversible changes should never be made. I am simply saying that they should not be made without the express agreement of the nation.
We shall no doubt be told that the issues are too complicated and difficult to be put to the public and
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that they will not be able to understand what it is all about. If a referendum on Maastricht can be held in Eire, Denmark and France without any complaints that it was too obscurely worded or that people did not know what they were voting for, surely it cannot be beyond the wit of a British Government to achieve the same.
During the discussion about the Statement on Maastricht on Monday in your Lordships' House it is recorded at col. 928 of Hansard that my noble friends Lord Harmar-Nicholls and Lady Chalker both said it would be desirable for noble Lords to be adult and sensible in considering this matter. Ought not the Government to recognise that the British public by and large are adult and sensible and are perfectly capable of making up their own minds in a coherent fashion on the subject of Maastricht?
6.33 p.m.
Lord Harris of High Cross: My Lords, long before Maastricht loomed into view liberal economists who favoured the Common Market nevertheless foresaw that centralised power from Brussels might over-whelm the competitive market of the Treaty of Rome. In an IEA Hobart paper 20 years ago Professor Harry Johnson shrewdly anticipated the words of the noble Lord, Lord Ridley, today by predicting that a common European currency,
"would involve both a heavier sacrifice of economic sovereignty … and a larger risk of economic stagnation".
In 1971, on the eve of the British referendum on membership, the IEA commissioned an assessment from Russell Lewis who had headed the European Community Information Office in London. He reluctantly acknowledged the danger of what he called,
"a new European-scale version of the bureaucratic, national, corporatist over-centralised style of government".
Yet in 1988 the noble Baroness, Lady Thatcher, was pilloried for daring to warn at Bruges against the spectre of a European super-state. Four years later her successor as Prime Minister suddenly declared himself a Euro-sceptic and clutched at the shadow of subsidiarity to fend off the substance of M. Delors' super-state.
Much constitutional confusion follows from the total misconception that centralised law is appropriate to impose uniformity and standardisation on widely differing economies in varying stages of development. It was one of. Adam Smith's seminal insights that all trade, whether within or between countries, was based on differing costs and the division of labour as the chief cause of the wealth of nations. All the complex, international division of labour springs from a single elementary fact. It is that through natural and acquired advantages of differing locations and resources costs of production are not level. As shown most dramatically by Hong Kong, foreign trade is the means by which by which lower-cost areas expand exports, trade Up, and so raise their own standards of living.
The folly of Brussels has been lightly to misuse the law, including the Single European Act, in the vain pursuit of a level playing field. All we need for free trade is a legal framework of broad, general rules for competition based on mutual recognition of differing

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national standards. What we have instead is an impenetrable jungle of detailed, specific regulations that are often shaped to placate union lobbies, business pressures and blatant national interests.
It is a misguided egalitarian perversion to debase the majesty of law in order to impose uniform conditions of production at the starting line. The result is not only to frustrate gains from trade, to inflate subsidies, to harden rigidities and thereby impair the spontaneous process of economic growth. Towering above such visible costs is the damage from needless centralisation and politicisation of economic life. This is already provoking fierce tensions and even hatreds both between and within the Twelve. By extending qualified majority voting, imposing monetary union and increasing the Commission's so-called "competence", Maastricht would carry this malignant process past breaking point.
Meanwhile such insensitive and coercive remote control threatens to bring our unique heritage of parliamentary self-government into increasing conflict with the edicts of the Brussels Commission and with the ceaseless imperialism of the Luxembourg Court. Those edicts and that imperialism will be the more bitterly resented for being not only unnecessary but positively hostile to the single market which was their bogus pretext.
6.36 p.m.
Baroness Elles: My Lords, my noble friend Lord Pearson of Rannoch has done this House a great service in enabling noble Lords to discuss what is of vital importance and interest to our country; that is, the Maastricht Treaty. Never was it more timely to say that truth has many facets. We talk about the sovereignty of our country and about the British constitution. One of the main principles of our British constitution is the sovereignty of Parliament. The powers of Parliament in exercising its sovereignty include, among many other things, the conclusion of treaties and the definition of who comes within the sovereign territory.
It is worth recalling that the right to conclude external trade treaties was lost in 1973. They have been decided by qualified majority vote ever since the EEC Treaty of 1957. The Single European Act not only condoned that but it further empowered the European Parliament with the task of assenting to or rejecting both accession and association agreements —there are many of the latter—thus depriving the United Kingdom Parliament of the ability to exert its sovereign powers in treaties which came under those particular provisions of the Single European Act as it amended the EEC treaty.
The freedom of movement of persons was reinforced in the Single European Act by Article 8A in the formation of the single market. That means that in law the United Kingdom is restricted in controlling who comes into the sovereign territory of the United Kingdom as regards European Community citizens. Further, the right of the European Parliament was established to use the co-operation procedure to amend draft legislation of the European Community.
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About 50 per cent. of amendments now adopted by that Parliament appear in European Community legislation which then comes back to our Westminster Parliament. The Maastricht Treaty —perhaps this is not recognised—seeks to impose limitations on some powers which have been acquired over the years and have apparently slipped to Brussels. Much of this imposition of limitation is due to the work of my right honourable friend the Prime Minister and his colleagues during the negotiations on the treaty.
Much has been said about subsidiarity but the fact is, it is working. The Commission has already struck out a whole list of matters on which it intended to draft legislation. That will no longer happen. EMU is now subject to strict convergence conditions and, as I am sure my noble friend Lord Ridley has pointed out, even those convergence conditions will probably be impossible to achieve. Therefore EMU may not even happen. We also have the protection that Parliament will be able to vote before entering into the third stage. Foreign policy and Home affairs, including migration, are firmly entrenched into inter-governmental procedure. The Court of Auditors has been strengthened, which is vital in the fight against fraud.
The question of European citizenship is one of interest. At least it is going to be on a reciprocal basis throughout the Community, unlike Commonwealth citizenship. Some people may remember that Commonwealth citizenship gave Commonwealth citizens the right to come to this country and to vote in our elections, but that was not on a reciprocal basis.
Finally, I should like to point out that there is for the first time a declaration in the Maastricht Treaty of the importance of the role of national parliaments and of better co-operation with the European Parliament. I hope that this is an opportunity which our Westminster Parliament will not reject, and that it will seize it and use it for the benefit of our own country and our own Westminster Parliament.
Ratification of the treaty will ensure that these checks, some of which I have briefly mentioned, will be applicable to the existing treaties in force, including the Single European Act, concluded by a government some of whose members apparently did not understand its effects.
There is no option for Britain now to go it alone in an unstable world and raise barriers with our most important trading partners. The Acts of Parliament in accordance with our constitution in recent years acknowledged the transfer of sovereignty on some issues to a system of co-decision with other member states, and that requires and demands that negotiators on behalf of Britain need the strength and support of a majority of Parliament behind them. Undermining the Government's position serves only to undermine their strength in Community negotiations. The present ploys of seeking to overthrow the treaty will not succeed, but they do serve to weaken the negotiating power of our Government at the present time. This is a service neither to the Conservative party nor to Parliament, and nor is it a service to Britain.
Baroness Trumpington: My Lords, I would just remind your Lordships that when four is on the clock we are in the fifth minute.
6.42 p.m.
Lord Ardwick: My Lords, I think that somebody in this debate must protest against the arrangements for debating a subject of first importance with so little time allowed to each speaker. It was almost as bad last week in the defence debate. Such arrangements are an assault on the dignity of the House and on the dignity of the participants. The Procedure Committee must find a solution. After all, the House is not short of time at this point in the year.
There is another difficulty. The noble Lord, Lord Pearson, deployed a long, elaborate, excellent argument, but nobody has a chance of replying to it until the Minister herself comes to wind up. She is the only one with the scope to do it. It is a highly political subject, yet even my noble friend the Leader of the Opposition has only four minutes like the rest of us. This is not a subject for this kind of debate.
I do not belong to the minority in this Parliament which is exciting every fear, fighting the battle very hard, and sparing no extravagance of rhetoric to repudiate Maastricht and of course closer union with the European Community. On the contrary, I belong to the majority in this Parliament which I think is well aware of the shortcomings of the treaty yet believe that it is the best thing on offer to this country and the best thing likely to be on offer. It is our turn now to say that there is no alternative.
Of course from our Labour point of view there is one egregious deficiency in the Government's proposals, and that is to keep Britain out of the agreement on the Social Chapter, a measure that for us Labour people, and almost everybody else in Europe, helps to develop what could be a mere efficient trading bloc into a closer and more human community. It is of course to our embarrassment that we have been joined in our demand to restore the Social Chapter by some of those who hate it most but thought it would be a wrecker. Fortunately, they seem to be wrong.
Some of us Labour supporters of Maastricht this morning were relieved that Mr. Smith apparently has insisted that Labour should not support any wrecking amendments. We can only hope now that the parliamentary battle will not after all be fought in a fog of legal conundrums. Though in the end we shall ratify the treaty, the hope of achieving economic and monetary union in good time seems less feasible than it once did. The preliminary need will be hard enough—to end the recession and to get the Community back on the road to full employment.
The Foreign Secretary is not my favourite prophet, but he spoke wisely on Monday when he said that the world is in an economic and social turmoil and that the destruction of the Maastricht Treaty would add substantially to that turmoil; and if, he said, we were held responsible for the destruction of Maastricht it would reduce our say on matters of vital concern to us in Europe and the world.
6.46 p.m.
Lord Mackay of Ardbrecknish: My Lords, we should be grateful to my noble friend Lord Pearson for one thing at least, in that he has flushed out of the undergrowth a whole covey of unreconstructed anti-marketeers. We have heard for most of this afternoon arguments I well recall hearing in the early 1970s when we first joined up to the Treaty of Rome—arguments we heard again when the noble Lord, Lord Wilson, renegotiated the treaty in 1975, arguments we heard again in 1986 and arguments we are hearing again today.
I should have a good deal more respect for the people who hold those views if they would make clear to everyone that they were actually against the European Community and our continued membership of it. That is what this argument is about. It is not really about the Maastricht Treaty. The Maastricht Treaty is just the frontispiece for the usual arguments that have so plagued politics in this country for 20 years about our continued membership of the Community and so damaged our position inside the community and in the world.
The first step is always the most important step on any journey, and the most important step we took was back in the early 1970s when we joined up to the Treaty of Rome. The second most important step was in 1986 when we joined up to the Single European Act. I would contend, if I had time, that the step we took then was a good deal more important than the step we are being invited to take this year by joining up for the Maastricht Treaty.
I jotted down just a few things in the Single European Act and I should like to read them out quickly to your Lordships. Qualified majority: all over the Single European Act are the two words "qualified majority"; acting unanimously, it is suggested, towards harmonising indirect taxation; co-operation to ensure convergence of economic and monetary policies; strengthening economic and social cohesion; strengthening the scientific and technological basis of European industry; jointly formulating and implementing European foreign policy. That is what we signed up for in 1986.
I did so gladly. I voted for that treaty and that Act gladly, and I did so led by my noble friend Lady Thatcher. I was tempted to read out the Division list of those Members of another place who agreed to that treaty being passed, but that would take rather too long. There are a few familiar names who appear to have had a conversion as on the road to Damascus since they led their party into the Division Lobbies on that treaty. People who demanded loyalty from their colleagues, and rightly received it, seem to have dropped the word "loyalty" from their lexicon. We are going to have to decide quickly whether we want to stay in this European Community and act as members of a club or whether we want to get out. The economic consequences would be hugely damaging. For my own part of the United Kingdom inward investment which comes because we are members of the European Community is very important to our economic health and to employment.

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But more importantly—and this is perhaps more important for a younger generation—all over the world today we are seeing a descent into tribalism. Surely in Western Europe we know enough about the evils of tribalism through our long centuries of history. The European Community is an attempt to turn our backs on that tribalism. Surely our future deserves that.
6.50 p.m.
Lord Moran: My Lords, the ERM is barely surviving. The United Kingdom has had to pull out. There is no sign of the convergence of European economies. We await the second Danish referendum. Opinion in Europe seems to be hardening against Maastricht. In those circumstances many people outside this House regard the Maastricht Bill as a stupendous irrelevance and believe that the Government should be concentrating on urgent matters such as 3 million unemployed, the plight of manufacturing industry, the breakdown of family life and the appalling increase in juvenile crime.
But the essential point is that the Treaty of Maastricht marks a major step towards the achievement of what is called an ever closer union, with a single currency and a central bank with sweeping powers. Anyone who studies the treaty can be in no doubt that its whole thrust is towards a single European state. The lessons of the break-up of the Soviet Union and Yugoslavia are ignored. In such a state this Parliament would become subordinate. Britain would cease to be an independent country. This House would become as irrelevant as the GLC. Eventually the Palace of Westminster could, like County Hall, be sold, perhaps to become a Japanese-owned hotel.
I much regret that Ministers consistently avoid telling the British people down what road they are travelling but insist that there is no question of a super-state; that the Community is now moving towards the transfer of power from Brussels back to national governments; that subsidiarity is a real safeguard; and that we are preserving our freedom of action and our status as a sovereign nation. It seems to me that none of that is true.
I am quite sure that a change of this magnitude should not be brought about without the wholehearted support of the British people. But they have not been asked what they want. Since all three parties are agreed on Europe, they cannot express their views through the normal electoral process. A referendum, as urged by the noble Lord, Lord Blake, and my noble friend Lord Moore, is therefore unquestionably needed. Parliamentary approval achieved by arm twisting by the Whips or legal sleight of hand is no substitute. If the British people are asked and declare that they want a single European state run from Brussels, so be it. Those who dislike the prospect can lump it or leave. But to take that step without the clear support of a majority of the British people would be wrong and dangerous.
6.52 p.m.
Lord Skidelsky: My Lords, I suspect that I am in a majority in this House in not much admiring the Treaty of Maastricht. However, I part company from some other noble Lords who have criticised it and asked for a referendum. I do not believe that a referendum is appropriate for the exact reasons stated by the noble Lord, Lord Healey: that in the form in which we have signed it, the Treaty of Maastricht commits us to nothing that we have not long agreed to. It is an absurd proposition that we should have a referendum on whether we have a floating or fixed exchange rate. That has never been the case in the past. I believe that by far the best way to stop some of the dangerous potential of the treaty from being realised is to fight for its revision at the intergovernmental conference in 1996 rather than withdrawing now into insular isolation.
It is a great over-simplification to say that the Maastricht Treaty is a blueprint for a federal Europe. It is more complicated than that. It is a compromise between the French and German models of the state. The French model is bureaucratic. The French president governs through an echelon of higher civil servants, often without regard to his Prime Minister or to his cabinet. A Europe moulded in the traditions of Napoleon and in the practice of the Fifth Republic is the official French version of the European dream.
The current German model is at the opposite end, although German history offers grimmer alternatives. It is a decentralised model with a weak centre, strong states and a strong constitutional court. A federalised Europe or part of Europe is a logical extension of that model and is foreshadowed in the German constitution.
Both those models are exportable constitutional blueprints. The British model, which takes its constitution for granted and relies on agreements and good sense to make illogical institutions (like your Lordships' House) work, is uncompetitive in that market. That is one important reason why European unity has developed along Franco-German rather than British lines. What Maastricht portends is difficult to say at this point. The likeliest potential is for a weakly federal Europe with a strong self-confident bureaucracy, a community overregulated by officials but without the power to act decisively in international affairs, which only the power of national governments can give.
It is at that point in the argument that I part company with those who simply wish to reject the treaty. To say that it is not what we would like, and that therefore we should have nothing to do with it, is to give up too easily and too early. If there is a danger of Maastricht growing into a monster, it must be in our interest to try to tame and domesticate it, not to turn our back on it and let it grow unchecked. If it is the emergence of a new Carolingian Empire we fear, we do not escape its dangers by running away from it.
Although we count less in Europe than we should, we are not without influence or allies. Our Presidency of the Council, and the conclusions we got it to reach in December prove that. I note in particular the widespread support for the British attempt to use the

