Sitting of 17 December 1962

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  GOVERNMENT INFORMATION SERVICES

    Minister Without Portfolio
    Mr. Liptonasked the Minister without Portfolio if he will issue a report on the activities of his Department since the date of his appointment.
    The Minister Without Portfolio (Mr. W. F. Deedes): No, Sir.
    Mr. Lipton: Is not that reply just as mysterious as the duties which the Minister is supposed to be carrying out in co-ordinating Government information services? Why is he not giving some information service to the House? Has he noticed since he has taken over this job that this country presents a woefully sick image? Despite the difficulties created for him by his Ministerial colleagues, what is the right hon. Gentleman doing to provide us with a newer, better and happier look?
    Mr. Deedes: The hon. Gentleman should bear in mind that my function is to co-ordinate the information services at home. A principal forum for expositions of Government policy must always be the House. I give advice and assistance where I can to the information services, but it is not part of my job to usurp the functions of Departmental Ministers.

  HOSPITALS

    Good Hope Hospital, Sutton Coldfield
    Mr. Snowasked the Minister of Health whether he is aware of the inconvenience caused to many workers re-
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    siding in Tamworth who work in the Birmingham area when hospital cases affecting their families are transferred to Burton-on-Trent; and what steps, pending the availability of more beds at the Good Hope Hospital, he proposes taking.
    The Joint Parliamentary Secretary to the Ministry of Health (Mr. Bernard Braine): I cannot identify the circumstances which the hon. Member has in mind.
    Mr. Snow: That is the sort of reply I feared. Is the hon. Gentleman aware that it is a wholly unimaginative policy which forces workers who work in Birmingham but reside in Tamworth to have their family cases treated at Burton, bearing in mind the very unsatisfactory local transport arrangements? If he does not know anything about it, will he please look into it?
    Mr. Braine: Now the hon. Member has made the point clear. Apart from maternity cases, a patient from Tamworth who has a special link with Birmingham can generally be accommodated in a Birmingham hospital if he makes known his request.
    Mr. Snowasked the Minister of Health what are the total interest charges which have so far been incurred in connection with the Good Hope Hospital, Sutton Coldfield; and what is the capital cost so far of this hospital.
    Mr. Braine: None, Sir; about £406,000.

    Hospital Treatment (Mileage Allowance)
    Mr. Wingfield Digbyasked the Minister of Health what regulations exist, when patients have to attend hospital for treatment, for paying them a mileage allowance for the use of their own cars, instead of sending an ambulance, where there is no public transport available, as is often the case in rural areas.
    Mr. Braine: I am sending my hon. Friend a copy.

    Regional Hospital Boards (Funds)
    Mr. Albuasked the Minister of Health whether he will make additional funds available to regional hospital

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    boards to cover the extra day's running in leap year, 1964.
    Mr. Braine: Yes, Sir.
    Mr. Albu: Will the Parliamentary Secretary take it from me that this will be very welcome? Hospital management committees are very short of money at the present time.

    Hospital Plan
    Mr. Farrasked the Minister of Health (1) if he will retain emergency and out-patient facilities in local hospitals otherwise affected by the Hospital Plan for England and Wales;
    (2) if he will retain maternity facilities in local hospitals otherwise affected by the hospital plan for England and Wales.
    The Minister of Health (Mr. Enoch Powell): Yes, Sir, in a large number of cases.
    Mr. Farr: May I thank my right hon. Friend for that encouraging reply? Is he aware of the great difficulty that many people from the rural districts will have of getting into these larger hospitals when they are built, and will he bear that in mind when formulating his Hospital Plan?
    Mr. Powell: Yes, Sir. Every single instance has to be looked at in the light of local circumstances and of experience as the new facilities are provided.
    Sir A. V. Harvey: Can my right hon. Friend say whether in cases like the hospital in the borough of Congleton, built in the last 25 years, which is a perfectly good hospital, he will make an exception?
    Mr. Powell: I do not think there is any question of making an exception but of ensuring that new and better facilities that are acceptable to those concerned are in existence before any of the older facilities are discontinued.

    Student Nurses
    Mrs. Castleasked the Minister of Health how many pre-nursing students who attained the age of 17 years during the past year have taken up employment as student nurses.
    Mr. Braine: I regret the information is not available.
    Mrs. Castle: In that case, is not the hon. Member aware—or ought not he to be aware—that the overwhelming proportion of the pre-student nurses, or hospital cadets as they are sometimes called, go on into the nursing career as soon as their age enables them to do so? In view of that fact, is it not time that they were treated as part of the nursing service and therefore received the same pay increases as nurses automatically at the time when the nurses receive them?
    Mr. Braine: Those below the minimum age for entering nurse training—and the minimum age is 18 and not 17—may prepare themselves in two ways. They may either remain at school or colleges of further education, or enter hospital employment as nursing cadets. There are ample opportunities for nursing cadets to enter nurse training. No fewer than 20,000 new student nurses and 4,000 pupil nurses enter each year. The information which the hon. Lady has sought is not available, but it is known that two-thirds of those entering nursing cadet schemes from 1954 to 1960 later took up nurse training.
    Mrs. Castle: Has not the hon. Member obliged me by proving my point? Will he therefore answer the second half of my supplementary question and agree that these hospital cadets should be treated exactly as nurses are treated in the matter of pay?
    Mr. Braine: That is an entirely separate question, which I understand was answered last week.

    New Cross Hospital, Wolverhampton
    Mr. Bairdasked the Minister of Health if a limb fitting centre will be included in the reconstructed New Cross Hospital, Wolverhampton.
    Mr. Powell: This is still under consideration.
    Mr. Baird: Does the right hon. Gentleman realise that if this centre is closed the poor people who use it—mostly cripples—will have to travel a journey of one hour each way to the otherwise nearest centre? Will he consult his right hon. Friend the Member for Wolverhampton, South-West (Mr. Powell) who must understand this problem, and see

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    that representations are made to the effect that the present centre is retained in the new hospital?
    Mr. Powell: It will be some time before a decision on this matter needs to be reached, but obviously I shall have the same considerations in mind as my honourable fellow burgess.

    Nurse Recruitment (Deputation)
    Dame Irene Wardasked the Minister of Health on what date he is receiving a deputation from the Royal College of Nursing on nurse recruitment.
    Mr. Powell: This Thursday.
    Dame Irene Ward: May I ask my right hon. Friend whether he will announce in full his answer to the case presented by the Royal College of Nursing?
    Mr. Powell: Not necessarily, but there may well be a statement after we have met—I do not know.

    Stoke-on-Trent
    Dr. Strossasked the Minister of Health whether he is aware that in Stoke-on-Trent the ten-year building programme has had a detrimental effect on the financial ability to maintain older buildings which are not being replaced in this programme; and whether he will make specific inquiries and give what additional help is needed.
    Mr. Powell: No, Sir. The maintenance programme has not been restricted.
    Dr. Stross: As it might be thought that I framed my Question perhaps rather clumsily, may I ask the Minister whether he is aware that the impression which I have is that this is a national problem—namely, that the amount of finance available to the regional boards is now such that their allocations, in turn, to hospital management committees are not sufficient to allow them to see that any replacement on maintenance is kept up to the standards which they prefer?
    Mr. Powell: Throughout the country the total value of the revenue allocation has been rising, but it is for the regional boards, in the first instance, and also
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    for the hospital management committees, to decide how they shall allot it as between maintenance and other forms of revenue expenditure.
    Mr. K. Robinson: Is not the Minister aware that one of the effects of the Hospital Plan, at least in some regions, is that there are practically no minor capital moneys available to the type of hospital referred to in the Question if they do not figure in the plan? Is he further aware that one regional board—I hasten to add not that with which I am associated—has only £7,000 a year available for capital work on those hospitals which do not appear in the plan?
    Mr. Powell: This Question does not relate to capital expenditure, which, as the hon. Member knows, includes minor works. It refers to revenue expenditure. There is a good deal of misunderstanding about the status of minor works under the Hospital Plan, and I should be glad to clear that up if the hon. Member will either communicate with me or put down a Question.
    Mrs. Slater: Does the Minister mean that putting in a new sluice room, for example, or modernising the bathroom and lavatory facilities, must come out of revenue? Is it not that type of work, modernising the hospital and making it more efficient, which the present situation is preventing from being done?
    Mr. Powell: That sounded to me like capital expenditure. The total of capital expenditure is annually increasing at a rapid rate.

    Beds
    Dame Irene Wardasked the Minister of Health whether, at hospitals where there are empty beds owing to shortage of staff and a waiting list for hospital treatment, he will take steps to ensure that where staff is available extra finance will be forthcoming to pay them.
    Mr. Powell: I would refer my hon. Friend to my reply to her on 10th December.
    Dame Irene Ward: Is the Minister aware that my Question is not the same as the other Question which I put down and to which he directs my attention? Would he be so kind as to tell me, if

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    the circumstances in the present Question arise, whether he will take the action which I suggested in the Question? Will he discuss the matter with the Royal College of Nursing when he sees its representatives on Thursday?
    Mr. Powell: In answer to the second part of the Question, I gather so. In answer to the first part, cases must be looked at individually, but most regional boards hold a certain reserve which in their discretion they could, if necessary, apply in this way.
    Mr. K. Robinson: Is the Minister aware that this reserve is smaller this year than it has ever been since the hospital service began? Is he aware that at least one hospital has the staff to open a new ward —I am talking about the St. Helier Hospital, Carshalton—but cannot open it because it has not the money available to pay for the food of the patients who would occupy the ward—according to reports, at any rate?
    Mr. Powell: The ward to which the reports refer is now open.

    Waiting Lists
    Lord Balnielasked the Minister of Health what steps he is taking to secure a significant reduction in hospital waiting lists.
    Mr. Powell: Guidance on reduction of geriatric and similar lists has been issued. I am sending my hon. Friend a copy. Measures to reduce other lists will be recommended shortly.
    Lord Balniel: Can my right hon. Friend say whether pilot schemes are being undertaken by hospitals to ensure that the information is available on which to base their recommendations so that they will be realistic and not merely academic exercises?
    Mr. Powell: Yes. The recommendations in all cases are based on practical experience in a number of hospitals.

    Minor Works and Maintenance
    Mr. Marshasked the Minister of Health if he will state the maintenance allocation to the Greenwich and Deptford Hospital Maintenance Committee for the current year, the amount requested
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    when estimates were prepared, and the percentage increases in monetary and real terms over the allocation for the previous financial year.
    Mr. H. Hyndasked the Minister of Health if he will state the maintenance allocation to the group management committee in respect of the hospitals in the Accrington constituency for the current year, the amount requested when estimates were prepared, and the percentage increases in monetary and real terms over the allocation for the previous financial year.
    Mr. Ledgerasked the Minister of Health if he will state the maintenance allocation to the group management committee in respect of the hospitals in the Romford constituency far the current year, the amount requested when estimates were prepared, and the percentage increases in monetary and real terms over the allocation for the previous financial year.
    Mr. D. Jonesasked the Minister of Health if he will state the maintenance allocation to the group management committee in respect of the hospitals in the Burnley constituency for the current year, the amount requested when estimates were prepared, and the percentage increases in monetary and real terms over the allocation of the previous financial year.
    Mr. A. Lewisasked the Minister of Health if he will state the maintenance allocation to the group management committee in respect of the hospitals in the West Ham, North, constituency for the current year; the amount requested when estimates were prepared and the percentage increases in monetary and real terms over the allocation of the previous financial year.
    Mr. Powell: As the Answers contain a large number of figures, I am circulating them in the OFFICIAL REPORT.
    Mr. Marsh: In the meantime, can the Minister indicate whether or not the real purchasing power of these sums represents an increase on last year?
    Mr. Powell: Yes, Sir.
    Mr. Ledger: Is the Minister aware that, due to the financial circumstances,

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    letters have been sent out by the Romford Group Hospital Committee advising maintenance staff to seek alternative employment, and does he not think that that is unwise and a false economy?
    Mr. Powell: I have not seen the actual letter and I would not like to judge the action of a hospital management committee without looking at the details.
    Mr. D. Jones: Will the Estimates involve a reduction in the respective staffs, particularly in Burnley?
    Mi. Powell: No, Sir. The allocations are permitting the expansion of nursing and other staffs throughout the country.
    Mr. K. Robinson: Will the Minister now answer the first half of my last supplementary question? Are not the reserves to which he referred for maintenance for regional boards smaller than ever and in many cases non-existent so that management committees simply cannot recruit nursing staff? What does the Minister intend to de about it?
    Mr. Powell: In many cases recruitment has gone ahead very fast during the earlier part of the year and, in order to keep within the allocations, it has to go ahead at a reduced rate now; but there is no reason why there should be an absolute stop in any region.
    Mr. Loughlin: Will the Minister not talk just in terms merely of additional staff but of those hospitals throughout the country which, because of his meanness, are having to reduce staff, as was indicated in an Answer the right hon. Gentleman gave me last Monday?
    Mr. Powell: Referring to the answer which I gave to the hon. Member last Monday, most, if not all, of the reductions referred to in that Question were called for on grounds of good administration and efficiency.
    Mr. H. Hynd: Can the Minister give an assurance that the money available to hospitals in my constituency will not result in any diminution of the services which they want to perform?
    Mr. Powell: It is sufficient to permit a real increase in the content of the services which they are giving.
    Following are the figures:

    Hospital Management Committee

    Initial allocation 1962–63

    Percentage increase in money terms over initial allocation for 1961–62

    £

    Accrington Blackburn and District

    1,268,000

    6·4

    Burnley

    1,076,000

    7·3

    Deptford and Greenwich Greenwich-Deptford

    1,036,000

    6·3

    Seamans

    378,000

    6·2

    Romford

    1,616,500

    6·1

    West Ham

    1,455,000

    10·5

    NOTES
    1. Revised allocations for 1962–63 have not yet been settled.
    2. Increases at constant pay and prices are not separately calculated for each hospital authority.
    3. Allocations to Hospital Management Committees are the responsibility of Regional Hospital Boards. I do not propose to ask Boards to disclose the draft estimates of individual hospital authorities.
    Mrs. Castleasked the Minister of Health what allocation for expenditure on minor works and maintenance, respectively, has been made to the group management committee in respect of hospitals in Blackburn; and how this compares with the amounts requested and with the allocation for the previous financial year.
    Mr. Powell: Allocations are not made for individual items of revenue expenditure. The board has approved expenditure of £2,200 on minor capital works this year, compared with £3,274 last.
    Mrs. Castle: Is it not the fact that many of these urgent minor works are being held up; and that the right hon. Gentleman's grand new hospital scheme is being operated at the expense of immediate improvements that could, with very small expenditure, and fairly quickly, do a great deal to improve existing facilities? Will he not, therefore, look into this matter again?
    Mr. Powell: Of course, a balance has to be kept between the application of the total available capital to new buildings and to minor works, but there is still a great mass of capital being expended upon minor works as opposed to the

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    major new projects. It is for each board to select, year by year, the minor works that it will put in hand.

    Hospital Engineers
    Mr. Rankinasked the Minister of Health when he expects to conclude his consideration of the Report of the Study Group appointed by him to inquire into the position of hospital engineers.
    Mr. Powell: I cannot yet add to my reply to the hon. Member on 10th December.
    Mr. Rankin: Is the right hon. Gentleman aware that these key workers in the hospital service have not had any increment in their remuneration since November, 1960? Does he not realise that they were looking forward to his conclusions on this Report, which he got last February, to help not only with salary reconsideration but also with matters of grading, qualifications, training and a whole lot of other important aspects of their work?
    Mr. Powell: As I assured the hon. Member last week, and as I have informed him since—I think that he will have heard from me—the fact that there has not yet been a decision on these recommendations is in no way holding up negotiations on pay. The claim is at present under consideration.

    Sheffield
    Mr. E. L. Mallalieuasked the Minister of Health what is the increase in the number of those awaiting hospital treatment now and a year ago in the Sheffield region; and what is the difference between the number of nursing staff employed in the region now and then.
    Mr. Braine: Waiting lists in this region decreased by over 2,300 in the year ended 30th September, 1962; nurses increased by over 1,000 whole-time equivalent.
    Mr. Mallalieu: Is the hon. Gentleman then satisfied that there is sufficient nursing staff to deal with the urgent cases in this region?
    Mr. Braine: Certainly not, but, as the figures I have just given indicate, staffs are increasing rapidly.

  MINISTRY OF HEALTH

    Medical Record Cards
    Mr. Wingfield Digbyasked the Minister of Health whether he will supply medical record cards and their holders in more serviceable material.
    Mr. Powell: They seem tough enough.
    Mr. Digby: The next time my right hon. Friend visits his G.P., will he look at his card and see how tatty these cards become with a little wear, so tatty that they would disgrace a paper chase?
    Mr. Powell: The quality of paper does not seem responsible for that. It may not be generally known that a gussetted version can be obtained which will permit more than the average number of papers to be inserted in one holder.

    Medical Students
    Mr. Boydenasked the Minister of Health how far the number of medical students in British universities in the years 1960–61 and 1961–62 fell short of his estimates for student doctors in those years.
    Mr. Powell: I have made no such estimates.
    Mr. Boyden: Is it not the situation that the universities could have taken more students in these years? Is the right hon. Gentleman preparing for a considerable expansion in the number of students in medical schools in the coming years when the number of students available from State schools will be much higher than it is now?
    Mr. Powell: Questions of student expansion are not for me, but the hon. Member and the House will be glad to know that the number of British students of medicine entering our universities increased last autumn by 6 per cent. and this autumn by 8 per cent.
    Mr. K. Robinson: Since almost everybody, except, possibly, the Minister, agrees that we need a considerable increase in the number of doctors in the National Health Service, has the right hon. Gentleman had any discussions with

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    his right hon. Friend the Minister of Education on the prospects of opening new medical schools in the foreseeable future, and with what results?
    Mr. Powell: I do not think that it is a question for my right hon. Friend the Minister of Education. As the hon. Member will know, the Government have discussed with the University Grants Committee the conclusion about the increase of medical intake which was announced to the House last year, but the trend of the intake at present is very sharply upwards.

    Water Supplies (Fluoridation)
    Mr. Lubbockasked the Minister of Health by how much he estimates that the annual cost of dental treatment under the National Health Service would be reduced, if one part per million of fluoride were added to all drinking water.
    Mr. Braine: I regret it is not possible to make an estimate.
    Mr. Lubbock: Would not the incidence of dental decay be reduced by more than 50 per cent. if one part per million of fluoride were added to drinking water? Would it not be a good idea if the addition of fluoride were stimulated by the Ministry of Health making a contribution towards meeting the costs which local authorities will incur as a result of adding fluoride to drinking water?
    Mr. Braine: The answer to the second supplementary question is that we do. As the hon. Member has said, fluoridation is expected to reduce the incidence of dental decay among children by half, and the increase of caries resistance should persist well into middle age. But it is quite impossible to estimate the financial effect on the general dental service. The effect will be less to reduce costs than to make a more effective and economic use of the nation's dental manpower.
    Mr. Eden: Would not the cost of dental treatment be considerably reduced if children were encouraged to eat fewer sweets and iced lollies and to clean their teeth with greater regularity rather than that the Government should bring in any form of mass medication?
    Mr. Braine: I agree with my hon. Friend that more discipline on the part
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    of parents and children would go a long way towards reducing dental decay.
    Mr. Edenasked the Minister of Health in what forms, other than by fluoridation of the water supply, fluorides can be made available for general consumption; and what would be the comparative costs of introducing each method on a national scale.
    Mr. Powell: I would refer my hon. Friend to my reply on 30th July to the hon. Member for Wood Green (Mrs. Butler).
    Mr. Eden: Is it not a fact that fluorides are available in pills and toothpaste, and in foodstuffs and in other forms which the public can quite readily acquire should they require to do so, and would it not be much cheaper to encourage them to do this than to do what he is proposing?
    Mr. Powell: No, it would not be cheaper for a given effect because I am advised that there is no other method of preventing dental decay which is as effective as correction of the deficiency of natural fluoride where that exists.
    Lord Balniel: Does my right hon. Friend recollect that the campaign against chlorination of water and pasteurisation of milk were both conducted on the ground that this was mass-medication, and in view of the now overwhelming evidence that this is the cheapest and most effective way of benefiting the health of children, will he do his utmost to encourage local authorities to undertake this?
    Mr. Powell: I am sure that my hon. Friend speaks with the voice of the overwhelming majority of people.
    Mr. Edenasked the Minister of Health what research has been conducted to investigate the cumulative effects of imbibing fluoride; and what conclusions have been reached.
    Mr. Powell: The main research with the conclusions reached is summarised in Appendix 8 of the Report on the Fluoridation Studies in the United Kingdom.
    Mr. Eden: Is my right hon. Friend satisfied from these reports that there is no danger at all of cumulative effects over at least a generation of time, and

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    can he say whether it is possible to vary the contents of fluoridation according to the needs of the individual or even according to the nature of the water which is being treated?
    Mr. Powell: The answer to the first part of my hon. Friend's supplementary question is, yes, absolutely. As regards the second part, the main object of fluoridation is to bring the fluoride content, whatever it may be, up to a given level. There is no need for a variation in the level of fluoridation in areas where this is carried out artificially any more than in areas where fluoride is naturally present.
    Dr. Stross: Can the right hon. Gentleman give a figure estimating how many hundred of millions of people on this planet are drinking water which has more than one part per million, and is there any evidence whatever that they come to any harm by it?
    Mr. Powell: I cannot give the total number. In this country it is about one-third of a million and in the United States, I believe, it is over 7 million, and there is no such evidence or suggestion whatsoever.

    Bronchitis and Lung Cancer
    Mr. Pavittasked the Minister of Health if he will introduce legislation to make action for the prevention of bronchitis and lung cancer mandatory upon local authorities.
    Mr. Powell: No, Sir.
    Mr. Pavitt: Does the Minister recollect that forty years ago similar legislation was introduced regarding tuberculosis and that there was a regular drop of 3 per cent. in the incidence of this disease over the following period? In view of the fact that bronchitis is now the No. 1 killer and that we are losing 30 million days of production each year owing to bronchitis, would he not give us something more satisfactory than "No, Sir"?
    Mr. Powell: If I could legislate bronchitis and lung cancer away, of course I would. The question is whether it is right to take this aspect out of the whole range of the preventive health functions of the local health authorities and make this one mandatory. I do not
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    think that there would be any gain from this.
    Dr. Stross: Will the right hon. Gentleman tell the House, if he feels he cannot do this, what he has in mind to do, particularly concerning lung cancer, and whether, as stated later on the Order Paper, we expect an additional 1 million deaths in the next 30 years?
    Mr. Powell: As the hon. Member says, there is a Question on that later.
    Mr. S. Silverman: How does the right hon. Gentleman reconcile the sympathetic answer that he gave just now to his hon. Friend who wanted to deprive children of sweets in order to preserve their teeth with his reluctance to do anything to deprive people of cigarettes to preserve their lives?
    Mr. Powell: I am not reluctant to bring to the notice of people by every means that I can the fact that there is a close causal connection between the smoking of cigarettes and the incidence of lung cancer.
    Mr. Pavitt: In view of the unsatisfactory nature of the reply, I beg to give notice that I shall raise the matter on the Adjournment.
    Sir B. Jannerasked the Minister of Health what steps he proposes to take to combat the increasing number of deaths from bronchitis.
    Mr. Powell: I understand the Medical Research Council is promoting study of causes and treatment. My Standing Medical Advisory Committee is considering further measures of prevention and care.
    Sir B. Janner: Is the Minister satisfied —as many medical people are not—that sufficient attention is being given to the question of atmospheric pollution? Is he aware that in Leicester great difficulty is caused owing to the fact that the power stations are emitting a considerable amount of smoke and sulphates? Why does not the right hon. Gentleman hurry the matter up and see what can be done to prevent the kind of thing that happened recently, and thereby avoid the considerable increase in the number of deaths from bronchial trouble?
    Mr. Powell: If the hon. Gentleman has a question on air pollution, perhaps he would be good enough to address it to my right hon. Friend the Minister of Housing and Local Government.
    Mr. Pavitt: Has the Minister examined the figures, showing that 378 deaths per 100,000 occur in this country at the age of 50, as compared with two per 100,000 in Norway, where they do not have the same air pollution problems that we have? Will not he take this matter seriously?
    Mr. Powell: I do take it seriously. It is one of the scourges of this country. That is why the research that I mentioned is in hand, and also why I am seeking further advice from my medical advisers.
    Sir B. Janner: What did the right hon. Gentleman mean when he said that this was a matter for the Minister of Housing and Local Government? Has he fallen out with that Minister? Why has he not had a word or two with him about the matter? He understands what the problem is. When will the right hon. Gentleman consult the Minister of Housing and Local Government?
    Mr. Powell: It is merely that it is the custom for a Minister to answer Questions falling within his Departmental responsibility.
    Dr. Strossasked the Minister of Health whether he is aware that within 30 years a million deaths will occur in Britain from cancer of the lung; and what further action he will take to prevent this.
    Mr. Powell: No reliable estimate can be made; better facilities for treatment and persistent discouragement of smoking, especially of cigarettes.
    Dr. Stross: With reference to the persistent discouragement of smoking, especially of cigarettes, is the Minister aware that this is seriously handicapped by the fact that enormous sums of money are still being spent urging young people, in particular, to smoke cigarettes? Is there nothing further which he can do which will help to prevent smoking, rather than relying on the cure of a horrible disease such as this? Will he
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    do this instead of waiting until it manifests itself among the public?
    Mr. Powell: I am sure that the effectiveness of continuous health education of all kinds cannot be measured in terms of money against the outlay upon advertisements. I believe that it is a long job, but it is a job which in the long run is bound to produce a big effect. Meanwhile, the hon. Member may have noticed that the advertisers have agreed to eliminate certain slants, particularly directed at young people, from their advertising matter.
    Mr. Manuel: Can the Minister give the House any information about whether there is any chance of an early break-through in the earlier diagnosis of lung cancer or any other types of cancer? This is being very anxiously considered in the country, and if he has any information which he can give to show that during the next few years there are likely to be any advances it will be very welcome indeed.
    Mr. Powell: Certainly not without notice. I doubt whether it would be a proper subject on which I should give an answer at all.
    Mr. Lipton: In connection with the advertising campaign to which the Minister referred, what action is he taking with the Poster Manufacturers' Association, who have taken it upon themselves to ban some of the posters which have been approved for display by the Minister of Health?
    Mr. Powell: I am in communication with them about this.

    Chief Welfare Officer
    Mr. K. Robinsonasked the Minister of Health what salary scale attaches to the post of chief welfare officer in his Department, applications for which were recently invited.
    Mr. Powell: £2,565 per annum.
    Mr. Robinson: Is the Minister not aware that at least half a dozen local authorities pay their chief welfare officers a considerably higher salary than this, and since his chief departmental officer ought surely to be at the top of the welfare profession, how does he expect to get the best applicants for the job at this salary?
    Mr. Powell: There has been, in fact, no lack of applicants for the job. This salary was recently fixed by agreement through the Civil Service negotiating machinery.

    Drugs
    Sir B. Jannerasked the Minister of Health whether he is aware that the drug meclozine, a travel sickness pill, causes deformity in infants if taken by pregnant women; that its sale has been stopped in Sweden, Denmark and Norway, following Swedish observation of the effects of the drug; whether it is issuable under National Health prescription; and if he will make a statement.
    Mr. Powell: I understand this effect is so far not established, but chemists have been advised to supply certain preparations containing the drug on prescription only; no country, to my knowledge, has prohibited sale.
    Sir B. Janner: Does the Minister say that he has inquired as to whether the sale has been prohibited in the countries referred to in the Question because, according to the information that I have received, that is the case, and will he make very careful inquiries to see if the drug is one which should be given even under prescription?
    Mr. Powell: Yes, Sir. I have inquired and the result of my inquiry is as I have told the hon. Member.
    Mr. K. Robinson: Is it not a fact that the manufacturer in one country at least, I believe it is Sweden, has withdrawn the drug and, if that is the case, ought not the Minister to make it clear to the House?
    Mr. Powell: We are talking about a drug that enters into a large number of preparations and I am not aware of the incident to which the hon. Member referred.
    Sir G. Nicholson: When my right hon. Friend says that he advises chemists only to supply the drug on prescription, surely that implies that he is highly suspicious of this drug, and in view of the terrible tragedies which happened recently and strong public opinion, does he not think that he should go further than merely advise?
    Mr. Powell: This drug has been referred to the Poisons Board, but in advance of any decision by the Board the Pharmaceutical Society thought it right to give this advice to their members.
    Dr. Stross: In view of the fact that we now suspect that women in the early months of pregnancy are not able to detoxify abnormal substances which they take by mouth, a power which they regain after the first three or four months, is not the best advice to give to women in early pregnancy to take no drugs of any kind if they can possibly avoid it?
    Mr. Powell: I am sure that the consideration which the hon. Gentleman mentioned in his supplementary question will be in the minds of the medical profession in advising their patients.

    Public Health Inspectors
    Mrs. Slaterasked the Minister of Health how many local authorities are short of public health inspectors; and what is the estimated national shortage.
    Mr. Braine: I regret this information is not available.
    Mrs. Slater: Does the hon. Member know that, through the Association of Municipal Corporations, a survey has been made of the existing shortage? Nearly all the large authorities are desperately short of public health inspectors. In view of the proposals for slum clearance and clean air, does not the hon. Member think that his Department should be taking this matter seriously by carrying out an adequate survey and inquiring into the top salary offered to these people?
    Mr. Braine: I take note of what the hon. Lady says. It is true that in some areas—especially industrial areas—there is a shortage. I will ask my right hon. Friend to take note of the hon. Lady's observations.

    Sedatives
    Mr. A. Hendersonasked the Minister of Health what recent reports he has received from his medical advisers on the effects of the use of sedatives, especially sleeping pills; and whether he will make a statement.
    Mr. Powell: None, Sir.
    Mr. Henderson: Has the attention of the Minister been drawn to the report, which appeared recently in the Evening News, that 27 million prescriptions are issued each year and that 1,500,000 sleeping pills are used each night in this country? Will he look into this and consider whether a national campaign should be organised to educate people to an awareness of the problem of the overuse of drugs, and even try to counteract the cause—which to a large extent is due to high pressure salesmanship?
    Mr. Powell: I am sure that these matters are in the minds of the medical profession in prescribing for and advising their patients.
    Mr. Emrys Hughes: Does the right hon. Gentleman regard Schweppes as a sedative?
    Mr. Powell: There is an appeal ultimately to me on these matters, but prima facie it does not seem to me that this would be prescribable on Form E.C.10.
    Mr. Henderson: Will the right hon. Gentleman look into this problem, because I told his Department of the existence of this report in the Evening News? I am sorry he has found it unnecessary to look into the problem.
    Mr. Powell: I am sorry, but I did not connect any communication from the right hon. and learned Gentleman with this question. Indeed, I was at a loss to know his precise point. I will certainly look at the matter and see whether I can write to him further about it.

    Psychiatric Medical Education, Wales
    Mr. Abseasked the Minister of Health (1) whether he is satisfied that, in view of present psychiatric medical training facilities in Wales, the accommodation allowed to a psychiatric department in the new teaching hospital to be built in Cardiff will be fully deployed; and if he will make a statement;
    (2) whether he is aware of the concern of the Welsh Regional Hospital Board and its Mental Health Services Committee about psychiatric medical education in Wales; and what steps he will
    880
    take to ensure that doctors in Wales receive adequate psychiatric training.
    Mr. Braine: My right hon. Friend is aware of the concern expressed; it is for the university to decide on the allocation of its funds; my right hon. Friend is satisfied that the accommodation will be fully used.
    Mr. Abse: Is the Minister aware that Wales will find this a very dusty answer? Does he know that the Minister for Welsh Affairs, over the last two years, has on at least one occasion expressed a wish for a chair and department of psychiatry, and that the Welsh Regional Hospital Board has protested on at least three occasions asking for such a chair? In view of the fact that the Minister's plan for Wales, as for elsewhere, is to reduce by half the number of mental health beds, how can he hope to achieve this—since he is gambling on new therapeutic advances —without the chair and department of psychiatry that have repeatedly been demanded?
    Mr. Braine: Doctors in Wales do not have to await the setting up of a university chair of psychiatry in order to qualify for the Diploma of Psychological Medicine. They can, and do, get their training in mental hospitals. This is not an ideal situation and we would like to see some improvement. Equally, it is not peculiar to Wales. But the treatment of patients is in no wise affected.

    Fluothane
    Mr. Boydenasked the Minister of Health if, in view of the monopolistic position of Imperial Chemical Industries as the manufacturer of the anaesthetic fluothane, he will now include a costings clause for all future contracts for this anaesthetic.
    Mr. Powell: I am in negotiation with the firm on this among other points.

    Multiple Sclerosis
    Mr. H. Hyndasked the Minister of Health whether, in the absence of facilities for curing multiple sclerosis in this country, he will assist patients to get treatment by the Le Gac method in Belgium.
    Mr. Braine: No, Sir.
    Mr. Hynd: If this treatment is not available in this country, are the sufferers from this disease simply to be left with no cure at all? Will the Minister stretch a point and try something which is apparently available just across the Channel?
    Mr. Braine: Similar methods to Dr. Le Gac's could be used in this country if doctors wished to use them. It is not for my right hon. Friend to arrange for a specific form of treatment to be given. This is a matter for the doctors.

    Miss Edith O'Shaughnessy (Invalid Chair)
    Mr. V. Yatesasked the Minister of Health if he has considered the letter sent to him on 9th November by the hon. Member for Ladywood, concerning complaints made by Miss Edith O'Shaughnessy, a polio victim, of Lady-wood, Birmingham, of the dangerous and defective condition of invalid chairs issued to her; and if he will make an inquiry with a view to providing a more adequate and safer service to disabled persons.
    Mr. Braine: The hon. Member will now have had my reply of 11th December to his letter.
    Mr. Yates: While I appreciate that the Minister has replied since I put down the Question, may I ask him whether he will go further into the matter and have a wider inquiry? Is he aware that the Infantile Paralysis Association in Birmingham has recently drawn attention to the question of an invalid who called for a chair which was supposed to have been repaired but which broke down four times? The case which I mentioned was of a lady in danger of an accident, and probably the accident which she had resulted from this situation. Will he satisfy himself that everything is being done to provide an adequate service?
    Mr. Braine: Certainly. Perhaps the hon. Member will give me particulars of the case which he has cited. In regard to the case to which the Question refers, I very much regret that there were delays, and the firm of repairers have been
    882
    reminded of their responsibilities to ensure that delays of this kind do not occur. We try to speed these matters up.

    General Medical Council (Treaty of Rome)
    Mr. Clark Hutchisonasked the Minister of Health what study he has made of the extent to which changes would be required in the constitution and powers of the General Medical Council in order to implement the provisions of the Treaty of Rome.
    Mr. Powell: I am advised that none would necessarily be required.
    Mr. Clark Hutchison: Will the Minister remember that, as the General Medical Council is a sub-committee of the Privy Council, if there are any changes to be involved they will be fundamental, constitutional ones?
    Mr. Powell: I am not certain that I would necessarily agree with my hon. Friend's logic, but I am in close touch with the General Medical Council over this.
    Mr. K. Robinson: Does not the Minister mean by "none necessarily" that if the General Medical Council sees fit to recognise the qualifications that they are required to recognise under the Treaty of Rome there will be no legislation necessary, but that if it refuses it will be compelled to do so by legislation?
    Mr. Powell: No. I mean that there is nothing in accession to the Treaty of Rome which would necessarily require the powers or the composition of the Geenral Medical Council to be altered.

    Audiology Technicians
    Mr. Pavittasked the Minister of Health what recognition is given to audiology technicians who have gained the diploma of their profession; and what steps he is taking to encourage all audiology technicians to become qualified.
    Mr. Braine: None, Sir. Hospital authorities have been advised to provide training on a recommended syllabus.
    Mr. Pavitt: In view of the importance of these technicians undertaking the

    883
    whole range of the duties falling within their province, and the way they have organised their profession so as to award a diploma, would it not be advisable for the Ministry to give recognition to encourage more probationer technicians to become the expert, qualified people the service needs?
    Mr. Braine: The Department has advised all employing authorities to give training in accordance with an outline syllabus that has been drawn up after consultation, and I think that that is where we can leave it.

    Census (Bathrooms)
    Mr. Boxasked the Minister of Health when he expects to be able to publish information obtained in the 1961 Census regarding the number of houses in England and Wales without bathrooms.
    Mr. Braine: In the County Reports, beginning next February.

  HOUSE OF COMMONS CATERING
  Mrs. Slaterasked the hon. Member for Holland with Boston, as Chairman of the Kitchen Committee, why no improvements have been made to the servery in the Members' Tea Room; what proposals are in hand for improvements to it; and when they will be commenced.
  Sir H. Butcher: The Committee is very conscious of the difficulties imposed on hon. Members and staff of the department alike from the peculiar accommodation problems of the department. In May, 1961, as Chairman of the Kitchen Committee, I requested the Serjeant at Arms to forward to the Ministry of Works certain items for inclusion in the 1962–63 estimates, but I was informed in March last that the Ministry had not been able to provide for all of these. Those not provided for included, as regards the Members' Tea Room, the provision of a waste-disposal unit and additional plate-racks. The Committee has repeated its request for these to be included in the 1963–64 estimates.
  Mrs. Slater: Does the hon. Member for Holland with Boston remember that I withdrew a similar Question last year, having been told that it was hoped that
  884
  these improvements would be made in the last long Recess? Does he not realise that the conditions in this servery break every food regulation which every local authority has in operation and that it is an absolute disgrace that women should have to work under such conditions? Is it not almost inconceivable that we should have such a kitchen in this building—a kitchen which is so badly planned and which contains such few facilities for ensuring that food is served under good health conditions? Will he not ask the Minister of Works for these improvements to be made at once in the interests of the people who work there and of hon. Members?
  Sir H. Butcher: I do not dissent from anything which the hon. Lady has said. The only thing which I would draw to the attention of the House is the fact that the question of alterations there would impose a substantial financial burden on the Estimates. I hope very much that the remarks the hon. Lady has just made will be noted by the Minister of Public Building and Works and others so that the matter may be included, without doubt, in the next set of Estimates. I would add that the physical difficulties in terms of plumbing are such that the alterations could be made only during the long Summer Recess.
  Mrs. Braddock: Does the hon. Member for Holland with Boston realise that if this Palace were subjected to the ordinary health laws and inspection by a medical officer of health, the requirements mentioned by my hon. Friend the Member for Stoke-on-Trent, North (Mrs. Slater) would have compelled this work to have been done? In view of these conditions—the very dreadful conditions whereby we have bins in the room where dishes are being washed, and refuse stands there through the whole of the day and is emptied only on occasions during the day—will the hon. Member not consider putting his foot down on this matter to get something done in the interests of health and hon. Members?
  Sir H. Butcher: It is easy for the hon. Lady to say that I should put my foot down, but I do not know where that would get me. I would prefer making proper representations through the authorities of the House to the Minister of Public Building and Works

  885
  and, for my part, I am grateful to the two hon. Ladies for having drawn attention to matters which have been closely in the knowledge of the Kitchen Committee for some time.
  Dame Irene Ward: Would it be of assistance to my hon. Friend the Member for Holland with Boston, since he does not seem to have been really very effective with the Minister of Public Building and Works, if I asked Mr. Speaker if we could adjourn the House so that we might accompany my hon. Friend to see the Minister on the subject?
  Mr. Speaker: If the hon. Lady wants to know the effect on me of certain representations, then the channel of appeal should not be through the Chairman of the Kitchen Committee.

  WHOLLY UNEMPLOYED PERSONS REGISTERED AT ST. HELENS EMPLOYMENT EXCHANGE AND YOUTH EMPLOYMENT OFFICE

  Percentage Rates*

  Date

  Men

  Women

  Boys

  Girls

  Male

  Female

  18th June, 1962

  882

  975

  78

  86

  2·4

  5·9

  16th July, 1962

  915

  1,005

  45

  74

  2·4

  6·0

  13th August, 1962

  939

  982

  211

  194

  2·8

  6·5

  10th September, 1962

  985

  1,018

  169

  175

  2·9

  6·6

  15th October, 1962

  1,026

  1,089

  105

  114

  2·8

  6·6

  12th November, 1962

  1,082

  1,118

  102

  110

  2·9

  6·8

  10th December, 1962

  1,129

  1,133

  82

  97

  3·0

  6·8

  12th June, 1961

  652

  796

  20

  31

  1·7

  4·6

  10th July, 1961

  672

  776

  12

  31

  1·7

  4·5

  14th August, 1961

  695

  783

  182

  112

  2·2

  4·9

  11th September, 1961

  737

  874

  45

  46

  1·9

  5·1

  16th October, 1961

  755

  868

  24

  31

  1·9

  5·0

  13th November, 1961

  735

  908

  26

  34

  1·9

  5·2

  11th December, 1961

  761

  888

  14

  26

  1·9

  5·0

  * Percentage rates of unemployment are given for males and females as rates cannot be calculated separately for men, boys, women and girls.