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principle of subsidiarity to start clawing back some of the powers usurped by the Commission. That was no mean achievement. The Commission's own submission in October 1992 was an alarming document. It seemed to suggest that over wide and increasing areas the role of national parliaments should be limited to implementing Community law. We fought and resisted that. We have begun to have the principle of reversing unnecessary legislation accepted and have introduced specific criteria for Community action and a more restrictive approach to harmonisation. It is only a start but it indicates what can be done if vision, will and willingness to seek allies is present.
My vision is of a free trade, liberal, confederal Europe based on the close and durable co-operation of its leading powers in the pursuit of common goals. I wish that we spent less time debating Maastricht and more time considering why Europe, as it now is, still has to rely on the United States to try to stop Bosnians, Croats and Serbs from massacring each other. Let us get Maastricht over and done with, and in the meanwhile work with our partners to bring about the tasks worth doing: reviving the European economy; re-equipping the former Soviet Union; and bringing peace to our borders.
6.58 p.m.
Lord Hamilton of Dalzell: My Lords, I remind noble Lords that the Treaty of Maastricht commits us to the irrevocable fixing of exchange rates. I believe that that removes the ability of the Government to run the economy of the country. It seems extremely cynical to take the view that because such an event may not happen it must be safe to sign the treaty. The treaty is not just a piece of paper, I hope.
Perhaps I may advance the argument further. The Chancellor of the Exchequer on behalf of the Government holds executive powers over interest rates and taxes. In his speech in the emergency debate after "white" Wednesday my noble and learned friend Lord Howe of Aberavon, whose work I much admired when he was Chancellor of the Exchequer, stated that a chancellor has three policy options: a prices and incomes policy; the medium term financial strategy; and an exchange rate policy. My noble and learned friend believed that the prices and incomes policy had been tested to destruction. The point about the prices and incomes policy was that it was not only tested to destruction; it was destroyed by the people of this country who refused to abide by it. Not only did that action destroy the policy, but it also destroyed two governments: the miners' strike destroyed the Conservative Government in 1974 and in 1979 a Labour Government was destroyed after the winter of discontent.
One can make the same criticism about an exchange rate policy. We have just seen it destroyed by market forces. My noble and learned friend Lord Howe got around that difficulty by stating that he recommended a system of regulated movements in currency exchange rates. But that is not what the Treaty of Maastricht provides. We are committing ourselves to the irrevocable fixing of exchange rates.
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That seems to leave us with the option of the medium-term financial strategy, in which the Government can use their executive powers to have a domestic monetary policy for the benefit of the British people.
There is no doubt in my mind that the treaty removes the power of the Government to run the domestic economy for the benefit of the British people. The thought makes me fear for the stability of the country. If the Government have no control over their financial policy, for whom do we vote in an election, and why?
7 p.m.
Lord Jay: My Lords, if my noble friend Lord Healey and others are right in saying that there is nothing in the Maastricht Treaty which was not already in the Single European Act, then presumably we do not need the Maastricht Treaty or the Maastricht Bill. However, all I wish to do in the four minutes available is to draw four conclusions from the remarkable speech on the Maastricht Bill made by the Foreign Secretary yesterday in the Commons.
First, the Government have, I am afraid, gone a long way in the past few weeks to shake the public faith, both in the authority of Parliament and in our legal system. On Monday the Foreign Secretary made this astonishing statement about the social chapter:
"there are legal considerations on either side of the argument. The question at the end of the day is not [which is more legally] valid but which set of considerations is the more important".—[Official Report, Commons, 15/2/93; col. 33.]
That does not sound quite like the rule of law to me.
Secondly, if it is true on the Government's view that the treaty on the social chapter says that the Government are entitled to opt out, and if the Bill were to say that they are not so entitled, then at any rate to the non-lawyer there still seems to be a wholly unresolved contradiction.
Thirdly, the doctrine that the Crown—that is, the Government—is entitled to make treaties without parliamentary approval becomes untenable when a treaty alters in a major way the whole constitution of the United Kingdom. On that doctrine, the Government can make a treaty with anyone from China to Peru, abolishing the wish of Parliament, and then inform Parliament that it had no right whatever to intervene. That is surely absurd.
Fourthly, in my view the whole deplorable muddle over the treaty and what it does or does not mean overwhelmingly supports the case for a full and fair referendum, to enable the electorate to make up its mind. The treaty, after all —and there is no dispute about this—proposes revolutionary changes in the constitution of the UK and a major surrender of power over the economy, as has just been said, over foreign affairs, security and defence and on the legislation about citizenship.
The noble Lord, Lord Blake, has been justly described as the British substitute for a written constitution. Both for that reason and for his admirable speech today, it seems to me that his voice is a most powerful, indeed overwhelming vindication of the case for a referendum on the issue.
7.4 p.m.
Baroness Hooper: My Lords, I have listened carefully to the debate this afternoon in the hope of understanding the panic and near hysteria to which mention of the Maastricht Treaty seems to give rise in some quarters. I cannot say that I am much the wiser or that the arguments that I have heard today are any different from the arguments we have heard since 1973 and before that. In that, I very much agree with my noble friend Lord Mackay of Ardbrecknish. It has nevertheless been a reasoned and thoughtful debate and it gives my noble friend the Minister the opportunity to set the record straight where necessary.
My own approach to the issues raised by the Maastricht Treaty is certainly one of caution. I believe that it is right to be cautious in this, as in other instances where the future of our country in the world is under consideration. I also believe that nothing is to be gained from rushing in headlong. But the Government can hardly be accused of rushing in or, indeed, of casting caution to the winds. After all, we have been active in the development and evolution of the European Community for 20 years and we gave it considerable attention and scrutiny during the period of our applications for membership before that.
We must also, I believe, recognise that our Prime Minister —alone of all the leaders in Europe—negotiated hard and well before signing the treaty, not after. He initiated a full scale debate in the House of Commons which was the envy of French and Spanish politicians to whom I talked at the time.
My right honourable friend's successes in getting the best possible deal to coincide with our national interests have been dealt with perfectly adequately by other speakers this afternoon, particularly in relation to the opt-outs on monetary union and the social chapter. That surely proves that it is possible to have our special interests taken into account when necessary.
However, in mentioning the social chapter, I would nevertheless point out that we already have a perfectly good social charter which we signed in 1976. That is the social charter of the Council of Europe, which is the counterpart of the European Convention on Human Rights and guarantees the enjoyment without discrimination of a number of fundamental rights: for example, safety and health at work; fair remuneration; protection for children and young persons. So by all means let us consider ways of strengthening the supervisory system of that social charter, but we certainly do not need another one.
I am a convinced and enthusiastic European, both as a former member of the European Parliament and now as a member of the Parliamentary Assembly of the Council of Europe. But that does not mean being blind to the difficulties. So, combined with my cautious approach, I also believe that we should be realistic and recognise how greatly the European Community has changed and developed since we joined, and how much, indeed, the world and our national circumstances have changed. That, in my view, is the strongest card in favour of the Maastricht Treaty. It dots the "i"s and crosses the "t"s on the European Act and what has gone before. What
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Maastricht does is to limit increasing centralisation, as my noble friend Lady Elles put it so well, to clarify and define, to provide sanctions and scrutiny procedures where they are much needed.
For example, Article No. 128 requires cultural aspects to be taken into account in other EC policy areas. That surely is a safeguard for those who fear losing our national identity. Article 129 provides a definition of public health in which I certainly took considerable interest, as a Minister for Health, and ensures that Community activity cannot impinge on our National Health Service. Budgetary scrutiny procedures are introduced and increased powers given to the European Court to ensure that implementation is fair and the famous level playing field is achievable.
To those who advocate a referendum, I ask: what about the constitutional effects of that? What does it do to our parliamentary democracy if Parliament is to be bypassed every time something really important comes up? I believe that what we are talking about is institutional change which is necessary in a changing world and I certainly look forward to supporting the Bill to introduce the Maastricht Treaty when it comes to your Lordships' House.
7.8 p.m.
Lord Beloff: My Lords, I also am a good European but my idea of Europe is not confined to where the writ of Brussels runs. In 1949 we were all anxious to see Europe at peace and the countries of Europe learning to co-operate with each other. At that point, we were approached by Mr. Jean Monnet with the suggestion that there should be a joint Anglo-French economic plan. That was examined by the Foreign Office in the person of Mr. Roger Makins, as he then was, now our colleague the noble Lord, Lord Sherfield. The reply was returned that Britain could not sacrifice her long-standing and important ties with the United States and she could not abdicate from her right to control her own economic policy.
Since then, there has been what can only be described as an open conspiracy. The French and Germans got together for different national reasons to create a United States of Europe. That is their entitlement. If they wish to do it they are obviously entitled to do so. But the attempt has been made to bring this country into that combination by a mixture of threats and blandishments. The blandishments are economic. But it takes someone with the political innocence of Lord Mackay of Ardbrecknish to believe it.
Let us take the simplest form. We have been in the Community for over 20 years. We knew at the time that the common agricultural policy was very damaging to us. Over those years we have not succeeded in getting it changed. So much for being at the heart of Europe. We are now being landed with a trade war with the United States. Can anyone believe that this country, if it still controlled its own foreign trade policy, would be engaging in a trade war with the United States? If Sir Leon Brittan would still glory in the name of Briton, like George III, he might not be prepared to represent French protectionism (which is what it is all about) in international negotiations.

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Nor is it true, alas, that any of the safeguards referred to by the noble Lords, Lord Reay and Lord Skidelsky, and others are genuinely there. It is not only that the Commission said: "Subsidiarity is an old idea. It is always there in any state and any federation of states". In other words, in October the Commission already described what was being created as "a federation of states". The declaration from Edinburgh did not alter that. One cannot have safeguards unless one has, as the United States has, a written constitution with an independent judiciary to interpret it.
The European Court at Luxembourg is not independent. It is an instrument of European integration, as are the Commission and the council—not the Council of Ministers, but those who do the work; that is to say, the permanent representatives. It is simply not true that the safeguards are there. I am sure that the Prime Minister did his best. I am sure that he intended to seek to protect this country's institutions. But in fact those institutions are now under threat. To those who say, "The Europeans won't like us very much if we now turn our backs on the treaty", one can only reply that there are more Europeans than one would think of if one takes one's view of Europe from the cafes of Brussels.
7.13 p.m.
Lord Monson: My Lords, I have no doubt that the Prime Minister and his Cabinet colleagues are entirely sincere in their belief that the Maastricht Treaty can be manipulated so as to ensure the survival of our nation state and prevent the formation of a federal or, worse still, unitary Europe. But equally, I have no doubt that Herr Bangemann and those numerous senior politicians and officials on the Continent who share his philosophy—notably those from Germany, Italy and the Benelux countries—are equally sincere in their belief that Maastricht represents a giant step forward in the creation of a united states of Europe, broadly on the lines of the United States of America, but more centralised. Even at this early stage, the ancient nation states of Europe have less autonomy in certain matters than do the individual states of America, Australia or the provinces of Canada. Clearly, those two sincerely held but totally opposed interpretations cannot both be right. Which will be proved correct in the long term?
Mr. Major has a country to run, as have all British Prime Ministers. There are and always will be urgent problems to contend with relating to health, education, law and order, social security, energy, transport, and above all the economy. No British Prime Minister, and no prime minister anywhere, can afford to spend even as much as 10 per cent. of his or her time dealing with what is still legally the European Economic Community. In contrast, the Utopians in Brussels can choose, if they wish, to devote 99 per cent. of their time plotting to phase out gradually the individual nation states and create a unified Europe. I say "plotting"; it is done with the very best of motives, as they would judge it.
This being so, it is fairly obvious who is going to win, particularly as the idealists are reinforced by the
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hard headed pragmatists in Ireland, Portugal, Spain and Greece, for whom the treaty is a means of extracting much more money from the so-called wealthy countries. As it is, every man, woman and child in the Republic of Ireland, for example, receives a net £121 a year from the British taxpayer, and that sum is set to rise once the treaty is ratified.
But let us suppose that this interpretation is over-pessimistic and that we end up in the year 2015, say, still retaining some notional degree of national independence. Are we then out of the wood? No, my Lords. The massive extension of qualified majority voting deprives the British people, and all other peoples, of control over large areas of their own lives. Not only is that wrong, but far from promoting friendship between the peoples of Europe, which is one of the objectives of the Treaty of Rome, it will create tension and even hostility between them. Individuals the world over will reluctantly and grudgingly submit to most laws they dislike and to most taxes they dislike provided they are imposed by their own kith and kin, so to speak, people with whom they share a common culture and a common history. The moment such unpopular laws or taxes are imposed by distant people with whom they have no affinity, there will be the risk of civil disobedience and even physical resistance. The notion that the gracious bestowal of subsidiarity will compensate for finding oneself in a small minority in all major areas of decision-making is frankly laughable, especially when one studies the pathetically tiny list of trivial items that is to be devolved back to us in consequence of last December's Edinburgh summit.
Last but by no means least there is the question of the compulsory citizenship of the union and the rights and obligations attaching thereto. The nature of those obligations is nowhere spelt out. But very senior lawyers whom I consulted believe that they entail a general duty of loyalty to the new union, and therefore there is a danger that disloyalty to the union or to any of its component states—for example, by supporting Turkey against Greece in the event of a conflict between those two countries—could be construed as treason by the European Court. That is a very worrying possibility.
7.18 p.m.
Baroness Carnegy of Lour: My Lords, I hope that the noble Lord, Lord Healey, while he is still in his place, would not think it impertinent if I echo the first part of his speech and suggest to my noble friend Lord Pearson that perhaps the questions that he addressed in his speech, matters which have been addressed by other noble Lords who agree with him, are now yesterday's questions and not today's.
What has gone wrong with the Community so far, and what has gone right (and we have not heard enough about that this afternoon) has flowed from previous treaties, not from Maastricht. Now we have the Maastricht treaty. It contains a number of provisions. Many are there at the behest of the United Kingdom. They should begin to reverse the

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centralisation trend and the rate of increase of Commission activity, which we who serve on the European Select Committee know is right.
The Maastricht Treaty also contains at its heart a timetable for moving to stage three, which is a monetary and economic straitjacket. Even if we exercised our opt-out option, it would prove pretty uncomfortable for the United Kingdom. When the treaty was signed, it gave many of us who were European enthusiasts a lot of anxiety. It still gives anxiety to many speakers in this debate. But time has moved on. Federalism is seldom mentioned nowadays in the reports about what is being said in Europe. Denmark said no. France said yes by a small margin; were it not for France's Caribbean vote, it would have said no.
We have had the currency devaluations and seen what speculators can do when currencies within a system are put under strain. Germany is struggling with the political and economic effects of reunification. German and French elections are approaching. It is not surprising that this week we hear that the Community Finance Ministers—apparently led by Germany—have agreed that the timetable for stage three should be lengthened at least until 1998 and probably longer. It seems that in the end stage three may never happen at all.
At any rate, there is now a lot more time and room for manoeuvre for the Community to sort itself out. Yet we need the treaty for all the advantageous and necessary provisions it contains. It seems to me that it should be ratified; the benefits within it should be enjoyed and on the currency and central bank issues we go on from there together with our colleagues in the Community. I suggest that the main anxieties about the Maastricht Treaty now are yesterday's questions.
7.21 p.m.
Lord Harmar-Nicholls: My Lords, I have heard every speech in the debate, not for the first time. There is nothing new. We have been doing this for 22 years from a date in 1971 when we were questioning whether or not the Treaty of Rome was the direction in which we should go. At that time only 39 Conservative Members voted against it because of the power and influence of the government of the day—mainly from Mr. Harold Macmillan as he then was. The argument is there.
The message that I hope my noble friend will take back to her colleagues in the Government is this: that there is an honest, deeply felt difference of opinion on an important matter involving the future of this country. The debate has reflected it. Those people who have taken the trouble to look into it find that it is felt also by people outside. The Government must face up to the fact that honest, decent, sincere people, many of whom have tried to study what it is about, hold different views. We live in a democracy. The only constructive contribution came from my noble friend Lord Blake.
One must accept the difference. We must go on. We do not want to scratch one another to bits. We do not
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want to ruin the party system upon which our parliamentary system is based. The difference of view in my party was reflected in the debate today and we know that there is a difference of view in the Opposition party.
When one has those divisions it is the Government's duty, in order to preserve our system of government, to find a way out of the impasse. The only way I can see is the one mentioned by my noble friend Lord Blake—a referendum. No one is in love with the referendum system. Our parliamentary control has worked well for more than a century and it is a good way, where power of attorney is given to Members: they give some thought to the detail and deal with it. They cannot do that with Maastricht. Therefore it must be referred in some way to the people who will either suffer or benefit from whatever flows from whether or not the treaty is signed.
I give this warning to my noble friend Lord Mackay and many others. Those of us who have been a long time in Parliament —I have been in the Palace of Westminster for 43 years—have learnt many lessons from the various tactics that can be used. I remember when in company with the noble Lord, Lord Jay, and others trying to point out the downside of the European treaty. We were told that we could not say that certain things would happen. It was said, "We have the power of veto to stop those things happening". The power of veto hardly exists. We have gone down all the roads that we warned about and the veto is no longer there.
Maastricht comes along and what do they say? They say exactly the same. They use the power of the Whips to push it through because they are so wedded to it. They are saying, "Maastricht does not contain the dangers you talk of. We have achieved subsidiarity. Subsidiarity will prevent the dangers occurring"—just as the veto was supposed to prevent them happening.
I therefore ask my noble friend when she reports, as I hope she will, what happened in the debate to indicate that nothing less than a referendum will do, or some alternative which will allow the people to have a say, since those who are supposed to represent the people are divided. That is a constructive suggestion. I hope that my noble friend will heed it.
7.25 p.m.
Lord Underhill: My Lords, when the terms of the debate were first announced I was particularly concerned to deal with the gross misrepresentation by the Government of the terms of the social chapter. But there are other issues with which I should deal on which there ought to be Community action fairly soon.
First, there is the scandalous speculation in currencies of member states. Our states are being picked off one by one. That can only be dealt with by unified action by the Community. Secondly, there is the dangerous rise of nationalism—to which the noble Lord, Lord Mackay, referred—in parts of what was the USSR and other parts of Eastern and Central Europe. It is extremely worrying. The Community can play a large part in dealing with the appalling position

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brought about by the growth of nationalism. There is also the fearful trend towards racism which is gathering in parts of Europe, even in states within the Community. Those are issues which have not been dealt with by other Members, but they are vital issues on which the Community could act through the Maastricht Treaty.
There is also the question of confusion occasioned by those who helped to lead us into the Single European Act. Now they are prominent in opposition to the Maastricht Treaty. I should like to know why and how they justify those different actions.
When the treaty was first produced—I have read it —I realised that it was not a perfect instrument. Equally, the Treaty of Rome was not a perfect instrument, yet I found it possible in the referendum of 1975 to vote to join the Community. I still regard that treaty as being imperfect and it contains points that need to be improved. My colleagues have sincerely taken a different view.
The last Labour Party conference in October made a declaration that Britain is intimately involved with Europe. It reaffirmed its commitment to closer economic and political co-operation in Europe. On that we must keep in mind that Britain's trade with Europe is substantial. In 1991, 55 per cent. of our trade was with European states; it was worth nearly £59 billion. I was able to support the referendum in 1975 and I have no hesitation whatever in supporting the attitude of the Labour Party on the Maastricht Treaty, even though we know it is imperfect. Rejection of the treaty is likely to move the United Kingdom out to the periphery of Europe, but Britain's future requires that we should be at its heart.
I wish to make some brief points on the social chapter. The Government have grossly misrepresented the social chapter. I emphasise one point only. There are no provisions applying to pay, the right of association, the right to strike or the right to impose lockouts. Other provisions can be determined only by qualified majority voting. Other provisions regarding directives require unanimous decisions. We should condemn the Government's misrepresentation of the social chapter and deal with it accordingly.
7.30 p.m.
Lord Belhaven and Stenton: My Lords, I am grateful to my noble friend Lord Pearson of Rannoch for giving the House the opportunity to discuss the Maastricht Treaty, albeit in a somewhat shorthand way. It is an issue of great constitutional importance. Indeed, I think a good many people in this country, including sometimes myself, believe it is a treaty of union by stealth, unlike the treaty of union between Scotland and England which took place nearly 300 years ago. In that case at least both Parliaments knew what they were talking about.
The title of the treaty surely must mean something even if the interpretation appears to be confused. It is called a Treaty on European Union. The word "union" in the constitutional sense, as I understand it, has or used to have a precise meaning. There are so far as I know only two kinds of constitutional union; first, federal or confederal, as with the United States or
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Switzerland; and secondly, incorporating, as exemplified in this United Kingdom. We are given to understand that Her Majesty's Government fought a long and bloody battle to exclude the word "federal" from the wording of the Maastricht Treaty. It was not to be allowed at all. So, as we are evidently going to have a union, I have to ask what sort of union it is if it is not confederal, federal or incorporating.
I am driven to the conclusion that we have here a federal union, and, as we have seen this afternoon, I do not think that I am alone in my conclusion. If we are not going to have a union, why is "union" the principal word in the title of the treaty? Indeed, without the word "union", the title would be meaningless. We have heard endless talk about the European train which is supposed to be going towards a closer and closer union and to be carrying Britain into the heart of Europe, wherever that may be. I have a home outside Krakow in Poland, which I think is actually in the heart of Europe. It is also outside the EC, but that is incidental.
I believe that we should move with great caution in this matter and it could be that with the Single European Act we have gone too far already. At all events we ought to be consolidating any gains that have been made and not madly accelerating towards some nebulous Eldorado.
I should like to ask my noble friend the Minister one question. Granted that this is a union, whatever else it may be, do the states so united have the right to secede after the union? This may not be an immediate issue but the failure to be precise on this point in the constitution of the United States resulted after 70 years in a bloody civil war. Her Majesty's Government ought to tell us what we are in for.
Secession would be far from easy whether or not there was to be a right to it. Indeed, a legal exercise of the right could in certain circumstances lead to war. We are very far in already in this Community but it could still be possible to get out, though I myself would not advocate that. But I believe that this is a "treaty too far" and, no matter what may be said by its proponents, that it is an entire surrender of sovereignty.
7.34 p.m.
Baroness Flather: My Lords, I should have been a great deal happier if today we were debating the implications of the Single European Act and even happier if it had been the Treaty of Rome itself, for that is what today's debate has been about. I wonder what happened to the idealism which gave birth to the European Community in postwar Europe. I still subscribe to it, even if no one else in this Chamber does. It is not simply about what we gain from it. It is also about what we give to it.
It was the Treaty of Rome which foreshadowed the Single European Act by stating that the single market should be completed, at the latest, by 1973, though it took 20 years to put that into effect. And it was with the Single European Act in 1986 that we gave away what the detractors of Maastricht will have us believe we are giving away now. On the contrary, as many noble Lords have already stated, Maastricht is

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attempting to roll back the power of the European Commission and return the decision making to the national governments. Subsidiarity is not a new invention of the Maastricht Treaty but it is only under this treaty that the burden of proof is placed on the Community institutions to show that action should be taken at Community level rather than at national level. This more than anything else is likely to blur M. Delors' vision of a super state with himself at its head.
We were late in joining Europe but we joined and we took a huge leap when we rushed the Single European Act through our Parliament. It is surprising that some of the greatest detractors of Maastricht saw nothing to fear from that. Dare one wonder whether all the implications were clear to them at that stage? But it is less than becoming now to forget their own central role in taking Britain further towards a federal Europe than does anything in the Maastricht treaty. It was the Single European Act which made the European Commission all powerful, not Maastricht.
We cannot stand on the sidelines of Europe. We need to be at the centre. The Europeans need us and we need them. We must approach our present situation with both realism and honesty. It is not a question of better late than never. We cannot turn back the clock even if we should wish to do so.
Maastricht has become a bandwagon for anti-Europeans. What I have heard this afternoon suggests to me no more than a total dissatisfaction with the existing situation—something in the nature of "Don't get me wrong. Some of my best friends are Europeans". They know that not only do people not understand the provisions of this treaty, they do not know what the position is under the Treaty of Rome or the Single European Act. If the treaty is not signed, let us be in no doubt. The rest of Europe will still move on, with or without us. The train has left the station. Let us be willing passengers on it.
7.37 p.m.
Lord Hacking: My Lords, this is a most important matter, which raises complicated issues. It is to the great credit of noble Lords who have spoken before me that they have allowed me to rise to speak only six minutes after the appointed time under the timetable set by the Government. I do hope, with the concurrence of my noble friend, that this canter can come to an end. The next two speakers from the Front Bench were formerly Commissioners in Brussels. I would ask your Lordships to agree that they should have longer than the four minutes that has been allocated to the rest of the speakers.
I also come to this matter as a lawyer who has practised European law; as a lawyer who has appeared in the European Court; and as a member of your Lordships' Subcommittee E on law and institutions. I also come to this matter in support of the Maastricht Treaty. I believe that the case as regards federalism has been greatly overstated, as the noble Lord, Lord Healey, suggested. If your Lordships look carefully at the treaty they will not find
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the evils in it. Indeed the Maastricht Treaty improves considerably on the position under the Single European Act of 1986.
In introducing the debate, my noble friend Lord Pearson referred to Article 3b. When he said that it is the "Council that decides" on the issue of subsidiarity, he missed altogether the role of the European Court. If the Council has not properly applied Article 3b there is an immediate remedy in the European Court. Therefore it is important when considering the Maastricht Treaty to look at the strengthening of the powers of the European Court and of the rule of law in Articles 165 and 184. It is important also to look at the strengthening of the European Parliament in Articles 137 to 138e.
My worry, particularly as regards the debate that has gone on in another place, is that political manoeuvring—I do not attach that criticism to any single party—is obscuring the debate. What I care about is our commitment to the affairs of Europe and that we should play a central role in it. That means not just obtaining a squeaky majority in another place, but demonstrating a commitment by the people of this land as a whole. In my view it would not be out of place for that view to be tested in a referendum. I should be happy to go to the hustings and I am confident of the result.
7.40 p.m.
Lord Thomson of Monifieth: My Lords, I am indebted to the noble Lord, Lord Hacking, for his generous appeal to the Government Front Bench, but I am ready to surrender my sovereignty and accept the collective discipline that we have all had to submit to in this debate.
This is the second rather curious debate on Maastricht which has taken place this week. Together they underline the damage which has been done to one of the true interests of the British people in our interdependent world and, as members of the European Community, through what must be said to be the drift which has been allowed to take place by Government. One of the most important and astonishing sentences in the Statement made earlier this week about the social chapter was right at the end where the Foreign Secretary reminded the House that the Government won an overwhelming majority on the Second Reading in another place for the Maastricht Bill.
I felt at the time, and I do so even more now, that the Government made a very great mistake in not pressing ahead at that time on the basis of their own election victory and instead allowed themselves to be attached to the coat tails of the Danes following their referendum. Appeasement never works in politics and the Government, the House and the British people are paying a pretty high price for the kind of political appeasement that the Government have conceded to the tiny minority of unreconstructed anti-marketeers, to quote the words of the noble Lord, Lord Mackay of Ardbrecknish, who have been able to conduct their campaign so vigorously over so many months.
I am both puzzled and saddened by the tone of so much of this debate this evening and by the way in

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which the opponents of United Kingdom membership of the Community, whose convictions we all respect—we have heard it all before, as the noble Lord, Lord Harmar-Nicholls, said—continue to clamour to close the constitutional stable door long after the horse has departed.
As has been mentioned, when we adhered to the Treaty of Rome, we accepted that we committed ourselves to an ever closer union. It did not mean a federal union. I do not believe that the great federal vision is at all a reality in the foreseeable future. We were committed to a closer union at that time. Since then we have had a referendum on the subject, a re-negotiation of our terms of entry and successive general elections. A major consensus was built up in this country on the real issues regarding sovereignty.
What does sovereignty mean in the modern world? It means that we should conduct our affairs in such a way that we are ready to pool our sovereignty in our own interests. We have pooled our sovereignty as regards our interests in self-defence through NATO. We have done so in the various developments in the European Community because we believed that it was the best way to ensure our future prosperity as part of a single market and to ensure the proper influence of Britain in world affairs.
The European Community will go on without us. The real question for us, and the real meaning of sovereignty in this matter, is how we use our role in the Community. As has been mentioned, the Single European Act was carried through Parliament by the Administration led by the noble Baroness, Lady Thatcher. It made far more constitutional modifications to our theoretical independent sovereignty than the Maastricht Treaty does. The noble Lord, Lord Mackay, recited some of those modifications. If he wishes to, Mr. Major can claim that he has been far more conservative over constitutional changes in the negotiations which he conducted on the Maastricht Treaty than his predecessor was over the Single European Act. Perhaps the only significant change was as regards citizenship.
I see the noble Baroness, Lady Trumpington, tapping her watch, and quite rightly. I apologise. I shall conclude on citizenship with the rhetoric that I used through the 20 years of debates on that subject. By nationality I am a Scot. I am proud to be a British subject. By conviction I am a citizen of Europe and I see no conflict at all between those three propositions.
7.45 p.m.
Lord Richard: My Lords, I have enjoyed listening to this debate in one sense but not in another. Perhaps I may join with those who have complained about the fact that we are all limited to about four minutes. I shall do my best to keep to four minutes, but I gather that the noble Baroness does not need to rise for about another 10 minutes to give her her 20 minutes, so I hope that noble Lords will forgive me if I leak a little around the edges—
Noble Lords: No!
Lord Richard: The House is obviously divided. I am sorry that the noble Lord, Lord Tebbit, has not graced
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us with his contribution this evening. We look forward to what he has to say on this subject with great anticipation. I have no doubt that it will be relevant and stimulating and will no doubt have a profound political effect. We are sorry that he did not think that he could do it in this House in four minutes, but nevertheless we look forward to hearing him.
I am sorry that I do not have the opportunity to respond to the modest and moderate strictures on the European Community of the noble Lord, Lord Harris of High Cross. For him, I believe that he expressed himself in a somewhat restrained and subdued way this afternoon. We look forward to him reverting, I suppose, to his more vigorous self in due course. As for my noble friends Lord Stoddart and Lord Bruce of Donington, it would take more than four minutes for me to discuss some of their contributions and therefore I shall not try.
I wish to make two preliminary points and then say a word or two about the social chapter. The first and basic point as regards what we are supposed to be considering tonight was made by my noble friend Lord Healey. If the Government do not ratify Maastricht now, having gone through the detailed process of negotiation of the treaty and having secured the accommodations which they claim to have secured from our other 11 European partners, it will be the most enormous breach of faith on the part of this country. Secondly, it would diminish our influence inside the Community almost to vanishing point.
As regards those who say that we should not ratify, a great deal of the argument has been couched in words not that we should not ratify the treaty but that we should not be in the Community anyway. That is not the argument that is now before us, but whether we ratify the treaty. Having negotiated it in the way that Mr. Major did and having secured the concessions that he did, it would be a monstrous breach of faith not now to ratify.
I do not recognise the Community that the noble Lord, Lord Thomson of Monifieth, and I worked in from some of the descriptions that I have heard in the course of this debate. The noble Baroness, Lady Flather, referred to the all-powerful Commission. Good heavens! In my day the Commission was so powerful that every issue of social policy I put up was knocked down by the Council of Ministers. I am sure that the noble Lord, Lord Thomson, had exactly the same experience. The idea that the Commission is somehow formulating great plans for a federal Europe which it can then force through on unwilling individual member states is a travesty. The Commission does not work like that. As those who know the Community realise, the Commission attempts to produce an answer to a problem which it perceives to be a European-wide matter and it tries to produce a European-wide solution to it.
That may be the Commission's view, but when one gets to the Council of Ministers there is a good, solid battle among the individual countries to get their slice of the action. It is the modern European equivalent of the American smoke-filled room in which deals are done, some inside the room and some outside. They are done by the Ministers of the individual nation