  Mr. Spriggsasked the Minister of Labour how many registered disabled unemployed workers have been out of work for more than 12 months in the St. Helens area; if he is satisfied with the percentage of disabled persons taken by employers from the register of unemployed disabled persons; whether he is satisfied with the methods used by employers to take the requisite quota of disabled persons within their own particular industries; and if he will make a statement.
  Mr. Whitelaw: On 29th November, 166 registered disabled persons had been

EMPLOYMENT

  St. Helens
  Mr. Spriggsasked the Minister of Labour if he will state, up to the latest convenient date, the number of wholly unemployed men, women, boys and girls, respectively, in the St. Helens district, for each month since June, 1962; what these figures represent as a percentage of the insured population in each category for each of the above months; and how these figures compare with the same period last year.
  The Parliamentary Secretary to the Ministry of Labour (Mr. William Whitelaw): As the reply consists of a Table of figures, I will, with permission, circulate it in the OFFICIAL REPORT.
  Following is the information required:
  unemployed for more than 12 months. I am satisfied that employers generally make every effort to employ the standard percentage of registered disabled persons required by the Disabled Persons (Employment) Acts and co-operate well with our Disablement Resettlement Officers in finding suitable employment for the disabled. The availability of suitable work far those unemployed must depend to some extent on the nature of each industry concerned.
  Mr. Spriggs: What is the hon. Gentleman prepared to do for the disabled worker who has been unemployed for

  887
  twelve months or more? These are very serious cases of people who cannot get employment. What special provisions is the hon. Gentleman prepared to make to find work for them?
  Mr. Whitelaw: I accept that this is, indeed, a serious point. I can assure the hon. Gentleman that our disablement resettlement officers do everything in their power to obtain suitable employment for these people and, in general terms, get every co-operation from the employers concerned.
  Dr. King: We know that most employers are co-operating in taking on disabled men, but can the Parliamentary Secretary tell us whether he does anything to those who do not co-operate?
  Mr. Whitelaw: The words "does anything" are, perhaps, difficult. In general terms, one would say that most employers certainly do co-operate very well. As the hon. Member knows, they are obliged to employ their quota under the Act.
  Mr. Spriggs: Will the Minister extend the jobs that Remploy is able to offer to the disabled unemployed worker?
  Mr. Whitelaw: The hon. Member will appreciate that Remploy, in the main, does a first-class job, but it is engaged in providing jobs for the severely disabled.

  Immigrants
  Mr. N. Pannellasked the Minister of Labour how many vouchers he has issued to Commonwealth immigrants since 1st July, 1962; and how many of these were to persons without special skills or jobs to go to.
  Mr. Whitelaw: There were 20,575 up to 7th December, of which 14,129 were for persons without special skills or jobs to go to. The figures for the period since the first vouchers were issued in May are 23,030 and 15,561. Of the total number of people to whom vouchers have been issued, about 4,000 have entered the country.
  Mr. Pannell: In view of the increasing unemployment figures, does not my hon. Friend consider that has right hon. Friend should be more circumspect in issuing
  888
  vouchers to immigrants without skills or jobs to go to?
  Mr. Whitelaw: I think my hon. Friend will appreciate that unemployment amongst Commonwealth immigrants in that period has, in fact, fallen slightly.
  Mr. Prentice: Will the hon. Gentleman confirm that in recent months there has been a sharp drop in the number of Commonwealth immigrants; and that in October the number of these people leaving the country exceeded those coming in to it? Does not that show that unemployment here is having an effect on this immigration; and prove that we on this side were right when we said that the Measure was not necessary?
  Mr. Whitelaw: I would accept the hon. Gentleman's first two points, but certainly not the last one.

  Bradford
  Mr. George Craddockasked the Minister of Labour if he will state the percentage of the insured population who were wholly unemployed at the latest convenient date for men and women, boys and girls, respectively, in the Bradford district; what were the corresponding figures for those on part-time; and how these figures compare with those at the same date last year.
  Mr. Whitelaw: Percentage rates of unemployment are available only for males and females. At 12th November, 2·8 per cent. of males and 0·6 per cent. of females were wholly unemployed in Bradford and Shipley, and 0·3 per cent. of males and 0·2 per cent. of females were temporarily stopped. Corresponding percentage rates among wholly unemployed workers at 13th November, 1961, were: males 1·6 per cent. and females 0·3 per cent.; the numbers temporarily stopped were negligible.
  Mr. Craddock: Will the Parliamentary Secretary please take particular note of the point in the Question in relation to boys and girls, because unemployment and the lack of facilities for young people are growing in the city?
  Mr. Whitelaw: I appreciate what the hon. Gentleman says, but at the same time he would probably agree that considerable progress has been made in finding jobs for the school-leavers in the area.

  Burnley
  Mr. D. Jonesasked the Minister of Labour how many disabled persons are registered in the County of Lancashire; and how many in Burnley.
  Mr. Whitelaw: On 12th November, 8,504 registered disabled persons were unemployed in Lancashire, including 222 in the Burnley area.
  Mr. Jones: Is not the hon. Gentleman aware that this is a very high figure indeed? Is he not further aware that there is no rehabilitation centre of any kind in Lancashire, and would he consider building such a centre in Burnley, where it would be very warmly welcomed?
  Mr. Whitelaw: I note that the hon. Member says. He will be aware, on the other hand, that there is a Remploy factory in Burnley which employs sixty severely disabled employees. I am sure he will think this is very valuable.
  Mr. Jones: I want to make it perfectly clear that there is a difference, which the Parliamentary Secretary should appreciate, between Remploy and rehabilitation, and I insist on my point that there is no rehabilitation centre in Lancashire. We need one, and Burnley would offer an excellent site for such a place.
  Mr. Whitelaw: I did start by saying that I accepted what the hon. Member put forward about the rehabilitation unit. I was not confusing the two at all, but I thought that he would be interested in the information about the Remploy centre.

  Unemployment Statistics
  Mr. Prenticeasked the Minister of Labour if he will introduce a system of calculating the total figure of unemployed from a direct survey, in view of the failure of the present system to record the number of non-registered unemployed and the consequential under-estimation of unemployment in official statistics.
  Mr. Whitelaw: No, Sir. The direct sample survey is very costly and is subject to sampling errors. Our examination of suggestions of this nature has always confirmed us in the view that the present system of counting the number of persons registered as seeking work on a particular day is the best practicable
  890
  method of measuring unemployment in this country.
  Mr. Prentice: Has not the Parliamentary Secretary seen a recent study in Washington comparing the American methods of assessing unemployment and ours? Is he aware that it confirms that a very large number of people who are unemployed do not register? If the American methods were employed in relation to our situation, would they not show a total of over 200,000 more unemployed than our figures now indicate?
  Mr. Whitelaw: I would not like to accept those figures. All I would say about the United States method is that it is certainly extremely costly and is also subject to appreciable sampling errors.
  Mr. Callaghan: If there is a possibility of a difference of 50 per cent. between the figures revealed by the Ministry's present methods and the new system used in the United States, does not the Minister think that he should make some inquiries? Would it not be quite intolerable if our unemployment figure were ¾ million and the Government were acting on the assumption that it was ½million?
  Mr. Whitelaw: I was merely indicating that I was not accepting what the hon. Member's hon. Friend said about the American sampling.
  Mr. Callaghan: But does the Parliamentary Secretary deny it?
  Dr. Bray: Has the Parliamentary Secretary any idea of the number who are below the level of the skills to which they have been trained? Can he possibly find out that information without a survey?
  Mr. Whitelaw: I could not possibly give those figures, and the hon. Member will appreciate that it would be extremely costly to obtain them.
  Mr. Callaghan: Why not take a sample and find out? If the Parliamentary Secretary says that he does not confirm it, I can understand that because he does not have the information, bust why not take a control sample and see whether the Ministry's statistics are accurate or not?
  Mr. Whitelaw: I said that I did not accept it, and I adhere to that.

WHITEHEAD IRON AND STEEL COMPANY
Sir F. Soskice(by Private Notice) asked the Minister of Power whether he will ask the Iron and Steel Board to have regard to the implications from the point of view of the public interest, and, in particular, of the interest of those employed in the industry, of the proposal by Stewart and Lloyds Ltd., to take over the Whitehead Iron and Steel Company Ltd., of Newport.
The Minister of Power (Mr. Richard Wood): I have been in touch with the Chairman, and I should certainly consult the Board formally if it became necessary to do so.
Sir F. Soskice: Would the Minister accept that the terms, purposes and scope of this projected take-over is one directly within the responsibility of the Iron and Steel Board and, through the Board, of himself? Has he been in contact with the company through his Department? If he has, is he able to give the House any information about the short-term and long-term purposes of this take-over? In particular, will it embrace the transfer of the Whitehead iron and Steel Company to some other area of Stewart and Lloyds' operations, such as Corby, or will the Whitehead Iron and Steel Company continue to operate in Newport? If it is to close, has the Minister, or any of his colleagues, taken any steps, or do they intend to take any steps, and, if so, what, with the object of safeguarding about 1,500 of my constituents who are art present employed in the Whitehead Iron and Steel Company?
Mr. Wood: The right hon. and learned Gentleman has asked me several questions. The responsibility of the Iron and Steel Board is contained in some of the subsections of Section 5 of the Iron and Steel Act, one of which provides that the Board shall consult producers and others concerned in order to secure the provision and use of plant. Another provides that if necessary plant is going out of use it is among my powers to make arrangements to keep it in use. I do not think that in this case either of those two conditions apply.
892
The right hon. and learned Gentleman also asked whether I had had contact with the company. I have not. The matter has so far not proceeded beyond an expression of intention by the company to negotiate with the Whitehead Iron and Steel Company Limited. It is bound to be a little time before any results of their discussion emerge, and it would be quite impossible for me at present to answer the latter part of the supplementary question about the precise operation of Whitehead's if this transaction takes place.
Sir F. Soskice: Is it not the case that this project for a take-over has been mooted and referred to in the Press for at least a week now? Is not this a matter which directly falls within the responsibility of the Board to exercise general supervision over the industry under Section 3 of the Iron and Steel Act, 1953? Has not the Minister ample powers, under Section 15 of that Act, to furnish himself, through the Board, with full information about the purposes, scope and ultimate objective of this take-over?
Will not the right hon. Gentleman exercise those powers? If, when he exercises those powers, he finds that one of the purposes is that the Whitehead Iron and Steel Company is to cease operations in Newport and ultimately to go to Corby, will he state what steps, if any, he and his colleagues propose to take with reference to the continued employment of those working now in Newport for this company, or whether he completely washes his hands of any responsibility for their employment?
Mr. Wood: I said quite clearly to the right hon. and learned Gentleman that I would certainly consult the Board formally if it became necessary for me to do so. I do not think that that point has been reached. Whether it will be reached in the future I do not know. I and the Government would watch employment, but it might be that if this transaction came off the effect on employment would not be deleterious but might be an improvement.
Mr. Nabarro: Would my right hon. Friend bear in mind that Whitehead's is not a basic steel producer but is largely concerned only with rolled and rerolled steel products? Will he bear in mind,

893
further, that the integration of White-head's into the Stewart and Lloyd's organisation might well result in much greater efficiency overall in the production of steel?
Mr. Wood: I did know of the process for which Whitehead's is responsible. I think that some of the reflections which my hon. Friend has given to the House may have been in the mind of the board of Stewart and Lloyds when it made this suggestion.
Sir F. Soskice: Is it not the case that the Whitehead Iron and Steel Company is by far the largest independent reroller? Is not its undertaking one of great importance to a number of other companies which have dealings with it, for example, Richard Thomas and Baldwin and other companies in the country? Is it not really a matter of vital concern that if there is to be any change in the future operations of this company the Minister should at once use his powers to inform himself about any changes and, at the earliest possible moment, give the results of his inquiries to the House and stare whether he intends to take any steps and, if so, what, with regard to the future operations of the company and the future employment of those now employed in it?
Mr. Wood: I have already told the right hon. and learned Gentleman that I have been in touch with the Chairman of the Iron and Steel Board and, therefore, am taking steps to inform myself as far as possible of what is happening, but I cannot think that it is right or proper at the moment for me to take formal action with the Board, because I do not believe that there yet exists any basis for so doing.

SKYBOLT MISSILE (TALKS)
The Minister of Defence (Mr. Peter Thorneycroft): With permission, I should like to make a statement on my recent talks with Mr. McNamara in London on 11th December.
The principal subject discussed was, as the House knows, the future of the Skybolt missile. We have, of course, known from the outset of our association with the United States Government on
894
this weapon that it constituted a formidable development problem. We knew of various difficulties that had arisen, and of the steps that were being taken to surmount them. Such difficulties, of course, were not unexpected, nor are they unusual even in simpler missiles.
However, when I visited the United States in September of this year, the situation was that while the increase in costs was causing concern, I was assured that American plans assumed delivery of Skybolt. It was not until the beginning of November that Mr. McNamara, while assuring me that no decision would be taken without the fullest consultation, informed me that the future of the weapon was under review. This consultation was carried a further stage last week, and will be continued between the Prime Minister and the President in the Bahamas.
From the point of view of the United States, the weapon is proving more expensive than originally estimated; secondly it looks as though it will be late and possibly not as efficient and reliable as had at first been hoped; and, thirdly, alternative weapon systems available to the United States Government have proved relatively more successful.
I have stressed throughout my talks with Mr. McNamara the serious consequences for the United Kingdom of a cancellation of this project, and I can assure the House that the United States Government can be in no doubt on that aspect of the matter. The discussions have, naturally, included the possibility that the United States Government might provide us with alternatives to Skybolt of which the most important is Polaris, but I would stress that no decisions either on Skybolt or on possible alternatives to it have been taken.
Since discussions between our two Governments have not been completed, I am sure that the House will accept that I cannot say any more at the present time. Indeed, as the Prime Minister said last week, it would not be in the interests of the country to do so.
Apart from Skybolt, my meeting with Mr. McNamara gave us an opportunity for informal and confidential discussion of a number of matters of joint concern to the two Governments.
Mr. G. Brown: Is the Minister aware that this is a very grave statement, and that, for the first time, he has admitted today what his predecessor and other Service Ministers, including the Secretary of State for Air, have persistently denied, which is that from the outset the Government knew, as the Opposition knew, that this was no more than a gamble, with very grave difficulties in the way of meeting it? These are the words which the right hon. Gentleman used.
Secondly, is the right hon. Gentleman also aware that he has admitted that the Government, as well as the Opposition, have known what has been consistently denied—that more and more difficulties were arising in the development of this weapon and that it was giving rise to very great concern?
May I also ask the right hon. Gentleman whether, in view of his statement today, this weapon, if it ever arrives, will be late—and the case for it always has been that it would be in time—that it will be less efficient and less reliable than we had hoped, and that other weapon systems are better? May I also ask what point there is in pressing the American Government to go on with it? Have we not had enough experience of equipping British forces with second and third-rate weapons by now?
Thirdly, in view of what the Minister says, would it not have been better to do what we have consistently urged, which was to face facts as they are, accept that there is now no possibility of us having an independent nuclear deterrent, and base our defence strategy in accordance with the facts and not in accordance with the political hopes of the party opposite?
Mr. Thorneycroft: I think that the right hon. Gentleman somewhat exaggerates his points. The development of any weapon systems of this kind is an incredibly complex matter, and to describe it as a gamble is an overstatement of the position. Every missile is under a constant storm of criticism from the moment of its inception, and this missile has been no exception. Nevertheless, up to now it has been in the American programme.
The question of the independent detterent is a wider point, and I do not think that it would be suitable, in ques-
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tion and answer, to go into the whole of that system.
Mr. Brown: Will the right hon. Gentleman answer the second part of my question? In view of the fact that the right hon. Gentleman has said today, that if Skybolt comes it will be late, and not as efficient and reliable as we had hoped, and that alternative systems are better, will he explain what benefit there is to British defence policy in going on with what is admittedly a second-rate or third-rate weapon?
Mr. Thorneycroft: The quotations which the right hon. Gentleman was giving were quotations from my statement, stating what the American view was on this matter.
Sir A. V. Harvey: Will my right hon. Friend confirm that the five successive failures of Skybolt were to some extent fringe failures? Is it not a fact that, at the same stage of development, Polaris had 13 successive failures? Will he also, confirm that as recently as September Mr. McNamara confirmed that this weapon was making good progress? Is it so, or not? Will he also convey to his right hon. Friend the Prime Minister in the Bahamas that some of us on this side, who want to see Britain retain a nuclear deterrent, are highly suspicious of some of the American motives, in so far as they briefed members of the Opposition early last year in a completely different way from what they told the British Government, and say that the British people are tired of being pushed around?
Mr. Thorneycroft: So far as the British position is concerned, I can assure my hon. Friend that I have stated it as forcibly and as clearly as I can. I think the United States Government are in no doubt whatever where we stand in this matter. So far as the failures are concerned, it is a fair point to take that a number of the failures were fringe failures, or otherwise, in early firing, which are common experience with many missiles. I would not take the evidence of these failures as being, of itself, in any way conclusive, but, naturally, these are 'matters to be looked at in a wider context.
Mr. Grimond: Is the Minister seriously saying to the people of this country that

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the Government are going on with this policy, which has proved such a disastrous waste and failure? Are they going to encourage the American Government to go on with Skybolt, or to spend an astronomical sum of money on some alternative? Does not this mark the absolute failure of the policy of the independent deterrent? Is it not the case that everybody else in the world knew this, except the Conservative Party in this country? Is it not the case that the Americans gave up production of the B52, which was to carry Skybolt, nine months ago? Does the Minister of Defence read the evidence given before the Congressional Committee, which has been critical of Skybolt for 2½ years? Will he give an assurance to the House that we shall not embark on Polaris without a reasonable estimate of what it will cost, and a more reliable estimate of the chance of success being put before the people of this country?
Mr. Thorneycroft: I am aware that there are men who believe passionately that we should strip this country of her deterrent—[HON. MEMBERS: "We have not got one."]—and rely exclusively upon a deterrent controlled from the United States of America. I do not share this view. The question, in any event, seems to be quite wider and a separate issue from this missile.
Mr. Eden: Is not this a very big letdown for us, particularly following upon the significant rôle of the bomber force of the Royal Air Force at the time of the Cuba crisis in support of the United States of America? Will not my right hon. Friend look seriously into the question of providing a British independent alternative to this particular weapon, and take every opportunity of seeking to associate other European countries with us in this?
Mr. Thorneycroft: It would be fair to say that the cancellation of this weapon would be a blow both to the United States and to Britain. So far as alternatives are concerned, naturally full consideration is being given to that matter.
Mr. Emrys Hughes: Would the Minister tell us whether Mr. McNamara has not completely called the bluff of the Government by offering the Government
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the Skybolt missile, and offering to let them take it over themselves at an astronomical cost? Will he tell us whether he is going to America to refuse this offer, or to accept it? Is he aware that it is very humiliating indeed to see the Minister of Defence and the Prime Minister going cap-in-band, crawling to the Americans, for something that is no use, and which will prove exorbitantly expensive to the people of this country?
Mr. Thorneycroft: I do not think that there is anything degrading in seeing allies discussing together matters of mutual concern.
Mr. Biggs-Davison: Although the Leader of the Liberal Party may not care, is not British independence in as great danger now as ever since 1940? Will the Government act on the precedent of 1940 and tell Parliament and the people squarely what we are up against and what sacrifices may be needed to keep British and European nuclear power and British national independence?
Mr. Thorneycroft: I think that I have already, on other occasions, stated my views about Britain's independent position, but I ask the House to have some consideration for the fact that I am leaving tonight to help in these discussions. I really do not think it very helpful to pursue them too far.
Mr. Shinwell: At any time in the Government's consideration of the possible purchase of Skybolt have they ever considered placing a ceiling on the expenditure that they would like to accept as a commitment in order to obtain this missile? Since the right hon. Gentleman said in his statement that he visited the United States in September and then learned that the expenditure was likely to exceed the estimate, did not he have any reaction as a result of that revised estimate? How far are the Government prepared to go?
Mr. Thorneycroft: The reaction was of some understanding and sympathy for the United States Government, who were, of course, in the main, bearing this additional expense.
Captain Litchfield: As a graduate of the National War College of the United States, may I ask my right hon. Friend to make it abundantly clear to his

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American opposite number that the handling of this matter by the American Administration, and, in particular, their treatment of Her Majesty's Government, has caused a most unfortunate impression in the minds of those who are the strongest supporters of Anglo-American co-operation?
Mr. Thorneycroft: We are speaking of, perhaps, our closest ally in this matter and we are about to confront this problem together. I am sure that we will find a way through it, and I ask not to be pressed to comment on it.
Mr. Wigg: Before the right hon. Gentleman accepts some of the strictures of the United States Administration involving the cancellation of Sky-bolt, will he have another look at his own record and that of the Government? Does he recollect, for example, that the House had not risen for ten days for the Summer Recess when the Government cancelled Blue Water, leaving the Army without a tactical weapon, or any prospect of getting one, and that last Christmas they cancelled PT428?
Is it not a fact that the humiliation which this country now suffers arises from the fact that the 1957 White Paper and the White Papers which followed it were political documents? Is it not time that this country—all parties and all sections of opinion—faced up to the realities of defence? Is it not time that the right hon. Gentleman took the lead in endeavouring to persuade all sections of opinion, not only in this House but in the country, that we must face the fact that we have great needs and very limited resources and that there has to be a balance between the two, otherwise the humiliation which we suffer today will not be the last or greatest,
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and that, perhaps, worse has yet to come?
Mr. Thorneycroft: I agree that one must relate one's forces to the resources which are available. I have not criticised anybody in the course of my statement, no one at all. All I have said is that here is a common problem, and that it is a very great problem, both to the United States and to the United Kingdom, and that we might be allowed a few days to try to solve it.
Mr. G. Brown: In view of the Minister's emotive words about people wanting to strip the country's defences, may we have this perfectly clear? This is a weapon that still does not exist. How can the right hon. Gentleman talk about stripping us of something that we have not got?
Secondly, will he make it perfectly plain that, even if his right hon. Friend is successful in persuading the Americans to go on with this project, there is still no certainty, or anything like it, that the weapon will ever be brought to fruition?
Mr. Thorneycroft: My purpose is to see that the British forces are equipped with the best deterrent weapons that are available. At one time I had the wholehearted support of the right hon. Gentleman in this matter. I hope I have it still.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: We cannot pursue this further today.

SKYBOLT MISSILE (TALKS)

  BUSINESS OF THE HOUSE (SUPPLY)
  Ordered,
  That this day Business other than the Business of Supply may be taken before Ten o'clock.—(Mr. Iain Macleod.)

ORDERS OF THE DAY

  SUPPLY
  [3RD ALLOTTED DAY]
  Considered in Committee.
  [Sir WILLIAM ANSTRUTHER-GRAY in the Chair]
  Motion made, and Question, That the Chairman do report Progress and ask leave to sit again—[Mr. Redmayne]—put and agreed to.
  Committee report Progress; to sit again Tomorrow.

UNEMPLOYMENT
3.57 p.m.
Mr. Ray Gunter: I beg to move,
That this House expresses its grave concern at the high and rising level of unemployment which is the result of the policies of Her Majesty's Government and calls upon the Government forthwith to adopt measures that will increase industrial production and ensure full employment throughout the United Kingdom.
I have never been told whether the Chancellor of the Exchequer is a very keen student of homiletics, which, to the uninitiated, is the art of preaching, but I thought that he delivered a very good sermon to the nation on 1st December, at Stoke Newington. He spoke in considered and very thoughtful terms. Obviously, it was a moment of truth and of candour. Plainly, he had escaped, or had slipped, from the shackles of the Tory Central Office for just a few moments when he said, of the British people:
"There is today a restlessness, a cynicism and a feeling of unease. … We have lost to some extent our sense of purpose."
I believe that the right hon. Gentleman was quite right. It was a moment of candour and of truth, and I know from personal experience that moments of candour can be dangerous but yet refreshing.
Much is said and written these days about obtaining a new sense of purpose for the nation, about how we are to find our new rôle in this world, which is so different from the world which we knew in the days of our imperial grandeur. Much is said and written about how we
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may come to a new sense of our destiny, but I remind the Chancellor of the Exchequer and other Members on the Front Bench opposite that the mere call to the nation to find this sense of purpose is no substitute for its achievement.
I am persuaded by the history books that the purpose and dynamic of our industrial life depend so much, in whatever period of history it may be, on the vision, courage and integrity of those who claim to lead the nation; and the response to those assets and virtues has, I submit, been the hallmark of the British character during the difficult years of our history.
I am at one with the Chancellor in believing that millions of the most thoughtful of our people today are uneasy and know deep within themselves that there is something wrong somewhere with the nation. We have recently been touching upon the raw wound of our pride. But it is not altogether a matter of pride, though our pride is hurt. After all, it is not very easy, within two decades of the Battles of Britain and of Alamein, to adjust ourselves to a situation where our friends and allies tend to write us off.
It is not alone a matter of pride, however. Many people in this country today believe that human values are being debased, and the Prime Minister brings us no balm at all when he rests his cold feet upon the history books in the belief that warmth and comfort can come from the record of our exploits, deeds and achievements in a world which, in every material sense, bears no relationship to the present world, and when the problems of the 1960s and 1970s have no relationship to those problems which our fathers faced.
I submit at the outset of this debate, upon what, to me, is the indication of the running sore of deeper problems, that it is the harnessing of the courage and the skills of our people to meet today's problems that will equip us to play what I still believe will be a formidable part upon the world scene in the future.
I hope that I shall always have reverence for the history of our people. It is a great history. I hope that I shall always respect the traditions and the rituals of our people. But I say that no

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amount of reverence or respect for tradition will avail us unless we can get our people to understand the nature of the problems with which we are now confronted in a world that is undergoing frightening changes. If we cannot arouse them from that disquiet, unease and cynicism of which the Chancellor spoke, and bring to them a sense of vigour and adventure in the pattern of their daily lives, then I do not see any great hope for the future of this country.
Therefore, I say to the party opposite that the first requirement to relieve this nation of its present state is that the people should be told the truth and that we should all understand that promises given for the sole purpose of maintaining political power, and remaining unfulfilled, will inevitably create the atmosphere which the Chancellor has described. They will inevitably bring a sense of distrust and unease.
My mother knew very little about many things—she was a collier's wife—but there is one thing that she always taught her children, that one of the worst forms of lying is to make a promise and not to fulfil it, for then there arise distrust, unease and cynicism.
Let us start with the promises that were made in 1959. In 1959, the Conservative election manifesto, which was headed "The Next Five Years" said this:
"Conservatism is more than successful administration. It is a way of life. It stands for integrity."
They might have interpolated a word about directorships for the boys. The manifesto went on to say:
"It stands for efficiency, for moral values as well as for material advancement. By raising living standards and by social reform we are succeeding in creating one nation. …"
It continued:
"So long as Conservative policies of sound currency and expanding trade are continued and unity at home maintained, full employment is safe."
I remember that the then President of the Board of Trade, now Lord Eccles, had a whale of a time going up and down the country and telling people at every meeting that if the Conservatives were re-elected the Conservative Party would approach the problem of local
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unemployment in a revolutionary manner. Indeed, on 14th September, 1959, he is quoted as having said that if re-elected the Conservative Party
"intend to tackle unemployment with the methods of mobile warfare."
I am not sure whether the President of the Board of Trade knew very much of what he was claiming, but the past three years' record of the Government has about as much relationship to mobile warfare as one jeep stuck in the Libyan Desert.
We have the promises and now we are in a position to judge the three years' record. From mid-October to mid-November the number of people unemployed has increased by 42,000, which, I imagine, is probably twice as much as could have been expected at that time of the year. Those figures give cause for deep anxiety, but the greatest anxiety that arises from that analysis is the pattern of those figures. It is this pattern that is frightening many workers in many parts of the country today. It is throwing their minds back—and we did not want them thrown back at this time—to the 1930s.
We are seeing emerging a predominantly prosperous Southern half of the nation and a basically declining North. We find 1·3 per cent. unemployment in Greater London; less than 1 per cent. in Oxford, Cambridge, Slough and Northampton; 2 per cent. or thereabouts in Birmingham; over 5 per cent. in Middlesbrough and Stockton; 8 per cent. in Hartlepools and Workington; and nearly 9 per cent. in Girvan and Greenock.
Commander J. S. Kerans Commander J. S. Kerans (The Hartlepools) rose—
Mr. Gunter: I should like to finish this point before I give way.
We see this emerging pattern. We have moved into the most serious unemployment situation since before the war, and the Government have failed miserably to understand the true nature of the problem. I have no doubt that the Chancellor of the Exchequer will this afternoon claim that he has done something recently, by reflation, Purchase Tax cuts, higher investment allowances, and so on. I have no doubt that the Board of Trade will claim that it, too, has done something to

905
channel industry into the worst areas. But the indictment of the Government today is the usual one, the ever-justifiable one—too late and too little.
If these measures had been introduced early in the year there might well not have been the tragic situation that has emerged in Merseyside, Wales, Scotland, West Cumberland and the North-East Coast. We would like the people in those areas to understand that their present plight is entirely the responsibility of the present Government because of their lack of vigour and planning. I hope those who live and suffer there will protest in the not-too-distant future.
Mr. Paul Williams: If the hon. Gentleman's thesis is right, what he is saying is that the Chancellor's remedies will in due course solve the problems of the North-East. This is just what some of us are not saying.
Mr. Gunter: Neither am I saying it. All I say is that the Government will claim it. I do not propose this afternoon to survey the whole of the areas. There are many hon. Members on both sides who will, no doubt, give the most detailed attention to the areas from which they come. I should, however, like to pick just one or two examples.
Over the months, it has been an experience to witness hon. Members on this side of the House from Scotland trying desperately to get attention from Ministers. This problem has been before us for years. The heart of the problem in Scotland is the lack of balanced industrial development. Since 1948, the rate of unemployment in Scotland has been double that of Great Britain as a whole and sometimes four or five times as much as in the Midland region.
This tragedy in Scotland, and, indeed, now in parts of the north-east of England, is deepened because of the long duration of unemployment. These facts might have been much worse. They must be seen against the migration of large numbers from Scotland to the South and abroad. It is, perhaps, of interest that the Registrar-General for Scotland estimates that for ten years the annual rate of migration has been about 25,000 each year. Week after week, month after month and year after year, hon. Members on this side have been pleading for action.
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All we have had is the reply, "Well, things are not as bad as you try to paint them. There are plenty of jobs in the pipeline. If you hold your heads up and wait a bit, the jobs will come." They have never come. We have the same kind of aspect on the North-East Coast and on Merseyside.
In quoting the Sunday Times, I know that I am in good company. I was interested to read what it says of Merseyside:
"When Merseyside, then a fully-recognised development area, ceased to qualify for Treasury financial grants in 1960 it was believed"—
these are the beliefs that Ministers hold from time to time—
"that some 34,000 new jobs would be available by 1965 (against an unemployment register then standing at 19,000). This was made up largely by the … Ford offshoot at Halewood, a rather smaller Vauxhall expansion (going ahead smoothly and without publicity), a considerably smaller Standard-Triumph factory, of which the first brick has yet to be laid, and the rest accounted for by the component firms which were expected to spring up in the district."
This is the important part of it:
"In fact, since then, not only has the number of likely new jobs been trimmed to a much more glumly realist 14,000, but no fewer than sixteen of the brand-new post-war factories on the trading estates at Kirkby and Speke, then operating full blast, are now standing empty
'Takeover' is a fairly dirty word in Liverpool, where the Plessey merger with Automatic Telephone put nearly 700 men out of work, and the recent Courtaulds deal closed a substantial part of the British Enka fibre plant. A clothing works and a tyre factory closed. Dunlop stopped making rubber footwear. And as Lieut.-Col. Burford, Secretary of the Liverpool Chamber of Commerce, acidly says: 'There's not much point in the Government taking powers to direct industry to come, if they don't take powers to prevent them being stripped out again at a moment's notice'."
Mr. Gerald Nabarro: The Government do not direct, in any case.
Mr. Kenneth Thompson: May I say, on a matter of fact, that Dunlop's largest rubber shoe factory is still operating at full blast in my constituency?
Mr. Gunter: I will write to the Sunday Times.
It could well be that this afternoon the Chancellor will advance some further ideas for dealing with the situation. We

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hope so. We do not know, but rumour has it that there may be reliefs by way of tax inducement for firms to go north. It has been said—I think, in The Times—that possibly a Minister will be appointed to co-ordinate all the efforts of the various Ministers. I have learnt a lot about co-ordination on railways. I sometimes wonder whether there is not a theory abroad that when one is in a mess, one co-ordinates a lot of smaller areas of incompetence and simply creates a bigger area.
We should have few illusions this afternoon. We are entering a general election year. We have had three years of stagnation and, possibly, we may now have a year of expansion in time for an election. I do not know. We are, however, bound to ask, if the Government are in earnest, why it is that only now they are doing things which they know should have been done long ago.
The Chancellor has expressed great confidence that his measures will work out. If that be so, why, were they not introduced before this distress rose to its present proportions? Perhaps the Chancellor will tell us why, despite all the election promises and all the warnings that have been given over the past few years, the position has reached the state that it has today.
Unfortunately, there is a general belief that unemployment will grow in size and misery over the next couple of months. It could be that in the spring there will be a wonderful consumers' pre-election Budget. Possibly, there could be a withering away of a measure of unemployment; the spectre will withdraw for a bit and will then reappear. What a way that is to run a country! What a way to trade upon men's livelihoods and careers! If the Government really wanted to tackle this problem, there are many things that could have been done. There is so much that is obvious.
A former President of the Board of Trade, to whom I have already referred—Lord Eccles, who, following the falling of the guillotine in July, has joined the revolutionaries in his after and purer life in another place—now sees things differently. He speaks of the need for real action. He speaks of £200 million a year, for ten years, being devoted to deal with this tremendous problem in these areas.
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He advocates great spending on public works, roads, slums and schools. This is what ought to be done. Now is the time to do it.
It is some of the areas which contributed so much to our industrial prosperity that bear the most wicked scars of the first Industrial Revolution. Now is the time to clean them, to prepare and to equip them for the unfolding second industrial revolution. We cannot allow areas like Scotland and the North-East Coast to wither away.
I do not deny that industrial development certificates are valuable. I wish that the Government had shown a little more zeal to capitalise their value. In certain ways, these certificates have a negative value; they are a negative instrument. They tend in some ways to discourage successful firms from expanding when those firms could, and should, expand. When they are driven northwards by necessity, they tend sometimes to withdraw quickly when the cold winds blow.
Surely, what is required in these areas is a bold, imaginative approach to make these places attractive to the industrialists of the South. Not only must they be given priority, but they must be made attractive. They have a long history of craft and skill. If we really wanted to, we could develop imaginative schemes to this end, remodelling their transport and their services, bring the new technical colleges to them and fully equipping them to take part in the changes which are going on around us.
I submit that this should be part of a great and imaginative national plan. We must not carry on tinkering about with "ambulance" services for this or that locality, trying this or that trifling method to ease a problem as it arises in some locality or other, hastily devising ill-defined measures to deal with it. If we are to regain our place in the world, we must plan our economic growth. We must define the targets for our industries in these areas, and this means that, where the distress is greatest, there should be, as Lord Eccles suggested, great schemes of public works to provide immediate relief of unemployment and, at the same time, lay the foundations of future development in terms of transport, housing, power, water and the rest.

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The task demands great powers of planning, of co-ordination and of vision.
I have already said that the areas which now reveal their great distress are, as it were, sores which indicate, perhaps, a deeper trouble. There are other aspects of our situation which demand immediate attention. No matter on which side of the House we sit, we all know that dramatic changes are now unfolding in British industry. One of the priorities is to realise that, during this most difficult period, when the processes of manufacture are being altered, and when, inevitably, there will be redundancies in this industry or that, industrial relations are of paramount importance.
We can equip our people for change, but, if the economy is not alive and responsive to change, there will be little hope. There are several things which require immediate attention. I have said in the House before that perhaps my greatest love is industry, not politics. Looking at these things as an industrialist, I feel that one of the most damaging features in our industrial life today is the exaggeration of every minor industrial row. Every minor row, every unofficial strike, is blown up to exaggerated proportions by the Press and, so it appears from the Order Paper, by hon. Members opposite who, apparently, want Parliament to legislate.
I say clearly and seriously that all unofficial strikes are bad, but the men are not always to blame. An analysis of unofficial strikes reveals some startling facts. Men can sometimes be driven too far. After all, they are British.
Mr. Nabarro: Some of them come from Moscow.
Mr. Gunter: That is the very outlook I am referring to. That is what is damaging the whole fabric of industrial relations in this country. It is the attitude which is bringing spleen and bitterness where we want decency and understanding.
I put this to hon. Members opposite, to those who accept their responsibility in industry. What is the good of my blasting bad mangement every day, and their blasting unofficial strikers every day, when the aim should be to develop
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in the changing pattern of our industrial life the best relations in order to discover the art of living together in harmony for the welfare of us all? I submit that the Government have not been strong enough in making their protest against what is said and done by some of their own supporters and, indeed, by some organs of propaganda in this country. We must try to diminish the bitterness which is abroad.
I have purposely raised this subject this afternoon because I am convinced that the Government must accept much of the blame. Hon. Members opposite so often fail to understand—the hon. Member for Kidderminster (Mr. Nabarro) has not got a clue about it—that disputes about who is to bore the holes, disputes which arise on matters of demarcation, and so forth, disputes which appear sometimes to be so trivial, are really about the fear of unemployment.
Mr. Nabarro: Rubbish.
Mr. Gunter: Men want to retain their jobs, perhaps irrationally, and they are afraid of unemployment. The Government promised that we should have full employment. If we can instil into the minds and hearts of those engaged in industry a real sense of security about full employment, many of our troubles will diminish.
Now, a word about mobility of labour. It must be appreciated—some of my colleagues in the trade unions are appreciating it more and more—that to insist on anything like complete rigidity of labour would be foolish. Retraining in new skills, in apprenticeships, sometimes to new industries, presupposes a measure of movement in labour. There must inevitably, in the changing pattern of industry, be a certain amount of movement.
Redundancies are bound to occur. Men fear redundancy, too. The Government have failed to show any imagination in this matter. Their attitude at times is pathetic. Last week, the bugles blew and we had the "Workers' Charter". What does it mean to a man who has spent forty years with the same firm? He might have joined that firm when he was 15 years of age. At 55, he is declared redundant, and the "Workers' Charter" means that he gets

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four weeks' pay. That is not the way to deal with these changes. The Government's great lack of imagination and vision is further revealed.
Is it not time that we thought in wider terms? In this matter of redundancy, why should we shrink from wider national legislation? It is significant that when, in 1961, the International Labour Office, at Geneva, conducted an inquiry and questioned 65 nations, the United Kingdom was the only one to declare that severance rights for a worker should be left to voluntary negotiation for settlement. In this changing world, it must be a national responsibility to deal with what happens as a consequence of change.
There are many people to whom the word "unemployment" does not mean a great deal today. It would be a great pity if those charged with the responsibility of government at this time failed, in an atmosphere of cynicism, unrest or lack of purpose, to realise that unemployment may become of more than academic interest to many more people during the next decade or so. The Americans have coined a new word for a modern phenomenon, cybernation. It is the science of linking the electronic computer with the automatic machine. A study recently conducted in America revealed that not only unskilled, semiskilled and even skilled workers have no part in many sections of industry, but that even middle-level management could find itself declared redundant as a result of the development of this new system.
There is no longer any strong reason to suppose that in twenty or twenty-five years man can always be in effective control of machine operations. Computers have already been designed which can store facts in the memory, and virtually learn from their own "experience" or even from their own mistakes. Their capacity and speed of operation mean that they quickly outstrip the human capacity for performing the same functions. This is not a bogy. More and more of these systems are now being introduced into industry in America. More and more they will increase over the years ahead.
Therefore, I want to say that if ever there was a time when we required leadership in this country, leadership in
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tune with these problems of employment or unemployment, not only the immediate problems but those which we see, looking into the future, it is now. There are grave problems. We in this country, I repeat, with our skills and experience, should be on the eve of great things, so long as we understand, in all these changes, that to withhold from anyone the right to work is to hurt him badly.
I believe that if this nation can be brought back to a sense of purpose, brought back to understand that human values will always surmount and ought to surmount everything else, we can win through. People are uneasy; they are without a sense of purpose. Maybe, ere long, they will hurl from office those who have brought them to this state, and bring to power, I hope, those—to be found in my own party—with vision about the future rôle of Britain.
I believe that within the next few months we may possibly have a General Election, when, I believe, my own party will be returned to power, because this is the party which is relevant to these problems, which understands the nature of the present problems of unemployment, and is geared to and in tune with future developments. The party opposite has proved that it is incompetent to deal with the immediate problem. I see no hope that it will grasp the difficulties or realise the hopes which lie before the nation.
4.33 p.m.
The Chancellor of the Exchequer (Mr. Reginald Maudling): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
"shares the concern of the Government at the recent rise in the level of unemployment and supports the actions of Her Majesty's Government to deal with the problems of certain areas particularly affected and to promote general industrial expansion on a sound basis".
The hon. Member for Southwark (Mr. Gunter) has moved the Motion in terms of great sincerity and seriousness. There is a good deal in what he said with which I would entirely agree—the need for change, the need to recognise the necessity for change and to grasp the opportunities which it contains, the need for good industrial relations, the danger of allowing these disputes, difficult as they are and dangerous as they are, to give the impression of a general climate of

913
labour relations which can be distorted, and the need to give to areas with relatively high unemployment attractions to industry which will bring industry there.
With most of what the hon. Member said I must say I find myself in agreement. In particular, I agree with him that the duty of anyone speaking on this subject at the moment, or, indeed, at any other time, is to tell the country the truth and not to hold out promises which cannot be fulfilled, and I shall endeavour during the course of what I have to say this afternoon, to follow strictly that precept, to set out the problems as I see them, and to say what the Government are endeavouring to do about them.
Perhaps I may permit myself just one party crack in a sense. Although the hon. Member made criticisms of the way in which the Government have acted, and said much about what they ought to do, I did not notice in his speech many very positive suggestions which we might follow—
Mr. Nabarro: None at all.
Hon. Members: That is the Government's job.
Mr. Maudling: It may be argued that it is not the function of the Opposition. We have, in fact, done quite a lot, and we shall be doing more.
There are two problems facing the Government and the country at the moment. One is the problem of unemployment; the other, the problem of achieving and obtaining a high level of expansion, a higher growth rate. The first, problem, unemployment, is certainly, in human terms, the more urgent. With that we entirely agree. The second, in economic terms, may be perhaps more fundamental in the long run. We must keep both in view at all times, and they are, of course, interrelated.
Prospects of employment, like prospects for OUT living standards in this country, depend upon getting a higher rate of growth and a more stable rate of growth in our expansion. Short-term expansion by methods which may soon bring a return to inflation and balance of payments problems would, in the long run, be self-defeating. A more rapid and a more sustained rate of growth, I accept entirely, must be the first objective of our policy at present.
Mr. Archie Manuel: Do I take it from what the right hon. Gentleman is saying now that he does not mean to do anything in the short term about unemployment? He is saying that growth is the only way, taking a Long-term view. In other words, he does not mean a crash programme of public works to ease the present unemployment problem and difficulties, but he is thinking of a long-term programme and would 'starve immediate needs. [HON. MEMBERS: "No."] What are hon. Members grumbling about?
Mr. Maudling: I hope that the hon. Member will be patient, for I intend to deal with this problem. I have a lot to say on these various problems, and I hope that he will bear with me if I do not answer him immediately. I hope that he and his colleagues will allow me to develop my points and to answer the hon. Member in the course of what I have to say.
In looking at the problem of unemployment we must be clear what the nature of the problem is. It is a twofold problem. There is the general problem of the level of unemployment in the country as a whole and there are special problems in particular areas, the North-East, Scotland, and Ulster, where there is a level of unemployment well above the national average.
Mr. Frederick Peart: And West Cumberland.
Mr. Maudling: I hope that I shall be allowed to deal with this problem as a national problem and not as an essay in competitive constituency propaganda.
Mr. Peart Mr. Peart rose—
Mr. Maudling: I hope that the hon. Member will forgive me for not giving way, but I want to develop my argument.
There are two problems, the general and the local, and they overlap to a considerable extent. For instance, weaknesses in heavy industry, steel and shipbuilding affect local difficulties, particularly in some areas, and the general difficulty already overlaps. As the Leader of the Opposition pointed out the other day, general expansion, not only in the context of particular areas, affects both the local and the general problem. General measures to expand

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the economy, which may be quicker and simpler, may get us more quickly into positive balance of payments difficulties. On the other hand, where there are particular problems, they may be more persistent, and may be more deep-seated and more difficult, but they could be tackled, and are being tackled, by methods which have less effect on the balance of payments.
Taking these two problems, the general and the local, I shall try to develop my argument, first, by analysing the situation we are facing in both cases, and, secondly, by outlining the way in Which the Government are tackling, and intend to tackle, this problem.
First, on the general employment situation. Let us, above all, get this into perspective. The present figure, 2·4 per cent., is too high—I would accept that—but really, to argue, as some people do, a comparison between that and the 1930s is absolute nonsense. There is no possible relation between the figures at present and the figures, or the conditions, of the 1930s, and to suggest that there is, is doing positive harm to the prospects of solving the difficulties. What is more, the present figure of 2·4 per cent. is below the definition of "employment" given in the classic case put in 1951 by the Labour Party-3 per cent. at the peak of the seasonal unemployment. That is true; I looked it up.
Because of the present general unemployment we must, as I say, look at this matter carefully. First, there is the seasonal position. There is no point in disregarding it. With the winter weather, employment in the construction trades, agriculture, and so on, falls off. Every year we get rising unemployment during this period till January or February, and then it falls off again. This is a seasonal movement that no one can ignore and no one can deny. Another point that I would make is that this year there has been a substantially higher number of school-leavers to be absorbed than in previous years. [HON. MEMBERS: "We told you that."] They have been absorbed encouragingly well. But this has added to the general problem.
Throughout recent months there has been a decline in demand for labour
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against a background of rising production. This is the exceptional feature. Throughout the first nine months of this year, while production has been rising, unemployment has also been rising. The clear deduction from this is twofold. First, we are seeing the fruits of the high level of investment in recent years—greater economy in man-power, greater productivity per man, and so on. Secondly, there has been, quite clearly, under the pressure of more competitive conditions and lower profit margins, a desire for employers to reduce their establishments and their manpower requirements because they have found that they can produce more with fewer men, with modern methods and better organisation.
This is, on the one hand, a good thing because it means that we are more competitive and costs are lower, and the future of everyone in this country depends on lower costs and greater competitiveness. On the other hand, there is the fear in people's minds that the effect of higher productivity with modern machinery must mean higher unemployment. I am sure that this is absolutely wrong, and we must assume that it is wrong and work for the purpose of proving that it is wrong. Throughout mankind's history we have been looking for means of getting machines to do the work for us. Now that we are more and more finding ways of getting machines to do the work, we must regard it as a blessing and not a disaster.
The deduction from this is that there is more slack in the economy than one would have thought six months ago, and that productivity is potentially greater, and we must make use of that higher productive potential.
Mr. Dan Jones: Since the right hon. Gentleman is putting forward the argument that a level of unemployment now is inevitable, does he not agree that benefit reforms must be inevitable, too?
Mr. Maudling: In the first case, what I said was the opposite of that. The second matter I will deal with later.
Demand has been rising fairly steadily throughout the year. Public expenditure particularly has been rising rapidly, and so have exports. Production has

917
been rising in the first three-quarters of the year. The main slack has been in private investment, for a number of reasons—lower profitability, doubts about the Common Market and doubts about the possible trend of the American economy. Investment in private manufacturing industry has, for various reasons, been slackening off. That is why as long ago as the summer we decided upon substantial increases in public investment at a time when private investment was likely to slacken.
Recent signs have been that after the third quarter the increase in exports has been flattening out, and possibly the same thing has been happening to production. It was against this background and against the background of consumer demand, which has not been rising as fast as we expected largely because savings, as recent figures have shown, have been growing very rapidly, that the Government introduced in October and November the very substantial measures to put further purchasing power, further stimulus, into the economy as a whole, to which I will refer again a little later.
That seems to me to be the best analysis I can give of the general level of unemployment and the reasons for it.
I turn for a short time to the special problems. Great progress has been made under the Local Employment Act, 1960. [HON. MEMBERS: "Rubbish."] HON. Members may say "Rubbish", but let them consider the facts before they make those noises. The amounts involved have been quoted previously—already more than £75 million, involving about 80,000 jobs.
As to the methods, undoubtedly our tough I.D.C. policy and inducements are right. If anyone doubts whether our I.D.C. policy has been tough, let him look at the much publicised case of the Slough Estates Company, which would have liked to develop in the North but could not do so, stating that it could not compete with what the Government were doing in the North. Let hon. Members look at that. That is as good a proof of our policy as I have seen.
The problem has changed. What is so interesting is the change which has
918
taken place since the Act was introduced. In 1960, people were talking about "development districts" now they are talking about "the North" and "the South". That shows how the problem has changed. Take, for example, the problem of Wales, about which we heard so much in 1960. It has been transformed. I was responsible for the Act and its early administration. We must look at the practical effects. What happens when industry is expanding rapidly, as it did in 1960 and 1961, is that it is much easier to get industries to go a short distance, to Wales or to Merseyside, as we succeeded in doing, than it is to get them to go further afield to the North-East and Scotland.
It was our policy—I think it was right, and I think that the House accepted the policy when we were passing legislation—that we should not discriminate between development districts. I think it is clear that when one is getting industry to move out of the crowded Midlands and the South it will go, first, to Wales and Merseyside before it will go further afield to the North-East and Scotland.
By the end of last year we could justifiably claim as a result of all that we had done and with the development in prospect that the problem had been largely confined to Ulster and Scotland and the then threatening position in the North-East.
Mr. Charles Loughlin Mr. Charles Loughlin (Gloucestershire, West) rose—
Mr. Maudling: I cannot give way. I want to continue with my argument.
Mr. Peart: What about West Cumberland?
Mr. Maudling: It was for very good reasons that we moved West Cumberland from the development districts list. It is an example of the very good development that we have had.
That was the position at the end of 1961. Since then there have been the following experiences. In Ulster, a great deal of excellent work has been done recently, despite the great difficulty of the pay-off in the shipyards. But we must remember, whatever the relative position of Ulster, that the absolute position there is worse than anywhere else.

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Secondly, in Scotland difficulties have persisted, and on the North-East Coast there has been a sharp deterioration, which shows itself in the figures. On Merseyside, there has been a disappointment. I remember so well the business of the motor car firms going to Merseyside. I remember very well myself persuading the Ford Motor Company to go to Merseyside and operate there with other motor car firms. Such development on Merseyside can, and will, make an enormous difference to the whole picture there. After getting the Ford Motor Company to go there, it is heartbreaking to me to see what has happened in the last few months.
I would sum up that the Local Employment Act system has created many jobs and will create many more. The pace at which we can move will depend on the general expansion of the economy. Investment, as I have said, is overhung by the uncertainties of the Common Market, and so on. Distance between the main producing and consuming areas has proved to be a very great handicap to outlying districts. It has proved, in practice, especially difficult to persuade firms to go to the North-East. This is a fair summary of the position that we have to face.
Mr. Sydney Silverman: Does not the right hon. Gentleman agree that the operation of the Local Employment Act is arbitrary in the extreme and that the decisions taken under it are very hard to justify to the people concerned? The north-east Lancashire belt stretches from my constituency to Burnley and down to the constituency of my hon. Friend the Member for Clitheroe (Mr. F. Pearson). This is a district where unemployment is as high and as persistent as anywhere, but not merely is it not scheduled under the Act but the President of the Board of Trade has refused to discuss it at all with hon. Members representing constituencies in the area.
Mr. Maudling: I was trying to deal with these problems on the basis of a national problem and not on the basis of competitive constituency considerations. Certainly, the method used under the Act is arbitrary in the sense that it involves decisions by Ministers, but it
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is nothing like so arbitrary as what is proposed by right hon. and hon. Members opposite. Anything so arbitrary as their system of planning I cannot imagine.
I want now to turn from the analysis of the situation to the policies which the Government have been pursuing. First, there is the general level of unemployment. We have been tackling that problem with a series of measures to expand demand. Obviously, that is the right way to tackle it. These measures must not be indiscriminate. We have been upbraided in the past by the right hon. Member for Huyton (Mr. H. Wilson), for example, for what he called a "frothy" consumer goods boom. We must not fall into the error of inviting that criticism again. Nevertheless, I must say that some of the suggestions coming from the Labour Party seem rather to fall into that error.
We must be discerning in the impetus we put behind the economy, first, because a steady and more rapid rate of growth means more investment above all, and because it is investment, particularly, in manufacturing industry which is showing slack or lagging behind at present, and, secondly, because we must keep a constant watch on the balance of payments. We must not overlook or neglect this factor.
We should not go too much on one month's figures, but the November export figures, for example, were disappointing, and this underlines the importance of watching the balance of payments always. Expansion of home demand that does not lead at some time, though not immediately, also to an increase of exports will obviously cause difficulties in our balance of payments, because expansion of home demand must always of itself lead to an increase of imports.
This is the reason for the nature of the measures we have taken to date, aimed as they are at encouraging investment, helping exports and, in the case of post-war credits, at a temporary boost to consumption. I would like to run quickly through these measures because, in sum, they are quite formidable.
Our measures were the release of special deposits and the ending of special restrictions on bank lending, an increase of £70 million in public investment, the

921
release of over £40 million of post-war credits, the reduction of Purchase Tax on motor cars, and very large improvements indeed in investment and capital allowances generally. The sum of money involved in all this should not be underestimated. These measures will have their effect, progressively, and in the long run the effect will be large. We must not underestimate, especially, the growth in public expenditure. I will say something about this.
The estimates of public expenditure this year compared with last year were up no less than 8 per cent. and there are substantial Supplementary Estimates still to come. So far as I can judge from the information I have at the moment from various Departments, the Estimates for this year will show an even bigger increase than last year and this will be especially marked in the social services—education, housing, etc.—and in assistance to local authorities. This is a measure of what we are doing in this field. We are pressed, indeed driven—quite rightly—by hon. Members on both sides of the House to expand these activities.
The hon. Member for Southwark referred to the need for more public investment. I said in my Mansion House speech that investment next year would be up by about £175 million. Additions, however, to the electricity programme are being worked out, and so the final figure is more likely to be £200 million of additional public investment.
All this is calculated before allowance is made for possible increases in social benefits which, as the House is aware, the Government have under review at the present time.
I want to make this clear and not burk the issue: public expenditure, both capital and current together, is the most expansive force in the economy today, by deliberate decision of the Government. This entails the fact that, for the time being, public expenditure will take a rising proportion of the national product. I recognise the difficulties of this. It is not a tendency I like to see, but I think that it is right at the present time.
If the House wishes to prove the seriousness with which we are tackling the problem of unemployment, both central and local, no better proof can be found than the degree to which we
922
are expanding public activity, both current and capital, in the nationalised industries, housing, schools, roads and all the things for which hon. Members are asking. All I say, in addition, is, "Let us look at what is being done." Anyone who presses us to go further and faster must calculate the cost that is likely to arise at the time when it makes itself fully felt, some time next year.
I turn now to our policy for local unemployment. We shall certainly continue the system of the Local Employment Act, which is basically sound. [HON. MEMBERS: "No."] If it is not, then I do not know why the Labour party did not vote against it. Hon. Members opposite seemed to like it at the time.
Mr. James Callaghan: I have read the debate on that Act. The criticism of the Opposition was focussed at the time by the late Aneurin Bevan and by my right hon. Friend the Member for Llanelly (Mr. J. Griffiths) on the point that the Act would take far too narrow a view of the picture and that development areas were the proper basis on which to plan.
Mr. Maudling: I was responsible for the passage of the Act and I cannot remember either Mr. Bevan or the right hon. Member for Llanelly (Mr. J. Griffiths) taking a large part in our debate. I think that the hon. Member has the wrong Bill.
Mr. Callaghan: If the right hon. Gentleman will look up his Second Reading speech on the Act, he will see that this was precisely the point made by Mr. Bevan when he interrupted the right hon. Gentleman during his speech.
Mr. Maudling: I cannot recall precisely what was dealt with during the many and long debates during the passage of the Act, and I suggest that the hon. Member reads those debates as a whole.
Certainly, our system of I.D.C.s, which we are administering vigorously, is accepted by the Labour Party. I do not think that right hon. and hon. Members opposite would put forward the proposal that industry should be directed into particular areas. I remember reading the powerful argument by

923
the hon. Member for Cardiff, South-East (Mr. Callaghan) himself at the recent party conference, when he pointed out the difficulties of direction, and no doubt he will also have the opportunity to enlighten us later. The Opposition's policy is not to direct firms to these areas, and in that they are right. [HON. MEMBERS: "Oh."] There may be some hon. Members opposite who disagree and no doubt they will make themselves clear. I am speaking of official party policy.
The inducements being offered to industry are very large. I have already quoted the figure of over £75 million. We must not, however, get on the basis of assuming that developing industries in these areas should be based on a permanent subsidy. We want to help industries to establish themselves in these areas but industries which, once established, will be capable of working on a profitable and viable basis.
In addition to these industries brought in under the Act, we have, as my right hon. Friend the President of the Board of Trade has already announced, been producing plans for a substantial number of additional advance factories—an important development—in Scotland and the North-East, where they are most needed.
We must not let our efforts to bring in new industries to these areas obscure the fact that it is fundamentally upon the initiative of the areas themselves that development will depend, particularly for new products and new ideas. It is the ingenuity of the people and firms there which must be encouraged. They must not look entirely, as sometimes people do, to the importation of new ideas and products from other areas. Of course, that is desirable and will help, but it must not obscure the basic problem of encouraging all that is best in the enterprise and skill of these areas.
There must be a seizing of the particular opportunities. Perhaps I can give one example—the motor car industry in Scotland. I think we all hoped, and still hope, that the arrival of the big motor car assemblers in Scotland could be followed by the arrival of component manufacturers there. But it is not only a question of bringing component manufacturers to Scotland. What about the
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Scottish engineering industry developing its own component manufacturing? Surely the arrival of the assemblers should be regarded as a real opportunity for Scottish manufacturers to develop production in this way.
The two things must go together—the import of new firms and the development of local enterprise. It is because of the importance of developing local enterprise that we are backing up the Local Employment Act by measures of expenditure designed to improve the amenities and facilities of the areas themselves. The hon. Member for Southwark rightly referred to the importance of doing this.
The £70 million of additional public investment expenditure, to which I referred earlier, is being particularly concentrated, as far as possible, in areas such as Scotland, the North-East and Merseyside where there are idle resources and more people looking for work. There is a definite bias in favour of these areas in allocating this expenditure.
Mr. Thomas Fraser: Is the right hon. Gentleman not aware that according to his White Paper on Public Investment the amount of money to be spent on classified roads in Scotland is next year going down by £1½ million? Is he further aware that the amount of money spent on factory building is also to be reduced from £11 million this year to £9 million next year?
Mr. Maudling: What I was saying was that the £70 million of additional expenditure—[HON. MEMBERS: "Answer."]—I do not carry those figures in my head. What I do carry in my head is the fact that in this additional expenditure of £70 million special bias has been given and is being given—
Mr. Ernest Popplewell (Newcastle-upon-Tyne, West)Mr. Ernest Popplewell (Newcastle-upon-Tyne, West) rose—
Mr. Maudling: No, I will not give way. I am responsible for these things and I know precisely what is being done, and this is what is being done. If we take, for example, road expenditure, to which reference was made, and take the North-East—this is a very good example—I would have thought that road expenditure in Scotland was pretty high. As I have said, I do not carry the figures

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in my head, but my guess is that public capital expenditure per head in Scotland, out of the total Exchequer expenditure for Great Britain as a whole, is very high. If we look at roads in the North-East we see that we are, taking this year and next year, doubling the expenditure and, in addition, we are allowing another £¾4 million on top to be spent on further road development on the North-East Coast.
Together, I think, all this additional investment expenditure will fairly fully absorb the skills of the building and construction industries in these districts, but as they are taking time to develop fully I am looking for ways of encouraging further quick schemes in Merseyside, Scotland and the North-East. We have decided to allow local authorities in those areas to start capital works of a small nature of up to £15,000 or so by the end of the financial year if they can be finished by the summer. It is a useful and sensible contribution, but if hon. Members opposite do not want it that is another matter.
I am sure that there is a lot in the argument put forward that apart from the financial inducements designed to attract firms to these areas, much can be done, as is being done, by the very high level of public investment that is now planned for these areas to increase the facilities and to improve them and to improve the amenities of the areas. Anyone who listened to the figures which I gave of the rate of increase in public expenditure, both current and capital, and anyone who knows the facts of the potential of the construction industries will recognise that what we are doing is very large indeed and will produce large results.
There are other ways in which we can use Government expenditure to assist local employment. I spoke about giving overseas aid from the products of our industries going through a period of recession and I have been looking into this possibility. But one can only give aid to people in the form in which they want to receive it. We can, however, link the two together. We are looking for possibilities of linking the two together where aid can be granted for a form of product for which there is a spare capacity in this country. I think
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that a sum of £10 million is possible as additional aid from industries which have spare capacity. I think that this could make a big contribution and is another way in which we could assist.
My right hon. Friend the Minister of Labour will later be referring to the providing of retraining facilities, which are of immense importance to the long-term employment prospects in these areas. These are the main ways in which we are tackling the problems of local unemployment difficulties. We have been looking at the special problems of the North-East, in the light of a number of representations and, in particular, of representations made to my right hon. Friend the Prime Minister by a recent deputation composed of hon. Members on this side of the House, and in the light of this—
Mr. Edward Short (Newcastle-upon-Tyne, Central): On a point of order. Is not the right hon. Gentleman aware that I was a member of that delegation?
Mr. Deputy-Speaker (Sir William Anstruther-Gray): Am I right in thinking that the hon. Member rises to a point of order?
Mr. Short: The Chancellor made a statement which is incorrect. I also saw the Prime Minister last week. Why does not the right hon. Gentleman mention my representation to the Prime Minister?
Mr. Deputy-Speaker: That is not a point of order for the Chair to deal with.
Mr. Maudling: I said "in the light of a number of representations". I think that the representation of the hon. Member for Newcastle-upon-Tyne, Central (Mr. Short) was well publicised in the local Press and I did not think it necessary to refer to it again.
On the question of the North-East Coast—
Mr. Short: Cheap jargon. That is all the right hon. Gentleman is capable of.
Mr. Maudling: I want to say something useful about the North-East Coast. We believe that a long-term effort is needed to strengthen the economic structure of the whole of that area. We must look at communications and public services and

927
consider the efforts which are being made by the local authorities and others in the area and present them to the Government as a co-ordinated whole. This is an approach at which we are urgently looking at the present time. Clearly, something needs to be done here and clearly something will be done here, and I believe that it will be of great value.
Mr. Douglas Jay: Will the right hon. Gentleman at least consider going back to the system which existed in the North-East before he introduced the Local Employment Act and treating the whole North-East Coast as a development district?
Mr. Maudling: I do not think that that would be the right thing to do. What I want to do is to find a system whereby the needs of the area can be looked at as a whole. I think that what I have suggested is the right thing to do and is accepted on both sides of the House as desirable. We shall go ahead with it.
Mr. P. Williams: In view of the fact that my right hon. Friend the Chancellor has announced something of importance and of help to the North-East, will he accept appreciation of that immediately and say whether any body is to be set up to co-ordinate the gathering of information and the dissemination of Government policy in the North-East itself?
Mr. Maudling: That is the sort of thing we have in mind.
Mr. Popplewell: In this new look which the Chancellor is going to give to the North-East, will he give an assurance to the House that he will restore to the old North-Eastern trading development area the right to promote schemes? The Chancellor said earlier that he wanted the North-East to do something for itself. Under the old arrangement the North-East promoted schemes far itself and this power was taken away from it, as the right hon. Gentleman will remember. Will he now seek to restore that power to the area?
Mr. Maudling: I am aware of the arguments about that, but I do not myself believe that that decision has prevented the development of the area. What I have been saying—and I hope that with this I may finish what I have been
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saying about the North-East—is that there is an area problem which should be looked at as an area problem.
Several Hon. Members Several Hon. Members rose—
Mr. Maudling: I have given often enough.
Dame Irene Ward: I have a go?
Mr. Maudling: I have given often enough.
Dame Irene Ward: Can I ask—
Hon. Members: No.
Dame Irene Ward: Will my right hon. Friend now deal in detail with some of the many points which were put forward by the deputation which the Prime Minister received, many more than my right hon. Friend has mentioned this afternoon?
Mr. Peart Mr. Peart rose—
Mr. Maudling: I thought that my hon. Friend the Member for Tynemouth (Dame Irene Ward) was rising to a point of order. I did not intend to give way. As I have said, I think that I have given way enough. I wanted to come to the summary of what I want to say on this general point.
Mr. Peart: On a point of order. Would it be in order for me to ask the Chancellor of the Exchequer whether West Cumberland is to be mentioned in his speech?
Mr. Deputy-Speaker: That would not be a point of order.
Mr. Pearl: Why not?
Mr. Maudling: I think that that is the most irrelevant question of the debate. If I may summarise what I have been saying, the position which we have reached in this country—
Mr. Peart: On a point of order. The Chancellor said that mine was an irrelevant question. Is he aware that we have more than 8 per cent. unemployed in the area? That is not irrelevant.
Mr. Deputy-Speaker: The hon. Member for Workington (Mr. Peart) is getting out of order if he puts a point of view under the guise of a point of order when it is not.
Mr. Maudling: I thought that the hon. Member for Workington (Mr. Peart) was asking why it was out of order. That is why I said that it was irrelevant. The level of unemployment in any part of the country is certainly not irrelevant.
The point is to try to achieve a higher level of employment and to maintain it, to achieve a higher and steady rate of growth. This means that we must have more elbow room than we have at the moment. As all parties know perfectly well when they think seriously about the problem, a level of unemployment of 550,000 or 600,000 is too high. On the other hand, a level of unemployment half that would lead us back into the difficulties of inflation and balance of payments which we have seen in the past.
Hon. Members: Oh.
Mr. Maudling: I do not say that those problems are insoluble, but it is unreal to try to pretend that we can bring the unemployment rate down to half what it is at the moment without running into problems. We must, therefore, have more elbow room and a higher rate of exports and, as we are seeking, greater co-operation internationally on mutual problems of industrial expansion. The work in O.E.C.D. and our proposals for a mutual currency account are all part of an intensely important pattern to try to get concerted action in the Western world towards expansion at the highest and most sustainable rate which can be achieved.
At home, if we are to get the lower rate of unemployment which we all want and sustain that level of activity without running into the problems of balance of payments, we have to do several things. The first is to press ahead with the problems of local unemployment, as I have explained we are doing. Secondly, with all the help we can get from every source, we have to have retraining, which is of immense importance. Thirdly—and I stress this again—the prospects of a steady and substantial rate of expansion depend also on the prospects of a successful incomes policy.
It cannot be stressed too often that if we are not only to have full employment but to maintain full employment, we must have competitive costs in this
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country. There is no sense in the interests of anyone, including the unemployed, in producing policies which might produce temporary alleviation, but which soon land us back again in problems which we wish to avoid—balance of payments and exports and so on. There is no doubt in my mind that we can succeed in this objective with a more stable rate of expansion. Our products are very competitive and must remain so. Government action is sustaining and stimulating the demand in the economy and we need and I am sure that we will get co-operation from the whole country, management, workers and the country as a whole. All that needs to be done to ensure that the expansion on which we are now embarking will be one which we can and will sustain.
5.16 p.m.
Mr. Neil Carmichael: Having been elected to the House in the recent series of by-elections, I rise to take part in this debate on unemployment with more diffidence than is normal, even for a first effort. I am well aware of my own limitations, and I trust that the House will show its usual courtesy and indulgence towards a first speech.
Part of my diffidence is because I am from Clydeside and the people from Clydeside are well aware—perhaps those from other areas are not so aware—of our long record of people who have come to the House from that area, starting with one whom most hon. Members would agree to have been a very distinguished Member and whom, I am sure, my hon. Friends would regard as the most distinguished Member who, although he came from the Clyde Valley, was first elected for the West Ham Constituency of London seventy years ago this month. In the 1920s, there came a very vigorous, individualistic and energetic band of Members. They made a strong impression on the House and, through the House, on the country. Most of them have now passed on, but it is nice to see that one of the original band is still in the House and is still very vigorous and forceful.
All of those Members spoke of unemployment, because the problem was then as great as, or much greater than, it is today. I am well aware that Scottish Members tend to be Chauvinistic

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and cause a certain irritation and annoyance among the less fortunate Members of all parties. I have no desire to increase this irritation—
Mr. William Ross: Why not?
Mr. Carmichael: —but I hope that I may be permitted to refer to the area which I know best. Glasgow is a big, vigorous, kind-hearted city, passionately loved by her citizens and quickly seductive of those who come to live within her borders, or even to visit hex. It is a city of great contrasts. The merchants and the coal-owners and the ironmasters and the shipbuilders of the last century built wonderful houses and beautiful terraces, and about the dock areas and the factories row upon row of slums for those who worked in the shipyards and smelted the iron and worked in the factories.
In the constituency of Woodside, which I represent, we have this contrast to a very great degree. We have the fine terraces and we have the slums. The slums are such a problem to the local authority, so densely are people packed—we have densities higher than most areas in Western Europe—that the local authority will be very fortunate if it is able to put one-third of the people back into the area in which they have lived for so long, once the present houses have have either fallen down or been pulled down.
In that area of Woodside we have also a university. It is an old university—500 years old. It is as large, I think, as most of the members of its staff would like it ever to become. This does not mean that we do not feel that there should be more opportunities for university education in Scotland. I hope that I am not being controversial when I say that all the candidates at the last election, speaking in the university, were unanimous in the demand for the fifth university.
Maiden speeches are by long tradition non-controversial. Here I come to another cause for diffidence. How can one speak of the terrible problems involved in unemployment without being controversial? I think that the heat of this debate earlier was not artificial. It is what people feel about this problem. A very material problem is caused when a man is suddenly brought from a wage
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packet to rather inadequate unemployment benefit. There is the terrible human problem of the man, as an individual, feeling that he is no longer wanted and the feeling of insecurity that goes with that, not merely to the unemployed man but to all the people who think that they may be next. It is the problem of lost hope.
The spring soon goes out of a man's step when he has been unemployed for three or four months, when he feels that when he comes downstairs in the morning it does not matter whether he goes right or left or back upstairs again because he has already walked the yards of the Clyde. He has already gone to all the industrial estates, followed every rumour of a job and there just does not seem to be any place for him. Many men I know have been through this. Here I should like to make a mild plea. During the 1930s and, I understand, the 1920s, the idea was abroad that people did not work because they did not really want to work. This story is beginning to be spread in certain ill-informed and irresponsible circles even today. The experience of every personnel officer lin whatever industry, large or small, particularly in the north, but I believe, even in the Midlands is that there is a constant procession of people looking for work.
I know, in my own area, of one job advertised which received over a hundred applicants, and of one firm which advertised a few apprenticeships receiving 270 applications. There are just not enough jobs in the country and far, far too few in my part of the country. The position in Scotland is quite desperate. We have an unemployed figure of 93,000. I do not wish to bore the House with figures, but a survey was made by Glasgow Trades Council recently in which it received a great deal of cooperation from employers on the Clyde, large and small. The social and economic barometer of the health of Scotland is the shipyards, the heavy and medium engineering. In four years those employed in shipbuilding have dropped from 27,500 to 19,500—there just are not the jobs any more. In heavy engineering, in one of the best known firms, the figure has dropped from 1,300 to 800 employed in three years and in medium engineering, in a firm which is a 'household word, employment dropped from

933
15,000 to 10,000. The position is very desperate. These jobs no longer exist for the people.
The thing that is most damning is how fast is this rate of decline. The Scottish Council of Development in Industry reckon that it will take 25,000 new jobs every year in Scotland for the next eight years even to maintain the very unsatisfactory figures that we have at present. If we want to get the figures down to the national average, we must have about 40,000 jobs a year.
Reference was made earlier to the North and the South and the difference between the two. One of our more responsible Glasgow newspapers quoted recently that instead of Disraeli's two nations we are quickly becoming three nations—the employers, the workers of the North, and the workers of the South. This is a terrible thing to happen in any country. What do we think can be done?
I feel nervous at having the temerity to suggest it, but when we look at a constituency such as mine and see the unemployment and the houses which we have in the constituency, and realise that civil engineering and the building industry is under-working just now—is there anything more obvious? We need new roads in Scotland for the sake of industry. We cannot keep it going without roads, and we need also another bridge over the Clyde which should be started immediately.
In a short time, I should like to see Government contracts coming to Scotland—the Post Office and the nationalised industries—and the Government directing as much of the industry to Scotland as is feasible. We do not need advance factories. We have over 1 million sq. ft. of unemployed factory space art present. It is work that we need, not factories. I should like to see the Government establishing some industries of their own in Scotland, using the expansion of the university as a nucleus around Which to build scientifically based industry in Scotland, and giving us a break from this occasionally prosperous but too often skimpy traditional industry of heavy engineering. Scotland has a highly skilled labour force, with a long tradition and a pride in its craftsmanship. As my hon. Friend the Member for Southwark (Mr. Gunter) said, this is
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where the real wealth of Britain lies, and where much of the greatness of Britain comes from.
It would be a tragedy to allow these communities to break up even further than they have. No less than 250,000 people have left Scotland in the last ten years because of lack of opportunity. I ask the Government whether it he possible to increase unemployment benefit. This would do three things. It would help the economy; it would greatly help the people in very severe need, and it would provide an assurance that the Government are really making a serious attempt to deal with the unemployment problem—because they would not wish to go on paying a higher rate of benefit indefinitely. It would show that the Government meant to increase not merely individual productivity but the national product.
I hope that the debate continues on the same lines as those on which it has been proceeding up to now. In my area the problem is so immense and depressing to so many people that I am quite sure that, no matter how much heat may be generated in this House, the people would rather have this than think that this House cared little about what was happening.
5.32 p.m.
Sir Herbert Butcher: Every hon. Member who has heard the speech of the hon. Member for Glasgow, Woodside (Mr. Carmichael) will wish that he had the good fortune that has fallen to me, namely, of sincerely congratulating the hon. Member on a valuable contribution to our debate.
He started his speech in a properly diffident and modest manner, reminding the House of the distinguished Clydesiders who had preceded him. I thought his modesty went a little too far, because those of us who have served in this House for some years remember with pleasure and affection his own father. It is nice to know that Clydeside is again represented by a Carmichael—and I hope that I shall not get out of order in saying that. When a former colleague of this House reads tomorrow's HANSARD I am sure that he will feel that great as are the accomplishments of his family there is every chance that they will be surpassed in the future. The

935
hon. Member's was a model maiden speech, and I commend it to all hon. Members, in every way.
I now want to deal with the points that he made. First, there was his advocacy of his native city, which he loves so much. I cannot help feeling that other depressed areas would do well to emulate his policy, namely, to catalogue many of the advantages which they are able to offer. He pointed out, quite truthfully and properly, the advantages of education and scenery, and the corporate unity of Glasgow. He could also have referred to the charm of the countryside and, passing to more material matters, to the fact that the cost of living is probably slightly cheaper than it is in England. Certainly the cost of housing is very much cheaper. The same things could probably be said of the North-East and other areas.
Another point on which I agree with him wholeheartedly was that which he made relating to the man who, having been employed for many years, suddenly finds himself unemployed. I cannot help feeling that the present concept of unemployment insurance is due for a change, and that the benefit which a man receives on becoming unemployed—through no fault of his own—should be related to the period for which he has been in steady and regular employment. It is surely not beyond the wit of man to devise a scheme which would prevent the terrible effect of the great drop in the family income which occurs when a man falls out of work through no fault of his own. My right hon. Friend the Chancellor of the Exchequer was right to summarise the various steps which have already been taken to deal with the problem of unemployment and to put the matter in proper proportion. He pointed out that the national figure was only 2·4 per cent. On the other hand, he was right to show his awareness of the fact that large and substantial pockets of unemployment require special attention and action.
He said that the enlargement of the already large public expenditure will be the most expansive feature in our economy in the next year or so. That may be very right and proper. It may be the right thing to do for unemploy-
936
ment. I enter only two cautionary words. First, I should like to know to what extent this increased expenditure is going to be inflationary, and, secondly, to point out that to the extent that public expenditure is a charge on industry it will in no way assist the development of our export trade. But the linking of aid to the production of goods is an imaginative approach, which should be carried forward with the greatest impetus that can be mustered by the Government.
The peroration of the speech of the hon. Member for Southwark (Mr. Gunter) was in much of a party character, but in all his proposals he seemed to draw his inspiration from a former Cabinet Minister on this side of the House, now elevated to another place. But I agree with him—and I took a note of the phrase he used—that "there is something wrong somewhere, and human values are being debased."
As I go round the streets of this city and many of the small towns in my constituency, I ask myself whether, at a time when we are dealing with problems of unemployment, we can afford to allow so great a diversion of the resources of our people, by betting shops and other such facilities. The money that goes over the counters of those places could be much better used, either in the purchase of household goods or in savings, which would help capital expenditure. I was glad that my right hon. Friend hinted that some remedial steps might be taken in that direction. If those steps were taken the bookmakers and owners of the gambling shops would have nothing to complain about. Gambling is their trade; they would merely have backed a loser.
There are one or two other steps which the Chancellor could take which would help to solve the unemployment problem. Two are somewhat technical, but they both have a certain amount of force. My right hon. Friend reduoed the Purchase Tax on motor cars with a view to stimulating employment in the industry, and it did so. On the other hand, it certainly increased unemployment in the motor-cycle industry.
The Chancellor's decision is having one other effect: the fact that this change in Purchase Tax in a downward direction was announced in the early winter is

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making many retailers and wholesalers anticipate that future movements of Purchase Tax will also be downwards. As a result, orders are being kept to the very minimum, and there is some likelihood of their being unemployment in manufacturing industries which produce goods which are subject to Purchase Tax. I therefore hope that my right hon. Friend, having to a large extent anticipated his Budget by his announcement last month, will go a little further and will, perhaps as soon as the House resumes, announce the whole of his proposals in connection with Purchase Tax for this year.
I believe that to some minor extent it would be of advantage to the country if the Government reintroduced the facilities under the House Purchase and Housing Act by which money was made available to building societies for lending on older houses. I declare my interest as a director of a building society. One of the results of making it easy for pre-1919 houses to pass out of the hands of the landlord and into the hands of the owner-occupier is that there has been an outward and visible brightening up—and quite a number of the industrial parts of this country could do with that. Secondly, expenditure has been undertaken on putting inside those houses such standard amenities as baths, sinks and boilers—and this has meant expenditure and employment in providing all the incidental work, on transport and materials, which are also required.
The hon. Member for Southwark said that it would be an admirable idea if the Government made places of heavy unemployment more attractive. He described the places where unemployment is heavy and said that the Government must make these places attractive. I agree with him, but I wonder what he had in mind when he used the word "attractive". Attractive to whom? Surely he means that we should make areas of unemployment profitable to industry. That, I think, is the main test which should and must be applied nowadays to the movement of industry from one part of the country to another. Whether we like it or not, and whether we enter the Common Market or not, we have to live in a highly competitive world in which we have to sell our exports in competition with all other nations. It is not the slightest good curing unemployment for
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a few years now if we then discover that we have sited our factories in the wrong place and have handicapped them so that their products cannot compete in world markets.
I was interested to hear what my right hon. Friend said about proposals for the north-eastern region. An hon. Member who used to sit opposite and spoke with great authority on matters of air and industry is taking an interest, and an important part, in the development of the north-eastern region, I believe that it would be well worth while as a shock tactic taking the north-eastern region and examining first how we can make it more attractive to industry. I repeat that when I say attractive to industry I mean more profitable to industry.
Secondly, we might pick up some suggestions at least among those contained in the recent article in the Economist and move a large section of Government employment into such areas. I am not suggesting that for the moment this House should be moved. Perhaps we should send an advance party to see how they get on. But I think that it would be a very good idea if we moved a substantial number of civil servants into that district.
We must always bear in mind that in this country, if we are to maintain our freedom and our liberty, we have to coax, persuade and encourage people to move. One of the things which the older districts of this country need is a bit of a face-lift and a bit of a new spirit, and perhaps, let us face it, a certain amount of enterprise by the firms and the people who are living there at the moment. I should like to see the north-eastern region used as an experimental area, and I believe that, with the plans which have been put forward in all parts of the House, we may move forward.
The hon. Member for Woodside has shown a spirit of humanity and of looking forward—the kind of approach which all of us wish to bring to the subject of today's debate.
5.46 p.m.
Mr. Shinwell: Few speeches in the House in my experience have given me as much pleasure as did the maiden speech of my hon. Friend the Member for Glasgow, Woodside (Mr. Carmichael). In his human approach to

939
a possible solution of these unemployment problems he has proved most truly a representative of that part of the country.
Much could be said about the history of unemployment in the west of Scotland, going back almost to the beginning of the century. I recall that in 1908 I led a procession to Cathedral Square in Glasgow. After some propaganda, but no particular inducement on my part, the mob decided to enter Glasgow Cathedral to make a protest. This was on a Sunday. The police had other ideas about the intentions of the mob, however, and we were soon batoned down the High Street—and that was the end of that agitation.
In the following years we were confronted, as were other parts of the country, by the serious malady of unemployment. In 1919 we initiated what was then described at the 40-hour strike. I was that chairman and the leader of that strike. Following demobilisation, which was perhaps carried out too speedily, we had probably 150,000 unemployed persons in the west of Scotland. But all that resulted from the agitation was that I found myself in Calton Goal in Edinburgh serving a rather longer sentence than I cared to serve. I was, of course, quite innocent—but that was not the view of the judge who tried me.
I will not take up much time of the House. I want to be brief, because I know that many hon. Members wish to take part in the debate. [HON. MEMBERS: "Hear, hear."] I must, however, make this observation: almost every hon. Member in the House wants every other hon. Member to be brief in his observations but forgets about it when he himself is on his feet. I do not want to waste the time of the House by discussing the local situation in the part of the country which I represent. The hon. Member for Holland with Boston (Sir H. Butcher) spoke about trying an experiment in the North-East. We do not mind what experiment is tried as long as we can provide idle men with work. I offer best wishes to the Chancellor of the Exchequer in the process of this experiment. We shall wait and see.
My concern is to ask the question: What is the cause of unemployment? I
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observe that in recent debates and so far in the course of this debate nobody has asked that question. But unless we can discover what is the fundamental cause of unemployment there is no hope of reaching a solution. I have no doubt that during the debate on both sides of the House there will be agreement with the Chancellor's statement that we must expand our exports. We have been asked to do it during the whole of this century. Exports have gone up and then they have receded. But unemployment has remained all through those years. We must at the same time remember that if we boost our exports by adopting incentives and other devices we may often do so at the expense of our neighbours.
It may be worth our trying another experiment, and perhaps the Minister of Labour will convey this to the Chancellor of the Exchequer. Why not initiate a world economic conference and bring the countries of the world together—particularly the more powerful and industrial ones—to consider the prospects of analysing the situation and of promoting a possible solution to the vexed and complex problem of unemployment? I throw this out as a suggestion, because when we talk about boosting our exports on the assumption, which I believe to be false, that that itself can help to solve the unemployment problem, we must consider the fundamental question of why we must boost our export trade in order to survive. I realise that we must import and that, because we must import, we must export.
I was disappointed with the Minister's speech, for it was full of bits and pieces. It contained the suggestion that if we expand our industries and productivity all would be well, but I noticed that the Minister said, in effect—and I urge hon. Members to note this—"We cannot solve our present unemployment problem because we must have regard to the balance of payments difficulties." It seems that if our balance of payments difficulties are an obstacle to the solution of the unemployment problem we must accept the consequences. My hon. Friend the Member for Woodside was right when he directed attention to a matter which I heard the Chancellor say in the North-East in the course of a television programme.