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states and not by the poor old commissioner, who is frequently trying to defend his policy against the depredations of individual and national interests. I do not recognise the description of the Community that has been given tonight by some noble Lords.
Perhaps I may now turn to the one point that I should like to make. It relates to the social chapter. We have heard so many versions of the legalities relating to the social chapter and the opt-out that, if the House will forgive me, I think that I shall venture to give my own. It seems to me that the starting point is what we have accepted already in the social field. There is quite a lot about it in the Treaty of Rome. Article 2 of the treaty again emphasises the importance of such things as a high degree of convergence, a high level of employment and social protection.
The next stage is that we come to the so-called social protocol, which can be found on page 117—at least, it can on my copy of the treaty. What does the social protocol do? It incorporates the so-called UK opt-out but in a very strange way. It does not refer to "The UK opt-out", but states, "The other 11 shall be permitted." According to the so-called "UK opt-out", all the 12 countries agree that 11 of them shall,
"have recourse to the institutions, procedures and mechanisms of the Treaty".
I see the noble Lord, Lord Tebbit, nodding in agreement. I am not sure whether I should take comfort from that.
But let us continue. According to the opt-out, the other 11 states are permitted to use the mechanisms, institutions and procedures of the Community. As I understand it, the opt-out and Amendment No. 27 in another place, which is a very simple amendment, take out the protocol on social policy. That means that we do not agree that the other 11 member states shall be permitted to,
"have recourse to the institutions, procedures and mechanisms of the Treaty",
for the purposes of using those procedures and mechanisms in order to give effect to the agreement on social policy, which is an agreement only between the 11. I see that the noble Lord, Lord Tebbit, is still with me—and that I am being frowned at by the noble Baroness, Lady Trumpington. If your Lordships will allow me to finish this point, I promise that I shall sit down.
If that amendment were to be carried, as I see it, it would mean that the other 11 countries would have to re-ratify the treaty because it would not be the same. Indeed, they would not be able—again, as I see it—to use the procedures and institutions of the Community to pursue the social policies to which 11 of them have agreed. In order for the United Kingdom to opt in, we should have to take a further step.
Although I have done the best that I can with the varying interpretations of the decisions and judgments that the Government have issued on this matter, for the life of me I do not understand the latest one which the Foreign Secretary gave to the House of Commons on Monday. The idea that accepting Amendment No.
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27 would not mean re-ratification of the treaty by the other 11 is beyond me. I regret very much to see that the noble Lord, Lord Tebbit, is still nodding.
7.53 p.m.
Baroness Chalker of Wallasey: My Lords, I am grateful to my noble friend Lord Pearson of Rannoch, for giving the House this opportunity to debate the constitutional effects of the Maastricht Treaty. We have gone a little wide of that but no matter. His speech, like those of other noble Lords, was indeed thought-provoking. I shall try to address his many concerns.
Perhaps I may say right at the beginning to the noble Lord, Lord Ardwick, who said that this debate is an insult to the House, that earlier today your Lordships considered whether this matter should be referred to the Procedure Committee, because this is not the first time that an issue of major importance has been limited to a debate of two-and-a-half hours. We shall, of course, have ample time to debate the Maastricht Bill when it comes to this House.
The noble Lords, Lord Richard, Lord Thomson of Monifieth and Lord Healey, and many others, were absolutely right when they said that not to ratify the Maastricht Treaty would be an enormous breach of faith. We have heard a lot about the technicalities and complexities of the Maastricht Treaty and about where some of your Lordships think that it is going and how it might affect the United Kingdom. However, I beg your Lordships not to lose sight of the basic positive benefits that the treaty contains. Several of my noble friends, including Lord Mackay of Ardbrecknish and Lady Hooper, have commented on that fact. The treaty checks the centralising trend in the Community. But it recognises that inter-governmental co-operation is just as European, and just as effective, as action under the provisions of the Treaty of Rome. For the first time the principle of subsidiarity has been given an explicit treaty base. We have built on this with the agreement at Edinburgh on guidelines for the application of subsidiarity. The treaty clarifies and codifies the new competences; it reduces the scope for Commission initiatives beyond the scope of the treaty's intention. It strengthens the rule of law; it empowers the Court of Justice to fine member states which fail to comply with legal obligations. I remember over many years that both Houses of Parliament have wished for those things, and they are now there in the treaty.
The financial accountability of the Community institutions has been improved, with strengthened financial control for the Parliament over the Commission and an enhanced status for the European Court of Auditors with the tightening of accountancy rules to prevent fraud, to which my noble friend Lord Pearson referred. Special arrangements have been secured for the United Kingdom where it is in our interest. We retain the right to decide whether, and then when, if we decide to go forward, to join Stage III of economic and monetary union. My noble friend Lady Carnegy of Lour was right to express that point.
Thus, we are helping to formulate policy, but have managed to keep our own options open. We will not

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be committed to the social chapter, with all the consequences for jobs and industry that industry in this country firmly believes would follow. That is an impressive list by any account. However, although I understand the real anxiety which has been expressed by many noble Lords, there are concrete achievements in this treaty which I believe are a tribute to the negotiating skill of my right honourable friend the Prime Minister. There is no reason why anyone should seek to undermine this.
I am aware of the difficulty of producing a definitive constitutional analysis of the European union. Several noble Lords have referred to this, including my noble friend Lord Belhaven and Stenton. The European union is a unique animal, but the word "union" was in the opening line of the original Treaty of Rome. There is no reason to be frightened of that word, which is now to encompass the Community and the separate pillars which are to be inter-governmental. The concept of the union was, in fact, a setback for the federalists. It does not enhance federalism.
The establishment and status of Community law may indeed have had implications for Britain and its Constitution. But this is not a new innovation to be found only in the Maastricht Treaty. This concept was established by the original Treaty of Rome in 1957. It remained unaltered by the Single European Act in 1986. In fact, the Maastricht Treaty improves on the status quo through the intergovernmental provisions of the European Union.
The union provides a structure for alternative forms of co-operation between member states outside the existing framework of the Treaty of Rome, where the Commission enjoys the exclusive right of proposal and the European Court of Justice has ultimate jurisdiction. I shall refer in a moment to intergovernmental co-operation in common foreign and security policy and in justice and home affairs, the two areas in which we have IGCs. However, just as the structure of the European union does not lead to the existence of a super-state, so it would be similarly misguided for anyone to read too much into the citizenship provisions of the Maastricht Treaty. Many fears have been expressed tonight about citizenship, but that is not dealt with in the way that has been suggested.
Let me now come to the question asked by my noble friend Lord Belhaven and Stenton about seceding from the Treaty of Rome. At the time of our accession to the Community, the Government of the day stated that membership did not endanger parliamentary sovereignty, since a future Parliament could repeal the European Communities Act and withdraw from the Community. Obviously it would now not be just the European Communities Act but the embodiment of the Single European Act and of the Maastricht Treaty. As the noble Lord, Lord Underhill, said, I do not believe that that would be in Britain's interests.
Let me turn to what was perhaps the most common theme in the debate; that is, the call for a referendum on Maastricht. As I have often said before in the House, the Government do not believe that it is necessary or right. Maastricht itself introduces no
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constitutional innovation. While the doctrine of the primacy of Community law may be viewed as having a "constitutional" significance, that is not a new concept. Parliament accepted it in 1972 in approving Britain's accession to the Community. In 1975, we had a referendum in which the people also endorsed Britain's membership of the Community. That was the referendum on the constitutional step and the result was a majority of two to one in favour. The Maastricht Treaty amends and adds to the provisions of the Treaty of Rome, but the status of Community law in the United Kingdom's legal framework remains unchanged.
I firmly believe that the essence of our parliamentary democracy is that Parliament is elected to represent the people, and to take decisions on their behalf. That was obviously the view of my noble friend Lady Thatcher when she led the Conservative Party through the "No" Lobby in the 1975 EEC referendum debate. She has changed her mind now as have others. I sometimes wonder why there has been such a change.
The Bill currently before another place is being debated in considerable detail. There are a number of highly complex and legal issues to be dealt with. I look forward to discussing them with your Lordships later this year. It is notable how long the other place has spent discussing the Bill. It is important that we should do the same.
My noble friend Lord Harmar-Nicholls said that nothing less than a referendum or some alternative would do. The alternative is called a general election. I discussed the European Community when we had the general election last year, and we saw the result.
I shall leave the social chapter and Amendment No. 27 tonight, not because I do not want to tussle with the noble Lord, Lord Richard, but merely because we went over it clearly on Monday when I announced the Government's decision at the Dispatch Box, and time is short. My noble friend Lord Pearson and a number of other noble Lords asked about citizenship. It is important that we should consider that point carefully. The concept of a union citizenship is additional to national citizenship. It does not replace national citizenship. It constitutes a means of linking some existing rights with limited additional rights. Many thousands of our citizens already use the right of free movement outlined in Article 8a to live, work and study in other member states, just as citizens of other member states can come here. They may now also take advantage of some new rights. EC nationals may vote in local and European elections in another member state where they are resident. General elections will be unaffected. It is right and proper that people should be able to exercise democracy where they live.
Citizens of the union will also enjoy the right to reciprocal consular facilities in countries where the nation of origin is unrepresented. Another provision allows citizens to petition the European Parliament and to take grievances to the European ombudsman. Those are rights which will benefit the British citizen. I do not see that they pose a threat to our Constitution.

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Let me now turn briefly to duties. Nowhere in the citizenship provisions is there any mention of a duty of the kind normally regarded as deriving from national citizenship; for example, military service. The reference in the treaty to "duties" is not a reference to specific duties. Neither the Maastricht Treaty nor any previous Community treaties impose specific duties on individuals. It is therefore an unnecessary and empty reference. In many ways I find that it is a misleading reference, and I wish it had not been included, because it has no value. I assure your Lordships that there is no power to add new duties under the Maastricht Treaty. Even the addition of new rights will require unanimity in the Council and ratification in each individual member state and, in this country, by both Houses of Parliament.
My noble friend Lord Pearson of Rannoch asked two other questions on that topic. First, he asked about the position of the Queen. I made that clear to my noble friend Lord Tebbit on 10th February in a Written Answer. Let me just add that the Maastricht Treaty in no way alters the Queen's constitutional position in the United Kingdom; nor does it impose specific duties on any individuals. If she chose, Her Majesty would be entitled to exercise the rights set out in the citizenship provision provided for in Articles 8 to 8e of the treaty. My noble friend Lord Pearson of Rannoch also asked about renunciation. He asked whether one could renounce citizenship. That is a non-issue because citizenship confers certain rights but no obligations. Citizens are not obliged to take advantage of the benefit.
Another theme in the debate has been Community competence, and the fear expressed by some of your Lordships that that is increasing. I find the Maastricht Treaty a welcome step forward because it constrains what many noble Lords have claimed to be the Community's creeping competence. In areas such as education, health and culture, harmonising measures are explicitly excluded. The content of primary and secondary education, and healthcare, for example, rightly remain matters for each member state to decide. The same is true for vocational training. The Commission will no longer be able to propose wide-ranging measures to be voted through by a simple majority of member states. The scope of the Commission's competence has been reduced and the voting arrangements toughened to qualified majority voting.
Those examples show how, for the first time, the Community's centralising tendency is being checked and reversed. In the past, the Community seemed to be drawing more and more areas of policy into the separate framework of Community institutions operating under the Treaty of Rome. What we have done with the clarification of competence, as well as the new forms of inter-governmental co-operation, is to move away from that. They were points made by my noble friends Lady Elles and Lady Hooper.
I was pleased that my noble friend Lord Hacking mentioned the role of the European Court. The European Community is a community of law, as he rightly said. It is founded on treaties and institutions,
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especially the Council of Ministers. That is the law-making institution. Such a system must contain provision for judicial review and settlement of disputes, otherwise there could be an abuse of power by institutions, and unchecked breaches of the rules by member states, businesses and firms. That is the function of the European Court of Justice. It is one which we in Britain should and do support.
I do not believe that the European Court of Justice is a centralising force. I know that some people accuse it of that. What I do see is that by expanding the powers and scope of the Community with constructive interpretations of the treaties and Community legislation, those who do so simply mislead. We have seen clear signs recently that the court is readier now to give due weight to national arrangements and states' rights, to be less inventive in interpreting Community law, and to give greater scope to exceptions and derogations. I would cite in July last year the national insurance contributions case in the field of social policy where the court upheld the maintenance of different state pension ages for men and women in the United Kingdom. It did so, having taken full account of the national financial consequences of so doing.
I understand what the noble Lord, Lord Harris of High Cross, said about centralisation. I wish it were true that general rules, mutual recognition and gentlemen's agreements were enough to maintain open trade not only in the single market but in the great wide world too. That was not the experience of the 1960s, the 1970s or the early 1980s. Mutual recognition is our preferred approach but, as the noble Baroness, Lady Thatcher, recognised in negotiating the Single European Act, an efficient single market needs a common framework in many areas. As I have said, the Maastricht Treaty expressly excludes harmonisation in the new areas of co-operation.
As regards subsidiarity we must remember that it is right that the principle enshrined in Article 3(b), now with the guidelines agreed at the Edinburgh European Council should make sure that every institution is committed to applying the principle at every stage of the legislative process. Any one member state can raise subsidiarity if a legislative proposal from the Commission appears to ignore the principle of subsidiarity.
Other noble Lords spoke about the increase of qualified majority voting being a blow to parliamentary sovereignty. We extended the qualified majority voting under the Single European Act. Without that we should never have been able to complete the single market, which has already been of great benefit to British industry. The Maastricht Treaty extends the qualified majority voting to some areas related to the single market, for example, the energy, telecommunications and transport infrastructure known in the jargon as trans-European networks. The objective of qualified majority voting is to secure greater efficiency in the Community's decision making. It is true that we could be outvoted but often others are out voted to our advantage. It is worth remembering that in hundreds of decisions we have been outvoted only five times and on only three issues.