941
The Chancellor declared his intention to survey the possibilities of increasing unemployment benefits. If we cannot solve the unemployment problem then clearly there is a humane duty—indeed, a high responsibility—on the Government either to increase the unemployment benefits speedily by legislation. Something else could be done. I have previously advocated the creation of a supplementary unemployment fund, to a large extent contributed to by employers, with a contribution from the State. This should increase the amount of benefit received by a person while unemployed on the condition, rigidly applied, that that person, if offered a job, must accept it provided the conditions are regarded as satisfactory from the trade union point of view.
The propositions I have suggested are remedial and might have a certain ameliorative effect, but I would be the first to agree that they would not solve the problem. What, then, can be done? It is surprising that the Chancellor did not mention the possibilities inherent in East-West trade. There are enormous populations throughout the world; 700 million in China, 400 million in India, 150 million in the African territories and more in other backward and underdeveloped countries where much could be done. There is a possibility of increasing trade in these directions and this would certainly enable us to boost our exports. It would enable us to increase our production and provide people with work and, at the same time, it would help to solve the unemployment problem which exists throughout what is known as the civilised world.
Why cannot we trade more with China? Why cannot we forget the antagonisms and hostilities of an idealogical character and tell the United States administration not to interfere in matters of trade which affect this country, as they are proposing to do about Cuba? Why should they interfere with our shipping, ordering us about, pushing us around, giving us instructions? Is it not about time we told them to mind their own business? China is one place. India is another. What about the countries behind the Iron Curtain? Only the other week some of my hon. Friends and I directed
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attention to the question of Rumanian trade. I understand that the negotiations have been resumed so I content myself with asking the Government to do something to boost East-West trade, irrespective of what the United States Administration believe to be correct. If the Government do that they will discover a vast reservoir of opportunities of which we can take advantage.
I return to the question I posed at the beginning; what is the cause of unemployment? The cause, after all, is simple enough; that it is impossible to reconcile consumption with production; productive capacity. While that is so internally, it is also true throughout the world. I have directed attention to only one possibility of correcting this position; the possibility of boosting trade throughout the world and helping the backward countries. We must also realise that there are vast numbers of people in Britain who would like to buy and consume more—clothing, food and other things—if they had the money to do so. But they do not have it.
I am told that retail drapers in Oxford Street and neighbourhood say that Christmas trade is not as good as it was last year or the year before. This is not due to bad weather or the lack of transport but simply because people do not have as much money to spend.
Mr. A. E. Cooper: The facts are that over the last seven or eight weeks there has been a surplus on small savings.
Mr. Shinwell: Then the obvious thing is for the Government to say to the people, "Do not save your money but spend it."
Mr. Nabarro: Really.
Mr. Shinwell: Let me explain.
Several Hon. Members Several Hon. Members rose—
Mr. Shinwell: I know that hon. Members opposite have so much money that they can afford to spend it.
Mr. Nabarro: Sit down.
Mr. Shinwell: Is that the kind of argument we are to get from hon. Members opposite?
Mr. E. Fernyhough: is it not obvious from what my right hon. Friend

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the Member for Easington (Mr. Shinwell) is saying that he believes that the unemployed have no consumer requirement because those requirements are all being fulfilled? Does that not apply to those on National Assistance, the old and the sick; that they are all getting what they want?
Mr. Shinwell: My hon. Friend is actually reinforcing my point. And had the hon. Member for Ilford, South (Mr. Cooper) not interrupted me I should not have dealt with this matter. The hon. Member mentioned savings, but, to the extent that people save—unless the money is used for investment purposes —that must reduce consumption.
Mr. R. W. Elliott (Newcastle-upon-Tyne, North): Regarding sales in the Christmas period, the right hon. Member for Easington (Mr. Shinwell) may be correct in what he was saying, but the fact is that in the third quarter of this year departmental store sales have been greater, according to a national index, and considerably higher than in the second quarter of this year.
Mr. Shinwell: The hon. Gentleman first says that I may be accurate and then tries to confute what I say. All I can say is that I read the newspapers and I also read certain documents sent to hon. Members, and I came to the conclusion that the retail trade was not quite as good. The obvious reason is that people have not as much money to spend—perhaps for the reason given by the hon. Member for Ilford, South, that they are saving the money, or it may just be that they have not got it. The fact is that unless in this country or in any other there is money to enable people to buy goods, and if production increases out of proportion to consumption, there must sooner or later be unemployment.
Who will deny that? Where are the hon. Members opposite now who said "Sit down"? Let them answer that question. I am stating facts, and if after I have concluded any hon. Member can refute what I have said about the primary cause of unemployment, not only in this country but throughout the world, I will be very glad to hear what he has to say—
Mr. Nabarro: Perhaps the right hon. Gentleman will hear what I have to say
944
about it. I was one of the hon. Members on this side who said "Sit down" after the right hon. Gentleman had said that people should not save. I want to tell him that it is far better that people should save than that they should spend their money on bingo.
Mr. Shinwell: I think that a quite unnecessary intervention, except that the hon. Member for Kidderminster (Mr. Nabarro) said that he had asked me to sit down. Everybody in this House and in the country knows that the hon. Member is famous for his courtesy—
Mr. Dan Jones: And for his bingo mentality.
Mr. Shinwell: —and for his remarkable manners, but if he thinks that he can stop me saying what I have to say he will have to get up much earlier in the morning than he is accustomed to do —because he can afford to stay in bed, being one of the affluent class. However, I will say no more about that. We are not dealing with the hon. Member but with a human problem. I leave hon. Members to draw their own conclusion.
I turn now to the short-term problem. My hon. Friend the Member for Southwark (Mr. Gunter) referred to public works, and that subject was mentioned in a debate some time ago on unemployment in the North-East and also in a debate on unemployment in Scotland. Of course we have to boost up public works. Much work has to be done, and my hon. Friend the Member for Woodside indicated what should be done in his area. The hon. Member for Holland with Boston spoke of the need to make some parts of the North more attractive. How can we make them more attractive? We can get rid of the slums and the squalor, we can get rid of the unsightly pit heaps and slag heaps, we can improve roads and provide amenities.
That is the way to make those places more attractive even if it does mean more profitability. That, however, is a matter for the Government and the local authorities in combination. We have heard of co-ordination this afternoon, but how can we effect that except by the Government taking the initiative and calling on the local authorities to combine with them to provide the necessary improvements and amenities, so that

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those and various other parts of the country can be made more attractive?
Government contracts should be given immediate attention. They have been referred to over and over again. I cannot understand why the majority of the contracts for the Post Office—engineering equipment, clothes, electronic equipment, and the like—or for the nationalised industries—the Electricity Authority, even the National Coal Board—or for the Service Departments who, between them, must spend on stores and various equipment something like £600 million or £700 million a year, go to the South and the Midlands.
I do not want to deprive the South and the Midlands of a living—
Mr. D. Jones: Fair shares.
Mr. Shinwell: Exactly—fair shares. There should be fair shares in this country, but at this time the people in the North are suffering more intensely than the people in the South.
I have reached the conclusion that it is not the intention of this Government to solve the unemployment problem. That is riot their intention—it never was. It never was the intention of a Tory Government to solve the unemployment problem. Indeed, there are hon. Members opposite who have said time and again that there must be a reservoir of unemployment, which is very satisfactory from their point of view—
Dame Irene Ward: Rubbish.
Mr. Shinwell: The Chancellor said again today that we can only solve the unemployment problem by upsetting the balance-of-payments position. I hope that every unemployed person will note what the right hon. Gentleman said—
The Minister of Labour (Mr. John Hare): I think that the right hon. Gentleman had better read HANSARD very carefully tomorrow. What my right hon. Friend described was the problem of how one reconciles the need for sound balance-of-payments position and a sound employment policy.
Mr. Shinwell: I heard what the Chancellor said. At the right hon. Gentleman's request, I will read the OFFICIAL REPORT tomorrow, but I am sure that
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I am right. The Chancellor referred to the proposals to provide more investment, more expansion, to inject more Government money into the public works programme, and the like, and then he added that we must be mighty careful because all this means inflation and might upset our balance of payments. I therefore repeat my hope that every unemployed person will understand just what was meant by the Chancellor; that if it is a choice between attempting to solve the unemployment problem by adopting a measure of inflation and affecting our balance-of-payments position, the unemployed must put up with it.
The Chancellor referred to the effect on productivity of automation, rationalisation, modernisation, and so on. What are the facts? Here I will deal with a local matter. In the administrative County of Durham—not the boroughs—according to the figures given to me by the Minister of Labour last week in reply to a Question, more than 1,500 miners are registered as unemployed—and that despite all the talk about absorbing unemployed miners who have been displaced as the result of the closing of pits. Those men have no hope of getting work. They have no opportunities for employment in the Midlands, the South or in Wales—none at all. What is to be done about them?
The fact is, and we must be ready for it, that the trend is towards automation, mechanisation, rationalisation and the modernisation of industry. It is happening now, not only in industry but in clerical work in office clerical work, and the like. What is the Government's intention about that? We are able today to produce far more goods with fewer men. What will happen in the future?
How will the Government tackle this job? By talking about the balance of payments? By providing a few advance factories with no certainty that they will be occupied? By telling us about a little road improvement in the North-East and talking about something in the nature of public works, and by talking all the balderdash that comes from hon. and right hon. Members opposite? [Laughter.] Yes, including the hon. Lady the Member for Tynemouth (Dame Irene Ward) who talks more balderdash than anybody in the House. She has been

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doing it for years and she gets away with it, and I can never understand why.
The hon. Lady has been criticising the Government without the courage to go into the Lobby against them. She pretends that she is interested in shipbuilding and shipping and the like, but she has never raised a finger to help those industries and has done nothing except talk about them. The hon. Lady is an excellent talker, though when it comes to action there is no courage behind it at all. [HON. MEMBERS: "Oh."] I am not going to take something from the other side of the House without returning it, and I am returning it now.
Dame Irene Ward: Thanks for a lot of votes. I am delighted.
Mr. Shinwell: The hon. Lady will not be delighted at the next election. We will soap the stairs for her.
All these bits and pieces will not do. The Government must tackle the question in a fundamental fashion. If they do not, they will go out at the next General Election, and no Government will deserve that more. The Chancellor of the Exchequer made the kind of speech that pretends that the Government are doing something, but the test is whether idle men are to be employed. The Government admit that it will be worse in the next month or two. They talk about seasonal and weather difficulties.
Mr. Rupert Speir: What about the fuel crisis?
Mr. Shinwell: The hon. Member should ask the Prime Minister some day about that fuel crisis. He should ask him to disclose all the facts. I have never done so, but let the Prime Minister, with Cabinet documents, disclose the facts and hon. Members opposite may not be laughing any longer. [Laughter.]
Mr. D. Jones: Why do hon. Members opposite not deal with this debate? If they were unemployed they would not laugh.
Mr. Shinwell: I have been unemployed, before we had the dole, and I feel bitter because of that experience. I recall also that in the 1930s we had 21 million unemployed and that in Scotland the figure was 26 per cent. We,
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on this side of the House are not going back to that period, but if this Government last much longer and if by some misfortune they come back after the General Election we may suffer the same again. That is what we are determined to prevent.
6.12 p.m.
Sir Fitzroy Maclean: The right hon. Gentleman the Member for Easington (Mr. Shinwell) had, first, a knock-about turn with the hon. Member for Kidderminster (Mr. Nabarro) and then a knock-about turn with my hon. Friend the Member for Tynemouth (Dame Irene Ward), in both of which he got as good as he gave.
Mr. Nabarro: Much worse from me.
Dame Irene Ward: The right hon. Member for Easington (Mr. Shinwell) is jealous of me.
Sir F. Maclean: In between these two encounters, the right hon. Gentleman asked a question of the Government which I also wish to ask them. I noticed incidentally, that he made no attempt to answer it himself, but why should he? He asked what the Government would do to counter the effects of automation. This is something which is taking place on a very large scale in my constituency. I am very familiar with the effects of it. They are deplorable in North Ayrshire, in the matter of unemployment, and so I, too, want to know what the Government are going to do about it.
Of late, a good many of the Government's utterances on unemployment have been far from reassuring. They may have been meant to be reassuring, but they certainly did not have that effect in Scotland. It is all very well for the Minister for Science to tell us that we must keep our heads about Scottish unemployment. We have been keeping our heads under successive Administrations, of both complexions, for a very long time without anything very effective being done. It is also not reassuring for the Government to ask us to keep calm or to give them time. They have been given time, but things have only got worse. One is led to suppose that the Government make the mistake, as the Scotsman put it, of
"… regarding as temporary and transient what is deep-seated and enduring."

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The problem in Scotland is quite different from that in areas in England and elsewhere which are adversely affected. The Scottish problem is a problem of its own and should be treated as such.
One of the things which must be remembered, and which I think the Government sometimes do not always remember, is that the rapid decline of the old industries makes even more urgent than it otherwise would be the need to establish new industries. We axe always being told, and quite rightly, about the jobs that are in the pipeline. Quite a lot of jobs are in the pipeline, but the trouble is that while jobs are flowing into one pipeline they are flowing out of the other, and while we are taking one step forward we are very often taking two steps back.
The assertion that we sometimes hear that unless industry as a whole expands it cannot expand in Scotland ignores the enormous leeway that must be made up and also ignores the fact that Scotland is a distinct country. It is all very well for the Minister for Science to go to Glasgow and talk about people preferring Surbiton to the Highlands. Many people may go to Surbiton from the Highlands, but not necessarily because they prefer it, but rather because they have to go there to earn their living. Depopulation is something which no Government should accept as calmly as that.
I am glad to see the Joint Under-Secretary of State for Scotland in the Chamber. I wish that we had had a Scottish Minister either opening or winding up the debate. He might have told us rather more about Scotland and what will be done to help Scotland than has his right hon. Friend the Chancellor of the Exchequer. I sometimes wonder whether the Secretary of State for Scotland has sufficient power and whether he might not be able to do much more for Scotland if he had more power in economics and finance. I have not so far noticed any great signs of activity from the new development department at St. Andrew's House. I wonder whether that also could not have its power expanded and whether it might not be better if it were remodelled and made into a real development department for Scotland.
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Any reference to planning in these debates always produces a derisive reaction from the other side of the House, but I remind hon. Members that a is some time now since the late Sir James Henderson Stewart, after he left office as Joint Under-Secretary of State, called for a five-year or a ten-year plan. [An HON. MEMBER: "After he left office."] Better to do it after leaving office than not at all, otherwise one would never say anything after leaving office.
My main conclusion is that what is being done by the Government is not unsatisfactory in itself. The Local Employment Act is all right as far as it goes, and it is satisfactory to know that more has been spent on Scotland than on England and Wales.
Dame Irene Ward: Satisfactory to my hon. Friend.
Sir F. Maclean: Satisfactory to Scotland—well, we deserve it more. But when I say "spent" it has to be remembered that most of the money spent is spent in loans at a relatively high rate of interest.
My own view is that the Local Employment Act is necessary, that it has done good work and that it will do more good work, but that it needs supplementing, and the question is how to supplement it. It has been said before, from both sides of the House, that what is needed is to provide a bigger deterrent and also a bigger carrot. Personally, I feel that there is something in that. But if a bigger stick is used to stop expansion where firms want to expand, there is always a danger that it will have the effect of stopping them expanding altogether, and nobody wants to do that.
That is also the answer to hon. Members opposite, some of whom, though not all, talk about the direction of industry. Until we have a Socialist State, which we are, I hope, a very long way from having, there can be no effective direction of industry. All that would happen if we tried to direct industry would be that it would shrivel away. If ever another Labour Government come in, and they try to direct industry, just wait and see what happens.
But I do not think that the same argument applies to the provision of a bigger

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carrot. If we offer sufficient inducements, human beings, including industrialists, will do almost anything. If the prospects for establishing new industries in Scotland are made sufficiently attractive, people will establish them there, and that is a factor which the Government, in this desperate state of affairs, ought to bear in mind.
What should be offered must be supplementary to the Local Employment Act. I am sure that to get things going we have to give inducements from the outset, but we also have to make up our minds fairly quickly what inducements we are to give and to whom, otherwise those concerned will lose interest, and that is one of the great complaints made against the operation of the B.O.T.A.C. machinery—that it works much too slowly. I hope that my right hon. Friend the President of the Board of Trade will do something about that. It is not the first time that he has been told about it.
In addition to what can be done under the Local Employment Act, I think that the Government should consider—I have said this before—fiscal inducements of one kind or another. They should consider the possibility of the remission of rates and of making good the losses to the local authorities by means of grants of one kind or another. They should also consider granting remission of taxation and increased taxation allowances of different kinds. There seems to me to be no reason why, if the Government want to promote increased investment in any given area, one of the ways in which to do it should not be to offer increased investment allowances in the area while the need exists.
To get them going I do not see why they should not grant industrialists moving into a development area remission of a certain amount of taxation for a certain number of years. I am sure that there are difficulties—there always are—but, in the desperate situation in which we are at present, that is something which needs looking at. It is something which has been done with success in other countries, and which could be done with success in Scotland.
Dr. J. Dickson Mabon: Is it not a fact that during the debate on the last Finance Bill we on this side of the House moved Amendments to do
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precisely this, but the hon. Gentleman, with one exception, either voted with his party or abstained?
Sir F. Maclean: I have changed my mind since then. Further, I would not accept that the proposals of the hon. Gentleman and his hon. Friends were necessarily the right way of doing it. What I am asking the Chancellor to do is to consider this scheme and see whether he cannot work out one which would produce the desired results.
Mr. Ross: May I remind the hon. Gentleman that on the occasion mentioned by my hon. Friend the Member for Greenock (Dr. Dickson Mabon) he did not even vote for his own new Clause?
Sir F. Maclean: No, the hon. Gentleman has got that wrong. I think that I did.
Mr. Ross: No, the hon. Gentleman did not.
Sir F. Maclean: If the hon. Gentleman is talking about the same new Clause as I am, I went into the Lobby with the Opposition and with my hon. Friend the Member for Tynemouth (Dame Irene Ward).
Dr. Dickson Mabon: In fairness to the hon. Gentleman, it is a fact that he did vote for his own new Clause, but was not present to move it.
Sir F. Maclean: I may not have been present to move it, but I seconded it, I thought, very successfully, and, certainly, as I have just told the hon. Member I voted for it. The hon. Gentleman generally has a very good memory in these things, but it has failed him this time.
Another thing which I think can and should be done to help—and I am glad to say that it is being done, although not always in the right places—is the provision of advance factories. Personally, I believe that, whereas most firms would prefer to have factories built to their own specifications, there are certain firms which would rather take a ready-made factory at once than wait for the machinery of the Board of Trade to produce whatever it is they want.
This brings me back to the urgency of the matter. I was in my own constituency this weekend, and there the

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local figures show unemployment running at a rate of 7·6 per cent. What is more, I am reliably informed that there are more men to be paid off at Hunterston, and there is still a steady run-down at the I.C.I. factory at Ardeer, past the bottom figure of 4,500 originally given. And that is largely the result of automation. That is why again I say, like the right hon. Member for Easington, that I want to know what the Government are proposing to do about that.
Mr. Shinwell: The hon. Gentleman has asked me why I did not provide a possible remedy for the effect of automation. He is quite correct; I did not do so. The obvious trend must be towards automation and towards remedying its effects in the reduction of the working week.
Sir F. Maclean: That is the point which I am making, too.
What makes the situation in this area of North Ayrshire worse—and I make no apology for referring to it, because it is representative of a great part of Scotland—is the need to absorb the available labour as quickly as possible, because otherwise, there is a danger that all the skilled labour will be drawn off relatively quickly, and that a residue of the less easily employed labour will be left.
That will not only be very bad for the unfortunate skilled workers who have 'to leave their homes, or for the less skilled workers who stay there but who have no work to do, but also very bad for Scotland, because it will mean that our labour force will be thrown out of balance, and that we shall lose a lot of very valuable workers.
That is why I urge the Government once again to reconsider their decision not to site an advance factory in Central Ayrshire, as the hon. Member for Central Ayrshire (Mr. Manuel) and I have so often urged them to do. I do not begrudge the hon. Member for South Ayrshire (Mr. Emrys Hughes) his advance factory at Cumnock. I am sure that it is needed there, but we in North Ayrshire have a much higher rate of unemployment at the moment.
I urge this on the Government all the more because of an incident which occurred earlier this year, when an American firm, with which I have been
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in touch, was told that it need not come to inspect the area, for two reasons, first, because there were no existing premises, and, secondly, because one could not be sure of getting labour in the area. That reply was given to me by the then Parliamentary Secretary to the Board of Trade, and all I can say is that, while there may still be no existing premises, there is certainly no shortage of available labour in that area at the present time.
Mention has been made of public works. There are arguments for and against a large programme of public works, but in this one small area of which I am speaking there are plans for roads, sewerage, a new post office and a new employment exchange. These plans were made a long time ago and have been held up for one reason or another, and this, in turn, is holding up other things such as housing development. The Government should consider seriously whether it is not better to spend money on employing men on projects of this kind than to spend a comparable amount of money on unemployment benefit and relief and leaving the men unemployed.
One of the great necessities today is to catch people's imagination in Scotland. An idea which has certainly caught my imagination, and which might catch the imagination of many other people has been put forward by the Ayr County Council, namely, a duty-free industrial estate at Prestwick. Something of the kind already exists at Shannon and it has been enormously successful. There are many things that we can learn from the Irish in this respect. Prestwick lacks none of the advantages of Shannon, and has many more of its own.
We hear many references to the need for research, particularly for Government research in Scotland. I certainly prefer the remarks of the Minister for Science on this subject and his reference to keeping our heads and preferring Surbiton. What is needed is something that will catch the imagination of the local population and of prospective industrialists. Once that is done, I think that the outlook will be much better.
It is sometimes said that in Scotland we do not do enough to help ourselves. In North Ayrshire, the people are certainly doing a lot to help themselves at

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the moment. In my constituency and in Central Ayrshire a joint industrial committee, formed by the trades councils and the local authorities, is doing much valuable work to this end, and, above all, it is giving plenty of publicity to the various amenities of the area, such as the good roads, railways, port facilities, and so on.
The Ardrossan Harbour Company has extended its facilities so that a much wider range of cargoes can now be handled. The Ardrossan Shipyard, which for so long lay practically derelict, has now been taken over by an enterprising local man—almost local, anyway—and, what is more, it is now proposing to expand. It has already had a great many contracts, Government and otherwise.
All that is extremely encouraging. Nobody can say that in this area the people, the industrialists and the local authorities have not played their part. That being so, let the Government now play their part. I know that their powers in these matters are limited, but there is a certain amount that they can do. I was disappointed that the Chancellor did not announce something new in his speech. I would have liked to hear him say some-think new and imaginative. Above all, I would like him to produce something quickly, because speed is of the essence.
6.36 p.m.
Mr. J. Grimond: With a great deal of what the hon. Member for Bute and North Ayrshire (Sir F. Maclean) said I agree. Of course, there should be far more protest against the complacency, the conservatism and, indeed, the incompetence of the Government in dealing with this problem. As the hon. Gentleman rightly said, this has been endemic in Scotland for many years. The hon. Gentleman has been taken to task for not always following his voice with his vote on previous occasions. He will have a chance tonight to follow up the protest he has made verbally by voting against the Government. The more he and other hon. Members do this the quicker we shall get some action.
The hon. Gentleman also mentioned some of the speeches which have been made by former Ministers after they have resigned office. It is becoming a habit of Tory Ministers to have, not so much a death bed repentance but a repentance
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after political death. We have had Lord Eccles beating his breast in the Upper Chamber. We had the late Sir James Henderson Stewart doing it before. It is no good. What we require from the Government is action white they have the power to take it.
The Chancellor of the Exchequer opened the debate by saying that he would deal with the problem under two headings. One was the question of local unemployment, and the other was the question of expanding the economy in general. The indictment against the Government is that they have been in office for 11 years but have done nothing under either heading. They have not for stalled the obvious danger of regional unemployment, and they have not until lately taken the decision that growth in the economy shall be given a high priority. It has taken the Tories over half a million unemployed to awaken to the fact that we have no effective industrial policy. It is going to be much more difficult to introduce these policies now, at a time of difficulty, than it would have been three or four years ago in a time of comparative prosperity.
I represent a constituency—I do not intend to say much about it—which has suffered from unemployment and depopulation for many years. We are well aware of what a social disease this is and of how it feeds upon itself. It is no fluke that industry concentrates in the south-east of England. It has been a deliberate decision to concentrate our financial, industrial and political power. We are one of the most centralised countries in the world, and we are centralised by deliberate policy on London.
The Chancellor of the Exchequer chose some enlightening phrases. He talked about the Government being driven to do something by this House. That is extremely enlightening about the Government's attitude. They wait till they are driven to do something. He talked of the difficulty of getting industry to go far afield. That also is typical of the Government's attitude, that the Tyne, the Tees, the Mersey and Scotland, to say nothing of Shetland, are far afield in a sort of backwoods where it is difficult to get people to go.
This centralisation has had two consequences. First, talented population has been drawn down to the South and

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to the Midlands. Secondly, this country has taken a London view. We are inclined to think that what is good or normal for Middlesex suits the rest of the country automatically. Since the nineteenth century, Manchester and Wales have been steadily drained of the capability of making a distinctive life of their own. This is not at all insignificant in the context of unemployment. Once an area begins to lose its talent, skill and ability as they drift away, once it ceases to have an organic local life and expression of its own, the population soon drifts away, too.
If the Government are sincere, therefore, about developing the depressed areas far from London, they must deliberately bring back power into those areas and encourage them to develop their own centres of political, industrial and social growth. I do not suggest that the capital of England should be moved to the Fells, but I do suggest that the Government should develop Edinburgh and regional capitals and a Welsh capital.
Mr. Cyril Bence: Have the Bank of England in Edinburgh. We would look after the money better.
Mr. Grimond: To complete the process would take time, but the Government can start right away by moving some of their own offices. It would not be comfortable for everybody. Anything that is done in this way would be uncomfortable, but it is no good pretending that we can solve regional unemployment and that everybody will remain as comfortable as before.
Mr. James Griffiths: I have had a lot of the argument about moves being uncomfortable. As Minister of National Insurance, it fell to me to establish the central office at Newcastle-upon-Tyne. Many people said that it could not work because it was too far away. It has been a wonderful success.
Mr. Grimond: I am obliged to the right hon. Gentleman. Of course, it would only be uncomfortable for the people who have a Middlesex outlook.
Secondly, the Government must restrain the growth of more offices in London. One reads in the papers that offices are still pouring into London.
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The Government could stop this, but they will not. They should put the main development in housing, transport and services where it will benefit the North-East.
If we consider housing, only 46 per cent, of the houses are in the North of England, Scotland, Wales and the South-West, yet these areas contain 64 per cent. of the unfit houses. While 30 per cent. of the unfit houses which were replaced in the years from 1956 to 1959 were in the South-East, only 19·3 per cent. were replaced in the North, Scotland and the South-West. Of 50 slum back spots, 45 are in the North. Seventy-four out of 82 local authorities whose pupil-teacher ratio will exceed the national average in 1963 are in the North. Sixteen out of 22 authorities with fewer than 100 13-year-olds at grammar schools are in the North. The first motorway was built between London and Birmingham, and the great bulk of new towns are to be found in a ring round London.
It is, of course, possible to make a case for that kind of development. It is possible to make a case for carrying out these main developments and making life more comfortable and agreeable in the South. It is not, however, possible to argue at one and the same time that we want industry to go to the North but that we will maintain all the advantages in the South. The industrial development certificate scheme does not touch the basic attraction of power, building, housing, roads and everything else in the South.
Let us face the problem frankly. If we are to get people in industry to go back to the North, it means making the North, the West and Wales relatively more attractive or, to put it another way, making the South-East relatively less attractive. To put it bluntly, it means allowing some of the results of overcrowding in the South-East to operate. It means allowing the differences in land values to take effect. By all means, let us take the product for the nation.
Such a method would mean giving priorities of transport to the North. It means giving really fast services and good roads to the northern ports. It means carrying out the Rochdale Commission's recommendations first in the northern ports and not channelling

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everything down to the South, as is still being done. It means taking a look at the Victoria tube and asking whether, if it is built—as, I dare say, it should be —Londoners should pay for it, perhaps, by other forms of taxation on other types of vehicles in the London area. It is not sufficient merely to stem the flow from the North. We have got to reverse the flow, especially as it affects skilled people and management.
Next, we must undertake in the North developments which would be preeminent of their kind. I should like to see a new town created in Scotland on one of the marvellous sites which we could provide, and in that new town I should like to see our fifth university. This would obviate much of the quarrelling about where the university should be situated. I should like that new town to be pre-eminent in architectural beauty. I should like to see some first-class research and post-graduate institutions in Scotland. There is a possibility of this. There is a chance that the Russian studies in Glasgow and the electronics and European studies in Edinburgh will form the basis for this. Will the Government put money and energy behind this kind of development?
The next place where the Government should look if they are serious about this problem is their own machinery. We have not yet begun to grasp the implications within the Government machine of development as against mere administration. I share the view of the hon. Member for Bute and North Ayrshire about the Scottish Office, but the Scottish Office does not have the economists, the sociologists or the people with commercial experience, and its so-called development department is not a development department at all. Furthermore, the Scottish Office is under the control of the Treasury. It is all very well to demand that Scottish Ministers should be present on the Government Front Bench, but the man we want there is the Chancellor of the Exchequer, because it is he who ultimately calls the tune in Scotland, as everywhere else. Again and again, I am struck by the lack of professional outlook and the lack of development outlook in agencies which are supposed to be introducing new industries or supporting old ones.
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Next, I come to some particular proposals for immediately helping these areas. The first is the possibility of a tax advantage. Surely, the Chancellor of the Exchequer missed a great opportunity when he increased the investment allowances. Why did he not discriminate and give a higher rate of investment allowances for these areas than for the South-East?
Dame Irene Ward: Hear, hear.
Mr. Grimond: If the right hon. Gentleman does not like that method of doing it, what about altering the National Insurance contributions or the rate contributions, as an earlier speaker has suggested?
In his speech, the Chancellor said two things. The first was that when aid was given to foreign countries, a condition as part of the granting of the aid might be that it should be expended in industries which had slack capacity to be taken up. The Chancellor said that the figure he had in mind was £10 million. That is not a great deal. Looked at against the problems of the shipbuilding industry alone, it is not a substantial sum.
I hope that the Minister of Labour will tell us more about that, because I fully agree that it is a good idea. Is it, however, intended that this should be additional to our normal aid programmes? If so, does the right hon. Gentleman have any idea what countries might accept it? Has a scheme been drawn up and offered to any country, or is it merely an idea?
Secondly, how far have we got with retraining in the depressed areas, of which the Chancellor spoke?
Mr. Loughlin: Will the right hon. Gentleman deal with this point about attracting industry to the less prosperous areas? There is danger of believing that we are dealing solely with the less prosperous areas, whereas we are dealing with an overall position. If the right hon. Gentleman looks at the figures for 1960, 1961 and 1962, he will find that there has been a gradual deterioration in London and the South-East, so much so that today there are seven unemployed for every four vacancies in what is generally regarded as a prosperous area.
Mr. Grimond: I note the hon. Member's comments and hope that he will have an opportunity of expanding them. It is generally agreed that the problem is worse, however, in the more remote areas than in London.
Mr. Loughlin: It is now a national problem.
Mr. Grimond: Have the Government given any consideration with a view to action to the proposition of having a duty-free area at, say, Prestwick or other similar places? This suggestion was made many months ago. Presumably, it has been considered by the development unit of the Scottish Office and, presumably, a conclusion about it has been reached.
It is noteworthy also that in this country unemployment pay is only 19 per cent. of earnings. In West Germany, it is 90 per cent. Even in Greece it is 40 per cent. We talk about a Welfare State. I should have thought that there was good deal to be said for increasing, unemployment pay. If my figures are right—it is rather difficult to work these things out because one does not know haw many are drawing National Assistance—it seems that one could take a sum of £1 million a week, £52 million a year, for this purpose. This would not be an addition to spending power which would be totally unacceptable to the Chancellor, and it would, I suggest, make a great difference to the unemployed and provide some additional demand for industry.
There is also the question of automation and [leisure. We really must consider stepping up the payments to people who are not employed so that they may share in the general prosperity brought about by automation.
I come now to the general heading with which the Chancellor dealt. He said that no measures for particular areas of unemployment can be effective unless the economy can be expanded. We cannot battle with regional unemployment against a tide of industrial stagnation. Here, of course, the Government are in a difficulty. Having wasted the easier years, they are now faced with a disastrous loss of confidence and, indeed, a general lack of direction throughout the country.
I take one instance which, I suggest, typifies the reason why confidence is
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lacking. It is agreed that it is essential that, if we are to have expansion, we must not at the saint time have gross inflation. What is the Government's policy about this? Very belatedly, they have, as I understand it, got round to talking about an incomes policy. They spent most of last year urging wage restraint. They set up the National Incomes Commission. But what else do we see? No sooner do Ministers leave office than they take jobs at large salaries and, what is more, at increasing salaries. Are these stories true? Are the figures one reads showing a steady increase in directors' salaries correct?
If so, the state of mind of the Government and of the industrial leaderships generally is incredible. These are the very men who, last year, were going about the country telling nurses, teachers and ordinary working people that they must not take more out of the national "kitty" than they put in. They declared themselves against increases in salaries about one-tenth of those which they are now taking. They are not refusing increases in their own present salaries.
The Government cannot have it both ways. It is perfectly reasonable to say that one does not accept restraint, that one thinks that those who are leading industry are entitled to as big a salary as they can get. That is a point of view. But how can it be reconciled with appeals for wage restraint, with talk of an incomes policy, with telling people like nurses and all wage earners that they, of course, must not have any more? One must either make it a genuine policy or drop the cant. Unless one does that, one simply will not get co-operation.
I put this question to the Government. Are directors' salaries to be referred to the National Incomes Commission? The claim of the Scottish builders and plumbers has already been referred. One of the grounds upon which it has been referred is that it may have repercussions upon other employment and that it sets a bad example. In all seriousness, I say that directors are much more capable of setting an example than are the plumbers and builders. This is an important matter. It is an illustration of the way in which the Government's words and their deeds just do not match. Unless they do something about it, they

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will not get the country behind them, they will not get the economy moving, and they will not have the basic tide into which they can absorb unemployment.
My party has long argued that we must have a decision from the Government to give expansion a high priority, but we have argued also that we shall be able to attain our target of expansion only if we have a good industrial relations policy. It is not only the "two nations" barrier between North and South which must go. The barrier between the other two nations, those who own the wealth and those who work to create the wealth, also must be broken down.
I am all for running a system with high returns, but the results must be shared. I am all for running profits systems, bat, again, let us share the profits and share the ownership of the means of production which gives rise to those profits. Until we have a revolutionary proposal from the Government about giving back the power to these areas which have been drained of their skill and ability, until we have a real sense of purpose which is not mere words but is reflected in the actions of the Government, and until we have a firm and continuing determination to go for expansion, we shall face the threat of unemployment, and no temporary measures will cure it.
6.55 p.m.
Mr. G. B. H. Currie: The right hon. Member for Orkney and Shetland (Mr. Grimond) was the Member who followed me after I made my maiden speech in the House. On this occasion, as I follow him, I say at the outset that I entirely agree with his concluding observations about the importance of improving labour relations in industry.
The right hon. Member for Easington (Mr. Shinwell) said, a little unfairly, I thought, that the Chancellor did not really deal with the long-term problems of unemployment. I may be wrong, but I think that, when my right hon. Friend was speaking, he dealt with the problems facing the Government in trying to expand the economy, with the problems of the balance of payments, the pressure of production and of preventing such
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inflation as would harm the economy. I thought that all those matters were dealt with quite adequately by my right hon. Friend.
I think that most of us here realise that, ever since 1945, our experience has been either that our economy has been expanding, or that, having successfully expanded it to a state almost of boom, we have had to put the brakes on and slow down the rate of expansion because we were running into difficulties of inflation. When right hon. and hon. Members opposite were in power, they found that the problem for them was very similar to that which faces us now.
Mr. D. Jones: We tackled it very much better.
Mr. Currie: That is a matter of opinion. I do not want to spend time now going over the figures for those years.
Mr. Jones: I invite the hon. Gentleman to do so.
Mr. Currie: I think it important tonight to look to the future and consider whether some way can be found of avoiding this repeated cycle in the nation's economy.
What do the problems seem to be? I think that we have had to cut back because of the dangerous pressures of inflation for a number of reasons when we have been in a booming economy. Our economy, I think, has been too much subject to pressures from the American economy. We have been much too subject to the effects of recessions in trade in the United States of America.
I think that we ought to look for some way of being a little bit more divorced from the immediate effects of recessions in the United States. I think that many of our manufacturers have not been sufficiently enterprising in going out to explore new markets, and that they are very largely to blame in this way. The Government, as I see it, lay down the type of economy in which industry can thrive; it is for the manufacturers and producers in these conditions to make the most out of the opportunities which are provided for them by the economy at home.
Another way in which we have fallen down—and all these matters give rise

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to unemployment, in my view—is this, that we have not been providing the after sales service in foreign countries to which we sell goods; we have not been competitive with manufacturers in foreign countries. This is particularly obvious, I think, in some branches of the motor trade. In industry our productivity has dragged behind our rising standard of wages and—let us face it—behind the increasing standard of living and behind the increase of social benefits. They have increased, but our productivity has dragged behind.
Then there are industrial disputes. I do not lay the blame for these disputes on one side or the other of industry, but we have got to face it that there have been industrial disputes. Sometimes the management is to blame; sometimes the people on the shop floor strike for reasons which, to the vast majority of the people of this country, appear to be totally inadequate. It does not matter whether managements are to blame, or whether the shop floor is to blame, the result is a loss of our exports, a failure on the part of manufacturers, in many cases, to he able to keep contract delivery dates, and loss of production on the shop floor.
These all add to the problems of industry in difficult export markets. All this possibly did not matter quite so much in those days when we had a sellers' market all over the world, but today, in France, Germany and other manufacturing countries, there are manufacturers who are ready and only too anxious to step in to replace the sales which we were hoping to make in those countries.
I hope that the Government will look at this problem very seriously and consider whether a method can be devised of bringing about a better relationship in industry between management and the shop floor. I myself believe that if they would have some sort of working party, representative of the unions on the one side, representatives of management, of owners, on the other, and representatives of the Government helping wherever possible, it might be possible to devise a way in which we could improve industrial relationships.
I think myself—I may be blamed, perhaps, for thinking in a way which is slightly Socialist—that that sort of investigation should go further and should
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look to the rewards which come from industry and should see whether some way could be devised—I know there are difficulties, in fixing levels, and so on—whereby proper proportions of the profits of industry might be spread out between shareholders, management and the shop floor. This is something which requires to be looked at in this modern, highly competitive commercial world in which we find ourselves today.
I do not want to take up too much time, because there are other right hon. and hon. Gentlemen who desire to speak in the debate, but I should just like to refer to the question of East-West trade. I think that it was the right hon. Gentleman the Member for Easington who raised it. He said there were limitless opportunities for the expansion of trade between East and West. Well, of course, that is true, but one thing which he forgets is that when we are dealing with the countries of the so-called planned economy group we have to be able to purchase from them a virtually equal bulk or value of goods in order to make it possible for them to purchase from us. That places a great limitation on what otherwise appears to be a wide-open market, and they are certainly extremely deficient in consumer goods.
Another matter which is not helping us in our trade at present is the stringent shipping policy of the United States of America. In these days, when we are finding certain difficulties in the balance of payments, and while these sorts of restrictions are being imposed on our shipping, we should perhaps look more closely at the value and nature of goods, often unnecessary goods, which are being imported from the dollar area into this country. While we are in this sort of situation there may possibly be sound arguments for some method of quota, tied possibly to the value of our exports to the dollar area; but I think that this may be one of the necessary measures if we are to get our economy on to a sound basis in the long term.
I would make another suggestion, for everything towards expansion of industry is, of course, helpful to the provision of new employment. I should like to see the Export Credits Guarantee Department making its advances more easily than has been experienced in the past. Many underdeveloped countries require