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In common and foreign security policy we proceed by unanimity. I am glad to see that through the inter-governmental arrangements we have brought both the common and foreign security policy and the policy on justice and home affairs together in a sensible manner.
The debate has been interesting. The European community has never lent itself to neat constitution analysis. It is a union of nation states and that is set out clearly in Article F in the Maastricht Treaty
A number of noble Lords have implied this evening that we should remain members of the Community but preserve the right to pick and choose those elements we implement and those we do not. That is simply not practical. Opt-outs have already been secured where it has been in our interests to do so; that is in economic and monetary union, the move to a single currency and the social protocol allowing the other 11 member states to move beyond the provisions of the treaty.
Far from undermining Britain's Constitution and the authority of the Government the Maastricht Treaty safeguards Britain's sovereignty. Crucially, the treaty strengthens the hand of our Government against legislative intrusion by the Commission. I heard it said:
"far too little credit has been given to the Prime Minister for the skill with which he has created a new structure for co-operation at intergovernmental level which is distanced, above all, from the Commission".—[Official Report, Commons, 18/12/91; col. 322.]
That was said by my noble friend Lord Tebbit.
It was thanks to the Prime Minister's supreme negotiating skills at Maastricht that Britain was able to reject those things that did not fit our needs. We rejected the imposition of a single currency without an Act of Parliament at a later date. If the Labour Party had been in power it would have signed Britain up to the social chapter, probably to a single currency and many other things besides—
Noble Lords: Hear, hear!
Baroness Chalker of Wallasey: My Lords, they now agree. We would then have been legally beholden to the Community. It was the Prime Minister and the Foreign Secretary who ensured that the jurisdiction of the European Court of Justice was limited, the powers of the Commission contained and the balance between Community and national institutions tilted to strengthen national governments.
That is the way to go. We can win the argument in Europe only by fighting our corner. We shall be there to do it as we have done. We shall continue to do so and that is why the Government will support the Maastricht Treaty.
Lord Pearson of Rannoch: My Lords, it only remains for me—
Lord Healey: My Lords, before the Minister sits down will she answer the question—
Noble Lords: Order Order!
Baroness Trumpington: My Lords, I am sorry but there is exactly one-and-a-half minutes before the debate will be cut off.
Lord Healey: My Lords, it will take me 30 seconds to ask the question. Will the Minister answer my noble friend's question? Is it not the case—
Baroness Trumpington: My Lords, the noble Lord is out of order.
Lord Pearson of Rannoch: My Lords, it only remains for me to thank all noble Lords who have spoken. There is a certain amount of confusion in some of your Lordships' minds about the difference between a single market and further political union. I urge those who support the Treaty on European Union to think more about that. Beyond that, it may be that many of us are waking up to the evils of European union precisely because the effects of the Single European Act are beginning to be felt and precisely because we are beginning to see that the political cart has run so far in front of the commercial horse that it is now almost out of sight.
Finally, I can but apologise again for the short time for which each of your Lordships was able to speak. Perhaps the usual channels will offer your Lordships a better opportunity to discuss the matter before the Bill in question comes to this House. With that somewhat slim hope, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

Humanities Research Council
8.16 p.m.
Lord Renfrew of Kaimsthorn Lord Renfrew of Kaimsthorn rose to ask Her Majesty's Government whether they will establish a Humanities Research Council.
The noble Lord said: My Lords, in asking Her Majesty's Government whether they will establish a Humanities Research Council I wish to emphasise the value to this country and more widely of research into what one may term the liberal arts and to argue that the humanities are currently disadvantaged in not having a research council of their own.
I confess that I am a little intimidated by the eminence of the noble Lords who have put their names down to speak in the debate. They include several Fellows of the British Academy and of the Royal Society and also the Chancellor of what in my home town is thought of as another place. I am delighted to see him taking his place.
It is also encouraging to see that the reply for the Government is to be given by my noble friend Lady Blatch. Her meticulous care, not least in educational matters, inspires so much confidence, and I greatly hope that she will find herself in agreement with some of the points that I shall raise tonight.
It is an exciting time for British universities. The enlargement of the university sector, inaugurated by the Further and Higher Education Act 1992, is undoubtedly increasing access to university education. There had been significant growth—about 25 per cent. in the five years to 1991—in the number of students reading art subjects and the increase continues. But it is not clear that the Government have given such

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thorough and careful attention to the development of research in that area as they have perhaps in science and engineering.
The hope that underlies my Question is that the Government will modify and improve the arrangements for funding the humanities by setting up a Humanities Research Council. The well-tried device of the research council is already employed in nearly all other areas of research. There are the Science and Engineering Research Council, the Economic and Social Research Council, the Agriculture and Food Research Council, the Medical Research Council and the National Environment Research Council.
Until now funding for research in the humanities has been channelled through the British Academy by the Department of Education. In general, the British Academy has served the humanities very well in organising the postgraduate studentship scheme, in making grants to researchers and in other ways. But recently the Government changed the environment for research in this field and in others by determining that in the sciences and social sciences the dual support system, in which research in universities is supported via both the Higher Education Funding Council and through the research councils, has shifted significantly in favour of the latter. The humanities have been left out of the change. They alone are not represented at the Advisory Board of Research Councils because they do not have a research council. Therefore, when research funding is discussed they are not present. In that sense they have been overlooked. They need a seat at the table and a significant voice. They need a research council of their own.
The matter was reviewed recently by a joint working party of the British Academy and of the Economic and Social Research Council chaired by Sir Brian Follett. It recommended a separate humanities research council within the Office of Science and Technology alongside the other research councils. That view is strongly supported by the British Academy, which now finds itself in an anomalous position because it is working both as a funding channel for the humanities—a surrogate humanities research council—and as the major national learned body in this area and for the social sciences. It is the equivalent in its own field of the Royal Society in the field of the sciences. A national academy is the proper role of the British Academy.
The Royal Society exists alongside the Science and Engineering Research Council and the other scientific research councils as the leading academic voice among scientists. It has its own scheme for Royal Society professorships and readerships. The British Academy would likewise continue to represent British scholarship both in the field of the humanities and in the social sciences at home and overseas. It would continue to have a professorship and readership scheme as well as a small grant scheme for grants of up to £2,000, which are the life blood of the research of so many individual scholars in the humanities. It would still be the appropriate base for the organisation and overseeing of the prestigious British research institutions in the humanities overseas such
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as the British School at Rome and the British School at Athens. But it would hand over to the new humanities research council the responsibility for postgraduate studentships, project funding and the further developments in the funding of the humanities which accompany the present revolution in information technology.
There is a general consensus in the academic world that the humanities now require their own separate research council. There is no good case for assimilating its function with that of the existing Economic and Social Research Council.
Admittedly, funding of the humanities is currently at a surprisingly low level, namely some £19 million a year through the British Academy, compared with some £45 million a year through the Social Science Research Council and more than £800 million a year for the sciences through the various scientific research councils. However, the British Academy and the Economic and Social Sciences Research Council agree that the new organisation should be independent, although there could be a case for sharing various administrative services and thus keeping down any additional administrative costs. After all, those two fields—the humanities and the social sciences—together represent more than half the university teachers in this country. At the same time often the humanities practise a different kind of research from that in the social sciences where some form of centralised policy for research can sometimes have a role. The very different character of research in the two fields should be appreciated.
This proposal is not a bid for massive new funds. The additional administrative costs are estimated to be of the order of £200,000 or £300,000 a year. Certainly research in the humanities is currently underfunded in comparison with other fields, especially when the number of university teachers in this area is taken into account and the increasing number of students, and perhaps also the diminishing unit of resource for teaching in the humanities. In this context, we are talking of £1 million or £2 million per year of extra money and certainly not in terms of tens of millions of pounds.
I should like to make it clear that I am not asking for a change in the dual support system for the humanities which might parallel the change recently implemented for the sciences, and might to some extent undermine the direct funding of the humanities in the universities through the Higher Education Funding Council. The present system for the humanities has worked well in the past. It needs to be improved and upgraded by the institution of a new research council. It does not need more radical restructuring, nor is more than a modest increase in resources required at this time.
The proposal which I have made commands the support of the British Academy, the Economic and Social Research Council and the Committee of Vice-Chancellors and Principals. With the transfer in responsibility for research funding from the Department of Education to the Office for Science and Technology, it is essential that the humanities should be given a role and a level of recognition equal to that

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of other disciplines. Literature, philosophy, classics, theology, languages, the law, history, and—dare I say it? —archaeology, have a central role in the intellectual life of any civilised society. Your Lordships will surely agree that while science and technology may facilitate the path of progress, and while economics may dictate its pace to some extent, it is the climate of philosophy and of ideas which conditions the world in which we live and our aspirations for it. It is our responsibility to ensure that the English language and the ideas to which it may give expression continue to develop and to achieve renewal, drawing upon original investigation and enlightened contemplation.
I hope that your Lordships will encourage the Government to give these matters the further attention and continuing commitment which they undoubtedly merit.
8.25 p.m.
Earl Russell: My Lords, as a university teacher in the humanities I must declare an interest in this Question, which I am extremely grateful to the noble Lord, Lord Renfrew of Kaimsthorn, for introducing.
Opinions on the proposal have been submitted by a large number of bodies, many of them bodies of which I am a member. We have opinions from King's College, London, the council of the Royal Historical Society, the Committee of Vice-Chancellors and Principals, the British Academy and the Liberal Democrats. Quite often when a large number of bodies to which one belongs express opinions there may be a need for a certain amount of adjustment. However, on this occasion all those bodies are unanimous, and my personal and private opinion happens to coincide with their view.
The noble Lord, Lord Renfrew of Kaimsthorn, has already mentioned the report by Sir Brian Follett, FRS, commissioned by the British Academy. That report said:
"It is of paramount importance that the humanities remain part of the mainstream national research effort and in no sense be isolated: only in this way do we believe that long-term excellence can be maintained".
Since the shift to dual funding of research and away from the link with student numbers to the research councils, it has become important that the humanities are the only disciplines that do not have their own research council. That creates some risk of being left out. The British Academy does the best it can, but the British Academy is stressing as strongly as any other body the need for a research council. The British Academy is not involved in debate at the stage of formation of policy. That means that on occasion policies for research are evolved without the needs of the humanities being considered as closely as they might otherwise have been.
For example, I do not believe that the new scheme for postgraduate training which is just coming into effect would have been introduced in precisely its present form if the humanities had been consulted at an earlier stage of the process. In the conduct of the recently completed research assessment exercise I do not believe that either the categories of classification or the categories of publication into which our output
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was divided would have been described in precisely the way in which they were if the humanities had had rather more input earlier in the process. The crucial argument is that one cannot afford to be left out of the discussions in which policy is formed.
I listened a few moments ago to the noble Baroness, Lady Chalker, saying how important it is to be present when important decisions are being taken and to be able to fight one's corner. That puts the case for the humanities as well as it puts the case for the United Kingdom.
Research is often the residuary legatee of an academic's time. It takes what is left over after everything else has been done and, as this House has always known, being the residuary legatee of an encumbered estate is not always a happy situation. There are a great many things going on which take up what might otherwise have been research time. Of course the current expansion has put a lot of pressure on everybody's research time. I think that that pressure is in danger of being particularly acute in the humanities.
If we look at the actual figures for expansion in the five years to 1990–91, the expansion in student numbers in the humanities has been 26 per cent. while in science, medicine and engineering it has been 11 per cent. I suspect that when the next year's figures are taken into account that differential will be a little wider. So there is a danger of pressure on research in the humanities being more acute than pressure in other subjects. If our standing in research in the humanities, which in this country has always been very high indeed, is to be preserved, it is important that the case for the humanities should be heard alongside the cases for science, engineering, medicine and the social sciences. It is only in that way that all the disciplines will be placed on the equality which I think is the only proper and reasonable basis on which they should compete.
There is also a strong point to be made about research libraries. I have some colleagues in the United States working in the same field as I do who cannot check the ordinary basic points that need to be checked every day without travelling to a library 300 miles away. There is nothing in this country that is that far away, but there are a number of places which are quite a long way away from the nearest decent research library. I am not saying that that need to travel can be eliminated but I think that on occasion it could be reduced, and reducing it might in the long term save money on applications for grants for casual travelling to undertake ordinary basic research.
I think there is also a stronger case for a humanities research council in the light of the end of the binary line and the recognition of the research potential of the new universities. There are a considerable number of people in the new universities whose research abilities are excellent and the recognition they have hitherto had is not always commensurate with their abilities. Their institutions are not used to funding research; they are not used to thinking in research terms sometimes. They do not always have basic research facilities. If we are to make a genuine commitment out of that ending of the binary line and develop the

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talents of those people, there is a need for central funding and also a need for an institution which can recognise the excellence and guide the central funding in the direction it should go.
There is a final question—and on this also the policy of the Liberal Democrats is in entire agreement with what the noble Lord, Lord Renfrew of Kaimsthorn, has asked. The question is whether it should be a joint humanities research council or a joint humanities and social sciences research council. Anyone who is a spokesman on social security has a profound respect for work done in the social sciences. I use it very often and am deeply grateful for it. However, the point is that the research methods are slightly different, the questions are different, the skills are different and the discipline is different. My noble kinsman Lord Henley has many times rebuked me for the use of anecdotal evidence, but I think he is well aware of this point. So because the humanities are in research funding terms a small part of the total effort, and also because our interests are in some ways separate and different, I think there is a case for a separate humanities research council which can be argued in terms very similar to the case for having a Scottish Office and a Welsh Office.
8.35 p.m.
Lord Dainton: My Lords, I must confess to feeling a little lonely in this company, as the only scientist here and one who many years ago deserved a headline in the national press which referred to "that illiterate Dainton". My mind goes back to some 60 years ago when I went to Cambridge and the late Lord Rutherford was then, in the early 1930s, reputed to be facing a financial cutback in the funds of the Cavendish Laboratory. He called his staff together —there were no ladies—and said "Gentlemen, we have less money: we must think harder." Forty years after that, Rutherford's words came back to my mind with great force during my first year as chairman of the University Grants Committee. In the financial year 1973–74 inflation was rising to reach ultimately almost 30 per cent. and the Government broke with past practice and withheld the supplementation that would have maintained in real terms the value of the UGC grant.
This created a financial crisis for many universities, with real prospects of insolvency for some of them. I am not going to weary your Lordships with the stratagems we had to adopt to get through the following year, because I want to emphasise that it was this financial stringency which focused the minds of myself and the then secretary, Mr. John Carswell, on the uniquely vulnerable position of British university research in the humanities, to the plight of which the Arts Sub-Committee of the University Grants Committee had drawn my attention.
As the noble Lord, Lord Renfrew, has explained, the natural scientists and engineers, the medical scientists, the agricultural scientists, the environmental scientists and the social scientists each had and still have a research council empowered to make grants to academics, either individually or in teams, to finance
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their research. In marked contrast, the humanists had to rely for their help on whatever their universities could afford to give from the block grant. The experience of 1974 showed that when times were hard one of the easiest areas in which universities could make economies was in financial help to academic staff in the humanities, despite the fact that work in these areas often could not progress without travels to institutions which had unique collections of artefacts or historical or literary material. We therefore decided to discuss these issues with the British Academy and during these consultations the case for a humanities research council was advanced, I think for the first time. It was hoped that it would resemble in some respects arrangements which already existed in some other countries of comparable size and development to Britain.
Because of the certainty at that time that a humanities research council would not be established, the University Grants Committee decided to make available to the British Academy in 1975 £125,000 per annum for an initial period of five years. They succeeded in persuading the Department of Education and Science, the Scottish Education Department and the Department of Education in Northern Ireland to cough up from their resources a year later. That was all done with the idea of fostering research work of high quality in the arts and humanities. Earmarking the money in this way, they passed it on to the British Academy to act as agent in its distribution, simply because the Academy knew most about the individuals who would be applying. We guessed that would be a good way of protecting the funds available for arts and humanities research from erosion in individual universities. As I say, a year later the other departments in other parts of the country, in Northern Ireland and Scotland, joined in. Later of course came the development which resulted in more work being put upon the British Academy, which became responsible for the award of research studentships, as the noble Lord, Lord Renfrew, has described.
I have recounted this history not just to explain the origin of the responsibilities which the British Academy now discharges, but also to illustrate how financial adversity can concentrate thought. Furthermore that adversity is now afflicting the universities once again but for rather different, and perhaps more importantly, more permanent reasons.
The first is that part of the price which the Government have decided must be paid by the universities for expansion of higher education is that the unit of resource for undergraduate students in humanities and the arts shall decrease. In fact an immediate decrease of 30 per cent. was announced recently. Secondly, large funds hitherto allotted to, but unearmarked within, the universities' own block grants to enable them to meet the indirect costs of research grants made to universities in subjects other than the arts and humanities, are now being transferred, as we have heard, from the funding councils to the various science research councils for the latter to distribute as they think fit, thereby further diminishing the resources over which universities have individual and complete control.