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credit. Many of our goods could be sold to those countries if credit could be given, and I think that the Export Credits Guarantee Department has probably a very large part to play in that. Moreover, I am firmly convinced that we ought to do more than we are doing to help the development of the underdeveloped countries.
After all, if we succeed in getting them developed they will eventually acquire wealth and become good customers of ours; so there is a certain amount of self-interest in helping the development of the underdeveloped countries. The Government have done quite a lot in helping towards the development of the rather backward countries of the Commonwealth. I believe that they can usefully do very much more in this direction.
I do not want to be too parochial, but I would refer very briefly to the situation as it exists today in Northern Ireland. At the middle of November, our unemployment figure was 34,299, or 7·1 per cent. of the employable population—7·6 per cent. for men and 6·2 per cent. for women. I shall not canvass the reasons for our difficulties in this speech. First, it would take too long, and, secondly, I do not believe that it helps to attract new industry if one canvasses the reasons which have led to a degree of unemployment in any part of the country.
Unemployment is a scourge. We are all agreed on this. I am sure there is not the slightest divergence from that view on the part of any hon. Member. Idle hands are costly hands to a country if one looks at it purely from the economic point of view. As the hon. Member for Glasgow, Woodside (Mr. Carmichael) so effectively said in his maiden speech, the unemployed man is miserable because of the lack of opportunity of work.
The position in Northern Ireland, I am glad to say, is not wholly black. There is relevance in what I am about to say, because we want to co-operate as far as possible by giving our experience to other areas now suffering from unemployment. There are today 51,000 at work in Northern Ireland as a result of the development of shadow factories with Government assistance who in all probability would not otherwise be in employment. Although I know that one can be critical of figures of this sort, there are
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now 18,500 jobs in the pipeline, waiting for new factories to be built.
We have had a great diversification of industry. It used to be that our jobs were in too few kinds of work. We had shipbuilding, aircraft manufacture, linen textiles, agriculture, and very little else. I am glad to say that today we are much more diversified, and the effect of a slump in one industry will be much less felt. This diversification is very important. Where new industries are being attracted now, I believe that the one thing to concentrate on above all others is as much diversification as possible.
Mr. F. H. Hayman: Perhaps the hon. Gentleman will take account of the fact that the Board of Trade actually invited a firm in my constituency, where there is 20 per cent. unemployment, to go to Northern Ireland.
Mr. Currie: That shows the apparent effect of some of our propaganda.
There is another thing which is now being done, and not before time. We are having our youth trained in new skills and techniques which will be required in industry from now on. I agree that in many cases this training has come much later than it could usefully have come, but it is very much better that it should have come even late than that we should have failed to appreciate the situation at all.
Many of our unemployed are unskilled. One might then ask what is suggested to bring those people into employment. [An HON. MEMBER: "A change of Government."] I believe that much earn be done by the development in Northern Ireland of the dead meat trade, which art present is practically non-existent. As another hon. Member said, much can be done to improve road communications, which would give work immediately and would help eventually to reduce costs. I believe that much can be done if we can find some way to reduce our greatest bugbear—crosschannel freights and internal freights. Like the right hon. Member for Orkney and Shetland, we find ourselves at the end of a sea communication, which makes life much more difficult.
I believe that much can be done by the development of a freighter aircraft

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for the transport of agricultural produce and other goods. Furthermore, we have an aircraft factory in which we can build such aircraft, with Government assistance. I believe sincerely that the Government have a very special responsibility for Short and Harlands, as they are the major shareholders. Whereas another firm can go to the market for money for development, Short and Harlands depends entirely on the Government for this. In view of their special responsibility, the Government should devote special attention to the firm.
It was a shocking mistake that the development of the SCI was not carried out by means of a large programme in Short and Harlands. Now that the Government are looking for a successor to the trooping type of aircraft and freightage aircraft for the Royal Air Force—the Beverleys—I believe they have a responsibility to give Short and Harlands an opportunity of at least providing a design for the replacement. The Government could help our industry in that way and make very much more secure the future of those in employment at Short and Harlands.
Our design team is the main part of the industry about which we are immediately worried. If the team breaks up or the members of it feel insecure and go to other jobs, we shall never be able to get them together again, and that will mean that the future of this vital industry to Northern Ireland will be very much in jeopardy.
Our shipyards, like many others throughout the United Kingdom, badly need orders. I cannot understand why so many orders appear to go to one or two yards when there would be enough to keep all our yards going to some extent if the work were Spread out.
As to the building industry, I agree with what has already been said, that immediate relief could be given to many areas if the Government would press ahead with an imaginative scheme to build dwelling-houses and flats and to replace slums so that our people could be housed in the way they ought to be.
I would like to see an extension of the Small Dwellings Acquisition Act, and new funds of money available at cheaper rates of interest. The building societies have had it all their own way
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too long and it is time that young married couples were able to get a house of their own at a reasonable rate of repayment, so that we could have the property-owning democracy which this party has talked about for so long.
I should like to see the development of our tourist industry, the expansion of our schools, and the raising of the school-leaving age, which would create a great deal of employment in itself. About 8,000 school-leavers come into our industry each year. I should also like to see a drive by the Government to deal not only with the long-term aspects of unemployment, but also with the first-aid repairs which are immediately necessary in order to cut out the scourge of unemployment.
7.21 p.m.
Mr. Alan Fitch: It is a sad reflection on the Government that only 17 years after the war and 11 years after they came into office we should be discussing such a subject as this. The Chancellor of the Exchequer said it was an exaggeration to say that we were back in the 'thirties. I agree that it is an exaggeration. But to any one of the 600,000 unemployed men it is cold comfort to say to him, "You are only one of 600,000 and not one of 1½ million."
Those of us who unfortunately suffered unemployment before the war are apprehensive of the future, I make no apology for speaking very largely about the North-West. It is an area which we have not heard a great deal about in the debate. I believe that the right hon. Gentleman the Chancellor of the Exchequer did not mention it, although he referred to Merseyside. It is an area of considerable unemployment.
We know that the national average is only 2·4 per cent., which I agree is not an alarming figure. But what is at least giving rise to concern is that practically all the areas of high unemployment are above the line Mersey to Humber. In the North-West itself, the rate of unemployment is 2·9 per cent., representing a total of 88,493. If one breaks this down into some of the areas within the North-West one finds very revealing figures, and I hope that the Minister of Labour will take note of them.
According to the latest figures, issued on 12th November, Merseyside has an unemployment rate of 5·6 per cent.,

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North-East Lancashire has 4 per cent, South Lancashire, in which my constituency lies, has 3·7 per cent., and the Furness area 3·3 per cent. The only part below the national level is the Manchester district with 1·9 per cent.
Mr. S. Silverman: Will my hon. Friend clarify the limit of the area north-east Lancashire, where he says that the rate of unemployment is 4 per cent.? In the area that was for a short time under the old Act a special area, stretching from just north of my constituency through Burnley and down to Padiham, the rate is very much higher. In Colne it is 9·8 per cent. and in Nelson 6·8 per cent. The average over the whole area is between 8 and 9 per cent.
Mr. Fitch: I thank my hon. Friend for his remarks. I am not sure of the geographical outline of the area northeast Lancashire. I take my information from the Lancashire and Merseyside Industrial Association Report. It includes Burnley, Nelson, Padiham, Clitheroe and other adjacent places.
The alarming thing is that the Government seem to be looking at the situation from a cold mathematical point of view. I know that a figure of 2·4 per cent. or even of 2·9 per cent. does not seem so bad. But we want to look a little deeper than this to try to discover whether the situation is temporary, whether it is a passing phase, and whether the future outlook is good. As far as I can see, the outlook is far from good.
For example, the number of wholly unemployed in relation to the number of temporarily stopped has gone up considerably. In my constituency the figures on 10th December were 1,440 wholly unemployed and 123 temporarily stopped. That is one of the most alarming aspects. I believe that this is the case in many Lancashire towns, and no doubt some of my hon. Friends will he able to confirm this finding.
The figures of 2·4 per cent, or 2·9 per cent. do not reveal concealed unemployment. By that, I mean uninsured married women who do not bother to register at the labour exchange because, in any case, they would not draw benefit, and school leavers who have not registered. The rate of unemployment among school leavers in the North-West is
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higher than normal, and we have the Christmas school leavers to come. Again, the figures of unemployment do not reveal that there are in south Lancashire only 457 vacancies for 5,000 unemployed, and in this I include Wigan and St. Helen's and the area bordering on them.
Figures quoted by the Chancellor, which will no doubt be repeated by the Minister of Labour, do not tell the whole story. I was interested to read a report in the Guardian on an American survey. The Americans have what they call "a direct survey of unemployment," and a report just issued suggests, according to the Guardian, that
"… compared with the American figures, British statistics of registered unemployed under-estimate the numbers actually looking for jobs. The report, by a committee of experts appointed by President Kennedy, gives comparative tables of unemployment for several countries adjusted to the American basis of measurement. On this basis the rate of unemployment in Britain in 1960 was 2·4 per cent. compared with 1·6 per cent. by the Ministry of Labour's reckoning. If the gap between the two systems of measurement can be assumed to have remained roughly the same, this could mean that there are in this country up to 200,000 people over and above the 544,000 registered as unemployed in mid-November who would be listed in America as out of work and seeking jobs."
That means that the real unemployment figure is nearly 750,000.
All areas of high unemployment have something in common—contracting industries. Lancashire is no exception. Lancashire has an industry unique to Lancashire—the cotton industry—and that is contracting. We have coal, railway workshops and shipbuilding, all of which industries are contracting. I do not want to be parochial, but it is interesting to note that the unemployment figures in the Wigan employment exchange are mainly of cotton workers, engineers and building workers and that only a very few miners are unemployed, mostly only those who are disabled. That shows that the policies of the nationalised coal industry towards redundancy and towards trying to channel out-of-work men into other pits is paying off. The figures at the Wigan exchange suggests that private enterprise industries have not yet been able to deal with redundancy in the same way.
One can sum up the position in Lancashire by saying that unemployment has

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been rising steadily throughout the year. Among those unemployed are many more wholly out of work. Many others are school leavers. One of the disturbing factors is that mills which have become empty through closures have not been taken over by other industries. In other words, there is contraction in Lancashire which is not offset by any form of expansion.
Those are the things which the figures do not show. They are problems involving human beings. The figures are a pointer to the future and they suggest that Lancashire's future is very bleak. That fact has created a lack of confidence in the future and that has lead to migration or, as we call it, the drift to the South.
The 1961 Census revealed that while there was a slight growth in population in Lancashire, it was only 3 per cent., compared with the national figure of 5·7 per cent. It would be wrong to suggest that this drift to the South has only just started, for it has been going on for some time, but the Government should do something about it and should have some sort of plan to halt it. We are not Luddites in the sense that we want things to remain exactly as they are. Obviously, mobility and flexibility of labour and of capital are necessary but in the North-West we are concerned with the fact that movement is now in only one direction—north to south and not south to north.
I was interested in the suggestion of the Economist that the seat of Government should be moved from London to the North. This suggestion should be carefully considered. I should also like the views of the Minister of Labour on the suggestion that our entry into the Common Market will accelerate this drift. Do the Government accept that view, and, if so, what are their plans for dealing with it? There has been much talk about the "Golden Triangle" formed by Hamm, Paris and Birmingham, a sort of supermarket within the Common Market. It is said that the people outside will gradually drift into this triangle.
I think that that is an over-simplified explanation. It may be argued that if one is nearer to the coast, one's communications with the Continent are better, but inside Europe a potential
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customer in Hamburg or Milan will not be unduly influenced by possible differences in transport costs from Birmingham, Manchester or Newcastle.
Mr. Fernyhough: But that is exactly what the Chancellor of the Exchequer said this afternoon—that industry was not going to the North because of transport costs.
Mr. Fitch: That was within the country itself, but I do not think that the Chancellor suggested that differences in transport costs would matter much if the customer was 1,000 or 2,000 miles away. The further away the customer is, the less do the differences in transport costs between Milan and Birmingham or Milan and Manchester, for instance, matter. I am interested to know what plans the Minister of Labour has for dealing with the suggested acceleration of the drift from north to south if we enter the Common Market.
What can we do about this problem? We in the North can do certain things. Local authorities have their powers, but they are limited. As has been said, we suffer from the aftermath of the Industrial Revolution. One has only to go to some Lancashire towns to see how badly planned they are, to see how houses have been built around the pits and mills without any planning.
The philosophy of the financiers and industrialists of the days of the Industrial Revolution was, "Where there's muck, there's money". Unfortunately, some of that philosophy has stuck and although it is an exaggeration to think the north of England, in the words of William Blake's Jerusalem, is "those dark satanic mills", there is some truth in that.
However, there are some things which local authorities can do with Government help, and some local authorities in the north of Lancashire are tackling the problem progressively. My own county borough council has a big scheme of redevelopment and is hoping to redevelop the whole of the town centre and get rid of many unsightly buildings. Other communities are doing the same. Then there is the necessity for the full implementation of the Clean Air Act, not only to make the atmosphere cleaner, but to make it healthier by dealing with the emission of sulphur dioxide. These are

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limited things which the local authority can do, but the main responsibility for this problem and the solving of it rest on the Government and their policy. What can they do?
We have heard a lot about the Local Employment Act. In my opinion the Act is far too rigid; there is not enough flexibility. On the one hand, there are the black areas of high unemployment and, on the other, the white areas, but there is nothing in between. I appeal to the Minister, while he may not agree that Lancashire, by and large, is a black area, to treat it as a grey area or an intermediate area. That is one of the things that the Act does not do. It is far too rigid in its application. It is quite ridiculous to treat a constituency like mine, where unemployment has been recently over 4 per cent. and is now 3·7 per cent., as though it were a prosperous area. Under the Act a place like Wigan which is not scheduled for development is treated in the same way as a prosperous area. That, in my opinion, is where the Act falls short. It should cater for these areas which are neither black nor white but in fact grey.
Another thing that the Government can do is to inject into the North-West and particularly into Lancashire capital for social purposes. There is, for instance, the question of slum clearance. One-third of the 2 million families in the North-West are living in old houses, and one house in every five in Lancashire is a slum house. This is a matter which the Government could tackle. In doing so they would not only be giving work to the people who are out of work but they would be removing the black marks of the Industrial Revolution.
Then, of course, we need roads. If we are to attract new industries to Lancashire we must have the best possible roads—not only new roads but improvement of the old roads. The Trans-Pennine Road should be extended to the Mersey so that there is a direct link between the West Riding and Lancashire. Manchester Airport could do with even more redevelopment. These are things that the Government should be considering. Education is another matter for consideration. We have many old schools in Lancashire,
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some, in my opinion, unfit for children to be taught in. This, again, ought to be tackled as something which would attract the potential industrialist and his family to Lancashire.
Added to these things which I suggest that the Government should undertake are the natural assets of Lancashire itself, the ability and industry of its people. About three years ago Heinz built their biggest factory in Europe, just outside Wigan. I asked one or two of the directors why they had chosen Wigan. They told me that they regarded the Lancashire people as hard-working and—this may seem rather funny, but it very interesting—very clean. This is an important point for people engaged in food production. They chose this part of Lancashire—no doubt there are several other parts which they could have chosen—because of the characteristics of the people.
This injection of capital for social purposes plus the character and ability of the people, plus the fact that we have in Lancashire property which is not necessarily old but which is out of use—the cotton mills, which are very cheap in comparison with property in the South—are all considerations which the Government should take into consideration.
I urge the Government to regard Lancashire as a grey area, as an area where the people are beginning slowly to lose confidence, and I suggest that it is the Government's duty to restore the confidence of the Lancashire people in the future. They can do this by introducing really radical policies, and they should do it now before the people of Lancashire have lost all patience.
7.45 p.m.
Commander J. S. Kerans (The Hartle-pools): It gives me great pleasure to speak about the North-East at last, because it is rather apt to be forgotten. In following the hon. Member for Wigan (Mr. Fitch), I would say that I understand his problems in the North-West, and that I shall probably be repeating many of the points myself that he made. We have, in fact, a certain amount in common.
On 9th May, I raised the matter of unemployment in my constituency of The Hartlepools. It then stood at 6·5 per cent. In the intervening months, it has

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risen to 9·6 per cent., with 12 per cent. male unemployed. I think that the House will agree that this a very disturbing figure indeed. Furthermore, I am faced with further redundancy in the new year in heavy engineering, plus nearly 300 school leavers before Christmas. From my point of view, there are no grounds for complacency whatsoever.
I think that the Press and television have done the North-East a great disservice. They have painted one side of the picture only and shown nothing good about it. There are two sides to every picture. In fairness, this should be put right in the months ahead. It has made a very bad impression in the South from the point of view of attracting industry into the area. It has not helped by any means at all. I know from my contacts in London that it has done a great deal of harm.
In my constituency, unfortunately a shipyard has closed down after a hundred years and it is now in the hands of the liquidators. This has been the fulcrum of industry in my constituency for nearly 100,000 people for a very long time, right back into the past. That includes heavy engineering. We must face the fact that there are 80 shipbuilding yards in this country, and they are not all going to do very well in the years ahead, when the demand for ships is not that great and with the difficulties that there have been over labour and so on. The recession in the shipyards did not occur overnight, and I think that it must have been obvious to the President of the Board of Trade and his officers.
For a long time I have put Questions about the rise in unemployment in my constituency. I have been fobbed off by being told that there were many jobs in the pipeline. These pipe dreams never materialised, because they do not catch up with the problem of the school leavers. They have been based on a false hypothesis in the Board of Trade. I cannot absolve the Board of Trade from some blame for not forecasting and seeing ahead. Furthermore, we have these long delays in B.O.T.A.C. Cannot we shorten the time in which a decision is arrived at, for the benefit of the industrialist who wants financial assistance? If the committee is all that busy, why not appoint another? Let us get some more people in.
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The problem in my constituency does not stop at the loss of a shipyard. The small traders—the butchers, the bakers and the candlestick makers—are all affected in some degree. People cannot leave the area, because they are paying off mortgages on their houses. It comes as a very great shock to a man over 50 when he is made redundant for the first time in his life, and is thrown back on a few pounds a week. These are heartrending problems, of which the country should be made aware. Skilled labour cannot always leave an area, for the reasons that I have enunciated.
The Chancellor talked about retraining those who are made redundant. That is a problem for the over-fifties. But let us not forget that the apprentice of today is the workman of the future. He will provide the skilled labour in the technical age in which we now live, and he should have a high priority in the Chancellor's reappraisal of the situation, and his reassessment of the steps to be taken.
There is a countrywide recession in the steel industry and the heavy engineering industry. In my constituency there is a £57 million steelworks which has never worked to full capacity since it was completed not long ago. When I left the Service I worked there, to learn a job. It is an appalling fact that these large industries are now facing a recession.
What remedies can be taken? First, we must advertise the North-East a good deal more than we have in the past. I was recently told of a proposal to have a merchant ship built as an exhibition ship for the North-East. That proposal has potentialities, because the further afield we can sell the potential worth of the North-East the greater will be our hopes in the long term.
I should like to know who coordinates what is going on in the North-East. We have not had a clear-cut answer to this question. I hope that my right hon. Friend the Minister of Labour will be able to give us some ideas tonight. We cannot continue to go to Department after Department in order to have one or another aspect of the matter dealt with. I can name at least half a dozen that we have to go to —the Ministry of Labour, the Ministry of Transport, the Ministry of Education, the Ministry of Housing and Local Government, the Admiralty, and the

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Board of Trade—and by the time we have gone round all those Departments we have very little idea of what is going on in Whitehall. It is that lethargy which is stultifying effort in the North-East. We must have somebody in charge before whom we can put all these problems, so that we can ensure that remedial action is taken.
Mr. Fernyhough: The Prime Minister.
Commander Kerans: Yes, I have been to the Prime Minister—and so have my colleagues—on that very point. We must improve our natural communications in the North-East by road, by air and, where necessary, by improved harbour facilities. My constituency has the harbour facilities, but better road and air communications are of vital interest, as the main arteries between the north and south of England, and Scotland. Much money must be spent on this. The nearest airport to my constituency is seven miles north-east of Newcastle. That is nonsense in this modern age, if we really want to get industrialists to come into the area.
Some fiscal incentive must be given to industry if we are to attract it to the North-East. If a firm is within 30 miles of London it has easy access to the South Coast by road. Could it not be arranged that firms in the North-East be given fiscal relief amounting to the difference between the transport charges which they have to pay and those which are paid by firms in the South? It should not be impossible to work out a satisfactory solution on these lines, for the benefit of industrialists who might then be willing to go to the North-East, Scotland, Northern Ireland and the North-West.
The Local Employment Act was reasonable in its concept, but it is illogical to have peripheral areas, as in the North-East. It is not generally realised that in this area people commute for long distances in order to go to their jobs. No less than 6,500 of my constituents work in shifts for I.C.I., and a good many others go by bus to work in Haverton every day. They are no different from the persons who commute to London. The whole of Durham and Northumberland should be treated as one area under the Local Employment Act, certainly for an experimental period.
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I also stress the necessity for siting a power station in the North-East. This has been in the pipeline for some time, out no decision has yet been reached. I ask the Chancellor of the Exchequer and his colleagues to announce a decision on the matter tonight, or, if that is impossible, at least to let us have a forecast showing the way that the Government are thinking.
Many Government Departments could go to the North-East. Several hon. Members opposite have talked about overcrowding in London. We must get these Departments out of the London area. What we need is some dynamic project to catch the eye—something that can be produced in the area. People in the North-East must realise that they cannot rely upon the Government to do everything. Local businessmen must inject a certain amount of verve into their planning, and collaborate in order to produce something on their own initiative. Many people in the North-East have a large amount of private investment locked up in the area, which they cannot retract to the South or to anywhere else.
We want more hotels, or motels. Newcastle certainly has not enough hotels to attract large businesses to the area. We must increase the social amenities; we cannot exist entirely on bingo halls and greyhound tracks. We want a few more theatres, amateur dramatics and all those things. There are some people whose wives will say, "I am not going to the North on any condition whatever. I want to be within 30 miles of London. The North is a mass of slag heaps. I cannot go there. There is nothing for me to do." This is a wrong concept. From my long experience of Newcastle and my constituency I know that the country is within a very short distance, and that there are masses of emenities. It is not right that that bad impression should be given to industrialists—English or foreign.
The North-East has another asset. It has been virtually strike-free for many years. It also has a very friendly population, which is more than some people say about the South. There is room for a great deal of expansion in industry in the North-East. I deplore the two-nation concept which is creeping into our debates and into the Press. We must

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an work together, with the same object. Not all men can leave the North-East. There was a story of a young man of 16 who went 200 miles to get a job as a grocer's assistant, and this was given great publicity in the Press. I admire him for his courage, but this is the wrong concept to put across to the people; a young man should not have to go that far to get a job. Once the skilled labour leaves the area it does not always come back.
Unfortunately, at the moment we are passing through a period in which industry is waiting to see whether we shall enter the Common Market. There is uncertainty. The Chancellor has taken various measures to inject capital into the economy, but this is a long-term process. It is a step in the right direction but it is too long-term to have an effect now on men without a job. World events wait for no man, and undoubtedly there is hesitation at the moment. The country needs confidence in what the Government intend to do. We need a co-ordinated policy, because many of my constituents will have a very poor Christmas. The constituents judge their Members of Parliament by results, and the Government are blamed for the present situation through me—and I cannot blame my constituents for that. Words may count for a certain amount, but we are judged by results.
I ask the Government for a major planning policy to inject new life into the North-East. We need dynamic projects, greater financial assistance and greater injections of capital to ameliorate the present situation and to allay anxieties. There is a great will to work in the North-East and a genuine desire to contribute to the national economy. Many of them have life-long investments in the area and cannot leave it. We cannot blame some people if they have a grave disbelief in the future and dissatisfaction with the present. They do not understand all the factors. They understand a pay packet on Thursday, Friday or Saturday. There is also a social problem.
Help may be on the way, but my constituents want reassurance and concrete proposals for the future. I ask the Government to give a lead. There is no room for complacency when unemployment reaches 10 per cent. I consider that some of my constituents have been sold
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down the river—and I have been down one myself. I hope that it will not happen again. I intend to abstain in the Division unless I receive some firm assurances from the Government. I want action now and action quickly.
8.3 p.m.
Mr. A. G. Bottomley: The hon. and gallant Member for The Hartlepools (Commander Kerans) is rightly concerned about unemployment. In his division the unemployment figure at the moment is 12 per cent. of the insured population. When I heard him say that he intended to deliver a broadside at the Government I expected something exciting, but I am afraid that they will treat his speech as a damp squib and will be delighted to know that all he intends to do in the Division is to abstain. If he had courage he would come into the Lobby with us and vote against the Government.
We heard this afternoon from the Chancellor of the Exchequer a repetition of speeches delivered by his predecessors. There was nothing new. I say to the Chancellor, if there were a war we should have full employment We should have to use all our resources in getting a victorious peace. If we can have full employment in war why do we tolerate unemployment in peace? We ought to have full employment, and we can get it if we pursue the policies which will make it possible.
The Government ought to control investment and to see that our raw materials are used to the best possible advantage. They should see that there is a proper distribution of industry. They should introduce building controls. Things of this kind should be done now. The situation birks no delay. Instead of doing this, the Government permit an extravagant consumption of our wealth on less essential industries.
Why do they do it? They do it because they pander to their friends, whose sole aim is to make the biggest profit in the quickest possible time.
Mr. K. Thompson: Will the right hon. Gentleman also tell the House that in time of war we should have direction of labour? Is he willing to have that now?
Mr. Bottomley: We did not have direction of labour initially; war conditions forced it upon us. And I do not think that we should necessarily have to have it now. But I will not develop the point. Let me make my own speech as I intend to make it, as other hon. Members are wanting to speak.
The Government put the blame on the workers. In fact they cannot be blamed. The workers of this country are some of the best in the world. Let me give one or two examples which will show that in recent years the workers have been playing their part. In my constituency recently, although there is unemployment —which is not a great encouragement to working hard—we have had the record output ever from the blast furnaces. This was done by men who belong to the union whose general secretary led the workers recently in the Ford's dispute.
Over the last ten years there have been fewer strikes in this country than in the Common Market countries and five times fewer than in the United States. British workers today work longer hours than do workers in France and Germany and have had fewer wage increases.
In consideration of this, the Government talk about an incomes policy but, as the Leader of the Liberal Party said, that policy is directed against one section of the community and not against those who ought to be covered. It is very difficult for me to talk to the unemployed in my constituency about an incomes policy. All they have is a miserable allowance—the dale, which, as hon. Members have said, ought to be increased to help them and also to enable them to buy more and thereby assist in the recovery of the economy.
This year we are laying stress, quite rightly, on productivity, and in his speech the Chancellor said that we must make sure that we had a higher rate of growth. It is all very well saying that, but if we have a higher rate of growth in producing the wrong kind of goods this could hasten our economic ruin. We have to produce goods which we need and which the world wants from us. If we are to play OUT part in developing our industry, we must note that we are living in a new age—the age of silicates, oxides, carbides and nitrites. Last week, in their budget, the Russians put more money aside for
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this kind of development than they have ever done before. We ought to be considering that. It is not that our technicians and scientists are lagging behind; they are in front. The reason we are not making the advance in this field which we ought to make is that we are not giving the kind of assistance which is necessary and creating the economic conditions which will make it possible to make progress in this development.
Why do not the Government consider bringing back the Ministry of Materials? This Ministry, created by the Labour Government, was only beginning to tackle the problem, and it is a pity that it was pushed aside. We must find substitute materials for imported raw materials. Its reconstitution ought to be considered, because unless we face the fact that we must try to trade as little as we must, rather than as much as we can, we shall find ourselves in continued economic difficulties and balance of payment problems. If we are to succeed in overcoming our economic ills we must have a national plan. We must tell industry, both public and private, what is required of them.
I am sure that the Chancellor has had the same experience as myself. Industrialists are saying, "We are 'fed up' with this policy of stop-go-stop. Why does not somebody tell us what is required?" We cannot do that unless we have a plan and produce the kind of goods which are necessary. I would lay down a number of conditions for this. We must ensure that the kind of goods which must be produced are those essential for the well-being of the economy, that the workers are treated as equal partners and that the consumers are given a square deal.
I admit that what I have been saying is in the long term and I appreciate that the immediate unemployment problems of the North, Scotland and elsewhere must be tackled at once. I have been told, as have hon. Members generally, that we must be patient. We know that certain Ministers have been on sight-seeing tours. That is not good enough and it must come to an end. Something more positive must be done—and it can be done—but it certainly will not be done without proper co-ordination.

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Some time ago I asked to see the President of the Board of Trade, but he was too busy to see me. I sent a letter to him in which I started that as a means of helping the unemployment position in Tees-side the Government should stress publicly that steel should be used as much as possible, particularly in constructional building. What was the result? After a week the right hon. Gentleman wrote to me saying that he was passing the letter on to the Minister of Housing and Local Government. Two weeks later that Minister said that it was being passed to the Minister of Works.
I have received a reply from the Minister of Works and, while it is in some ways rather useful, because it makes some suggestions, I wrote the letter in the first place merely to urge the Government to say—as was said in another context in 1952 to the industry and the community as a whole, when there was a shortage of steel and the public was told to use steel sparingly—that now that there is a surplus, the country should use as much steel as it could. However, for just that one suggestion, there was this delay of a month and still no pronouncement.
The steel industry has an important part to play in the country's economy. Steel can be used in all kinds of capital development; for housing, railways, docks, roads, hospitals, schools, and so on, but it is at this very time that the Minister of Housing has sent a circular to local authorities telling them, in effect, to keep their rates down. How will that encourage local authorities to undertake the sort of building that I have mentioned? In any case, they cannot do it in my area, because the unemployed do not want to pay higher rates.
Why cannot the Government accept the responsibility for a national programme to cover these building services? Why cannot they pay for the houses, roads and schools—and they might even pay for the police and Civil Defence—so that the ratepayers' money can be spent usefully on those things which local authorities must do to help employment. In this connection—and this has been mentioned by other hon. Members—it might be better if Government Departments were decentralised.
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In Tees-side there is a large number of unemployed clerks and office workers who have little hope of getting jobs. I want to see opportunities provided so that they may be employed and in these days of modern communications there might be a lot to be said for having offices in the provinces and outside London. After all, with close-circuit television and other modern aids people can not only speak to each other, but actually see each other, and documents, so that the movement of people as we have known it over the years is unnecessary. Telex is another means of communication in offices which enables work to be dealt with in parts other than London.
Indicative of the Government's attitude towards this urgent problem of unemployment is this. The owner of a firm near my constituency got in touch with me recently about the production of prestressed concrete sleepers. Last year a great deal of this work was transferred to another area and I am told that there is a threat of a further upheaval and that even more sleepers may be made elsewhere. The manufacturers have appealed to the Government not to allow this to happen and I have written to the British Transport Commission in similar terms.
Another factory near my constituency has informed me that it has forward-looking projects which are designed to keep men in employment for many years to come. However, the immediate problem is rather short term, with fears concerning the next twelve months. One Government contract has been promised, but has not been forthcoming. These instances show that positive action could be taken by the Government to ease the immediate problem.
I agree that the Government are now doing a good many things to help Teesside and I hope that industrialists and others will read what has been said in today's debate. If an industrialist comes to this area he will find it a good place and will wish to stay. This applies particularly to manufacturers of consumer goods. There is a population of 650,000 people. There is a supply of workers who are not only highly skilled, but who seldom engage in industrial disputes, as has been pointed out today.

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There are excellent public utilty services, facilities for education, technical training, sports and recreational activities, all enhanced by a delightful countryside. There are good communications—and we hope that the Government's road programme will improve these even further—and there is a £24 million project which local authorities will be putting to the Government. There are excellent communications from the ports to Europe and other parts of the world and I hope that those who are contemplating coming to this area as a result of Government encouragement will find their choice worth while.
If unemployment develops in Teesside, Scotland and elsewhere, what will happen? It must be remembered that unemployment breeds unemployment and that already, in the Midlands and some parts of London, it is beginning to show itself. We must face the fact that our society is lopsided. It is altogether wrong that a stockbroker can receive commission on a single sale of shares which is in excess of a steelworker's wage for a week's work. It is altogether wrong that a property speculator can make hundreds of thousands of pounds overnight while the men who design and build get hundreds of pounds less, and then must pay tax on it.
The policy of the Government encourages an excessive concentration of money in the hands of a few people who get progressively richer without any great effort. All these things provide a threat to our economy and political democracy. The keynote of what I have said is that we have two main tasks: first, the people must understand the truth about our economic position and the Government must convince them that everything depends upon having the right type of production; and, secondly, the Government must make it clear to them that, beyond a shadow of a doubt, the total product of the country's labour will be devoted fairly and in the national interest.
With this leadership I am sure that there will be a response. It is because I do not think that this Government will give that leadership that I hope a great number of hon. Members will go into the Lobby tonight and say that they,
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also, do not think that this leadership will be forthcoming from the Government.
8.18 p.m.
Mr. Graham Page: The right hon. Member for Middlesbrough, East (Mr. Bottomley) made some powerful proposals, but the background to his argument, which was that the Government were doing nothing about the problem of localised unemployment, is quite untenable on the facts. Under the Local Employment Act, 1960, £75 million has been offered in 340 projects, creating about 84,000 jobs. My right hon. Friend mentioned, among other things, the advance factories, the selective public works and the preferences in placing Government contracts, which can be of great value in the quick relief of localised unemployment.
There are also such things as the great increases in freight transport facilities that have been developed over the last two years, and the allowances given on changing jobs. Things like that have helped immensely to prevent really serious unemployment problems arising in some areas, and the recent measures for encouraging expansion—the reduction of interest rates, the release of the special deposits, the reduction in Purchase Tax on cars and the increases in allowances for capital investments—have all been very satisfactory in initiating schemes that will provide many new jobs.
The average basic unemployment figure throughout the country is 2·4 per cent. In talking of national averages, I do not wish in any way to hide the suffering and hardship caused to nearly 600,000 individuals now without work, and their families, but it is fair to pay tribute to the Government for tackling the problem better than almost any other country. We have had a lower average unemployment since 1951 than any country in Europe, than Canada, than the United States.
But, against this general picture, there are certain local areas where the unemployment problem stands out in tragic relief. One of those tragedies is Merseyside—
Mr. Manuel: And Scotland.
Mr. Page: I wish to deal with the one particular area of Merseyside, and

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I call it a tragedy because in that area, whatever one may think of the unofficial strikes that may have occurred—and they are unwise at times—there is no harder worker than the Merseysider, and none who will work longer hours when the jobs are there at which to work. But frighteningly sudden has been the increase in unemployment there. In 15 or 16 months the figure has doubled, and, we now have 34,321 people unemployed.
Merseyside has its special problems and, because it has special problems, it is entitled to the exercise of special Government powers to solve them. That was recognised in 1949, when Merseyside was made a development area. For ten years, despite the running-down of the Royal Ordnance factories there, which removed about 30,000 jobs, the new firms coming in have kept down the unemployment figure. That is something of an achievement, because, to keep pace with its increasing population, Merseyside needs 3,500 additional new jobs a year.
In 1960, the Government were successful in persuading Fords, Vauxhalls, Standard-Triumphs and other firms to start development in the Merseyside area. That development will create 33,000 new jobs. The hon. Member for Southwark (Mr. Gunter) read from the Sunday Times to the effect that those 33,000 new jobs had been reduced to an estimated, figure of 14,000. That is wrong. The number of jobs may have been reduced by a small amount—down, perhaps, to 30,000 or 29,000, as an estimate—but certainly not down to 14,000.
When these new developments were introduced into Merseyside in 1960, to produce 33,000 new jobs, that figure was against only 20,000 unemployed at that time. As a result, Merseyside was partially demoted from being a development district; that is to say, I.D.C.s were not excluded from the area, but the help by, grant to those wanting to set up business there was no longer available.
On Merseyside, therefore, we have now no chance of attracting industry in competition with full development districts. True, there have been new constructional jobs in the building of the Ford factory at Halewood, but against
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the total of unemployed the number has been insignificant.
Over the past two years on Merseyside it has been a case of jam tomorrow. The bread today has been disappearing, because many of the factories in Kirkby and in Speke have packed up, with the result that a number of jobs have been lost in the area. Take-overs have caused considerable resentment. The Plessey and Automatic Telephones take-over and the Courtaulds and British Anchor amalgamation caused a reduction in the number of jobs available in the area. So we now have about 34,000 unemployed.
But that does not tell the whole story. About 3,000 to 4,000 dockers are reporting every day and receiving attendance money because there are no jobs on the docks for them. Furthermore, the pension scheme has retired a number of dockers who would normally be working at this stage, for the strength and stamina of the older docker is absolutely lengendary.
I repeat that 34,000 unemployed is not the full story. For that reason, I think that we have a right to demand that Merseyside be given back its development district status in full. There would then be a positive encouragement to industry, by grants, to come to that area. We should be able to reduce the unemployment figure if that status were restored.
But I give the warning that that it is no good if it merely provides new factory buildings. That would take too long to provide the jobs for those who are now unemployed, and it is really unnecessary, because we have a great deal of vacant factory space there already. What is needed is assistance to restart those factories. If we could provide that assistance it would give quick relief and we should not have the troubles on Merseyside which we have at the moment on the big building sites. Lt would give quick relief if vacant factory space could be used and if some assistance could be given to that end. I believe that the Local Employment Act enables the Government to give that assistance.
There are also many factories which have not been abandoned and which, although not vacant, do not have full order books. The Government can

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help here by placing Government contracts in the area. This is a recognised form of preference for a development district. I hope that my hon. Friend the Parliamentary Secretary will put to his right hon. Friend this very important point, namely, that unless some Government orders are placed in the district many of these factories which are still operating will join those which have been abandoned and which are now just vacant factory space.
In addition to Government orders for factory work, there are, of course, the Government orders which can be given in ship repairing and, indirectly, in house building. Where are the naval vessels which we used to have for repair on Merseyside? Some of the Jeremiahs shake their heads and say that areas like Merseyside rely on a declining industry and they couple ship repairing with coal and cotton. I deny that ship repairing and shipbuilding is a contracting or declining industry, at any rate permanently. It is a very live industry and can go on being a live industry. I claim that Merseyside is entitled to its share of Government ship repairing and building.
This leads me to the subject of docks in general. Last Friday, Her Majesty the Queen opened the Langton River entrance dock in Liverpool Docks. It was a great act of solid confidence by the Merseyside dock authorities to build that magnificent new dock, but there is still a great lack of deep-water berths. We shall go on losing shipping and shipbuilding and ship repairing to the Continent unless we have more of them.
I should like to see another dock put alongside the Gladstone Dock in an area which has been reserved for a dock in my own constituency. I believe that an act of that sort would be a great act of faith in regard to the dock facilities of this country. Liverpool is not in any way a declining port, but it has very heavy maintenance expenditure, particularly on dredging, and, as a result, it is at a disadvantage in competing with other ports in that its dock dues are very high. In this respect it is entitled to a national contribution, because it certainly would be a national disaster if Liverpool ever ceased to be the great transport and distribution centre which it has been in the past.
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I do not go all the way with those who ask for the return of the development district status to Merseyside because they would like to introduce innumerable manufacturing industries there and would like to turn it into something like Birmingham. I should prefer to see an effort made to restore and rehabilitate Merseyside as the great distribution and transport area which it has been in the past; that means the rehabilitation of the docks and the modernising of the marshalling and storage facilities on the docks so that the area can retain its position as a great transport nerve centre. That involves the improvement of the road and rail access to the docks, and there one would hope that the Government would invest public money in improving that road and rail access.
To pass from shipping and the docks, I want to mention housing and house building as being one direction in which unemployment could be relieved in the district. The tremendous slum clearance and rebuilding programme that is necessary in Liverpool and in the area north of Merseyside is well-known. We have about 80,000 new houses to be built to replace the slums. If orders could be given by the local authorities for mass production of the quick construction types of flats and houses, there are several big contractors who would be prepared to place factories in the Merseyside area to build the components for that quick construction of flats or houses. This would provide employment for the factory workers and for the building workers, and the unemployment amongst the latter is very high on Merseyside at present.
I ask my right hon. Friend to look at this possibility. If the local authorities cannot give the big orders for the quick construction of houses and blocks of flats, the Government should take on the job and appoint a development corporation to do it. I believe that this is the only way to make rapid progress with house building and to provide a great amount of employment in one area and that it can be done well on Merseyside. There is no overall shortage of land there. The land can be found. For example, if the company called Railway Sites Limited would get on to the job of finding where vacant railway sites are and where development could take