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If one adds to those two factors the increased cost in pounds, due to deflation of our currency, for those scholars whose research work necessitates foreign visits to libraries and archaeological sites, it is certain that funds from university sources for humanities research are facing a disproportionate squeeze. Therefore it is clear to me at any rate that the time is ripe, if not over-ripe, for a reconsideration of the role and responsibilities of the United Kingdom in humanities research and of the means by which policy in that area can be reviewed, made and implemented.
The British Academy considered this problem and two-and-a-half years ago recommended the establishment of a humanities research council. Then it held discussions with the Economic and Social Research Council through the mechanism of a joint working party under an independent chairman, and that group came down firmly against a joint research council embracing all these three subjects and on the side of an additional humanities research council. It is evident that this conclusion will be widely supported by the research community in arts and humanities. The Academy has thought further about these matters and considered which of its existing activities, at present funded by the Government, should be transferred to the proposed humanities research council. Broadly speaking I agree with the division that it has proposed, and for a reason which has not yet been mentioned but which I believe is fundamental to the proper development of the world of learning in this country. It is that the learned societies, among which the British Academy is an acknowledged leader in its field, should not become, or in any way appear to become, the merely mechanical agents of whatever Government are in power, but should be completely free to express their unfettered and, if necessary, critical opinions on any matter which is within their competence. Any step which would put that independence at risk by making them too dependent on government funding should, in my view, be avoided at all costs.
So far, I am at one with the Academy. But on one issue I would part company. The British Academy would like to see a humanities research council as an additional and therefore sixth research council and funded by the new Office of Public Service and Science. I must take this opportunity to reiterate once again my view that to have six independent research councils each protected by a Royal Charter, each doing essentially similar administrative tasks in subject areas whose boundaries cannot be precisely drawn because the areas overlap, and within a single one of which several fields of research cannot be confined, is undesirable because it is inflexible, wasteful, productive of excessive bureaucracy and emphasises distinctions in the map of learning and of knowledge where none should exist. To my mind the argument of a single research council or national research foundation drawing its resources from the Office of Public Service and Science (which might be renamed the Office of Public Service and Research) is overwhelming.
In conclusion, therefore, I would urge the Government to take very seriously what is being said today and, forgetting about nomenclature, accept the
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case for the humanities and arts research to be treated in a similar manner to research in other subjects, thus giving some degree of policy coherence and protecting good research in whatever institution it may be being carried out.
8.44 p.m.
Baroness Perry of Southwark: My Lords, I thank my noble friend Lord Renfrew for having tabled this Question. I welcome very much the opportunity to support his proposal. I do so as a former member of the Economic and Social Research Council and as a one time student and then teacher of philosophy. I might claim to have my foot both in the social science and in the humanities camps.
I support the proposal for a separate humanities research council for three main reasons. First—this has been well rehearsed—the present arrangements are not working. The British Academy is not happy with its present role and it is not right that the humanities are treated in a way which is totally different from all other research. The importance of being able to argue the case for the humanities alongside the case for science, technology, social sciences, agriculture and other subjects has been well made.
Secondly, I wish strongly to contradict the noble Lord, Lord Dainton, as regards the idea that any kind of amalgamation of research councils into one overall body would be desirable. Experience on the Economic and Social Research Council led me strongly to believe in the importance of having a lead body for research and scholarship in a particular area not only because of the practical work it was able to do—the ESRC has carried out splendidly practical work in the past few years particularly in the provision of regulations for postgraduate training—but also because of the focus it provided for the academic community in that particular field. I have never been persuaded by the argument of amalgamation or of a single research council. I believe that the Advisory Board for the Research Councils, properly strengthened and perhaps somewhat reorganised, could do the job that the noble Lord, Lord Dainton, requests.
In particular, I believe it would be wrong for the humanities council and the Economic and Social Research Council to become one and the same, if that were to be proposed, not least because the splendid work which has been done, most particularly under the chairmanship of Professor Newby in the past few years at ESRC, has done so much to raise the standards and the standing of British social science. That is something that could only be detracted from if we were to ask that body to take on the substantial responsibilities for humanities as well.
My third reason, however, concerns what I believe is the crucial importance of research and postgraduate training in the humanities. I was moved recently to hear, on a visit to Lithuania, the rector of Vilnius University talk about the immense and daunting task which universities in the former Soviet Union face to recreate, so to speak, the idea of a modern university. He made the point that the universities in the former Soviet Union need to catch up with technology and

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science. It is right that we in the West have placed tremendous emphasis on the importance of technology and science to take us into the future. I thought the rector's words constituted a wise lesson for us when he said how tremendously difficult and how important it would be for the universities in the former Soviet Union to recreate the concept of humanities and liberal education. He said we live in a society where for the past 70 years the qualification for being either a senior administrator or a politician has been to have as little education as possible. He said that we in the West take it for granted that we produce people with a liberal education who can take their place as senior members of government and senior politicians whereas the universities in the former Soviet Union have to recreate that from nothing.
It seems to me that he had well described the reasons why we have not only university education but also postgraduate training and research across the whole gamut of the academic spectrum. I believe that a humanities research council would enable us to keep that balance right. There is a danger in that in our quite proper anxiety to increase the vocational and technological nature of our education and of our academic community we may forget the foundations of what a civilised society needs. That could be only further strengthened by the creation of a humanities research council.
8.50 p.m.
Lord Bullock: My Lords, my noble friend Lord Dainton suggested that the present structure of research councils is far from perfect, and that, while sympathetic to the cause of the humanities, it would be a mistake to add yet one more embattled research council. We have five, which is already too many. I understand his argument, but the real point that strikes me about it is why, in that situation, should it be the humanities that is the one left out? That is what troubles me, and where there has been a serious lack.
It is because they have no research council of their own that those teaching and working in the humanities have not had the opportunity to contribute to, and take part in, discussions, perhaps the battles, between the various research councils on the Advisory Body for Research Councils by which the division of their grants is settled. They are also alone in having no access to the Office of Science and Technology, which has taken over responsibility for funding project-based research in everything except the humanities.
This anomalous position, if continued, will work still more to the disadvantage of the humanities in the future for two reasons. The first is because of the changed arrangements for the funding of universities, the effect of which has already been mentioned, and I shall not go further into it. But clearly, unless there is a change there, the humanities will just lose out more than they do at the moment. The second is because the burden of student expansion has fallen disproportionately on the humanities and social sciences,
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leading to a continued deterioration in the staff-student ratio for the humanities and a steady increase in the amount of time demanded of academic staff for teaching undergraduates.
There is a tendency to speak about research in the humanities as if it were a form of self indulgence, or self promotion, when what dons are really paid to do is to teach. But hitherto it has been the hallmark of university teaching in this country that it has been in the hands of men and women who are not only able but, as part of their duties, are required to keep up with and contribute to the development of their subject. This double obligation to teach and to research seems to me to be to the benefit of both sides. My own experience of teaching is that it continually stimulated many thoughts that I might otherwise not have had. As for the benefit in teaching, there is nothing that can equal the intellectual excitement and benefit of contact with a teacher who is also actively engaged in research and in forwarding his subject.
It may be that the expansion of student numbers is going to make that less common than it was. I was taught by people who today would be very unlikely, because it would either be vice-chancellors or regius professors who would have that contact with undergraduates, but it was decisive for me. It was that element of teaching by somebody who not only knew about the subject but was continually adding to what could be known about the subject that was important. Even today, with the expansion of numbers, at some time in their three or four years an undergraduate should have experience of that contact with somebody who is actively engaged in research.
Even to do that means that we have to make special provision to provide protected time for research at least for our ablest people. Above all it means time, because it is that that is always encroached on when there is competition between teaching and research —time in the form of postgraduate studentships to begin with; full-time post-doctoral research fellowships in the early stages of a career, and, what is most important, grants, also competitive, enabling established scholars to "buy out" time off from teaching and administration for up to two years of full-time research.
These are provided under the present arrangements to a small degree, but they are not on a scale comparable to the percentage of academic staff in our universities—which I am told is 15 per cent. to 20 per cent. of the total—engaged in the humanities. Leaving aside the support grants received from the Universities Funding Council, the 1991 figure for research income from all sources for humanities, language-based studies and the creative arts together, was £16.5 million. When compared with £860 million for all other subjects this shows how serious is the disadvantage that the humanities suffer, and will continue to suffer, so long as they are excluded from the research council set-up.
This still leaves open the question whether there needs to be a separate research council for the humanities. It is striking that a joint committee of the Economic and Social Research Council and the British Academy considered this alternative seriously

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and rejected it unanimously. They showed in their report that the financial saving was not important, would not be more than £500,000 a year, and was far outweighed by the disadvantages.
One disadvantage that has not been mentioned is that such a combined research council for social sciences and the humanities would have to cover over half—52 per cent.—of the academic community, while the other four research councils would share the responsibility for less than half. If it is to be representative, that would mean a large, unwieldy council, and still risk leaving important areas of research unrepresented. The social science constituency would resent having to give up places and would be concerned at the drain of funds from social science research to the humanities, while those working in the humanities would never overcome the feeling that, as the only branch of the academic community denied a research council of their own, they were being treated as second-rate citizens.
There would be—and I think that the Follett Committee was right on this—a risk of perpetual friction between the two disciplines. It is a set-up designed to produce that. I am sure that it is not only those who are working in the humanities who would urge the Government to think again and to create a humanities research council, but equally strongly those who are working in the social sciences. Those two together represent 52 per cent. of the academic community.
Finally, I am equally sure that the present arrangement has also worked to the disadvantage of the British Academy simply because it was unable to bring sufficient weight to bear, and because of its status—it was not a research council—to secure what many of the Fellows felt was a proper provision for the humanities. If the present makeshift arrangements could be got rid of and replaced, that would not only be welcomed by the academy but would do a great deal for the academy.
The responsibility for public support for the academy would be transferred to the Office for Science and Technology, which would place the academy on an equal footing with the Royal Society and the Royal Academy of Engineers. That seems to me to be most important. Secondly, relieved of the burden of acting as a substitute for a humanities research council, the academy would then be in a much better position to take much-needed steps to give more adequate representation to social scientists in its membership than it can at present.
8.58 p.m.
Lord Blake: My Lords, as a Fellow of the British Academy since 1967 I am grateful to my noble friend Lord Renfrew for asking this Unstarred Question. I strongly support the establishment of a humanities research council and always have. The reasons have been well set out by other noble Lords, so I shall not speak at any length this evening. The situation about the humanities in relation to the Government is anomalous and confused. The position of the British Academy, as the noble Lord, Lord Bullock, points out, is curiously ambivalent.
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I am clear in my own mind that it ought to be as an essentially private institution or society, having the same sort of relationship with the Government as the Royal Society. It ought to have been transferred after the general election to the responsibility of the newly-created Office of Science and Technology, the OST, as the Royal Society was transferred. More important, the humanities ought to be given the same status of having a research council of their own, as with every other branch of academic learning. It would be possible to amalgamate humanities with the Economic and Social Research Council. One could not say that that was impracticable. But that would save little money and would involve a built-in formula for friction. I believe that such an amalgamation should be avoided at any cost.
The truth is that under the existing structure the humanities have only a muffled voice in the Government's consideration of academic research. They can make their views known only indirectly to the Advisory Board for the Research Councils (ABRC). The British Academy has no direct access. Its president is unable to fight his corner with the advisory board or whatever other authority is involved, as do heads of research councils. That cannot be right.
The academy accepted the role given to it in 1974–75 with considerable doubt. There was much misgiving about being a conduit for government funding of the humanities. At the time I was either a current member of the council of the British Academy or had been a member. However, I remember the discussions and general anxiety. It seemed somehow dishonourable at that time to reject that role, and the British Academy would have appeared in a bad light if it had done so.
The academic world and its problems have greatly changed since that time for reasons set out by several noble Lords. I believe that a humanities research council is the only satisfactory way forward if we are to avoid the humanities becoming metaphorically neglected, second-class citizens of the academic world. In many respects that is what they are at present. If matters continue as they are they will become third-class citizens.
I do not know what my noble friend Lady Blatch will say in reply. However, I hope that she will not take the view, since the arrangement with the British Academy has worked up to a point, that all is well and that there is no need for change. It is not a matter of changing the role simply because it is anomalous and peculiar. Many things are anomalous and peculiar in life, including perhaps your Lordships' House. But the system is not functioning well. What worked 18 years ago does not work well now. I hope that my noble friend will reflect on that point when she replies.
9.2 p.m.
Lord Beloff: My Lords, I believe that I am safe in saying that your Lordships' House has never heard five Fellows of the British Academy among the first seven contributors in a debate. It is all the more surprising that they all agree with each other. The case has been well put by my colleagues. However, I wish

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to approach it from a slightly different angle: that is, to explain historically why part of what we seek is to clear up an anomaly in the organisation of this country's intellectual life.
The Royal Society was founded by His Majesty King Charles II and therefore has a long and distinguished history in this country, in Europe and in world science generally. It was the only internationally-recognised learned body until the end of the last century. Only then did the humanities and social sciences begin to be organised for research purposes.
Part of its important task, as my noble friend Lady Perry pointed out, was to maintain intellectual contacts with other countries. At that time most other countries had academies. Many still have. Everyone knows that the Academy of Sciences in the former Soviet Union covers almost every form of knowledge. Most countries had academies which stretched across the divide. Therefore we created an academy which would do for those left out of the Royal Society what the Royal Society did for those included in.
Over almost the century that has elapsed, that has produced this curious fact. The academy includes fellows in the humanities and the social sciences. However, through developments over the past few years in public funding of research the social scientists have a research council of their own, and the British Academy has been asked to act for the remnant. As the noble Lord, Lord Bullock, said, that could produce a neglect of the importance of the humanities in our general intellectual world.
Therefore to leave the situation as it exists at present would be a mistake from both the national point of view and that of the academy. It is not that the academy cannot do the job that it has been assigned, as my noble friend Lord Blake pointed out. But it does so by going outside the normal activities of what is essentially a private learned society. No one imagines that the fellows of the academy spend their time controlling the distribution of postgraduate studentships, for instance. As soon as one has large sums of public money for which one is an agent, it is bound to distort the central activity.
Another serious point has been touched upon by preceding speakers. The expansion of the university community to something approaching 100 institutions needs the machinery to make sure that those who teach in some of the more remote or newer institutions are not discriminated against in any way and do not feel themselves discriminated against when public money is spent to assist their researches.
Given the slowness with which academies renew their membership, it would take decades before we had anything like an even representation. Without a fairly even representation, there is always the possibility that some promising scholar who needs financial assistance will be overlooked. That is particularly true in the humanities, because the necessary concentration of humanities research near major deposit libraries—the noble Earl, Lord Russell, talked about this—and also near the great national archives makes the Oxford-Cambridge-London
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triangle difficult to steer against. Therefore, it seems to me that from the national point of view it would be a great advantage to have a separate body with a single purpose—the distribution of public funds in a way that could at the different levels promote research in the humanities.
It would be good for the academy, as the noble Lord, Lord Bullock, said, to be able to limit itself to its prime tasks. The schools overseas have been mentioned. But equally the proposal would include a certain number of senior research posts and, above all, I repeat, building up what the noble Baroness, Lady Perry, pointed out—the important element which ought now to enter into our relations in the world generally, if you like, but in Europe particularly and in the newly enfranchised countries which are beginning to feel their way towards the idea of free research in a free society.
I believe that the arguments against trying to do that with the social sciences within a single research council have been amply stated. I only add to them something which was alluded to but was perhaps not sufficiently emphasised. It is difficult to harness an elephant and a donkey. We require in the social sciences—particularly as they now develop—the idea of project research, teams and rather large expenditure on major projects of different kinds. The Economic and Social Research Council has now developed this on the whole in a satisfactory way.
Humanists are mostly—there are exceptions such as the new edition of the Oxford English Dictionary —concerned with relatively small impediments to their individual pieces of research. It may make all the difference if someone can have £500, not, as may be the case, for a huge team in the social sciences, but to visit a particular library in a city which they would otherwise be unable to afford, especially in the current straitened circumstances of universities. I am sure that it is even truer of those who are still active on the university scene that one constantly comes up against relatively small needs which, even taken together, would probably do no more than match a single major project in the social sciences, let alone a single major project in the natural sciences.
Therefore, although I can see that there is a temptation to say, "Well, either leave things as they are or let us have a joint research council", the argument for an independent humanities research council has been made. I hope that the noble Baroness will take that with her to her colleagues.
9.13 p.m.
Lord Bridges: My Lords, I intervene briefly in the debate in order to draw attention to one matter which would be involved in a decision to fund humanities research in a new and different way. It concerns the 11 British scholarly institutions which operate abroad and which are at present funded through the British Academy. Those bodies are engaged in academic field work with a prime concern for archaeology and history, although they also have other interests and cover a wide range of disciplines. Typically, their origin lies in archaeological research conducted by British scholars in the last century. I should explain