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place, it would find that there would be a great amount of land for housing development. It would be valuable if there could be co-ordination between factory development and housing development. There, the £25 million for housing associations might well be put to good use.
I think that in these remarks I have shown that so many Ministries are concerned, as my hon. and gallant Friend the Member for The Hartlepools (Commander Kerans) has mentioned, that there might be some advantage in coordination. The Minister of Housing and Local Government, the Minister of Public Building and Works, the Minister of Labour, the President of the Board of Trade and the Minister of Transport are all deeply concerned in this problem, and without co-operation between all of them it cannot successfully be tackled. I wonder sometimes whether a co-ordinating Minister of State might be the appropriate answer.
However that may be, I am quite sure that if Merseyside were put on an equal basis of competition with others who have a like unemployment problem, the unemployment difficulties of the area could be solved. I ask again that Merseyside be put back into the development district status and that my right hon. Friend looks at the problem from the point of view of restoring that area to its great position as a transport and distribution area.
8.36 p.m.
Mr. Bruce Millan: The hon. Member for Crosby (Mr. Graham Page) has just been speaking about Merseyside. I want to speak principally about Scotland. But I think it is worth commenting that such a large number of hon. Members opposite have been contributing to this debate and saying in effect what we on this side of the House have been saying for so long—that, however well-intentioned the Government may have been and however good the intentions of the Local Employment Act, that Act has in fact failed to solve this problem of regional unemployment.
The speech of the Chancellor of the Exchequer this afternoon was profoundly disappointing, and it had in particular absolutely nothing in it from the Scottish point of view. We had been expecting the Chancellor to bring forward some
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new ideas. He has received quite a number of suggestions today, and in the Press recently. What the Chancellor said was, "I have taken some steps up to the present to stimulate the economy and I do not believe that anything more is necessary" A particularly disheartening feature of his speech was the point at which he said that there would be great difficulties if the unemployment rate was lower than it is at present, particularly from the point of view of the balance of payments and inflation. If this is the attitude of what is reputed to be an expansionist Chancellor, it makes one very doubtful whether the Government as a whole have any real apprehension of what the difficulties and problems are.
The Chancellor has taken a certain number of steps, particularly in the improvement of the investment allowances and in the reduction of Purchase Tax on motor cars, in order to give some stimulus to the economy. Of course, as far as these have gone they are perfectly acceptable to us, but from the point of view of cash payments, putting cash into people's hands, and giving a stimulus to the economy in that way, the Chancellor has done very little. Certainly post-war credits are being paid out, but a number of other things could have been done. One of them, which has been mentioned in a number of speeches today, is the raising of unemployment benefit and, indeed, of social security benefits as a whole. The Chancellor said that he did not want to stimulate a frothy consumers' boom. I hardly think that an increase in unemployment benefit would stimulate a consumers' boom.
There are other things which can be done. For example, there is the 10 per cent. Purchase Tax rate on essential goods. Could not the Chancellor give relief in that direction without waiting for the next Budget? This is the kind of stimulation of consumer demand which is not susceptible to the criticism of what happened before, when a large demand was created for consumers' durables and we had inflation, balance of payments difficulties, and so on, in consequence.
When we come from the national to the regional problem, one sees that there

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is very little either in what the Chancellor has said today or in what he did about a month ago which is of any relevance to the regional difficulties that are experienced in Scotland and in other parts of the country. Today, I was glad to see that so many hon. Members opposite, as well as on this side of the House, have now accepted that there is not simply a problem of local black spots of unemployment and that what we are dealing with are organic regional differences between different parts of the country. That is at least a step forward, although one sees absolutely nothing coming from the Government in solution of the problems that this brings.
We are familiar with what the problems are. Particularly in Scotland, the run-down of old industries is far more rapid than the build-up of the new. A certain temporary relief has been given to Scottish unemployment from migration, but it is a particularly undesirable way of getting relief. It is a point worth making that any relief from migration for Scotland or elsewhere can be only temporary and that, in the long term, nothing is mare enervating to any kind of economy than to lose the young, able-bodied men. That is precisely what is happening to Scotland. Temporary relief though it may be, it is a disastrous way to get it. From the longterm point of view, we shall never get a prosperous Scottish economy until we have the kind of conditions in which this continued migration of some of our best young people can be stopped.
What we need is not merely a temporary policy, but a sustained effort. One of the essential criticisms of the Government when dealing with this problem is that they last so much opportunity to deal with it in the years between, say, 1955 and 1959, when virtually nothing was done about the redistribution of industry policy. It was because the Government at that time failed to appreciate that a sustained effort—not a temporary effort spread over a few months —was required that in the last few years, when there have been general economic difficulties, the Government's policies have so miserably failed to match up to the problems.
In his speech today the Chancellor of the Exchequer said that hon. Members on this side of the House kept complain-
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ing about the Local Employment Act, but that in principle there was nothing wrong with that Act. Certainly, so far as it goes, we do not abject to the Local Employment Act in principle. It is a mistake to keep looking far new ideas and methods continually as if the old methods were necessarily completely unavailing. Certainly, however, new ideas are required.
There is a certain amount of substance in what the Chancellor has said about the Local Employment Act. The basic difficulty about its operation, apart from difficulties in its detailed application, has been that it cannot operate unless the economy as a whole is prosperous. We could tinker about with the Local Employment Act as much as we like, we could make improvements to it, we could improve the B.O.T.A.C. procedure, we could increase the inducements for the construction of new buildings, for example, and we could do a number of things about the Act, but these things by themselves will not solve the problem unless the economy as a whole is prosperous. That is the basic difficulty facing the Government today.
One aspect of the Local Employment Act which interests me is the extent to which assistance under it is going not to new firms coming in from outside but to existing firms in the area already. I have in mind particularly what is happening in Scotland, and the Chancellor of the Exchequer said today that, of course, we must encourage firms in Scotland and elsewhere to help themselves. It may interest the right hon. Gentleman to know that only last week, at an interview, I asked the President of the Board of Trade whether he could give me the breakdown of the total assistance which has gone to Scotland divided between assistance to firms coming in from outside, assistance to firms within Scotland itself which are developing and expanding employment, and assistance to firms in Scotland which may be eligible because, if they did not get the assistance, the numbers of employed would fall. Surprisingly, the President of the Board of Trade did not have the information. The Board of Trade has not done this exercise.
The more I think about it, the more it seems to me that the Board of Trade is not fully aware of the basic problems

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with which it is supposed to be dealing under the Local Employment Act. This is a simple point. It is implicit in the kind of thing which the Chancellor of the Exchequer was recommending today. But the Board of Trade has not done the exercise and does not know in analytical detail exactly how the Local Employment Act is working and, in particular, how it is helping existing industry as well as industry coming in from outside.
This brings me to a point which has been put in several speeches today. One suspects that the Local Employment Act has been helping far more new industry coming in from outside rather than existing industry. It has been said that there ought to be discriminatory investment allowances on a regional basis for areas of high unemployment. There may be practical difficulties in discriminatory taxation in a general sense, but there are no practical difficulties in discriminatory investment allowances which could not be overcome with a little ingenuity.
This is definitely one aspect of the matter which should be considered. In fact, the Government turned down a proposal to this effect made in the debate on the last Finance Bill. It is interesting to hear people such as the hon. Member for Bute and North Ayrshire (Sir F. Maclean) trotting out the proposal today as though there were something original in it and it had not been put forward before from this side of the House.
There are several other ways open to the Government to help an area like Scotland. A great part of our difficulty, for instance, comes from the rundown of the railway and mining industries. These are nationalised industries. The Government cannot completely wash their hands of policy in regard to them and say that it all has to be done on a purely commercial basis and that they cannot intervene. What about the new electricity station in the South of Scotland which all authorities agree will be required within the very near future? This is a big project. Shall it be an oil-fired station or a coal-fired station? Even on this the Secretary of State for Scotland will not commit himself. He says that we must look at the commercial considerations, that we must not put the South of Scotland Electricity Board at a financial disadvantage.
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When it comes to the operation of Government policy for the self-financing of our nationalised industries, it is all right to put the South of Scotland Electricity Board at a financial disadvantage in having to raise its tariffs by 11 per cent. to meet the Government's financial policy. If it is all right to intervene then and if it is all right to put the South of Scotland Electricity Board at a financial disadvantage in that way, why not put it at a financial disadvantage in building a coal-fired as distinct from an oil-fired generating station, particularly having regard to all the arguments on the other side in terms of employment in the mines and so on which are so great? In any case, it is by no means certain that the Board would be put at a financial disadvantage on this particular project by such a decision.
There is a complete lack of initiative on the part of the Government and a complete inability to match their approach to this particular problem of a coal-fired electricity generating station with the general problem of unemployment which we have in Scotland. If the Government cannot act in something in which they have the final and ultimate responsibility, how can we expect them to act vigorously towards private enterprise?
There is another thing which I want to mention. There were reports in the Press last week about opportunities for Scottish shipyards to tender for Russian cargo ships, but on this condition which one may very well regret—and I do regret it —that the Russians want to sell us a certain percentage of their oil. I want to know what the Government are going to do about this. Are they going to take the purist attitude that they cannot possibly have anything to do with this because it is an undesirable trade practice? Perhaps it is. Perhaps it is an undesirable trade practice, but it is a trade practice which, for example, has been acceptable to Italian industry. I understand that the Italians are importing Russian oil in quite considerable quantities.
I want to know whether this economic purism can be carried too far. If it is all right for Italy why should it be not all right for Britain and not all right for Scotland if there are opportunities for work which would be a relief for our shipbuilding industry? But again, we can only go by recent signs, and they are that

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the Government have no proposals for resolving the general background of unemployment which we have in Scotland at the present time.
There are a number of other things which could be done. My hon. Friend the Member for Hamilton (Mr. T. Fraser) was scoffed at by the Financial Secretary to the Treasury the other day when he said that if private enterprise were not willing to do the job, nationalised industry would do the job instead, and that further measures of nationalisation for the specific purpose of bringing employment to areas of high unemployment would be a very desirable thing. He was scoffed at by the Financial Secretary to the Treasury, and yet we had the Chancellor of the Exchequer this afternoon telling us that the only real source of expansion in the British economy at the present time is in public expenditure and in the nationalised industries.
I do not care what people's politics are. If we say to an unemployed man in Scotland or in the North-East or on Merseyside, "Are you in favour of nationalisation as a move to bring you employment?" I know very well What the answer will be, regardless of his political prejudices, but again the Government have not taken a wide view on this or on any other of the things which I have mentioned.
As for public works, as they are being called—I must say that I do not like the term very much: it sounds a bit like public relief-in so far as the expenditure of public money, of public capital expenditure is concerned, there are a number of obvious candidates in Scotland, for example, roads, the education services, the question of the fifth university; but the one which sticks out like a sore thumb is the question of housing, and in particular the question of slum clearance. It does not seem to have penetrated to the Government yet that the slum clearance programme in Scotland has been stagnating for about five years. As a matter of fact, the number of slums demolished in Scotland has been going down—certainly, only slightly; but it has been going down. The figure has hovered round about the 10,000 level.
Anyone who knows Scottish housing conditions knows that theme must be a
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wholesale clearance, a wholesale demolition of slums in Scotland if we are to get anything like decent housing conditions in the country, but again the Government are absolutely indifferent and they dilly-dallied about the fourth new town let alone a fifth or sixth new town, despite the great difficulties for Glasgow and Glasgow's overspill.
The Government introduced the Rent Act which is itself a factor inhibiting Glasgow's actions. The Government, again, have completely failed to take action about this; so houses become vacant, as people move out from Glasgow into the overspill areas, private landlords are selling them off, and the stock of rented accommodation in Glasgow is not going up despite 'the overspill programme. This is completely frustrating Glasgow's overspill programme and has prevented drastic action. From the short-term point of view as well as from that of the social consequences, this is something which ought to be tackled more vigorously than it has been up to the present time.
These are only a number of the things which the Government can do. They are all matters for which the Government have the responsibility and about which they can take action. The Government say "We have done our best, but private industry will not do what we want it to do." But these are all matters for which the Government have responsibility and, therefore, they do not have the excuse that someone is not willing to do what the Government would like them to do.
The point is that there is not a real will in the Government to do things of this kind. It was this will, impetus, and willingness to act vigorously about the problem that we wanted demonstrated by the Chancellor of the Exchequer today. Instead, we had absolutely nothing. We had no solution at all offered to the national and regional unemployment problems. This must rank as one of the most unsatisfactory debates that we have had for a very long time. I hope that the people are aware—I am confident that they are—of the complete bankruptcy of the Government about unemployment and other problems, and will draw the correct conclusions, particularly at a General Election.
8.56 p.m.
Mr. Stanley R. McMaster: We have listened to a number of interesting speeches. There is very little time left, and I hope that the House will forgive me if I show that an Ulsterman can speak at least as quickly as the hon. Member for Glasgow, Craigton (Mr. Millan).
The picture in my constituency is as bad as any in the United Kingdom. We now have an unemployment rate of more than 7 per cent., which has persisted for the past ten to fifteen years. I have seen more than 10,000 men discharged from the shipyards in East Belfast during the last twelve months and another 1,000·2,000 discharged as the result of the shutdown of the large linen mills there. This gives East Belfast an unemployment figure which is three or four times higher than the national average.
I was very glad to note from his speech my right hon. Friend's reference to Northern Ireland and his acceptance of the fact that our unemployment problem is one of peculiar difficulty, perhaps one of the most difficult in the Kingdom. I say "Kingdom", but I am speaking of the United Kingdom. Much play has been made during the debate on the question whether the country is one nation or divided into two nations. I stress that we are one nation, and, therefore, I urge my right hon. Friends to make sure that Northern Ireland does not suffer in relation to the large sum of money—£70 million—which is being devoted to public works in the United Kingdom. Northern Ireland should be able to share in this expenditure. It should be able to spend similar sums on housing in particular, but also on hospitals, schools and roads.
Turning to defence, we need to rebuild our Navy, and much of this work could be placed in our shipbuilding areas in Northern Ireland. The aircraft industry is also represented in my constituency. A proportion of defence expenditure could be diverted there deliberately to ease the unemployment situation in that seriously affected area.
My main suggestion is addressed to my right hon. Friend the Chancellor of the Exchequer—that he should once again consider the proposal for a tax holiday for new industries going to Northern Ireland and seeking to export
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manufactured goods. It is suggested that such industries should have tax relief for a number of years—perhaps a limited number of years; say, five or seven—after a factory is established.
It is hard to address the House, Mr. Speaker, over the burble from the benches opposite. I know that hon. Members opposite are not particularly interested in Northern Ireland. I noticed that in the speech of the hon. Member for Southwark (Mr. Gunter) not one mention was made of Northern Ireland, but my right hon. Friend the Chancellor of the Exchequer referred to it. I am not surprised that the Opposition are paying little attention to my remarks.
I should like to see the administrative difficulties which my right hon. Friend mentioned overcome. Our function is to overcome administrative difficulties. Our neighbours in Southern Ireland are able to offer such a tax holiday, and we have to attract industry in competition with other countries such as the Irish Free State. This will be even more serious if Eire and Britain enter the Common Market, because we must be able to attract industry to Northern Ireland.
I should like to see this problem considered by the National Economic Development Council as a matter of priority. I should like to be assured by my right hon. Friend the Minister of Labour that the differentials, which have existed over the past ten years and which have helped us to attract industry to Northern Ireland, will be maintained. This is a matter of great urgency, in view of the Common Market negotiations. We have excellent labour relations in Northern Ireland, and I would like a firm statement of intention by the Government to match the appreciation by my right hon. Friend the Chancellor of the Exchequer of the seriousness of our problem.
9.1 p.m.
Mr. James Callaghan: We were all very interested to hear about the problems of Northern Ireland, and certainly most interested in illusion of the hon. Member for Belfast, East (Mr. McMaster) that he represents one nation. I do not know that that will go down equally well in every part of Ireland. But the hon.

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Member's usual courtesy deserted him. He said that hon. Members on this side of the House were not interested in the problems of Northern Ireland. He would not have made this speech today if it had not been for the Opposition's Motion.
Mr. McMaster Mr. McMaster rose—
Mr. Callaghan: The hon. Member has made a charge and I am replying to it. I can recall only one occasion since 1955 when the Government have found time to debate the problems of Northern Ireland. On every other occasion time has been found by the Opposition. I sometimes wonder why hon. Members from Northern Ireland call themselves Ulster Unionists and continue to support the Conservative Party, because that party has done very little for Northern Ireland over the years.
Mr. McMaster: Perhaps the hon. Gentleman will explain why, in a rather long speech, his hon. Friend the Member for Southwark (Mr. Gunter) did not say one word about our serious problems in Northern Ireland.
Mr. Callaghan: Nor did my hon. Friend speak about Wales, but that does not mean that no one on this side of the House is interested in Wales. In the debate on the Address in reply to the Queen's Speech, the Opposition put down an Amendment and reference was made in that Amendment to Northern Ireland. I spoke about the problems of Northern Ireland then. The hon. Member, however, voted with the Government, as he always does. There will be a future for Northern Ireland when it breaks away from the thraldom of the Ulster Unionist Movement.
I congratulate my hon. Friend the Member for Glasgow, Woodside (Mr. Carmichael) on the compassion and humanity with which he spoke in his maiden speech. It was a speech of which his father will be very proud, and I can say no more than that to him, except that I believe that we have a most notable recruit to our benches from Clydeside and that we heard the authentic voice of Scotland ringing out again this afternoon.
We must time the beginning of the debate. It really started in July, 1961, and not this afternoon. It started when
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the former Chancellor of the Exchequer, the right hon. and learned Member for Wirral (Mr. Selwyn Lloyd) announced his measures to strengthen—strengthen —the economy. I am sorry that he does not speak in these debates. Three times have I sat here and watched his pencil poised over his notes in debates of this kind. Never does he rise to give us the benefit of his advice. I hope that we can tempt him to do so before long, because he has a lot of explaining to do. It was he who set off to strengthen the economy at a time when unemployment was 258,000. As a result of strengthening the economy, unemployment is now 544,000. It was he who set off to strengthen the economy—
Sir Alexander Spearman Sir Alexander Spearman (Scarborough and Whitby) rose—
Mr. Callaghan: I have already given way once and I was late starting. I must push on.
It was the right hon. and learned Gentleman who set off to strengthen the economy at a time when the price level was much lower than it now is. It was he who set off to strengthen the economy at a time when exports were moving ahead quite fast. As a result of his strengthening, the increase in exports has slowed down quite noticeably and they are now increasing at the rate of only 3 per cent. per annum, whereas if we are to get the expansion in industry of which the present Chancellor is so fond of talking, we need, I understand, an increase in exports of 6 per cent. per year. We are getting half that figure now.
Right hon. Gentlemen opposite have also strengthened the economy in the sense that industry is running well below capacity, whereas in July, 1961, when this debate started, industry was running all out. Since the middle of this year, production has been stationary—the Chancellor told us so this afternoon. It has gone up by only 2 per cent. since July, 1960. It has increased by 2 per cent. in eighteen months. The Chancellor did not repeat that this afternoon, but he has twice said that production is increasing at an annual rate of 7 per cent.
Sir A. Spearman: It is true.
Mr. Callaghan: The hon. Gentleman says that it is true. Heaven help us if

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our finances are ever committed to his care. He knows as well as I do that when the former Chancellor put his measures into operation, production sagged until January of this year and that only from the January level has it increased by 7 per cent. However, compared with the moment when the then Chancellor intervened, it has gone up by 2 per cent. Is it fair to describe that as increasing at an annual rate of 7 per cent. per annum? If that is strengthening the economy—higher prices, unemployment up, industry running below capacity, exports slowing down—the unemployed can be forgiven for saying, "Heaven help us if they start to weaken the economy".
What are the portents for the future? The Chancellor told us quite clearly this afternoon, and the facts are already known, that industry is spending less on new plant today, and has been doing so for some time, than it did in 1961 or 1960. This is an ill omen and everyone must thank goodness that we have a public sector. If we did not have a public sector in which the Chancellor could put another £70 million of spending, the future for Scotland and the North and for parts of Wales would be very bleak. I am delighted that the Chancellor has put another £70 million of public money into this sector, and I hope that we shall not have any complaints from hon. Members opposite when the Estimates are presented later this year, because this is one way of preventing a further decline in employment. I am certain that the Chancellor is right to do it.
Another ill omen is that the number of vacancies for workers is decreasing still. As unemployment goes up, so the number of vacancies goes down. I fear that we have to look forward to a substantial increase in unemployment during the next few months.
On the other hand, as the Chancellor pointed out, productivity is increasing while unemployment is going up. The conventional explanation of this seems to be that firms are getting more efficient work out of their machinery, but, because of their lack of confidence in the future, they are discharging workers whom they might otherwise have held in the hope of a return to better times. I do not know whether that is the true explanation, but it is one which is
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advanced and the Chancellor was saying something like it this afternoon. He said that workers were being discharged while productivity was going up. But I cannot think of any industrialist who would want to discharge workers at the same time as he was getting more benefit out of the machinery he had installed if he had any confidence in the future employment of those workers. As the Chancellor knows, it is confidence in the Government which is entirely lacking among the business and industrial community of this country.
Sir A. Spearman: Does the hon. Gentleman appreciate that it is the industries which are expanding most, the oil refineries, plastics and basic chemicals, which are dis-hoarding more men than anyone else?
Mr. Callaghan: I am interested to hear that the new name for unemployment is dis-hoarding. I prefer the simple word. Unemployment is unemployment. As regards the type of industries which are dis-hoarding, it is true that a number which are technically advanced are doing this, but it is also true that if these industries could see a future in front of them they would not be creating unemployment themselves. I take a practical example from the Welsh valleys. There is an advertisement in the Press today of a large factory for sale by I.C.I. in Merthyr, a 59-acre site. It is dis-hoarding its employees, because it cannot see any future for that factory in South Wales.
I turn to the wider aspect of the portents for the future. One on which I think the Chancellor should have spent more time is the decrease in the prices of primary products of the underdeveloped nations. World prices have turned against them steadily over the last five to seven years, and, according to all the forecasts, the prices of primary products are likely to decline still further during the next two or three years, which will have a most lamentable effect both on their standards of life and also on out exporting industry. It would be the height of good morality and political and economic wisdom to ensure that the prices of primary products were increased, and I wish that the Chancellor would turn his attention to this subject to see if we cannot get some long-term

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agreements in order that the effect will be felt on our own industry.
There is a job to be done in these countries which could be of tremendous benefit to our industries. I was glad to hear the Chancellor say that he was thinking of increasing aid to the extent of about £10 million and, perhaps, tying it. I am not very happy about tying it because that prevents the poorest countries from buying in the cheapest market and from their point of view that is an important consideration, too. But it is not aid that matters; it is the price that they get for their commodities that matters, and it is upon this aspect that the Government should be concentrating to a greater extent than at present.
With regard to the economies of the rest of the world, it seems that, like our own economy, the world is in a state of balance and no one seems very confident whether there will be a world recession or Whether production and an expansion of the wealth of the world will go on. It is in a state of balance. In the absence of any definite indication one way or the other there can be no doubt that, in this country at any rate, the Chancellor has been much too cautious in his approach and that he should have speeded up the measures that he has taken. If he holds back too long, he will find himself in the middle of "stop-go" once again, and that he has to plunge suddenly in order to enable the economy to recover much faster than if he were to take it more steadily than he seems to be doing at present.
I ask the Chancellor this question. We did not hear anything this afternoon about the Government's economic target of 4 per cent. expansion per annum. If, 18 months ago, the former Chancellor took these measures to strengthen the economy, and if, as a result, we are still crawling along in bottom gear, growing at 2 per cent. per annum or thereabouts, when does the Chancellor propose to aim at his expansion of 4 per cent. per annum? When shall we get the increase in wealth we all wish to see? I expected to hear something from him about this. Will he aim at a 4 per cent. growth next year, or in 1964, Or is it just one of those mythical targets to which 'he set his hand and to which the Government have put their signatures but which mean nothing in reality?
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In a debate like this we might have expected the Chancellor to tell us the Government's views about the growth of the economy in this way. If he is serious in his view that the problem in these areas that we have been discussing —and I am inclined to agree with him—can be solved only in the context of a general expansion of industry, he should have told us when he expects to aim at such a target of growth as will enable tim to solve these problems. We did not hear a word about it.
Unemployment has grown and is likely to grow still more before it improves next spring or in the early part of the summer. Debate about unemployment started in July, 1961, but I would remind the right hon. Gentleman that the debate on the second problem—the problem of the distribution of industry—started in 1955. When we look over the Government's record it is astonishing to see how often the 1955 General Election marks the turning point in the Tory Party's approach to social policies. It was after that election that the Government decided to reverse the taxation tide in favour of the wealthy. It was after that election that they decided to allow the distribution of industry policy to go by default. Seven years later we are now trying to pick up the broken threads of that policy.
I can sum up the position by saying that in the last few years 75 per cent. of the new jobs have been created in the South, around the new conurbations. But there is widespread rural depopulation, and the combination of both factors has created two nations, with a continuing drift to the South.
The first indictment against the Government is that they have failed to use their powers under the Distribution of Industry Act. Perhaps, rather than say that they have failed to use them, I should say that they deliberately did not use them. It was not their philosophy to use them. In 1959 the Chancellor, then President of the Board of Trade, said:
"We believe we should start from the assumption that the economic and industrial expansion of the country should proceed freely in response to growing and changing consumer demand and that it should proceed on the principle of the most effective use of our national resources, especially in competitive conditions."—[OFFICIAL REPORT, 9th November, 1959; Vol. 613, c. 32.]
Mr. Maudling: What is wrong with that?
Mr. Callaghan: What is wrong with that? We have the continuing drift to the South, resulting in congestion in London and unemployment in the North. If the Chancellor does not understand that he is not fit to occupy his job.
Because he failed to use his powers under this Act he put in its place the Local Employment Act, which Lord Eccles told us was a lavish, ambitious and revolutionary Act. Three years later he has changed his mind. He has told the House of Lords that he was wrong. It is very rare that in the history of one Parliament the Minister who introduced a Bill should say that he was entirely wrong about its consequences, and that he thinks that we should do something entirely different. That, in effect, is what Lord Eccles told the House of Lords the other day.
The Local Employment Act has done some good work in specific areas, but as a means of distributing industry and ensuring an even balance throughout Scotland. Northern Ireland, Wales and the North of England it is a complete and utter failure. It is quite inadequate. It selects small industrial pockets of unemployment and tries to deal with them as they arise. There is no broad conception of planning on a regional basis. The Government do not attempt to deal with a whole area, taking in all the social and industrial complexes that go to make it up. They do not say, "How shall we try to get industry as a whole into a balance throughout the area?" They say, "A pit will close down in this village. Let us try to get a factory there." It is a good idea for the village, but does not the President of the Board of Trade understand that it does not solve the problem of the distribution of industry, which is the problem that we are now discussing?
The Act does not try to solve the problem of the growing congestion in London and the South, with the 75 per cent. of new jobs created there. This used to be part of the job of the President of the Board of Trade; it is not now. This is the problem that we are discussing. Let me say a word about the effect which it has had. This afternoon my right hon. and learned Friend
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the Member for Newport (Sir F. Soskice) raised the question of the Whitehead Iron & Steel Co. Ltd., and the Minister of Power gave a most inadequate reply. We are there faced with a situation in which a firm employing some 1,500 men in Newport is in danger of being taken over by a Scottish firm with large interests in Corby. I am not attacking it on that account, but the probability is that the re-rolling which is done at Whiteheads will finish at Newport and will be sent to Corby.
The Local Employment Act will not help in this situation. We shall create more difficulties in Corby and we shall create difficulties in South Wales. The question which I want to ask the Government is, what responsibility do they take for the planning of industry as a whole? Do they take any? Is the future of the steel industry of any real concern to them, or do they assume that we are already in the Common Market —because that will certainly throw up some substantial difficulties for Ministers to solve?
I have here an extract from The Times about the iron and steel industry;
"Britain has accepted that there are incompatibilities as regards certain powers of price fixing and the control of investment projects where they concern Community products".
What does that mean? Does it mean that when we go into the Common Market there will be no power at all to plan the location of the steel industry? Will there never be another Llanwern or Raverscraig? Are we to have our steel industry in future on the banks of the Thames, where we know much of the steel industry would like to be today?
I should like to ask the Minister of Labour whether this has been taken up in the discussions which we have had with the Brussels Treaty Powers and the Coal and Steel Community. Can he give us an assurance that as far as the steel industry is concerned we shall be able to ensure that the distribution of industry policy goes on?
There is one other point which I wish to make about the distribution of industry. On 13th December my right hon. Friend the Member for Battersea, North (Mr. Jay) asked the Prime Minister
"which Minister is responsible for co-ordinating Government policy …?"

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The Prime Minister replied:
"Co-ordination of the many aspects of national policy involved is best secured by consultation between the Ministers concerned in different aspects of the problem."—[OFFICIAL REPORT, 13th December, 1962; Vol. 1669, c. 578.]
This is a complete reversal of the policy which was followed by the Labour Government between 1945 and 1951 and which was followed at any rate at the beginning of their life by the first Conservative Government in Employment Policy, the White Paper on which postwar Governments acted. Paragraph 30 of that document reads:
"The Government therefore propose that the channel for the expression of Government policy in this matter shall be the Board of Trade, which will be the Department responsible for all general questions of industrial policy and will be suitably strengthened.… The President of the Board of Trade will be responsible to Parliament for all the general aspects of the policy"
It may be a question for argument whether it ought to be the President of the Board of Trade. Do the social questions which are involved in the distribution of industry and in replanning industry in the way in which we on this side of the House want it re-planned raise the question whether the President of the Board of Trade is the right man? Or should there not be some new Ministry created for this purpose which will amalgamate certain functions? That is a matter for argument, but what is quite clear is that this policy works successfully only when there is one Minister responsible for the whole of it and not a hurry-scurrying between a group of Ministers none of whom has the final responsibility for carrying out the policy. That is the one major reason why the distribution of industries policy has broken down.
We have been asked to say what remedies we propose in the present situation. We have stated them all before. Indeed, we have stated them so often that we are getting tired of repeating them, because they fall on deaf ears. I have here a list of 12 proposals which we have made at various times for dealing with this subject. I do not propose to go through them all now. The Chancellor could, within the limits of his philosophy, repay the post-war credits at a faster rate, because that would be a non-recurring expenditure and he would not be taking
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on any recurring liability. Apart from that, a whole series of proposals have been put forward from this side of the House time and again and they have been repeated again today, including that of increasing unemployment benefits.
The Chancellor did not attempt to answer the terms of the Motion. The high and rising level of unemployment is indeed the result of Government policy; the result of policies which began in July, 1961. Hon. Members opposite may not like to hear it, but unemployment is a part of this Government's policy. They want unemployment. Unemployment is their way of solving the problem and the Chancellor told us that this afternoon. "It would be an embarrassment," he said in effect, "if unemployment were to go down because we would run into balance of payment difficulties once again".
Mr. Maudling: We should get this clear. I said, and I think experience shows, that unless we have more elbow room it is difficult to halve the present rate of unemployment without running once again into inflationary dangers. This, I think, is perfectly true.
Mr. Callaghan: In that case I do not understand why the Chancellor should expect us to share the Government's views on the recent rise in the level of unemployment. They are crocodile tears. The Chancellor could lessen the amount of unemployment today if he chose to do so and every man on the dole today looks to the Chancellor and says, "You are responsible for my being there".
The Chancellor is not increasing output as fast as he could because he fears that if he does he will get into balance of payment difficulties. Is that not right? Is that not what he said? If that is true —and if, in fact, he is so concerned about balance of payments problems—and if he is keeping a high level of unemployment for the time being, what comes of all those stories about the £ never having been stronger in our lifetime? Must we, after 11 years of Tory rule, keep half a million people out of work because of the risk of our balance of payments difficulties should we put them back into employment?
It is equally true that under this Government the Chancellor must keep a high

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level of unemployment or risk a balance of payments crisis. That is why we shall have e unemployment until just before the next General Election, when the figure will go down in order to tide them over the election—and then it will grow again afterwards. The reason is that they have no long-term solution to these problems.
I feel bitterly angered when I hear the Chancellor and other Ministers denying that it is possible to put up unemployment benefits now. After all, 97s. 6d. is what a married man has on which to enjoy Christmas. That, of course, does not apply to everyone, for 1st January will be gift Tuesday for a lot of people. The Surtax concessions come into force on gift Tuesday. The Chancellor will not be able to offer to put up unemployment benefits, but he will see to it that a director getting £15,000 a year wild get £1,638 in tax remissions.
The Leader of the Liberal Party suggested that the incomes of some of the new directors might be referred to the National Incomes Commission. That would be an excellent idea if the Government really wanted to set an example to the nation. They send the painters' hours there. What about sending the fees to be drawn by some of these directors who have recently been appointed? It is astonishing that we should pay someone £6,000 a year or less to run our defences, or mess them up, and that he should then get £30,000 a year for selling soda water—about £1 a bubble.
We cannot accept the Government's Amendment. It is hypocritical of them to say that they share concern for the unemployed. This is the old story. They stand aside. These problems have nothing to do with them. They say they are very worried about them. It is just like Skybolt; if things go all right—well and good; but if they go wrong, blame the Americans. If the Central African Federation goes wrong, then blame the Labour Party. If the Tory Party is unpopular, blame the Press. So unemployment is not their responsibility. But they are very concerned about it. This is hypocrisy. They created the unemployment; they are responsible for it. We do not believe that their measures will be effective to overcome it, and we do not believe that,
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even though they should try to overcome it, they intend to try to overcome it for some months yet. For that reason, we reject the Government's Amendment, and hope that the House will support us in our Motion.
9.31 p.m.
The Minister of Labour (Mr. John Hare): In the first two parts of his speech the hon. Member for Cardiff, South-East (Mr. Callaghan) tried to address himself seriously to the argument, but I think that he enjoyed himself very much during the last ten minutes. It was a good knockabout turn, but it did not contribute very much to solving the problem of unemployment.
I should like to join the hon. Gentleman in congratulating the hon. Member for Glasgow, Woodside (Mr. Carmichael) on a really first-class maiden speech. Those of us who heard it were much impressed both with its sincerity and with the great skill with which it revealed some controversial matters in a way that was absolutely a model in a maiden speech. We hope very much to hear from the hon. Gentleman in future.
The hon. Member for Cardiff, South-East said that the debate about unemployment really began in July, 1961, when my right hon. and learned Friend the Member for the Wirral (Mr. Selwyn Lloyd) was Chancellor of the Exchequer. By implication, of course, the hon. Gentleman has criticised my right hon. and learned Friend for the present unemployment position. He does not acknowledge, or has not acknowledged in the House today, that unless my right hon. and learned Friend had acted as he did today's unemployment position might have been infinitely worse—[Interruption.] This is the trouble with hon. Members opposite—they will not face up to facts.
They know perfectly well that we were in a balance-of-payments crisis and that the £ was in danger. They also know that the position is reversed today; that the £ is strong, that our reserves are good, that our exports are growing, and that, even on the hon. Gentleman's figures, our production has been increasing.
They also know in their heart of hearts that we are more competitive in

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prices than we have been for many years past, and they also realise the importance of that to our export trade. We are, therefore, at this moment well poised for further expansion, and this is precisely what my right hon. Friend the Chancellor has in hand.
This has been a good debate. Debates on unemployment are debates in which it is difficult to keep a sense of proportion. Percentage rates, statistics, and so on, are familiar to economists, but we in this House represent human beings—and it is not the monopoly of hon. Members opposite to be concerned when unemployment is being discussed.
I think also, considering the speeches, that we did not run into what some people might have imagined would have been a real danger. We did not on both sides talk ourselves into a crisis. We did not try to create greater dismay than is justified. We did not try to destroy morale or to undermine confidence. [Laughter.] Hon. Members opposite laugh, but confidence is very much the key to this whole problem.
The hon. Member for Cardiff, South-East asked why there was not confidence, and said that, after all, the Government are in power and that they should have engendered confidence after eleven years. One of the troubles about confidence—and there are two—is that many industrialists are hesitating about proceeding with their plans for expansion because of doubts about the Common Market negotiations. The second—and I know that hon. Members opposite will not like it—is that many businessmen are badly advised in thinking that there might possibly be a change of Government. Hence their lack of confidence.
Hon. Members opposite were saying, "This is a sad story after eleven years of Tory rule". I wonder whether they would like to look at a figure or two? Today, there are 1¾ million more in employment in Britain than there were eleven years ago. This represents an increase of 160,000 new jobs each year. [HON. MEMBERS: "Where?"] The fall of a little more than 50,000 during the past year is small compared with the gains which I have just mentioned. Again, if people are interested in looking at What has happened in this country—the growth and expansion which we have
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seen in the last eleven years—it is right to point out that much of that growth has taken place in the newer industries and in those which are particularly important to the export trade. In the engineering and electrical goods industries there has been a rise in employment, in the last eleven years, of 24 per cent. In chemicals the labour force has risen by 13 per cent., and in vehicle production by 21 per cent.
Another significant factor is that during these eleven years distribution and the professional and scientific services have each increased by over 500,000. This therefore represents—and I hope that my hon. Friend will agree—a picture of very considerable expansion and one is only sorry that hon. Members opposite do not seem able to realise it. Having said this—[HON. MEMBERS: "What?"] —having pointed out that during the last eleven years we have gone through one of the greatest periods of expansion in the country, we are now dealing with the problem of 544,000 people who are out of jobs.
Mr. T. Fraser: The right hon. Gentleman talked about great expansion over the past eleven years. Is he aware that only last week he told the House that in that period the number of males employed in Scotland had been reduced by no less than 16,000?
Mr. Hare: I should like to say something later about Scotland.
I should like to turn now to the problem we are discussing—the 540,000 people who are without jobs. It would be quite wrong not to tell the House that, owing to the usual seasonal influences, this figure will get worse before it gets better, but it will, in fact, improve. I have no doubt about that. My right hon. Friend the Chanchellor of the Exchequer told us this afternoon about the massive measures that he is taking to reflate the economy. The Government are confident that they will have the effect which my right hon. Friend said they will. This does not mean, however, that in generally refiating the economy, we shall be able to overcome the problems that we find in the areas of high unemployment, particularly the North of Ireland, Scotland and the North-East of England.
I recognise that the Northern Ireland unemployment situation is an entirely

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different type of problem, requiring exceptional treatment, which I think the House accepted when it passed a Motion on 30th March which stated that it
"believes that Her Majesty's Government, together with the Government of Northern Ireland, would be fully justified in adopting further exceptional measures to achieve these ends."—[OFICIAL REPORT, 30th March, 1962; Vol. 656, c. 1711.]
As it is, the inducements which Northern Ireland can offer to industrialists, as my hon. Friends who represent Ulster constituencies know, are in advance of those held out by other areas, because we realise that there are many factors, particularly geography, which place Ulster in a particularly difficult and special position.
Coming now to Scotland and the North-East, here we have the problem of the older heavier industries contracting more quickly in terms of jobs than the influx of new and growing industries is making good. In looking at Scotland and the North-East, I believe that we should deplore the talk of two nations. I believe that the hon. Member for Wigan (Mr. Fitch), whose speech I very much enjoyed, was perfectly right in saying that he also resented the implication that if we went into Europe there would be this so-called "golden triangle". I think that the talk of two nations is not only dangerous—and by dangerous I mean that we could talk ourselves into a depression by auto-suggestion—but that it is also completely untrue.
Taking the November figures, in Huddersfield we had the same unemployment position as we have had in London, while Leeds and Bury were very little higher, Edinburgh and Manchester had less unemployment than Birmingham, Dundee less than Coventry, and Aberdeen less than Southend-on-Sea. My own view is that the southern part of the country is already getting far too congested, and it would be intolerable to accentuate these conditions at the expense of bleeding Scotland and the North-East of their skilled manpower—leaving communities without hope and with no capacity to attract new industries to them.
There are people—and I am glad that my hon. Friend the Member for Holland with Boston (Sir H. Butcher) drew attention to Glasgow in this connection—
1018
who suggest that the South is a far pleasanter place to live in. I think that many of us would dispute that. The areas to which we must persuade new industry to go have great assets. They have good ports and communications. The communications have been, and are being, greatly improved by the progressive policy that has been carried out by my right hon. Friend the Minister of Transport. There is good countryside, and many of these assets are much more accessible than in the case of many of the towns in the South.
The hon. Member for Hamilton (Mr. T. Fraser) said that we were not doing as much for Scotland in the way of public investment as we should. I have ascertained the figures and I can assure the hon. Gentleman that Scotland, quite rightly, is certainly getting her fair share. Taking investment per head in England and Wales as 100, Scotland is getting 123 in education, hospitals 124, roads 130 and housing 168. It is no use the hon. Member trying to juggle with figures in the way that he did, because these are the facts.
Mr. T. Fraser: Expenditure is going down.
Mr. Hare: Also, in the North-East, as my right hon. Friend the Chancellor of the Exchequer said, £6 million is being spent on roads this year and that amount is being doubled next year. Generally, it is the policy of my right hon. Friend to see that priority in all public expenditure should go to areas of higher unemployment.
Apart from the amenities and assets of these places to which I have referred, as many hon. Members have said, the quality of the people who dwell in these parts is perhaps the greatest asset. They may be tough in bargaining, but once they agree they stick to their bargain and, with possibly some exceptions, their labour relations are first-class. Let those who doubt this go to Scotland or to Durham, and lot them talk to the managements of new industries which have gone to these areas since the war. If they do this, as many of us have done—I have done so myself—they will find that these people, who, after all, are the pioneers who have gone up from the South, have nothing but praise for the adaptability, skill and hard-working