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that I am interested in the subject because I am a member of the council of the British School at Rome, which is an institution I have known for over 40 years. I am also familiar with the British School at Athens which I came to know well when I lived in Greece some years ago.
The present arrangements by which the British Academy supervises the funding of the schools from official sources is generally held to be satisfactory. Budgetary supervision by the academy is thorough and effective. Also there is the advantage that the academy understands very well the nature of the research which is going on in the schools themselves.
The British School at Rome greatly hopes that its financial relationship with the Government can continue to be conducted through the academy in future, should a humanities research council be established in one form or another. I cannot speak for the academy, but I understand that that is also its view.
A strong reason for such a solution is that supervision of the schools would fit in well with the academy's role, which is shared only with the Royal Society, as a point of focus for relations with learned bodies in foreign countries.
The sums involved in supporting the schools are not small; namely, about £2.4 million in the current year, which is about 8 per cent. of the academy's total budget. Most of the schools have other sources of finance and are attempting to do all they can to maximise revenue at the present time.
I should add that the schools which I happen to know personally are very important as acknowledged centres of British academic activity. They operate in areas of study where our scholars have a deservedly high reputation. It is important that a solution can be adopted for the future to fund humanities research so as to safeguard their position. It is very much in the national interest that that should be done.
I mention the subject tonight not because I believe it to be controversial, but because of its importance. If the noble Baroness could find time to visit some of those schools in the course of her travels, I am sure that she would find much to interest her. I also believe that she would be very welcome.
9.16 p.m.
Lord Quinton: My Lords, I am inclined to believe that the difficult situation in which the humanities find themselves at the moment in regard to research may partly be due to certain sniffiness on their part in the past as to the whole idea of research. I do not think that Gibbon and Macaulay would have described their activities as engaging in research. It was study; it was something different. It is true that the style of study or investigation carried out in the traditional humanities is different from that which prevails in other forms of intellectual inquiry. As my noble friend Lord Beloff pointed out, it is more individualistic and is not a matter of large collective projects. That is reflected on the whole by the fact that what scholars in the humanities most require to assist them is comparatively small grants of money, in so far as we are talking about money. Humanists (if I may so call
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them), or persons engaged in study of the humanities, have been reluctant for a long time to regard their activity as describable as research. That does not mean that it is not or that their situation is not difficult.
Let us get down to the concrete basis of the whole matter. It has two aspects: first, providing for youngsters emerging with their first degrees who want to go on for one purpose or another to further graduate study; and, secondly, supporting established scholars in their work. In the humanities, both have been conducted by the British Academy. But the British Academy was the sole agent for the support of the young emerging student seeking a grant for graduate study; whereas all it could do was provide rather modest sums in the form of small grants for individual scholars who applied to it. It acted as an agent for the Government who gave it substantial, if not exactly generous, sums for young, newly-graduated people. But it had extraordinarily little influence on how that was to be done, who was to get it or, in particular, how much was to be received. They exercised a remote control over the selection of successful candidates.
Besides that, they had a very small role in distributing moneys to mature, established scholars. One says that the position of the British Academy is anomalous. It is a peculiar kind of anomaly—that is to say, it is a deep, or real or "not British" anomaly. What I mean by a "British anomaly" is the MCC. Why should that salubrious but not particularly rural borough exercise through its cricket club such an extraordinary imperial control over English cricket? It does not matter; it is just a name.
The British Academy is not like that. As has been said, the British Academy is a private, learned society primarily concerned to arrange foreign exchanges, organise lectures and support rather refined kinds of research and publication. It is certainly not well-suited to the major task which one would hope a Humanities Research Council would be able to carry out.
It is therefore a great illusion that the British Academy is a kind of humanities MCC. It is nothing of the sort. If anything, it is a kind of Wisden editorial committee, much more distantly related to the hard nuts and bolts of life for a person doing research in the humanities. What researchers in humanities are short of, as has been pointed out in recent reports on the subject, are two things—time and money. British universities are becoming more like the trains in India one sees in news programmes where one cannot actually see the train because of the number of people who are hanging on to the outside of it. With the British Academy it means that the staff of universities are so busy preventing the passengers falling off beside the track that they have little time to polish the door handles, clean the seats and generally render the train a more fit and adequate mode of transport.
The way to deal with that is to provide tracts of time in which research can be pursued. In humanities that is thin on the ground. At the highest professorial level at the moment there are two such posts, both provided by a private benefactor. There is no publicly-supported professorial research post in the humanities. There are some readerships, and they are

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gratefully received and valuable. But they do not remotely compare in volume with the support that is given to other fields of learning.
The other point—which has already been touched on and I have already prepared the way for it in a Freudian slip—is that students in humanities, pursuers of knowledge, need libraries. Libraries are very much Cinderellas. In the general ambit or view of the university budget they are the facility on which economies can be made so that the absolute front line activities can be carried on. It is said, "The library has a lot of stuff in it; it does not matter if we do not buy books for a few years. A lot of the books are decayed, but they decay fairly slowly". In fact a lot of the material that researchers in the humanities require is the kind that is particularly in need of conservation. That is something which has fallen completely between all possible stools of public funding which a Humanities Research Council might have the force to address.
To return to the limitations of the British Academy—I do not suggest anything more than the most devoted filial attitude to the organisation; it would be a limitation that the academy would admit—it is in no position to exercise any pressure to bring about the desirable purposes it envisages but does not see as its task to realise. All it can do to approach the centres of power is to make occasional visits, rather in the manner of the Burghers of Calais hoping that some Queen Philippa—if my humanities research has not hopelessly gone to pieces—will be there to control the frown of the cruel king. They have no regular institutionalised method of bringing pressure to bear on the ultimate funding authorities, whichever government department it happens to be.
The case for a Humanities Research Council is extremely strong. It rests on three things; first, that there really is research in the humanities and it is vitally important nowadays that it is not carried on by people in velvet coats living on private means but that it will be carried on by variously hard-driven university teachers; secondly, the circumstances of university teachers nowadays with pressure on time because of the enormous expansion of student numbers without increase of teaching personnel; and, thirdly, the neglect and decay of the libraries which are the essential tools, as the laboratories are for the scientists, on which humanistic research depends.
It is perfectly clear, as other noble Lords have said, that for all its excellent qualities, the British Academy cannot do this. It is in an embarrassing position as the powerless distributor of grants which the recipients all feel to be inadequate. It has a minute quantity of genuine patronage for research by established scholars. In a sense its position is extremely invidious. It should not have these responsibilities loaded on it.
The noble Lord, Lord Bridges, specifically mentioned the overseas schools, which have always been a central part of the British Academy's activities. These, one would hope, it would continue to support, administer and oversee. The responsibilities which it has discharged are not appropriate to it and it has not been equipped to discharge responsibilities which no
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one else is discharging—which provide for exponents of the humanities in this country things that they get everywhere else. We have no Collège d'Angleterre here; but for the serious, advanced scholar in France there is the Collège de France, where one is required to give one lecture a year. That might be abused a little; be that as it may.
In the United States there is the concept, admittedly not generally publicly-funded, of the distinguished service professor, who is released from the normal pressures of academic duty. There is in America the National Endowment for the Humanities; but no such thing exists here. Equally, as other noble Lords have mentioned, there are academies or research organisations in other countries where the humanities figure alongside everything else. It is an absurd anomaly that the humanities should not be accorded a position comparable with everyone else—not identical to everyone else but comparable with everyone else—at the research table.
9.27 p.m.
Lord Stewartby: My Lords, I begin by joining other noble Lords in thanking my noble friend Lord Renfrew of Kaimsthorn for giving us the opportunity of discussing this subject. I immediately move on from that to say that I enter this debate with some trepidation as an unreconstructed amateur following so many very distinguished professionals in the academic field. Although, to my permanent astonishment, I am a Fellow of the British Academy, I have never been engaged in funded research as a participant, a supervisor, an administrator or in any other way. This gives me the opportunity to see some of these questions not in a different way but perhaps from a different perspective. I wish to comment only briefly on these matters because they have been covered thoroughly by those who have already spoken.
I want in particular to deal with three points. The first is the question of money. It seems indisputable that the humanities are not generously endowed with public funds in relation to the research activities across the spectrum of other subjects. The academy and those who represent the humanities are fully justified in making that point powerfully and clearly to government even if by seeking extra resources the consequence might be at least in part disadvantageous to other areas of research and scholarship. That point is an important one but it is a separate point from the question of whether there should be a humanities research council.
It could be thought that one of the motives—perhaps an unspoken motive—for seeking a humanities research council would be to put the humanities in a better bidding position and that the proposal is financially driven. It could be suspected by government that this might be a consequence of setting up a humanities research council. We should be absolutely plain in saying this that the humanities need and deserve more funding for research but that that is a separate issue and the case for a Humanities Research Council exists on intrinsic grounds quite apart from the financial issue.

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My second point is about the anomalous position of the academy itself. Not being a professional academic or engaged in that field, I have been very struck by the awkwardness which is faced by the academy in having to fulfil this dual role and these two rather incompatible functions. The first role is that of a direct agent of government fulfilling the same kind of function as research councils do for other purposes and carrying on the administrative, functional and financial exercise of the research funding programme, and the second is that of an independent body of academic specialists in the field of the humanities which clearly look at matters from an entirely different viewpoint.
Having passed a little of my misspent youth as a Treasury Minister, I know how tempting it is from a government point of view to look at a body, whether it is the British Academy or any other body, in relation to the single basis on which that body is in communication with government. If a second basis is very different and the two may cut across each other, I believe that the effectiveness of each role may be complicated and probably diminished. I see a difficulty which has been expressed, and which genuinely exists, that the academy is not entirely free, particularly in its role as an independent academic body, but it is perhaps equally not entirely free to fulfil the administrative role in relation to being a proxy for a research council as it would be if it were pursuing only one of those two roles. I hope that that point can be fully registered.
The other side of that particular coin is that because the academy covers not only the humanities but also the social sciences, it seems to me that there is inevitably a tendency for the structure of the academy to be skewed towards the humanities because it has to provide an administrative role for the humanities which it does not provide for the social sciences. Although it is something which the academy manages at least adequately, it is an anomaly and the academy would be in a much more comfortable and sensible position as regards its own internal affairs if it did not have to face that problem.
The final point I want to touch on is the question of what kind of humanities research council might be needed. I share the view which a number of noble Lords have expressed this evening that a combined research council covering the ESRC and the humanities, although possibly superficially attractive in that it might appear to enable administrative economies to be made, would, if the amalgamation related to anything other than the secretarial and administrative infrastructure, and if the council itself was a joint body, impose impossible tensions between the two different strands within that joint council.
I have some experience of what kind of thing goes on in the way of social research because for many years I have been a trustee of my family's charitable foundation, which funds research of that kind. Although not on any formal basis, I have also been involved in a good deal of research in the historical field. I am therefore very conscious of the differences in the approach to research in these different areas. It is not just that different sorts of people are involved;
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the objectives of the research are often different. They are defined differently in the social sciences and in the field of the Economic and Social Research Council as compared with the humanities. ESRC projects may be jointly run by a number of people and may have a specific end in sight for a practical purpose for which they may have been commissioned. In the humanities, however, the work is inevitably more personal and less structured, but that does not mean that it is totally unstructured. One of the advantages of a humanities research council which might appeal to the Government is that there are areas in humanities research—let us not be shy about saying this—which could do with a little more structure. The completion rates for work by postgraduate PhD candidates in the humanities do not measure well against those of candidates in other fields. It is perfectly right that such issues should and could be addressed by a humanities research council, if one existed.
Equally, it is extraordinarily difficult for the British Academy, given its constitution and nature, to tackle such problems. I believe that there would be advantages for both the Government and the academy (as well as for the universe of the humanities) if the proposals which my noble friend Lord Renfrew has outlined this evening were accepted. I hope that they will be considered seriously by the Government in that light.
9.36 p.m.
Lord Jenkins of Hillhead: My Lords, the normal purpose of making a wind-up speech on behalf of one's party is to reply to the debate and to endeavour to deal with any hostile points that may have been made. However, that is not possible this evening because there is nothing to reply to. Your Lordships have shown a powerful, surprising and welcome unanimity, and that unanimity can be a many-faceted thing. It is not the same thing as repetition. Agreement has been expressed in a way that is a tribute to the plural traditions of the British humanitarian tradition. I hope that the Minister will take due notice of that remarkable unanimity when she replies.
Not only can I not make a normal winding-up speech but, as the noble Lord, Lord Renfrew, hinted —we are most grateful to him for initiating this debate —I am here as much in my capacity as Chancellor of the University of Oxford as of Leader of the Liberal Democrats. I was reassured, therefore, to be informed by my noble friend Lord Russell that my views are fully in accordance with party policy. I was not wholly aware of that previously, although I had assumed that that might be so as my views are very sensible on this issue.
In my chancellerian capacity, I am more worried about the future of research into the humanities at Oxford than I am about the future of research into the natural and applied sciences and medicine. If that is true in Oxford, which some may think of as the home of the humanities in this country—and compared to the university of the noble Lord, Lord Renfrew, it is a comparative newcomer to, at any rate, large-scale research into the sciences—how much more true is it likely to be of other universities.