1019
qualities of the labour force there. These firms are, in fact, the best advertisers for these areas. I wish that more industrialists would talk to their colleagues and find out these things for themselves.
A great deal has been done to make known these facts by local authorities and by Members of Parliament on both sides of the House who represent the North-East. Also, I have not found Scottish Members in any way shy of extolling the virtues of Scotland. The Scottish Council, under the chairmanship of Lord Polwarth, is engaged in a real job in pointing out the many advantages that Scotland has for new and growing industries.
One of the troubles that we find, even when unemployment is high, is that industrialists are having great difficulties in getting the skilled manpower they need to meet their requirements. I know that during the expansionist period during 1951 and 1961 employers who would have been perfectly willing to go north were not able to do so because they could not find the skilled men available.
Hon. Members: Speak up.
Mr. Speaker: Order. When I hear hon. Members shouting "Speak up", I feel impelled to draw the attention of the House to the fact that it is making rather a noise and had better keep order.
Mr. Hare: I was talking of the need for increasing the pool of skilled labour so that areas of high unemployment can get the benefit of expansion as it comes.
As the House knows, we have recently published proposals for modernising our industrial training arrangements and I do not propose to go into them at length tonight. In many respects, they represent a complete break from the past. They have been well received and I shall press forward and seek the cooperation of employers and trade unions in setting up training boards industry by industry.
But, meanwhile, I shall continue to do all I can to get employers and trade unions to look far more urgently than they have done in the past at the length of apprenticeship, the age of entry and the quality and content of training. I do not want the time that must elapse
1020
before the setting up of these boards to be used as an excuse for doing nothing. That relates to the long term.
In the short term, as my right hon. Friend the Leader of the House made clear in replying to the debate on the Queen's Speech, we propose to provide more retraining for adults. I have been discussing with trade unions and employers means to get started on plans for this. As the House knows, some training of adults goes on at my Department's centres, but a substantial part of that is for disabled men. I hope to start two new centres in Scotland and one in Durham and to enlarge the existing Government training centre at Glasgow.
Mr. William Ainsley: How many people will be trained at the training centre in the North-East?
Mr. Hare: I am hoping to find jobs for—[HON. MEMBERS: "Answer."] I hope to start a class of 20 straight away. [Laughter.] The House may laugh, but I have been discussing the matter with trade union leaders, trying to obtain their support in retraining in both the building construction and the engineering industries. Although, in principle, they say that they agree that something should be done, when it gets down to the detail of setting up these training centres, either in Scotland or in Durham, I encounter considerable difficulties. Nevertheless, I intend to go ahead.
Dr. Jeremy Bray Dr. Jeremy Bray (Middlesbrough, West) rose—
Mr. Hare: There are a number of other points with which I want to deal. The question of Government offices was raised both by the right hon. Member for Orkney and Shetland (Mr. Grimond) and by the right hon. Member for Middlesbrough, East (Mr. Bottomley). In Newcastle-upon-Tyne, we have the Ministry of Pensions and National Insurance, we have the Post Office Saving Certificate Division at Durham and in Cardiff we have the Inland Revenue. We intend to do what we can to continue to move staff away from London wherever necessary.
I repeat what my right hon. Friend the Chancellor of the Exchequer said when he opened the debate, that the Government are keeping under close review

1021
the position of those receiving National Insurance benefits. This was referred to specifically in the Queen's Speech.
The hon. Member for Southwark (Mr. Gunter). who opened the debate with a very sincere and clear speech, laid great stress on the need for the improvement of labour relations if we were to make our way forward in the world and make the best use of the great assets which reside in this country. I agree with practically everything he said, but I think that he was rather unfair about the new Bill which has been published, dealing with contracts of service. He spoke of a man who might have been in employment for forty years and then, at the end, would have only four weeks' notice or four weeks' compensation if notice was not given. The point is that nothing of the sort has ever been put on the Statute Book before. Here is a formidable start —a start which, I think, can well lead to further developments.
As the hon. Gentleman knows, in the matter of redundancy, severance payments, retirement pensions and sick pay schemes, I am pressing forward as fast as I can with both sides of industry to see that better measures are brought about by agreement with the two sides of industry.
In all these things, we cannot, I think, expect to change overnight attitudes of mind which have existed for many years. We look to employers to be more enterprising in new departures, to seek new technological developments and to show a greater willingness to expand in new areas. We look to trade unionists to be
less dog-in-the-manger about the training in expanding industries of men displaced from the contracting industries, and we look to them to be more forthcoming in their attitude to new and developing techniques.
For the Government's part we shall concentrate all our efforts not only to bring new expanding industries to the areas, especially in Scotland and the North-East, which have suffered particularly from the decline in the old industries, but we shall concentrate also on having such measures as our economic resources allow to make these areas more attractive as centres of economic growth. I believe that it is only in these ways that the long-term problem can be solved.
The effect of the Motion would be to land us right back in the difficulties of last year. I therefore ask the House to reject it and to vote for the Amendment, which is positive, constructive, and which emphasises the Government's determination to secure expansion on a sound and lasting basis.
Dr. Dickson Mahon Dr. Dickson Mahon rose—
The Parliamentary Secretary to the Treasury (Mr. Martin Redmayne)The Parliamentary Secretary to the Treasury (Mr. Martin Redmayne) rose in his place and claimed to move, That the Question be now put.
Question, That the Question be now put, put and agreed to.
Question put accordingly, That the words proposed to be left out stand part of the Question:—
The House divided: Ayes 235, Noes 315.

Division No. 19.]

AYES

[10.0 p.m.

Abse, Leo

Boyden, James

Dalyell, Tam

Ainsley, William

Braddock, Mrs. E. M.

Darling, George

Albu, Austen

Bradley, Tom

Davies, G. Elfed (Rhondda, E.)

Allaun, Frank (Salford, E.)

Bray, Dr. Jeremy

Davies, Ifor (Cower)

Allen, Scholefield (Crewe)

Brockway, A. Fenner

Davies, S. O. (Merthyr)

Awbery, Stan (Bristol, Central)

Broughton, Dr. A. D. D.

Deer, George

Bacon, Miss Alice

Brown, Rt. Hon. George (Belper)

Delargy, Hugh

Baird, John

Butler, Herbert (Hackney, C.)

Dempsey, James

Barnett, Guy

Butler, Mrs. Joyce (Wood Green)

Diamond, John

Baxter, William (Stirlingshire, W.)

Callaghan, James

Dodds, Norman

Beaney, Alan

Carmichael, Neil

Driberg, Tom

Bellenger, Rh. Hon. F. J.

Castle, Mrs. Barbara

Dugdale, Rt. Hon. John

Bence, Cyril

Chapman, Donald

Ede, Rt. Hon. C.

Bennett, J. (Glasgow, Bridgeton)

Cliffe, Michael

Edelman, Maurice

Benson, Sir George

Collick, Percy

Edwards, Rt. Hon. Ness (Caerphilly)

Blackburn, F.

Corbet, Mrs. Freda

Edwards, Walter (Stepney)

Blyton, William

Craddock, George (Bradford, S.)

Evans, Albert

Boardman, H.

Cronin, John

Fernyhough, E.

Bottomley, Rt. Hon. A. G.

Crosland, Anthony

Finch, Harold

Bowden, Rt. Hon. H.W.(Leics.,S.W.)

Crossman, R. H. S.

Fitch, Alan

Bowles, Frank

Cullen, Mrs. Alice

Fletcher, Eric

Foot, Dingle (Ipswich)

Loughlln, Charles

Robinson, Kenneth (St. Pancras, N.)

Foot, Michael (Ebbw vale)

Lubbock, Eric

Rodgers, W. T. (Stockton)

Forman), J. C.

Mabon, Dr. J. Dickson

Ross, William

Fraser, Thomas (Hamilton)

McCann, John

Royle, Charles (Salford, West)

Galpern, Sir Myer

MacColl, James

Shinwell, Rt. Hon. E.

George, LadyMeganLloyd(Crmrthn)

MacDermot, Niall

Silverman, Julius (Aston)

Ginsburg, David

Mclnnes, James

Silverman, Sydney (Nelson)

Greenwood, Anthony

McKay, John (Wallsend)

Skeffington, Arthur

Grey, Charles

Mackie, John (Enfield, East)

Slater, Mrs- Harriet (Stoke, N.)

Griffiths, David (Rother Valley)

McLeavy, Frank

Slater, Joseph (Sedgefield)

Griffiths, Rt. Hon. James (Llanelly)

MacMillan, Malcolm (Western Isles)

Small, William

Griffiths, w. (Exchange)

MacPherson, Malcolm (Stirling)

Smith, Ellis (Stoke, S.)

Grimond, Rt. Hon. J.

Mallalieu, E. L. (Brigg)

Snow, Julian

Gunter, Ray

Mallalieu, J.P.W. (Huddersfield, E.)

Sorensen, R. W.

Hale, Leslie (Oldham, w.)

Manuel, Archie

Soskice, Rt. Hon. Sir Frank

Hannan, William

Mapp, Charles

Spriggs, Leslie

Harper, Joseph

Marsh, Richard

Steele, Thomas

Hart, Mrs. Judith

Mason, Roy

Stewart, Michael (Fulham)

Hayman, F. H.

Mellish, R. J.

Stonehouse, John

Healey, Denis

Mendelson, J. J,

Stones, William

Henderson, Rt.Hn.Arthur(Rwly Regis)

Millan, Bruce

Strauss, Rt. Hn. G. R. (Vauxhall)

Herbison, Miss Margaret

Milne, Edward

Stross,Dr.Barnett(Stoke-on-Trent,C.)

Hewitson, Capt. M.

Mitchison, G. R.

Swain, Thomas

Hill, J. (Midlothian)

Monslow, Walter

Swingler, Stephen

Hilton, A. V.

Moody, A, S.

Taverne, D.

Holman, Percy

Morris, John

Taylor, Bernard (Mansfield)

Holt, Arthur

Moyle, Arthur

Thomas, George (Cardiff, W.)

Houghton, Douglas

Mulley, Frederick

Thomas, Iorwerth (Rhondda, W.)

Howell, Charles A. (Perry Barr)

Neal, Harold

Thomson, G. M. (Dundee, E.)

Howell, Denis (Small Heath)

Noel-Baker, Francis (Swindon)

Thornton, Ernest

Hoy, James H.

Oliver, G. H.

Thorpe, Jeremy

Hughes Cledwyn (Anglesey)

Oram, A. E.

Timmons, John

Hughes, Emrys (S. Ayrshire)

Oswald, Thomas

Tomney, Frank

Hughes, Hector (Aberdeen, N.)

Owen, Will

Wade, Donald

Hunter, A. E.

Padley, W. E.

Wainwright, Edwin

Hynd, H. (Accrington)

Paget, R. T.

Warbey, William

Hynd, John (Attercliffe)

Panneil, Charles (Leeds, W.)

Watkins, Tudor

Irvine, A. J. (Edge Hill)

Pargiter, G A.

Weitzman, David

Irving, Sydney (Dartford)

Parker, John

Wells, Percy (Faversham)

Janner, Sir Barnett

Parkin, B. T.

Wells, William (Walsall, N.)

Jay, Rt. Hon. Douglas

Pavitt, Laurence

White, Mrs. Eirene

Jeger, George

Pearson, Arthur (Pontypridd)

Whitlock, William

Jones, Rt. Hn. A. Creech (Wakefield)

Peart, Frederick

Wigg, George

Jones, Dan (Burnley)

Pentland, Norman

Wilkins, W. A.

Jones J. Idwal (Wrexham)

Plummer, Sir Leslie

Willey, Frederick

Jones T. W. (Merioneth)

Popplewell, Ernest

Williams, D. J. (Neath)

Kelley, Richard

Prentice, RE.

Williams, L. (Abertillery)

Kenyon, Clifford

Price, J. T. (westhoughton)

Williams, W. R. (Openshaw)

Key, Rt. Hon. C. W.

Probert, Arthur

Williams, W. T. (Warrington)

King, Dr. Horace

Proctor, W. T.

Wilson, Rt. Hon. Harold (Huyton)

Lawson, George

Pursey, Cmdr. Harry

Winterbottom, R. E.

Ledger, Ron

Rankin, John

Woodburn, Rt. Hon. A.

Lee, Frederick (Newton)

Reid, William

Wyatt, Woodrow

Lee, Miss Jennie (Cannock)

Reynolds, G. w

Yates, Victor (Ladywood)

Lever, Harold (Cheetham)

Rhodes, H.

Zilliacus, K.

Lever, L. M. (Ardwick)

Roberts, Albert (Normanton)

Lewis, Arthur (West Ham, N.)

Roberts, Goronwy (Caernarvon)

TELLERS FOR THE AYES:

Upton, Marcus

Robertson, John (Paisley)

Mr. Short and Mr. Redhead.

NOES

Agnew, Sir Peter

Bingham, R. M.

Channon, H. P. G.

Aitken, W. T.

Birch, Rt. Hon. Nigel

Chataway, Christopher

Allan, Robert (Paddington, S.)

Bishop, F. P.

Clark, Henry (Antrim, N.)

Allason, James

Black, Sir Cyril

Clark, William (Nottingham, S.)

Amery, Rt Hon. Julian

Bossom, Clive

Clarke, Brig. Terence(Portsmth,W.)

Arbuthnot, John

Bourne-Arton, A.

Cleaver, Leonard

Ashton, Sir Hubert

Box, Donald

Cole, Norman

Atkins, Humphrey

Boyd-Carpenter, Rt. Hon. John

Cooke, Robert

Awdry, Daniel (Chippenham)

Boyle, Rt. Hon. Sir Edward

Cooper, A. E.

Balniel, Lord

Braine, Bernard

Cooper-Key, Sir Neill

Barber, Anthony

Brooke, Rt. Hon. Henry

Cordeaux, Lt.-Col. J. K.

Barlow, Sir John

Brooman-White, R.

Cordle, John

Barter, John

Brown, Alan (Tottenham)

Corfield, F. V.

Batsford, Brian

Browne, Percy (Torrington)

Costain, A. P.

Baxter, Sir Beverley (Southgate)

Bryan, Paul

Coulson, Michael

Beamish, Col. Sir Tufton

Buck, Antony

Courtney, Cdr. Anthony

Bell, Ronald

Buliard, Denys

Craddock, Sir Beresford

Bennett, F. M. (Torquay)

Bullus, Wing Commander Eric

Crawley, Aidan

Bennett, Dr. Reginald (Gos & Fhm)

Burden, F. A.

Crosthwaite-Eyre, Col. Sir Oliver

Berkeley, Humphrey

Butcher, Sir Herbert

Crowder, F. P.

Bevins, Rt. Hon. Reginald

Butler, Rt.Hn.R. A. (Saffron Walden)

Cunningham, Knox

Bidgood, John C.

Campbell, Gordon (Moray & Nairn)

Curran, Charles

Biffen, John

Carr, Robert (Mitcham)

Currie, G. B. H.

Biggs-Davison, John

Cary, Sir Robert

Dalkeith, Earl of

1024

1025

Dance, James

Joseph, Rt. Hon. Sir Keith

Profumo, Rt. Hon. John

d'Avigdor-Goldsmid, sir Henry

Kaberry, Sir Donald

Proudfoot, Wilfred

Deedes, Rt. Hon. W. F.

Kerby, Capt. Henry

Pym, Francis

Digby, Simon Wingfield

Kerr, Sir Hamilton

Quennell, Miss J. M.

Donaldson, Cmdr. C. E. M.

Kimball, Marcus

Ramsden, James

Doughty, Charles

Kirk, Peter

Rawlinson, Sir Peter

Drayson, G. B.

Lagden, Godfrey

Redmayne, Rt. Hon. Martin

du Cann, Edward

Lambton, Viscount

Rees, Hugh

Duncan, Sir James

Lancaster, col. C. G.

Rees-Davies, W. R.

Eden, John

Langford-Holt, Sir John

Renton, Rt. Hon. David

Elliot, Capt. Walter (Carshalton)

Leavey, J. A.

Ridley, Hon. Nicholas

Elliott,R.W.(Nwcastle-upon-Tyne,N.)

Leburn, Gilmour

Ridsdale, Julian

Emery, Peter

Legge-Bourke, Sir Harry

Rippon, Rt. Hon. Geoffrey

Errington, Sir Eric

Lewis Kenneth (Rutland)

Roberts, Sir Peter (Heeley)

Erroll, Rt. Hon. F. J.

Lilley, F. J. P.

Robson Brown, Sir William

Farey-Jones, F. W.

Lindsay, Sir Martin

Rodgers, John (Sevenoaks)

Farr, John

Linstead, Sir Hugh

Roots, William

Fell, Anthony

Litchfield, Capt. John

Ropner, Col. Sir Leonard

Fisher, Nigel

Lloyd, Rt.Hn. Geoffrey (Sut'nC'dfield)

Royle, Anthony (Richmond, Surrey)

Fletcher-Cooke, Charles

Lloyd, Rt. Hon. Selwyn (Wirral)

St. Clair, M.

Forrest, George

Longbottom, Charles

Scott-Hopkins, James

Fraser,Rt.Hn.Hugh(Stafford&Stone)

Longden, Gilbert

Seymour, Leslie

Fraser, Ian (Plymouth, Sutton)

Loveys, Walter H.

Sharpies, Richard

Freeth, Denzil

Lucas, Sir Jocelyn

Shepherd, William

Galbraith, Hon. T. G. D.

Lucas-Tooth, Sir Hugh

Skeet, T. H. H.

Gammans, Lady

McAdden, Sir Stephen

Smith, Dudley (Br'ntf'd & Chiswick)

Gardner, Edward

McArthur, Ian

Smithers, Peter

Gibson-Watt, David

McLaren, Martin

Smyth, Rt. Hon. Brig. Sir John

Gilmour, Ian (Norfolk Central)

McLaughlin, Mrs. Patricia

Soames, Rt. Hon. Christopher

Gilmour, Sir John (East Fife)

Maciay, Rt. Hon. John

Spearman, Sir Alexander

Glyn, Dr. Alan (Clapham)

McLean, Neil (Inverness)

Stanley, Hon. Richard

Goodhew, Victor

Macieod, Rt. Hn. Ian (Enfield, W.)

Stevens, Geoffrey

Gough, Frederick

MacLeod, John (Ross & Cromarty)

Steward, Harold (Stockport, S.)

Grant-Ferris, H.

McMaster, Stanley R.

Stodart, J. A.

Green, Alan

Macmillan, Maurice (Halifax)

Stoddart-Scott, Col. Sir Malcolm

Gresham Cooke, R.

Macpherson,Rt.Hn.Niall(Dumfrles)

Storey, Sir Samuel

Grosvenor, Lt.-Col. R, G.

Maginnis, John E.

Studholme, Sir Henry

Gurden, Harold

Maitland, Sir John

Summers, Sir Spencer

Hall, John (Wycombe)

Marlowe, Anthony

Tapsell, Peter

Hamilton, Michael (Wellingborough)

Marples, Rt. Hon. Ernest

Taylor, Sir Charles (Eastbourne)

Hare, Rt. Hon. John

Marshall, Douglas

Taylor, Edwin (Bolton, E.)

Harris, Reader (Heston)

Marten, Nell

Taylor, Frank (M'ch'st'r, Moss Side)

Harrison, Brian (Maldon)

Mathew, Robert (Honiton)

Taylor, W. J. (Bradford, N.)

Harrison, Col. Sir Harwood (Eye)

Matthews, Gordon (Meriden)

Teeling, Sir William

Harvey, Sir Arthur Vere (Macclesf'd)

Maudling, Rt. Hon. Reginald

Temple, John M.

Harvey, John (Walthamstow, E.)

Mawby, Ray

Thatcher, Mrs. Margaret

Harvie Anderson, Miss

Maxwell-Hyslop, R. J.

Thomas, Peter (Conway)

Hastings, Stephen

Maydon, Lt.-Cmdr. S. L. C.

Thompson, Kenneth (Walton)

Hay, John

Mills, Stratton

Thompson, Richard (Croydon, S.)

Heald, Rt. Hon. Sir Lionel

Mlscampbell, Norman

Thornton-Kemsiey, Sir Colin

Heath, Rt. Hon. Edward

Moore, Sir Thomas (Ayr)

Tiley, Arthur (Bradford, W.)

Henderson John (Cathcart)

Morgan, William

Tilney, John (Wavertree)

Hendry, Forbes

Morrison, John

Touche, Rt. Hon. Sir Gordon

Hicks Beach, Maj. W.

Mott-Radclyffe, Sir Charles

Turner, Colin

Hiley, Joseph

Nabarro, Gerald

Tweedsmulr, Lady

Hill, Dr. Rt. Hon. Charles (Luton)

Neave, Alrey

van Straubenzee, W. R.

Hill, J. E. B. (S. Norfolk)

Nicholls, Sir Harmar

vane, W. M. F.

Hirst, Geoffrey

Nicholson, Sir Godfrey

Vaughan-Morgan, Rt. Hon. Sir John

Hobson, Sir John

Noble, Rt. Hon. Michael

Vickers, Miss Joan

Hocking, Philip N.

Nugent, Rt. Hon. Sir Richard

Vosper, Rt. Hon. Dennis

Holland, Philip

Oakshott, Sir Hendrie

Wakefield, Sir Wavell

Hollingworth, John

Orr, Capt. L. P. S.

Walder, David

Hope, Rt. Hon. Lord John

Orr-Ewing, C. Ian

Walker, Peter

Hopkins, Alan

Osborn, John (Hallam)

Walker-Smith, Rt. Hon. Sir Derek

Hornby, R. P.

Osborne, Sir Cyril (Louth)

Watkinson, Rt. Hon. Harold

Hornsby-smith, Rt. Hon. Dame P.

Page, Graham (Crosby)

Webster, David

Howard, Hon. G. R. (St. Ives)

Page, John (Harrow, West)

Wells, John (Maidstone)

Howard, John (Southampton, Test)

Pannell, Norman (Kirkdale)

Whitelaw, William

Hughes Hallett, Vice Admiral John

Partridge, E.

Williams, Dudley (Exeter)

Hughes-Young, Michael

Pearson, Frank (Clitheroe)

Wills, Sir Gerald (Bridgwater)

Hulbert, Sir Norman

Peel, John

Wilson, Geoffrey (Truro)

Hurd, Sir Anthony

Percival, Ian

Wise, A. R.

Hutchison, Michael Clark

Peyton, John

Wolrige-Gordon, Patrick

Iremonger, T. L.

Pickthorn, Sir Kenneth

Wood, Rt. Hon. Richard

Irvine, Bryant Godman (Rye)

Pike, Miss Mervyn

Woodhouse, C. M.

James, David

Pilkington, Sir Richard

Woodnutt, Mark

Jenkins, Robert (Dulwich)

Pitman, Sir James

Woollam, John

Jennings, J. C.

Pitt, Dame Edith

Worsley, Marcus

Johnson, Dr. Donald (Carlisle)

Pott, Percivall

Yates, William (The Wrekin)

Johnson, Eric (Blackley)

Powell, Rt. Hon. J. Enoch

Johnson Smith, Geoffrey

Price, David (Eastleigh)

TELLERS FOR THE NOES:

Jones, Arthur (Northants, S)

Price, H. A. (Lewisham, w.)

Mr. Chichester-Clark and

Prior-Palmer, Brig. Sir Otho

Mr. Finlay.

Question put, That the proposed words be there added:—
The House divided: Ayes 311, Noes 235.

Division No. 20.]

AYES

[10.13 p.m.

Agnew, Sir Peter

du Cann, Edward

Kimball, Marcus

Aitken, W. T.

Duncan, Sir James

Kirk, Peter

Allan, Robert (Paddington, S.)

Eden, John

Lambton, viscount

Allason, James

Elliot, Capt. Walter (Carshalton)

Lancaster, Col. C- G.

Amery, Rt. Hon. Julian

Elliott, R.W.(Nwcastle-uPon-Tyne,N.)

Langford-Holt, Sir John

Arbuthnot, John

Emery, Peter

Leavey, J, A.

Ashton, Sir Hubert

Errington, Sir Eric

Leburn, Gilmour

Atkins, Humphrey

Erroll, Rt. Hon. F. J.

Legge-Bourke, Sir Harry

Awdry, Daniel (Chippenham)

Farey-Jones, F. W.

Lewis, Kenneth (Rutland)

Balniel, Lord

Farr, John

Lilley, F. J. P.

Barber, Anthony

Fell, Anthony

Lindsay, Sir Martin

Barlow, Sir John

Fisher, Nigel

Linstead, Sir Hugh

Barter, John

Fletcher-Cooke, Charles

Litchfield, Capt. John

Batsford, Brian

Forrest, George

Lloyd,Rt.Hn.Geoffrey(Sut'nC'dfield)

Beamish, Col. Sir Tufton

Fraser,Rt.Hn.Hugh(Stafford&Stone)

Lloyd, Rt. Hon. Selwyn (Wirral)

Bell, Donald

Fraser, Ian (Plymouth, Sutton)

Longbottom, Charles

Bennett, F. M. (Torquay)

Freeth, Denzil

Longden, Gilbert

Galbraith, Hon. T. G. D.

Loveys, Walter H.

Bennett, Dr. Reginald (Cos &Fhr.)

Gammans, Lady

Lucas, Sir Jocelyn

Berkeley, Humphry

Gardner, Edward

Lucas-Tooth, Sir Hugh

Bevins, Rt. Hon. Reginald

Gibson-Watt, David

McArthur, Ian

Bidgood, John C.

Gilmour, Ian (Norfolk Central)

McLaren, Martin

Biffen, John

Gilmour, Sir John

McLaughlin, Mrs. Patricia

Biggs-Davison, John

Glyn, Dr. Alan (Clapham)

Maclay, Rt. Hon. John

Bingham, R. M.

Goodhew, Victor

McLean, Nell (Inverness)

Birch, Rt. Hon. Nigel

Gough, Frederick

Macleod, Rt. Hn. lain (Enfield, W.)

Bishop, F. P.

Grant-Ferris, R.

MacLeod, John (Ross & Cromarty)

Black, Sir Cyril

Green, Alan

McMaster, Stanley R.

Bossom, Clive

Gresham Cooke, R.

Macmillan, Maurice (Halifax)

Bourne-Arton, A.

Grosvenor, Lt.-Col. R. G.

Macpherson,Rt.Hn.Nlall(Dumfrles)

Box, Donald

Gurden, Harold

Maginnis, John E.

Boyd-Carpenter, Rt. Hon. John

Hall, John (Wycombe)

Maitland, Sir John

Boyle, Rt. Hon. Sir Edward

Hamilton, Michael (Wellingborough)

Marlowe, Anthony

Braine, Bernard

Hare, Rt. Hon. John

Marples, Rt. Hon. Ernest

Brooke, Rt. Hon. Henry

Harris, Reader (Heston)

Marshall, Douglas

Brooman-White, R.

Harrison, Brian (Maldon)

Marten, Neil

Brown, Alan (Tottenham)

Harrison, Col. Sir Harwood (Eye)

Mathew, Robert (Honlton)

Browne, Percy (Torrington)

Harvey, Sir Arthur Vere (Macciesf'd)

Matthews, Gordon (Meriden)

Bryan, Paul

Harvey, John (walthamstow, E.)

Maudling, Rt. Hon. Reginald

Buck, Antony

Harvie Anderson, Miss

Mawby, Ray

Bullard, Denys

Hastings, Stephen

Maxwell Hyslop, R. J.

Bullus, Wing Commander Eric

Hay, John

Maydon, Lt.-Cmdr. S. L. C.

Burden, F. A.

Heald, Rt. Hon. Sir Lionel

Mills, Stratton

Butcher, Sir Herbert

Heath, Rt. Hon. Edward

Miscampbell, Norman

Butler, Rt.Hn.R.A. (Saffron Walden)

Henderson, John (Cathcart)

Moore, Sir Thomas (Ayr)

Campbell, Gordon (Moray & Nairn)

Hendry, Forbes

Morgan, William

Carr, Robert (Mitcham)

Hicks Beach, Maj. W.

Morrison, John

Cary, Sir Robert

Hiley, Joseph

Nabarro, Gerald

Channon, H. P. C.

Hill, Dr. Rt. Hon. Charles (Luton)

Neave, Alrey

Chataway, Christopher

Hill, j. E. B. (S. Norfolk)

Nicholls, Sir Harmar

Clark, Henry (Antrim, N.)

Hirst, Geoffrey

Nicholson, Sir Godfrey

Clark, William (Nottingham, s.)

Hobson, Sir John

Noble, Rt. Hon, Michael

Clarke, Brig. Terence(Portsmth, W.)

Hocking, Philip N.

Nugent, Rt. Hon. Sir Richard

Cleaver, Leonard

Holland, Philip

Oakshott, Sir Hendrie

Cole, Norman

Hollingworth, John

Orr, Capt. L. P. S.

Cooke, Robert

Hope, Rt. Hon. Lord John

Orr-Ewing, C. Ian

Cooper, A. E.

Hopkins, Alan

Osborn, John (Hallam)

Cooper-Key, Sir Neill

Hornby, R. P.

Osborne, Sir Cyril (Louth)

Cordeaux, Lt.-Col. J. K.

Hornsby-Smith, Rt. Hon. Dame P.

Page, Graham (Crosby)

Cordle, John

Howard, Hon. G. R. (St. Ives)

Page, John (Harrow, West)

Corfield, F. V.

Howard, John (Southampton, Test)

Pannell, Norman (Kirkdale)

Costain, A. P.

Hughes Hallett, vice-Admiral John

Partridge, E.

Coulson, Michael

Hughes-Young, Michael

Pearson, Frank (Clitheroe)

Courtney, Cdr. Anthony

Hulbert, Sir Norman

Peel, John

Craddock, Sir Beresford

Hurd, Sir Anthony

Percival, Ian

Crawley, Aidan

Hutchison, Michael Clark

Peyton, John

Crosthwaite-Eyre, Col. Sir Oliver

Iremonger, T. L.

Pickthorn, Sir Kenneth

Crowder, F. P.

Irvine, Bryant Godman (Rye)

Pike, Miss Mervyn

Cunningham, Knox

James, David

Pilkington, Sir Richard

Curran, Charles

Jenkins, Robert (Dulwich)

Pitman, Sir James

Currie, G. B. H.

Jennings, J. C.

Pitt, Dame Edith

Dalkeith, Earl of

Johnson, Dr. Donald (Carlisle)

Pott, Percivall

Dance, James

Johnson, Eric (Blackley)

Powell, Rt. Hon. J. Enoch

d'Avigdor-Goldsmid, Sir Henry

Johnson Smith, Geoffrey

Price, David (Eastleigh)

Deedes, Rt. Hon. W. F.

Jones, Arthur (Northants, S)

Price, H. A. (Lewisham, W.)

Digby, Simon Wingfield

Joseph, Rt. Hon. Sir Keith

Prior-Palmer, Brig. Sir Otho

Donaldson, Cmdr. C. E. M.

Kaberry, Sir Donald

Profumo, Rt. Hon. John

Doughty, Charles

Kerby, Capt. Henry

Proudfoot, Wilfred

Drayson, G. B.

Kerr, Sir Hamilton

Pym, Francis

Quennell, Miss J. M.

Stevens, Geoffrey

Vaughan-Morgan, Rt. Hon. Sir John

Ramsden, James

Steward, Harold (Stockport, S.)

Vickers, Miss Joan

Rawlinson, Sir Peter

Stodart, J. A.

Vosper, Rt. Hon. Dennis

Redmayne, Rt. Hon. Martin

Stoddart-Scott, Col. Sir Malcolm

Wakefield, Sir Wavell

Rees, Hugh

Storey, Sir Samuel

Walder, David

Rees-Davies, W. R.

Studholme, Sir Henry

Walker, Peter

Renton, Rt. Hon. David

Summers, Sir Spencer

Walker-Smith, Rt. Hon. Sir Derek

Ridsdale, Julian

Tapsell, Peter

Watkinson, Rt. Hon. Harold

Rippon, Rt. Hon. Geoffrey

Taylor, Sir Charles (Eastbourne)

Webster, David

Roberts, Sir Peter (Heeley)

Taylor, Edwin (Bolton, E.)

Wells, John (Maidstone)

Robson Brown, Sir William

Taylor, Frank (M'ch'st'r, Moss Side)

Whitelaw, William

Rodgers, John (Sevenoaks)

Taylor, W. J. (Bradford, N.)

Williams, Dudley (Exeter)

Roots, William

Ropner, Col. Sir Leonard

Teeling, Sir William

Wills, Sir Gerald (Bridgwater)

Royle, Anthony (Richmond, Surrey)

Temple, John M.

Wilson, Geoffrey (Truro)

St. Clair, M.

Thatcher, Mrs. Margaret

Wise, A. R.

Scott-Hopkins, James

Thomas, Peter (Conway)

Wolrige-Gordon, Patrick

Seymour, Leslie

Thompson, Kenneth (Walton)

Wood, Rt. Hon. Richard

Sharpies, Richard

Thompson, Richard (Croydon, S.)

Woodhouse, C. M.

Shepherd, William

Thornton-Kemsley, Sir Colin

Woodnutt, Mark

Skeet, T. H. H.

Tiley, Arthur (Bradford, W.)

Woollam, John

Smith, Dudley (Br'ntf'd & Chlswick)

Tilney, John (Wavertree)

Worsley, Marcus

Smithers, Peter

Touche, Rt. Hon. Sir Gordon

Yates, William (The Wrekin)

Smyth, Rt. Hon. Brig. Sir John

Turner, Colin

Soames, Rt. Hon. Christopher

Tweedsmuir, Lady

TELLERS FOR THE AYES:

Spearman, Sir Alexander

van straubenzee, W. R.

Mr. Chichester-Clark and

Stanley, Hon. Richard

Vane, W. M. F.

Mr. Finlay.

NOES

Abse, Leo

Dugdale, Rt. Hon. John

Jones, T. W. (Merioneth)

Ainsley, William

Ede, Rt. Hon. C.

Kelley, Richard

Albu, Austen

Edelman, Maurice

Kenyon, Clifford

Allaun, Frank (Salford, E.)

Edwards, Rt. Hon. Ness (Caerphilly)

Key, Rt. Hon. C. W.

Allen, Scholefield (Crewe)

Edwards, Walter (Stepney)

King, Dr. Horace

Awbery, Stan

Evans, Albert

Lawson, George

Bacon, Miss Alice

Fernyhough, E.

Ledger, Ron

Baird, John

Finch, Harold

Lee, Frederick (Newton)

Barnett, Guy

Fitch, Alan

Lee, Miss Jennie (Cannock)

Baxter, William (Stirlingshire, W.)

Fletcher, Eric

Lever, Harold (Cheetham)

Beaney, Alan

Foot, Dingle (Ipswich)

Lever, L. M. (Ardwlck)

Bellenger, Rt. Hon. F. J.

Foot, Michael (Ebbw Vale)

Lewis, Arthur (West Ham, N.)

Bence, Cyril

Forman, J. C.

Lipton, Marcus

Bennett, J. (Glasgow, Bridgeton)

Fraser, Thomas (Hamilton)

Loughlin, Charles

Benson, Sir George

Galpern, Sir Myer

Lubbock, Eric

Blackburn, F.

George,Lady MeganLloyd(Crmrthn)

Mabon, Dr. J. Dickson

Blyton, William

Ginsburg, David

McCann, John

Boardman, H.

Greenwood, Anthony

MacColl, James

Grey, Charles

MacDermot, Nlall

Bottomley, Rt. Hon. A. G.

Griffiths, David (Rother Valley)

Mcinnes, James

Bowden, Rt. Hn. H. W.(Lelcs, S.W.)

Griffiths, Rt. Hon. James (Lanelly)

McKay, John (Wallsend)

Bowles, Frank

Griffiths, W. (Exchange)

Mackle, John (Enfield, East)

Boyden, James

Grimond, Rt. Hon. J.

McLeavy, Frank

Braddock, Mrs. E. M.

Gunter, Ray

MacMlllan, Malcolm (Western Isles)

Bradley, Tom

Hale, Leslie (Oldham, W.)

MacPherson, Malcolm (Stirling)

Bray, Dr. Jeremy

Hannan, William

Mallalleu, E. L. (Brigg)

Brockway, A. Fenner

Harper, Joseph

Mallalleu, J.P.W. (Huddersfield, E.)

Broughton, Dr. A. D. D.

Hart, Mrs. Judith

Manuel, Archie

Brown, Rt. Hon. George (Belper)

Hayman, F, H.

Mapp, Charles

Butler, Herbert (Hackney, C.)

Healey, Denis

Marsh, Richard

Butler, Mrs. Joyce (Wood Green)

Henderson, Rt.Hn.Arthur(RwlyRegiS)

Mason, Roy

Callaghan, James

Herbison, Miss Margaret

Mellish, R. J.

Carmichael, Nell

Hewitson, Capt. M.

Mendelson, J. J.

Castle, Mrs. Barbara

Hill, J. (Midlothian)

Millan, Bruce

Chapman, Donald

Hilton, A. V.

Milne, Edward

Cliffe, Michael

Holman, Percy

Mitchison, C. R.

Collick, Percy

Holt, Arthur

Monslow, Walter

Corbet, Mrs. Freda

Houghton, Douglas

Moody, A. S.

Craddock, George (Bradford, S.)

Howell, Charles A. (Perry Barr)

Morris, John

Cronin, John

Howell, Denis (Small Heath)

Moyle, Arthur

Crosland, Anthony

Hoy, James H.

Mulley, Frederick

Crossman, R. H. S.

Hughes, Cledwyn (Anglesey)

Neal, Harold

Cullen, Mrs. Alice

Hughes, Emrys (S. Ayrshire)

Noel-Baker, Francis (Swindon)

Dalyell, Tarn

Hughes, Hector (Aberdeen, N.)

Oliver, G. H.

Darling, George

Hunter, A. E.

Oram, A. E.

Davies, G. Elfed (Rhondda, E.)

Hynd, H. (Accrington)

Oswald, Thomas

Davies, Hoi- (Gower)

Hynd, John (Attercliffe)

Owen, Will

Davies, S. O. (Merthyr)

Irvine, A. J. (Edge Hill)

Padley, W. E.

Deer, George

Irving, Sydney (Dartford)

Paget, R. T.

Delargy, Hugh

Janner, Sir Barnett

Pannell, Charles (Leeds, W.)

Dempsey, James

Jay, Rt. Hon. Douglas

Pargiter, G. A.

Diamond, John

Jeger, George

Parker, John

Dodds, Norman

Jones, Rt. Hn. A. Creech(Wakefield)

Parkin, B. T.

Donnelly, Desmond

Jones, Dan (Burnley)

Pavitt, Laurence

Driberg, Tam

Jones, J. Idwal (Wrexham)

Pearson, Arthur (Pontypridd)

1030

1031

Peart, Frederick

Slater, Joseph (Sedgefield)

Wade, Donald

Pentland, Norman

Small, William

Wainwright, Edwin

Plummer, Sir Leslie

Smith, Ellis (Stoke, S.)

Warbey, William

Popplewell, Ernest

Snow, Julian

Watkins, Tudor

Prentice, R. E.

Sorenson, R. W.

Weitzman, David

Price, J. T. (Westhoughton)

Soskice, Rt. Hon. Sir Frank

Wells, Percy (Faversham)

Probert, Arthur

Spriggs, Leslie

wells, William (Walsall, N.)

Proctor, W. T.

Steele. Thomas

White, Mrs. Eirene

Pursey, Cmdr. Harry

Stewart, Michael (Fulham)

Whitlock, William

Rankin, John

Stonehouse, John

Wigg, George

Reid, William

Stones, William

Wilkins, W. A.