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There are at present several factors working against research in the humanities. The first is the increase in the number of undergraduates—much more in the arts subjects than in the science subjects, a point to which my noble friend Lord Russell referred—and the pressures that go with that when it is not accompanied by any comparable increase in the numbers of academic staff. A balance has to be struck. It is important that teachers do research. It is also important that those who are outstanding in research also do some teaching. I would venture to claim that Oxford is a better undergraduate university than Harvard because that is more true of Oxford than it is at present of Harvard, where good people are not prepared to devote time to teach undergraduates.
In the interests of fairness, I do not believe that Oxford, as a graduate school, would be able to hold a candle to that of the vast graduate school of Harvard which has 22,000 graduates compared with our 4,000. As an undergraduate university, Oxford is bigger and in many ways better than that most distinguished of American academic institutions.
Secondly, working against effective research in the humanities is the fact that, nonetheless, we are all becoming relatively more important graduate schools. Graduate studies hardly existed in Oxford in my days as an undergraduate. Now they are becoming, as is the fashion throughout all academic institutions, more important than previously. Having graduate students helps research in the sciences; they rather get in the way of research in the arts.
Scientific research is more of a team effort. Graduates can be useful to those who are conducting it, whereas, to some extent, they are a necessary and desirable distraction for those who are conducting it in humanities.
However, humanities research—the case for which I do not believe needs to be argued in your Lordships' House, although it was most neatly done by the noble Baroness, Lady Perry,—needs a little fostering and cosseting at present if this country is to maintain its tradition of research in the humanities. That, as has been strongly argued this evening, requires a humanities research council.
There is one last point I should like to make in relation to the British Academy. I, unlike nearly all noble Lords who have spoken this evening, am not a Fellow of the British Academy and so I can perhaps speak more freely about it than others can. Looking at the papers relating to this issue, I have been struck by the British Academy's unselfish approach. Some of the things it is required to do in the absence of a humanities research council may not fit well with other aspects of its work. Nevertheless, empire building, or at any rate empire holding, is a tradition in institutions even of considerable academic repute.
I have been struck by how the academy, under the leadership of Sir Anthony Kenny, has recently shown no desire to pursue a policy of, "what we have, we hold", but has been much more interested in achieving a sensible structure for humanities research in this
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country. As has been so well argued by many of your Lordships tonight, that points strongly in the direction of a humanities research council.
9.44 p.m.
Lord Peston: My Lords, in one way, this is the easiest speech I have ever had to make in your Lordships' House. The subject was cogently and persuasively introduced by the noble Lord, Lord Renfrew of Kaimsthorn, who covered pretty well all the ground. If he missed any points, other noble Lords covered them.
The logic of the case is clear cut. Although I am sympathetic to what was said by the noble Lord, Lord Dainton, about an umbrella body, in so far as we are discussing present realities, we need a separate funding body for the humanities. That follows logically with no problem at the present time and I did not understand the noble Lord, Lord Dainton, to be saying anything other than that. He merely had a few additional ideas.
I have always had a slight difficulty about using the word "research". I know that in order to impress the powers that be one must use the word "research". I always assumed that the humanities engaged in scholarship and that the rest of us engaged in research. However, I have a feeling that in the present climate there is no money in scholarship but there is money in research.
I agree with the noble Lord, Lord Stewartby, that logically the issue is not about money; logically the humanities deserve their own body. However, in practice it is all about money and about nothing else. The humanities need money and because the dual support system is ending they are being squeezed. I wish to convey the message to my colleagues in the humanities that I am sensitive to the fact that they need money rather than being told that they are jolly good chaps and women.
I agree and disagree with the noble Lords, Lord Beloff and Lord Quinton. Of course, they were right in saying that in respect of the humanities one is mostly talking about relatively small sums. It is amazing how productive of scholarship small sums can be. However, I do not believe that one should go to the other extreme and assume that there are not areas of work which require large sums, not least in the field of the noble Lord, Lord Quinton. I discovered that in the United States philosophers are spending vast sums of money. I am not clear about what they do with it but scholars have no difficulty in feeling that they need it. I do not believe that we do a great deal of justice to our colleagues in the humanities when we say that they need only small sums of money. Some need large sums and I hope that when the time comes the relevant body will bear that in mind.
I have been a member of what is now called the Economic and Social Research Council. It was the Social Science Research Council, a title which I much prefer. I have also sat on sub-committees of the Medical Research Council, the Science Research Council and so on. I have always been struck by the way in which my colleagues in the humanities are like church mice; they do not like to ask for money. They

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ought to be persuaded to say that the small change of the scientists is a great deal of money to the social scientists let alone to those in the humanities. Therefore, one should not say that only small sums are involved; although small sums are important. I hope that my colleagues in the humanities will push themselves forward more. I should like to see the setting up of the new body because it would give leadership and confidence to those people enabling them to push themselves forward more. That is another good reason for supporting them.
I wish to refer to an error of omission. I had always assumed that the beginnings of the humanities were the classics and that the other subjects—English literature, philosophy and history—followed on. I do not believe that any noble Lord mentioned the classics. There is one area of academic life of this country about which I am worried. Because no one can see any connection between the classics, economic performance and all the other issues which dominate us today they are being more and more neglected. The classics department of my own college does not exist any more, although it was quite brilliant. It is the easiest department to get rid of and perhaps it will not be long before only Oxford and Cambridge have classics departments.
An area in which big money is required is libraries. Even if we were to argue that everyone else does not need a great deal of money, a modern library requires millions of pounds not only in capital investment but in order to keep it going. I have argued previously in your Lordships' House that in comparison with the library facilities which my Alma Mater, Princeton, enjoys no university in this country has anything comparable or can even begin to understand the ambitions of the great American universities for libraries. That involves very large sums of money, on the same scale as the physicists used to enjoy. I hope that we shall not forget that.
Those are my main points. I have managed to find enough to say to fill five minutes, although I was fairly desperate to think of anything to say. My main purpose has been to be as supportive as possible of the noble Lord, Lord Renfrew of Kaimsthorn. Like other noble Lords, I hope that we shall receive a sympathetic response from the Government which will encourage us and our colleagues in the humanities to feel that they have a worthwhile academic future.
9.50 p.m.
Baroness Blatch: My Lords, we have had a most distinguished list of speakers in the debate. It has made it a special evening for me and has resulted in a most interesting debate. I am grateful to all noble Lords, but particularly to those noble Lords who have stalwartly sat through a number of debates today and spoken in at least two of them.
I welcome this opportunity which my noble friend Lord Renfrew has given us to consider some important questions about research in the humanities. First, I can reaffirm the Government's commitment to promoting high quality research in this area. For reasons which noble Lords will understand, I shall not be able this evening to respond to all the requests
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made of the Government during the debate. However, I shall say what the Government have done in recent years to sustain research in the humanities. I shall briefly describe the present structures for supporting that work and the proposals which have been made for changing those structures. I shall also explain the Government's stance towards those proposals.
As many noble Lords know, there is a dual system of public funding of research in the humanities analogous to the funding of scientific research. Our universities have a well-deserved reputation for academic excellence. The Government want to ensure that the excellence of British scholarship in the humanities is maintained and developed. The bulk of the funding comes through the general institutional grants from the Higher Education Funding Councils. In addition, the Government provide specific support for humanities research through their funding of the British Academy.
The noble Earl, Lord Russell, and the noble Lord, Lord Dainton, were concerned that the new dual support system could mean reduced funding for the humanities. The new dual support arrangements involve a switch from funding council to research council support. They will not affect total funding for university research. The new arrangements apply only to scientific research. The Universities Funding Council has made no reduction in its funding for humanities research and there is no reason why individual institutions should do so.
The noble Earl, Lord Russell, and the noble Lord, Lord Bullock, referred to the status of the humanities without research council status. The Government do not accept that the needs of the humanities are overlooked in national research policy. It is true that a research council could act as a voice for the humanities, but so can the British Academy. That is not to say that a research council would bring no benefits to humanities research. Indeed, I have heard a very pressing case for that this evening. The Government are considering carefully where the balance of advantage would lie.
The noble Lord, Lord Blake, implied, as did a number of speakers, I hope unintentionally, that there might be grounds for dissatisfaction with the way in which the British Academy discharges its functions. The noble Lord, Lord Blake, in particular addressed that question. I do not believe that any criticism of the British Academy was intended and I wish to take this opportunity to say plainly that my department is far from dissatisfied with the academy's stewardship. I hope that the increase in grant for next year—11 per cent. in a very difficult PES round —is proof of that. I hope that the noble Lord, Lord Blake, will accept my assurance that there is certainly a basis for serious debate and that the issue must be addressed in the forthcoming White Paper, to which I shall refer again in a moment.
I hope that the noble Lord, Lord Bridges, will use his influence to persuade my department to send me out to see the schools abroad. I would very much welcome an opportunity to do so: I seem to find myself in Bognor Regis and other unattractive places. I apologise to anybody in the Chamber who might

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come from Bognor Regis. Perhaps I could use, as a reason for going out, inspecting the new roof which I know is under way up there.
The noble Lord, Lord Quinton, the noble Earl, Lord Russell, my noble friend Lord Beloff and the noble Lord, Lord Peston, made the very important point about libraries. I want to say that the Government recognise the particular importance to humanities scholars of good library facilities. In his initial guidance to the Higher Education Funding Council, my right honourable friend the Secretary of State asked the council to consider what initiatives it might launch in support of libraries for teaching and research, recognising in particular the needs of the humanities. The council has established a working party, again chaired by Sir Brian Follett, to consider library provision in higher education. Indeed, the President of the British Academy is a member of that working party, and thus I can say that the humanities are well represented.
The noble Lord, Lord Jenkins, pointed out the particular connection between this kind of research and teaching in the humanities. It is of course true that for some the policy of research selectivity may mean an increased emphasis on teaching and would reduce time allocated for research. This applies in all disciplines and is intended to ensure that research funds are used effectively. Funding for scholarship, on which high-quality teaching depends, will continue to flow through funds for teaching. Universities will be able to support talented individuals from their general funds.
We attach great importance to the work of the academy. The Government's grant-in-aid enables the academy to make awards for fees and maintenance to research students in the humanities, to provide post-doctoral fellowships and readerships, and to support a variety of research projects and institutes, including the overseas archaeological schools.
The Government's grant-in-aid to the academy in the current financial year is some £19.5 million. My right honourable friend the Secretary of State has recently announced an increase to £21.5 million for the next financial year 1993–94. This represents, as I have just said, a cash increase of some 11 per cent. Given the current pressures on public expenditure, I believe that this substantial increase provides clear evidence of the Government's commitment to the work of the academy.
As I have also said, in addition to the grant-in-aid to the academy, resources for humanities research are included in the allocations to universities and colleges by the Higher Education Funding Councils. The allocation by the Universities Funding Council in the 1992–93 academic year includes £78 million for research in the humanities.
As your Lordships know, the resources allocated to institutions by the funding councils are not earmarked: it is for each university and college to determine how the funds available to it will be deployed. As a number of noble Lords have made clear, the proposal for a research council for the humanities is not a new one. There has for some time
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been a debate within the humanities community about the need for such a development and the form that it might take. Different proposals have been discussed with my department and most recently, as has been mentioned, there has been a report on the matter from the joint working party established by the British Academy and the Economic and Social Science Research Council under the chairmanship of Sir Brian Follett.
The Follett Report argues that, as a result of changes in structures and funding for higher education and scientific research, the existing arrangements for the public funding of humanities research are no longer satisfactory. It recommends that a new agency should be established for the public funding of project-based humanities research, to bring it into a position comparable to that of the social and natural sciences. The new agency would take over certain of the British Academy's responsibilities in this area.
The Follett Report further recommends that the new agency should form part of the research council structure under the Office of Science and Technology, and that it should offer the full range of functions appropriate to a research council. The report asserts that the success of the new body would depend on extra resources being devoted to project-based humanities research.
The noble Earl, Lord Russell, informed the House that he, the Liberal Democrats and the Follett Report—I understand he informed the noble Lord, Lord Jenkins, of this—have considered whether there should be a joint research council covering both the humanities and the social sciences, or whether there should be a separate research council for the humanities alone. The report concludes that it would be technically feasible for a single research council to administer project-based funding across both sets of disciplines. It argues, however, that such a change would disrupt the present Economic and Social Research Council and that, relative to the alternative of the ESRC and a new humanities research council, it would save little in administrative costs. Accordingly, the report recommends the establishment of a humanities research council. It also recommends that the responsibility for continuing public funding for the British Academy be transferred to the Office of Science and Technology. I noted the conflicting views that the noble Lord, Lord Dainton, and my noble friend Lady Perry of Southwark held on these matters.
The Follett Report has been endorsed and commended to the Government both by the British Academy and by the Economic and Social Research Council. As will have become clear, the report raises a number of important issues. Several of them have been raised during the debate. Some of them also need to be considered within government, and they have of course already been the subject of discussions between the departments concerned. My honourable friend the Minister for Further and Higher Education—I am absolutely delighted he has given his time to hear the entire debate from.below the Bar in our Chamber this evening—only yesterday evening had a discussion

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with the president of the British Academy. I understand that that was a useful and constructive dialogue between my honourable friend and Sir Anthony Kenny.
As I explained to your Lordships at the beginning, I am not in a position to give the Government's response now: it is our intention to announce our response in the Science and Technology White Paper, which we will he producing later this year.
The Government recognise the strong views within the humanities community about the need for a research council to provide a distinctive voice for the humanities and to enhance the status of humanities research. We are aware that some see the humanities as somewhat isolated under the present arrangements; and we understand the argument that bringing the humanities within the research council system would enable the humanities to be considered alongside the scientific disciplines when decisions are being taken about the allocation of resources for research.
I noted the comments of the noble Lord, Lord Peston, about timorous mice. However, the noble Lord has never been reticent about asking for money. It is possible that he could teach a humanities research council some lessons in that respect. But proposals for change can have disadvantages as well as advantages. The Government need to consider the issues fully before they can decide how the interests of the humanities would best be served.
An important question is the pattern on which any research council for the humanities should be established. Would it make best sense to establish a humanities research council on the model of the existing research councils? Such a body could certainly be expected to provide greater coherence, direction and control over research in the humanities. But is that type of management appropriate for humanities research? As your Lordships are aware, humanities research is in most cases very different in nature from research in the sciences.
Most humanities research requires the time of individual scholars who have access to good library facilities. These activities are integrated with the basic functions of higher education institutions, which are supported by the grant from the funding councils. This system gives scholars the flexibility they need to pursue their interests. Would it be helpful to the humanities to have a research council which identified a limited list of priority areas for research, as the existing research councils do, and directed resources accordingly? Is there a risk that such a process would unhelpfully distort the pattern of research in the humanities?
A further issue is what functions a humanities research council would assume. A research council on the existing pattern might be expected to be active in monitoring and evaluating the quality of research projects, in promoting inter-disciplinary work and, as highlighted by the noble Lord, Lord Stewartby, in monitoring the health of the humanities community through such activities as forecasting the demand for new scholars to replace existing staff as they retire and in co-ordinating library provision, as the noble Earl, Lord Russell, has suggested. However, in practice the
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British Academy already discharges many of these functions in collaboration, as appropriate, with the ABRC and other agencies. The higher education institutions have responsibilities in these areas too. Do we need a humanities research council to take over and develop these functions; and what would be the division of responsibilities between a humanities research council and the British Academy? Which of the academy's current functions would a research council assume? It is generally supposed that a research council would take over from the academy the responsibility for the administration of the postgraduate studentship scheme in the humanities. The Follett Report so recommends. But what other functions would be assigned to a humanities research council?
The noble Lord, Lord Bridges, raised the question of the location of the responsibilities for schools and institutions abroad. Given that there are few large-scale projects in the humanities that would require research council support, should the Government be considering a rather different type of body than the research councils we have at present? If so, what form should it take?
There is also the question of the basis on which a humanities research council would be funded. The academy has made no secret of its wish to see additional funding provided for a new body. That is perfectly understandable. But the reality is that any new body would probably have to be funded within the existing resources available for humanities research. The Government have always made that clear. When my honourable friend the Higher Education Minister met with the British Academy only yesterday, the academy assured him that for its part it would want to see a humanities research council even if the new body was funded initially on the relevant proportion of the academy's existing budget. It is helpful to have that clarification of the academy's position. Of course, as I have made clear, the Government's position on the question of a research council for the humanities is wholly reserved.
My noble friend Lord Stewartby pressed us to consider these two issues as separate issues, one of finance and one of structure. The question for the Government is whether a research council would be a more effective mechanism for distributing the resources available for humanities research. That is a structural question which must be looked at on its merits aside from the question of the size of the sum to be distributed. Presumably a research council would concentrate resources. Would that be helpful for the humanities, given the distribution of humanities scholars and the patterns of humanities research; and might the existence of a humanities research council make it harder for the humanities to argue for a fair share of universities' general funds?
I make no judgment on these questions. I hope that noble Lords will understand that I am unable to give your Lordships an answer this evening. The issues I have outlined are currently the subject of active consideration by the Government. We recognise that our consideration of these matters cannot go on indefinitely.

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The science and technology White Paper provides an opportunity to determine the appropriate structures for supporting humanities research. There are essentially two options: to bring the humanities within the research council system under the Office of Science and Technology or to retain the existing arrangements. We intend to consider in the White Paper whether any changes are necessary to the organisation of the existing research councils, and it is right that the proposal for a humanities research council should be considered in that context.
I have listened carefully to the points made during this debate. They will make an important contribution to the deliberations of the two departments. I can assure your Lordships that I shall report your views to my right honourable friends the Secretary of State and the Chancellor of the Duchy of Lancaster. I am sure that they will want to consider them most carefully. I know that they will appreciate this debate tonight, and they will consider all that has been said before
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reaching a decision on this important matter. I again thank my noble friend Lord Renfrew for giving us the opportunity to discuss this important matter.

Trade Union Reform and Employment Rights Bill
Brought from the Commons; read a first time, and to be printed.
Alliance and Leicester (Girobank) Bill
Reported from the Unopposed Bill Committee with amendments.

London Local Authorities Bill [H.L.]
Reported from the Unopposed Bill Committee with amendments.
House adjourned at ten minutes past ten o'clock.