Reynolds, C. W.

Strauss, Rt. Hn. G. R. (Vauxhall)

Willey. Frederick

Rhodes, H.

Stross, Dr. Barnett(Stoke-on-Trent.C.)

Willams, D.J.(Neath)

Roberts, Goronwy (Caernarvon)

Swain, Thomas

Williams, L1. (Abertillery)

Robertson, John (Paisley)

Swingler, Stephen

Williams, W. R. (Openshaw)

Robinson, Kenneth (St. Pancras, N.)

Taverne, D.

Williams, W. T. (Warrington)

Rodgers, W. T. (Stockton)

Taylor, Bernard (Mansfield)

Wilson, Rt. Hon. Harold (Huyton)

Ross, William

Thomas, George (Cardiff, W.)

Winterbottom, R. E.

Royle, Charles (Salford, West)

Thomas, lorwerth (Rhondda, W.)

Woodburn, Rt. Hon. A.

Shinwell, Rt. Hon. E.

Thomson, G. M. (Dundee, E.)

Wyatt, Woodrow

Silverman, Julius (Aston)

Thornton, Ernest

Yates, Victor (Ladywood)

Silverman, Sydney (Nelson)

Thorpe, Jeremy

Zilliacus, K.

Skeffington, Arthur

Timmons, John

Slater, Mrs. Harriet (Stoke, N.)

Tomney. Frank

TELLERS FOR THE NOES:

Mr. Short and Mr. Redhead.

Main Question, as amended, put and agreed to.
Resolved,
That this House shares the concern of the Government at the recent rise in the level of unemployment and supports the actions of Her Majesty's Government to deal with the problems of certain areas particularly affected and to promote general industrial expansion on a sound basis.

LITHIUM CARBONATE (DUTY)
10.25 p.m.
The Minister of State, Board of Trade (Mr. Alan Green): I beg to move,
That the Anti-Dumping Duty (No. 2) Order 1962 (S.I., 1962, No. 2614), dated 29th November, 1962. a copy of which was laid before this House on 29th November, be approved.
This Order, under the Customs Duties (Dumping and Subsidies) Act, 1957, imposed an anti-dumping duty of Is. per lb on lithium carbonate originating in Canada. Lithium carbonate is an ingredient in vitreous enamels used on staves, refrigerators and other domestic appliances. This duty has been imposed in unusual circumstances, and I should like to give the House an account of the background.
The Board of Trade announced in September that it was considering an application from the British producers for anti-dumping duties on lithium carbonate—and also on a related product, lithium hydroxide—imported from the United States and Western Germany, and in early October the Board announced that it had accepted the extension of the application to lithium carbonate imported from Canada. The Board has not yet completed its full consideration of the application as a Whole.
Provided we are satisfied that the provisions of the Act are met we are ready to take appropriate action against serious "forestalling" or the equivalent — that is to say, if during the investigation of a case an exporter tries to build up stacks in the British market in anticipation of a passible anti-dumping duty, of if he is so slow in providing information that imports can continue without danger of penalty for longer than would otherwise have been the case. I emphasise that these circumstances arise very seldom, and up to now we have averted the danger by obtaining satisfactory undertakings from the exporters concerned.
In the case of Canadian lithium carbonate, the Canadian exporter was notified of the prima facie case for inquiry under the Act on 14th September, and was given until 19th October to make
1034
representations. This was in line with the Board's normal practice. By that date the firm concerned strongly denied dumping, but did not provide evidence to cause us to alter our opinion that they were dumping. We were willing to allow them more time because examination of other aspects of the case was not then complete, and lack of the resulting evidence was not yet holding up the completion of the case.
By late November, however, we could forsee that a decision might soon be held up simply and solely by lack of this evidence; at the same time, we learned that a consignment from Canada was imminent. We considered that it would be wrong to allow the consignment to appear on the British market at what, as far as our existing information went, would be a dumped price. Accordingly, we asked if the exporter would be prepared to hold up the shipment or, if it was already on the way, to give an assurance that no sales would be made from it until the case was finally settled. He was not prepared to do this. My right hon. Friend decided that in these circumstances we should take immediate action.
On our existing information Canadian lithium carbonate has been sold to Britain at an export price lower than the fair market price in Canada; that is to say, it has been dumped within the meaning of the Act. On existing evidence sales of Canadian material have caused material injury to the British lithium industry. In the circumstances, anti-dumping action appeared to be in the national interest. My right hon. Friend was accordingly satisfied that the three conditions for imposing duties under the Customs Duty (Dumping and Subsidies) Act, 1957 were fulfilled. The duty of ls. a lb. is equal to the margin of dumping established on the present evidence. The Board of Trade remains ready to consider further evidence from the exporter. If we were satisfied by this that he was not dumping, the Order could be revoked. The Act provides for him to claim the refund of any duty paid in the meantime.
We have imposed the duty with a good deal of reluctance. I emphasise that there has been no change in our normal practice of not interfering with ordinary

1035
trade while an anti-dumping case is under consideration. But, as an exceptioned measure to meet an exceptional situation, I commend the Order to the House.
10.30 p.m.
Mr. Douglas Jay: I am interested in the Order because the President of the Board of Trade has just been rebuking the Canadians for too free use of anti-dumping duties against us. No sooner has he done this than he brings forward this Order and imposes it solely on Canadian exports.
That does not necessarily mean that there is no case for it. I did not think the Parliamentary Secretary made out a very clear and convincing case, however. He asserted that harm was being done to what he called the lithium industry, Or the producers, but he did not tell us what the harm was or the damage which would result to British industry if the duty were not imposed. It may be that it would be serious damage, but we were not told.
I should like to ask him some questions. The Board of Trade rather frequently brings along these antidumping duties on chemical products—at any rate, we had the instance of fertilisers last summer. There are people who say that whenever I.C.I. go to the Board of Trade and demand an antidumping duty on some imports, very often on a product of which they are the sole producers in this country, the Board of Trade gives way with surprising ease, or at least with greater ease than in the case of other people. It might be because I.C.I. have had rather more practice in making out cases under the anti-dumping legislation than have other people.
I therefore ask the Minister whether the people he calls the producers, whether the lithium industry, are I.C.I. If not, will he tell us who else they are? Secondly, what is the total damage which is being done by these imports from Canada and, thirdly, how long does he expect the duties to remain in force? Does he look on them as a temporary measure to tide over an emergency or crisis for a few months, or are we introducing new import duties on an industrial raw material for an indefinite period ahead?
10.33 p.m.
Mr. Forbes Hendry: I am very sorry to intervene at this late hour of the night, but it seems to me that in introducing this Order my right hon. Friend is departing from the established precedent in bringing in an Order affecting only part of an industry. I should like him to give me some answers to questions arising out of that.
In parts of my constituency the paper industry has been worried about dumping by competitors in Canada, Australia and East Germany, and on several occasions has made application to my right hon. Friend the President of the Board of Trade for the imposition of antidumping duties. The industry has always been answered with the argument that before the Board of Trade can consider action under the legislation it must be satisfied not only that dumping and subsidisation is taking place but that this is causing or threatening to cause material injury to the industry as a whole in the United Kingdom. The answer has been given to the various paper makers in my constituency that the specialty on which they are claiming is only part of the great paper-making industry and that the dumping from elsewhere involves too small a part of the paper-making industry as a whole to make any definite impression an the industry.
I do not know what the lithium industry is. It may be part of the great chemical industry. On the other hand, it may be part of the vitreous enamel industry. But as far as I know there is no separate industry in this country known as the lithium industry. I think that the Board of Trade must regard the paper-making specialties to which I referred quite as much as industries on their own account as the lithium industry.
To quote an example, in my constituency there is a small paper mill employing about 300 people in the manufacture of duplicating paper, about 10,000 tons of it a year. To the people concerned, this is an industry in itself. It would be impossible for this mill to switch from the production of duplicating paper to another form of paper, because it is on duplicating paper that the goodwill of the concern has been built up and made known to the trade. If this mill were

1037
troubled with dumping from overseas the whole place might have to go out of commission, causing several hundred people to be unemployed.
That case is relevant because I have been met with the argument that the Order deals with only part of an industry. I would, therefore, like the Minister to say whether there has been a change of policy on the part of the Board of Trade and whether my paper makers, who are dealing with a highly specialised commodity, may make formal requests to the Board of Trade is this connection if necessary.
I was rather vexed when the Minister said that it was with reluctance that he introduced the Order, because every time an application for anti-dumping duties is asked for, the Board of Trade searches out all the reasons why an Order should not be made. It is desirable, in the interests of industry in general—with particular emphasis on the smaller industries, especially those in the north of Scotland and elsewhere—that the Board of Trade should seek reasons why an Order should be made and not why one should not be made.
10.36 p.m.
Mr. H. Rhodes: Having heard the remarks of the hon. Member for Aberdeenshire, West (Mr. Hendry), I am tempted to start a discussion on Hong Kong cottons, but I will not. Like my right hon. Friend the Member for Battersea, North (Mr. Jay) I am interested in discovering just who are the producers in this country, because from the experience we have had since the antidumping Act came into operation the only people who have been able to get relief have been the "big boys".
The gigantic organisations—more often than not the chemical industry—have been able to put the whole of their resources behind their efforts and have been able to prove damage simply through having the means to do so at their disposal. The Act is rapidly gaining a bad reputation. I said when we were considering it, before it went on to the Statute Book, that it was a bad Measure. I still think it is and, in view of the comments made by hon. Members about the Order, I hope that we shall be given a satisfactory explanation by the Minister.
10.38 p.m.
Sir James Duncan: I intervene in the debate for two reasons. First, the Order concerns Canada and as one who has always been in favour of Empire preference as far as possible and Empire free trade, my ears pricked up, metaphorically speaking, when I heard that the Order was directed solely against Canada. Secondly, I understand that there is no production of lithium carbonate in this country. I understand that it is a mineral, a mineral of itself, and not a product of minerals. I understand, too, that it is used as one component in the manufacture of paint and enamel and someone told me, with what justification I do not know, that it is used in doing something to brown bread, Whether or not that is true I do not know.
I am intrigued by the Order. Having listened to the Minister, I realise that there may be some point in his introducing it, but as one who has suffered in the past in the agricultural sphere from the difficulties of proving cases of agricultural dumping, I am interested to note the speed with which the Board of Trade is acting now. Like the right hon. Member for Battersea, North (Mr. Jay) I, too, would like to know to what extent the Order is in the national interest. Who are the alleged producers? I do not think there are any British producers, although there may be British users. To what extent is the imposition of this duty in the national interest? Is it a product of which a good deal is used and, if so, for what is it used?
The third question one has to deal with is the extent to Which it is having a serious effect on the British industry? After all, if the British industry that uses this material can get it at the market price from elsewhere and cannot get it at home, we should know where it normally comes from, and why there is this special reason for taking forestalling action against our oldest Dominion.
10.40 p.m.
Mr. Cyril Bence (Dumbartonshire, East): When I first saw this Order, I made inquiries which led me to understand that lithium carbonate is used for hardening glass, especially for lenses. We are imposing a duty of ls. a lb on the Canadian price of this substance, but are the Canadians exporting this same mineral to Japan, for instance, at the

1039
same price at which they send it here? If so, are we not making this product dearer here while the price remains the same in Japan, or in some other country?
I do not know whether or not this mineral is produced here. It being a mineral, I presume that it is mined or quarried. By whom is it mined or quarried in this country, and where? If it is not produced here, how can it be a threat to our industry if it is imported as forming part of something we manufacture? It must be to our advantage to import as cheaply as we can. If there are a few quarrymen or miners extracting this mineral in this country, I can understand them appealing to the Government to bring in this Order, but it is a serious matter for a manufacturing nation like Britain to impose this duty on an imported substance if lithium carbonate is not mined or produced here. The duty means that our costs are driven up as compared with, say, those of Japan.
The Explanatory Note states:
"(This Note is not part of the Order, but is intended to indicate its general purport.) This Order imposes on Lithium carbonate originating in Canada an anti-dumping duty of 1s. 0d. per lb."
Why is the duty imposed only if the country of origin is Canada? Is Canada the only country in which lithium carbonate is produced?
Mr. Geoffrey Hirst: It is the only country that is dumping it.
Mr. Bence: Will this imposition make Canadian lithium carbonate more expensive than that emanating from some other country? This Explanatory Note is too brief for such a complicated matter. I had to do a lot of checking to find out what this product is. I learned that it goes into vitreous enamel, and is also used for hardening glass for lenses; that it has a hardening or toughening property.
I hope that the Minister of State will explain this Explanatory Note, and let us know whether this substance is mined or manufactured in this country, what other countries manufacture it, and why we should have to take this sort of action against one of our Dominions, a member of the Commonwealth. I do not know the price of lithium carbonate. If the average price is 6d. a lb., a duty of Is. a lb. is pretty hefty, but if it costs 400s. a
1040
lb. then a duty of Is. a lb. is neither here nor there. The Explanatory Note should give us some idea of the general world price, so that we can relate the duty to the price. One shilling a pound has no meaning at all. If it is 1s. per lb. of gold it does not mean a thing. I do not know what the price of this product is. It may be 20s. or 100s. or 3d. per lb. I have no idea. I suppose that those who are in the business know, but as we do not know the names of those in the business it is not much help. We should be told what is the relationship between this Is. per lb. and the world price of the commodity.
10.46 p.m.
Mr. Peter Walker: If the import of this product is endangering the livelihood of one of our industries I congratulate my hon. Friend the Minister of State, Board of Trade on the manner in which he has swiftly dealt with the problem. It is encouraging, without obtaining the full evidence, to know that before the ship reaches these shores such action will be taken. I hope it will be repeated on other occasions in connection with other imports coming to this country.
A point has been raised about the lack of evidence in respect of this product. I wonder if my hon. Friend will be able to tell me the manner in which he will obtain information upon the internal price of the product in Canada. I recall on previous occasions when this type of Order has been brought forward that the Board of Trade has been unwilling to discover or to do anything about discovering the internal price of the product until representation has been made to it by the industry adversely affected in this country. I therefore ask my hon. Friend whether he received a request from such an industry or whether he received evidence, which he accepted, from that industry.
One of the big differences in the manner in which these matters affect large combines and producer bodies on the one hand, and smaller concerns on the other, is that the large combine is able to collate this information whereas the smaller concern is not. I should like to know whether in this Order that we are discussing tonight the information was obtained by the Board of Trade or by some industry concerned.
10.47 p.m.
Mr. Green: I have been asked a number of factual questions and I will do my best to give the facts in reply.
The first question asked by the right hon. Member for Battersea, North (Mr. Jay) was as to whether was concerned in this case. The answer is, "No" The Associated Lead Manufacturers are the sole producers in this country and they represent an industry within the terms of the Act. What they do—perhaps I can answer a number of hon. Members on this point, and particularly my hon. Friend the Member for South Angus (Sir J. Duncan)—is to import the ore and process it here. They import the ore from Rhodesia, so this is not a case of picking on one Commonwealth country. This will, in fact, help another Commonwealth country into the bargain. I hope that there is no suggestion of picking an one country at the expense of another Commonwealth country.
I was asked by the right hon. Member for Battersea, North how long this Order might last. It can be removed at any time, but it will remain in force until the Board of Trade receives evidence which satisfies us that no dumping is taking place.
On the genesis of the Order, it has been suggested that this is directed solely against one country, namely Canada, but I said at the beginning of my remarks that this started with imports from the United States of America and the Federal Republic of Germany. Both the United States and the Federal Republic of Germany ceased to send material in because they had accepted the fact, on the evidence that we had got, that they were liable to dumping duty.
Our difficulty was simply on the matter of time, to get from them the information for which we had asked them within a reasonable time. I am not blaming them particularly far not providing the evidence within the time we asked, but the fact was that the time was running out. A shipment was known to be under way. We could get no undertaking that it would not be disposed of if it was landed here, so on the basis of our knowledge of prices and costs in Europe, the United States of America and West Germany—we were able to make a
1042
reasonable deduction about the Canadian price—we had no option but ourselves to forestall the act of dumping against this single producer, representing an industry within the meaning of the Act, that we were quite satisfied was being materially damaged if this material continued to come in at these particular prices.
Sir Harry Legge-Bourke: In the Department's attempts to prevent this happening, was any contact made with the Canadian Government about it, or was it done purely between Her Majesty's Government here and the exporter concerned?
Mr. Green: We had to ask the exporter concerned for the evidence of his pricing because he is really the only person who can give the evidence. His Government cannot. So we dealt with the firm, as we must, and it is only because of the delay in getting the information that I am asking for the Order now, and for no other reason.
If the Canadian producer comes forward with his own evidence—for which, I say again, we have asked more than once—and convinces us that he is not in fact dumping, on the basis of his own true figures, we shall revoke the Order and he will be entitled to get back the duty which has been levied on this consignment which is on the way, if it is landed. We are not seeking to impose an unfair burden on him. We are not picking on one particular country in this matter. We are not at all endeavouring to change the policy under which we operate the anti-dumping duty procedures.
The Is. represents about 24 per cent. of the price now ruling, which itself has been driven down, of course, so it is a substantial differential. It is difficult to say what would be a fair price over the years, but the ls. is near enough to a 24 per cent. duty.
Mr. Jay: May I press the hon. Gentleman to answer two questions which he has not answered? First, what is the material damage which is being done to the British industry? Who is being damaged, and where? Who is likely to be thrown out of work, how many people, and where? Secondly, I do not think that the hon. Gentleman answered the question asked by one of his hon.

1043
Friends below the Gangway. On what information did the Board of Trade decide that the price charged by the Canadian producers in Canada was at a certain level? Did the Government, as the hon. Gentleman appeared to say, merely presume that it must be at some sort of level because of information they had about prices in other countries and because the Canadian producers did not answer the questions addressed to them?
Mr. Green: I quite understand why the right hon. Gentleman asks his questions, but, with respect, he will appreciate that I cannot be expected to go into too many commercial details or give away information which has been given to us in confidence. I cannot give all the details for which he asks.
I gave the name of the firm in this country, Associated Lead Manufacturers, who are the only producer. Our information, on which we rely, is that, if this dumping had gone on, that manufacturer would have certainly had to stop production of this material and its associated products. There would have been no industry, therefore, of this kind left in the country, since it was the only remaining one. One could, by inference, suggest that a little damage would have been done to producers of the ore in Rhodesia because there would have been no imports from there. I do not make much of that, but it is a contingent point.
Mr. Jay: The hon. Gentleman does not suggest that that is a good ground for applying the anti-dumping duty, that we could switch our source of supply from one overseas country to another?
Mr. Green: I did not try to make anything of it, but I said that it was a contingent point having regard to what has been said in this short debate.
We are quite satisfied that this particular industry, the sole producer in this country, would have been driven out of the business if the process had continued. We did not think this constituted anything but material damage, which is one of the criteria under which we apply the Act. I would think it material damage when the sole producer
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is clearly hurt. We are quite convinced this is the case. We got our figures on the basis that till we have got—I must repeat it, because it is an unusual circumstance: I accept that, and I said it at the beginning—till we have got evidence direct from the Canadian producer, which we have sought, we have no means of checking against his figures the figures which we have worked out for ourselves. We have no means of doing it.
I tell the House quite frankly that this is an unusual situation. This is why, I repeat, if the Canadian producer will come along with his figures and prove that we are wrong we shall revoke this Order and refund the duty to him. We shall certainly do that, but we could not risk the continuance of the present situation because of delay in providing us with the evidence for which we had asked. We had, therefore, to go on such evidence as we could find for ourselves, and that evidence, the existing evidence, convinces us that there is dumping here which constitutes material injury to the sole producers of this material in this country.
Sir J. Duncan: It is not clear to me. This stuff, this raw material, a mineral, which Associated Lead Manufacturers manufacture—I do not see why they could not import it from the United States or Canada or Rhodesia or anywhere else. Or is it that their competition would come from the manufacturing side? That has not been made clear.
Mr. Green: The point, if I may stress it again to my hon. Friend, is this. Associated Lead Manufacturers import ore from Rhodesia. They process it. Lithium carbonate and its derivative, lithium hydroxide, come from Canada and also from the United States and West Germany. It is not an ore. It is a processed article, which they themselves manufacture.
Question put and agreed to.
Resolved,
That the Anti-Dumping Duty (No. 2) Order 1962 (S.I., 1962, No. 2614), dated 29th November, 1962, a copy of which was laid before this House on 29th November, be approved.

EMPLOYMENT, ABERDEEN
Motion made, and Question proposed, That this House do now adjourn.—[Mr. I. Fraser.]
10.58 p.m.
Mr. Hector Hughes: What I have to say is in a sense complementary to the debate we have had today, but I approach it from an Aberdeen point of view because I want to say something about unemployment in Aberdeen.
Today has been exceptional, in that Her Majesty's Opposition have at last succeeded in inducing the Government to give a whole day's debate to the subject of unemployment, but it is a sad feature that nothing has emerged from that debate. The Government, not only after a whole day's debate but after eleven years in office, with power, have no solution to offer for the unemployment, the increasing unemployment, which is afflicting the country.
The only time that Britain has approached full employment was during the years 1945–50, the time when the Labour Party was in power, and the reason for that is obvious. It is that the Labour Government planned their way, and stuck to their plan, and administered the country in accordance with their plan, while this Government are a catch-as-catch-can Government who do not plan. So, during eleven years of office, they have found no solution for the tragedy of unemployment which afflicts the country.
I want to say a few words about the state of affairs in Aberdeen. I think that it will be generally agreed that in a civilised community the citizens in the North and the South, whether they be Scots or English, are entitled to have as a birthright the right of access to the amenities and necessities of life. These include the right to live in a house, to have a job, to earn a living and to partake of the social services. That the workers of the country have not got. There is great and growing unemployment, particularly in Scotland.
There seems to be a bias against Scotland. The north of Scotland is badly treated in the matter of trade, industry, commerce and employment, and the Government seem to be doing nothing about it. Worse than that, there
1046
appears to be academic or professorial attempted justification for that state of affairs. Lest the House doubt what I am saying, I will give two quotations in support of the views I have just put forward.
One is from The Times. On 10th December, the "Thunderer," in a very good article entitled" "Drift to the South-East," said:
"For some months public anxiety has been building up over the so-called ' drift to the South-East,' over the danger of Britain splitting geographically into 'two nations.' The processes at work are not new. The anxieties created have been familiar for long to those who studied such problems. But the development of the Welfare State and the growth of the Affluent Society have thrown into relief the differences that can exist between prosperous and less prosperous parts of the country. The recent rise in unemployment has heightened the contrasts; the Common Market may add to the pressures."
The geographical difference referred to by The Times is the geographical difference between England and Scotland.
The north-east of Scotland, as I have said, is very badly treated with regard to trade, industry and commerce. Lest it be thought that I have no authority for what I said about academic support for that strange view, I quote an astonishing letter from Professor John Dukes, Professor of Economics at Manchester University, in the same issue of The Times. He wrote:
"Why do we try to petrify the distribution of population?"
He went on to suggest that workers who travel from North to South in search of work should be deprived of their social services. I submit that that is a very reactionary doctrine, and I hope that it will not be adopted.
These two quotations show that this debate is timely and necessary in a country which is governed so badly by the present Government. Notwithstanding the whole day's debate that we have just had, there are other facts which I should like to bring to the notice of the House. First, I wish to state two things. The first will concern some facts relating to Scotland, and the second will be a solution to this problem—and the Government, during their eleven years of office, with power, have been unable to find one.
As to the facts, the unemployed in Scotland number nearly 100,000. In

1047
Aberdeen alone they number 3,000. These numbers may convey little, but look at the percentages. These are against Scotland and in favour of England. In England alone the percentage of unemployed people is 1·8 per cent.; in Great Britain as a whole it is 2·1 per cent.; in Wales, 2·1 per cent.; but in Scotland, 3·8 per cent. That shows that England has the smallest percentage of unemployed, Great Britain comes next, followed by Wales, while Scotland fares worst of all.
This is only one aspect of this terrible problem, which the Government have shown no effort to solve. It is a loss not only to Scotland, but also to the wealth of the whole country. In Aberdeen itself it is a loss in shipbuilding and ship-repairing, fishing, marine engineering and other engineering, textiles, paper making, and the granite and other industries, quite apart from the loss of family life and happiness of the workers involved. It is a dire loss not only to Scotland, but to the whole nation.
The Government apologise for this state of affairs. They have done so today. But they have had eleven years in which to find a solution to the problem. A solution has been offered since 1958 by the Scottish T.U.C. It put before the Government a clear and concrete plan to solve the problem, but the Government have not adopted it. Instead, they prefer to go on in their catch-as-catch-can way instead of according to a planned and ordered society.
This point has been put better than I could put it by my right hon. Friend the Member for Battersea, North (Mr. Jay), in his latest book:
"Since 1955 the United Kingdom economy, with controls dismantled has resembled a car having to be driven at walking pace and stopped dead every twenty yards to avoid the ditch because the driver is suffering from a neurotic inhibition against the use of a steering wheel."
The steering wheel we suggest is an ordered plain. The Labour Government had an ordered plan but this Government prefer their uncertain way, with the result that trade, industry and commerce are not spread evenly throughout the country as they should be. Instead we have this vast unemployment and also financial and balance of payments
1048
crises. Scotland offers splendid opportunities to any Government. Aberdeen and the north-east of Scotland are rich in industrious workers in a good climate, and have many other advantages; but no advantage is taken of them.
In Glasgow, the Scottish T.U.C. has suggested that the Government should appoint a Scottish development council to consider this whole problem, a council composed of men on the spot, Scotsmen Who know the needs of Scotland, and not, as the Government have appointed during the last eleven years, Englishmen with their eyes fixed on England, whose interests are in England and who know little of the interests of Scotland. I ask the he Parliamentary Secretary to ask his colleagues to appoint such a council to deal with this terrible problem.
11.10 p.m.
The Parliamentary Secretary to the Ministry of Labour (Mr. William White-law): The hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) will be rather surprised at the special reason why I am pleased to reply to his Adjournment debate tonight. Not only am I wholly a Scotsman, but I am half Aberdonian, for my mother came from Aberdeenshire. Therefore. I have a special interest in his part of Britain and I welcome the opportunity to say something about it.
I do not intend to follow the hon. and learned Member in some of his general statements about the past, about the merits of Labour planning and about what the present Government have done. I think that the record will speak for itself, and I would be content to rest on that. I have come to answer his specific points about unemployment in Aberdeen and not on a basis wider than that.
The hon. and learned Gentleman has spoken, as he always does, very vigorously. There was a good deal in what he said with which I could not agree, but I say at once that I fully understand the underlying problems which he has mentioned and I naturally share his concern for those who may became unemployed. I also agree that it is extremely important when we are discussing these problems, inevitably in terms of cold statistics, to remember the very real human problems which unemployment can create.

1049
The hon. and learned Member referred to a number of problems and difficulties which, he felt, threatened the livelihood of his constituents in Aberdeen. I hope to refer to some of those later. Before I do, I want, first, to consider the unemployment position in Aberdeen and what has been happening over the past twelve months. I intend to do this because I am anxious, as I think we all should be, that the problems which the hon. and learned Gentleman has mentioned should be seen in their true and proper perspective.
The December unemployment figures for the Aberdeen travel-to-work group, which, as the hon. and learned Gentleman knows, includes Stonehaven and Inverurie, were published today. They show there 2,866 males and 766 females, a total of 3,632, representing a percentage rate of 3·7, were unemployed. Those figures are higher than those for December. last year, when there were 3,163 unemployed, a rate of 3·3 per cent.
Although this represents an unwelcome rise, it is, neverthless, right to point out that unemployment has been rising much more slowly in Aberdeen than in Scotland or Great Britain. It is also true that the rate which I have quoted is considerably lower than that of many other places in various parts of England and, indeed, south England. When one speaks at length about two nations, the North and the South, it is iniportant—
Mr. James H. Hoy: What comparable part?
Mr. Whitelaw: The hon. Member will find that various parts of England, certainly in the South-West, and indeed, a place like Southend-on-Sea, are comparable with Aberdeen in many ways.
Mr. Hector Hughes: That cannot be so, having regard to the percentages which I quoted and which showed that the unemployment rate in Scotland is very much higher than it is in England.
Mr. Whitelaw: The hon. and learned Gentleman must listen to the point which I am putting to him. I am talking about Aberdeen City and not about Scotland as a whole. I am making the point that to talk glibly about the North and the South and the two nations is to talk in generalities.
Mr. Hoy indicated dissent.
Mr. Whitelaw: The hon. Member for Edinburgh, Leith (Mr. Hoy) knows that the unemployment percentage there is lower than in many places even in the Midlands.
Mr. Hoy: The hon. Member is not doing his own case justice. All that my hon. and learned Friend is saying is that Scotland as a whole has an unemployment rate twice as high as that of the rest of Britain. If the hon. Member wants to get on he had better tackle that problem.
Mr. Whitelaw: The hon. Member must listen to what I am saying. I am not arguing about the position in Scotland and in England. I am saying that it is too general to speak in such terms when one compares places like Aberdeen with certain places in England. I think that I am being quite fair, and I am sure that the hon. Member for Leith appreciates this.
I cannot produce comparisons based on the December figures, since these are not yet available for Scotland or for the country as a whole, but if we look at what has happened between November, 1961, and November, 1962, we find that the increase in unemployment in Scotland was 34·6 per cent. and in the whole of Great Britain it was 40·6 per cent., whereas the increase in Aberdeen was as low as 6·9 per cent.
Now I turn away for a moment from the general employment position to look at the particular problems of youth employment, which have been of special concern to us over the past few years, particularly because of the bulge in school leavers. It is interesting to note —as the hon. and learned Member probably knows—that between 1959 and 1962 the "bulge" in the number of 15year-olds was larger in Aberdeen than in the whole of Scotland; the increase was over 40 per cent. for Aberdeen, as against 23·5 per cent. for the whole of Scotland.
On 10th December of this year there were in the City of Aberdeen 28 boys and 23 girls unemployed—a total of 51. This shows a rise over the figures for December last year, when there were 25 unemployed in all. But the fact remains that there are still over three vacancies

1051
for young people for every one who is unemployed. I am sure that the hon. and learned Gentleman will be pleased to know that in Aberdeen City none of the 1,049 young people who left school in the summer was still registered as unemployed last week. I think that he will agree that this is a very satisfactory position.
But it is not sufficient merely to see that young people find work. It is particularly important that sufficient young people should receive skilled training as well. I understand that the proportion of boys obtaining apprenticeships in Aberdeen is a little below the average for the whole of Scotland. I am glad to say that there has been a marked improvement this year. Between January and November of this year 398, or 35·5 per cent., of boys entered apprenticeships in the City of Aberdeen, compared with 248, or 25·6 per cent. last year. The figure for this year is quite close to the average for Scotland over this period—39·1 per cent.—and the average for Great Britain, of 36·4 per cent.
Good as those figures are, we should certainly like to see more opportunities for skilled training in the Aberdeen area. I am sure that the hon. and learned Member would agree that the provision of adequate skilled training for young people now is one of the soundest investments for the future industrial prosperity of Scotland and, indeed, of such places as Aberdeen.
On the present statistics, therefore, it would be quite wrong to suggest that the present unemployment position in Aberdeen can be compared seriously in any way with the very difficult situations to be found—and I acknowledge this—elsewhere in Scotland, in the north of England and on Merseyside. Nevertheless, as the hon. and learned Member rightly pointed out, several sections of industry in Aberdeen are facing difficulties which could cause an increase in unemployment in the area. The hon. and learned Gentleman's wide-ranging survey dealt with a number of these problems. I cannot deal with all of them tonight, particularly as many of them are more appropriate for Departments other than my own. But I assure him that my right hon. Friends concerned will take careful note of what he said.
Mr. Hector Hughes: Will the Minister do what I specifically asked—consult the Scottish Trades Union Congress?
Mr. Whitelaw: As the hon. and learned Gentleman knows, my right hon. Friend has had several meetings with the Scottish Council and he has met the Scottish T.U.C. My right hon. Friend the Chancellor of the Exchequer has received a deputation from the Scottish Board for Industry and has heard its views. I think that I can say, therefore, that my right hon. Friend fully appreciates the point of view put forward by the Scottish T.U.C.
There are one or two points which the hon. and learned Member raised on which I should like to comment. He expressed concern about the problem of the shipbuilding industry in Aberdeen, and 1 accept that it has problems. As he knows, the shipbuilding industry in this area employs about 2 per cent. of the total insured employees and, in common with the shipbuilding industry all over the country, has been facing difficulties.
As he knows, the industry is suffering from a world-wide excess of capacity over orders for ships. Aberdeen has a particular problem in that it is a large builder of trawlers. I realise that present restrictions on grants and loans may be disadvantageous to the shipbuilders, but it would surely be pointless for the sake of maintaining employment in the shipyards to encourage the building of a number of fishing vessels whose economic prospects thereafter must be open to grave doubt.
I think that the hon. and learned Member was very interested in the announcement made today affecting Aberdeen. Both he and my hon. Friend the Member for Aberdeen, South (Lady Tweedsmuir), whose recent promotion has given great satisfaction to many people in Scotland and, I am sure, particularly to many people in Aberdeen, have been worried about the serious position in the yards in Aberdeen. There has been some redundancy. I think that the order worth £1½ million which has been placed in an Aberdeen yard today for three car ferries by David MacBrayne should be of considerable assistance and should make a useful contribution towards maintaining employment in Aberdeen. I should have thought that this

1053
is one of those examples of placing orders in the right places which hon. and learned Members have recently and properly been advocating during the debate this afternoon.
Mr. boy: Investment by a public company.
Mr. Whitelaw: I do not think that it matters whether the company is publicly owned or not. What matters is that orders should be placed and that firms should make a profit in the future, because that is the only way in which one can provide employment in the long run. I am glad that both the hon. Member for Leith and the hon. and learned Member for Aberdeen, North feel that this is a valuable order and agree that it should give some assistance to the area.
The hon. and learned Member referred in general terms to the problem of bringing work to the area and also to firms which were facing difficulties. Certainly, there are problems in some of these industries, and we must face them. At the same time, however, I am sure that he will agree that we are facing them from what one might call at present a reasonably good employment position. I am sure that the hon. and learned Member will accept how satisfactory it is, and especially the fact that the school leavers have been placed so well in the area.
I would remind the hon. and learned Member that the Government have already anticipated the risk that some of these industries may face difficulties by making Aberdeen eligible for assistance under the Local Employment Act. While the figures might tend to make another position perfectly possible, in this case it has been recognised that the problems of some of these industries make it right to keep Aberdeen scheduled as a development district under that Act; as I say, at a time when it could easily be not so scheduled.
1054
I am sure that the hon. and learned Member will feel some satisfaction in that. I notice that when places are not scheduled there is often a request that they should be. Despite this, some hon. Members opposite say that the Local Employment Act does not do good. If the Act did not do good I am sure that the hon. and learned Member and other hon. Members would not be so keen for their areas to be development districts. if there were no value in being a development district hon. Members would certainly not wish their areas to be such. Those who want their areas to be so scheduled should acknowledge that the Act is a valuable instrument for providing industry in those areas where we want to see it.
Already the Act has brought some extra employment, about 300 new jobs, to the area. I do not suggest that that is a very large number. Nevertheless, it has contributed towards the present broadly satisfactory employment position in Aberdeen. I can assure the hon. and learned Member that we shall continue to draw this area—as well as other areas which are development districts—to the attention of industrialists who wish to expand. There are already many who know the value of the area and the good labour they can get there. I speak from considerable personal experience when I say that I appreciate its sterling values; and I think that I can assure the hon. and learned Member that the instrument of the Local Employment Act does much to enhance these attractions.
The Question having been proposed after Ten o'clock and the debate having continued for half an hour, Mr. DEPUTY-SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at twenty-eight minutes past Eleven o'clock.

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  R.A.F. Station, Melksham (Messing Facilities)
  R.A.F. Station, Melksham (Messing Facilities)
  Retired Civil Servants (Employment)
  Retired Civil Servants (Employment)
BRITISH ARMY
  Forester Brigade (Dispersal)
  Forester Brigade (Dispersal)
  Retired Civil Servants (Employment)
  Retired Civil Servants (Employment)

Preamble
The House met at half past two of the clock, The LORD MERTHYR on the Woolsack.
Prayers—Read by the Lord Bishop of Oxford

EXPORT TAXES
2.36 p.m.
LORD BARNBY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government, with regard to stated policy to secure international abandonment of export subsidies, what is their policy towards securing suppression of export taxes particularly on food products and textile fibres which all can add to the cost of living in the United Kingdom.]
EARL FERRERS: My Lords, as the noble Lord indicates, Her Majesty's Government are opposed to export subsidies which distort trade and interfere with normal commercial competition. Export taxes are imposed mainly by the Governments of less developed countries primarily to raise revenue. The imposition of these taxes is consistent with the international commitments of the Governments concerned. It is, of course, for them to decide how best to raise revenue. If, however, the noble Lord has in mind any particular case in which he considers an export tax damaging to British trade, and would supply details, Her Majesty's Government will consider the matter.
LORD BARNBY: My Lords, I thank the noble Earl for his reply. May I ask him whether he would be good enough to make sure that the Board of Trade press in all directions possible for the mitigation of export taxes, which are just as harmful as export subsidies which the Government oppose so strenuously at present?
EARL FERRERS: My Lords, I do not know that I can follow the noble Lord quite as far as he would wish, but I would remind him that there is actually no direct link between export subsidies and export
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taxes, and it is a matter for the individual countries concerned as to how they should raise their own revenue. But if the noble Lord has any specific points, then I will certainly look into the matter and let him know.

SUPPLEMENTARY FOOD IN PRISONS
2.38 p.m.
LORD STONHAM: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will permit the sale of eggs in prison "shops", and whether they will reconsider the regulation which prohibits the receipt by prisoners of food parcels.]
THE MINISTER OF STATE, HOME OFFICE (EARL JELLICOE): My Lords, prisoners are allowed to purchase, from their earnings, a wide variety of foods at the prison canteen, but for practical reasons it is generally necessary to exclude foods which require cooking. My right honourable friend is not satisfied that there is any case for allowing food parcels to be sent in. A convicted prisoner's luxuries should depend on the money he earns by his skill and industry, not on what his relatives happen to be able to afford.
LORD STONHAM: My Lords, but is the noble Earl aware that, by their skill and industry, men can earn as much as 8s. or 9s. a week in prison, which compares with the 13s. a week which Her Majesty's Government spend on average on prisoner's food, which may permit a filling diet but one very deficient in proteins? Why will the Government not allow a prisoner, therefore, to spend his money on eggs if he wants to make up that deficiency, even if he wants to eat them raw?
EARL JELLICOE: My Lords, I should have thought that very few prisoners would in fact wish to eat them raw, and the difficulty is purely the practical one of providing the facilities for cooking. But where facilities for cooking are available, as in some sections of Holloway Prison, then this practice is permitted.
LORD STONHAM: My Lords, will the noble Earl accept my assurance that quite a number of prisoners, aware of this difficulty about the lack of cooking facilities, have actually written to say that they would rather eat eggs raw, because, if mixed with the cocoa, they could not possibly make prison cocoa taste any worse? Would the noble Earl have a look into that?
EARL JELLICOE: My Lords, I am of course happy to accept the noble Lord's assurance, and I will look into the particular point which he has raised with me. If he could let me have details it would, of course, facilitate matters.

POSTER CENSORSHIP
2.40 p.m.
LORD FRANCIS-WILLIAMS: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether their attention has been drawn to recent decisions of the Joint Censorship Committee of the British Poster Advertising Association and whether they consider the activities of this body to be in the public interest.]
THE LORD PRESIDENT OF THE COUNCIL AND MINISTER FOR SCIENCE (VISCOUNT HAILSHAM): My Lords, may I take the opportunity provided by the noble Lord's Question to welcome back the Lord Chairman after his operation and to say how glad we all are that he is looking so well.
NOBLE LORDS: Hear, hear!
VISCOUNT HAILSHAM: My Lords, in reply to the noble Lord's Question, I must tell him that Her Majesty's Government have no responsibility for the decisions of this body and it would not therefore be in accordance with the practice of this House for the Government as such to comment upon them.
LORD FRANCIS-WILLIAMS: My Lords, in view of the fact that the body concerned refused to allow permission to advertise posters issued by a Department of Her Majesty's Government, the Ministry of Health, dealing with the dangers of smoking, have Her Majesty's
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Government any view as to whether a private body of this kind ought to be able to stand in the way of their giving what they believe to be necessary education to the people of this country?
VISCOUNT HAILSHAM: My Lords, the Government may have a good many views, and I may have still more views personally about it which I should like to express were I in order to do so. But I think we must stand on the general principle, my Lords, that in Parliament the Government do not have to answer for any idiotic decisions except their own.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, has the noble and learned Viscount seen reports to the effect that in another matter, apparently, a foreign Embassy made representations to a Government Department with regard to certain posters which were proposed, and that this other body we are talking about refused to publish those posters?
VISCOUNT HAILSHAM: My Lords, I again must not answer questions directed to a matter as to which there is no Government responsibility. But, my Lords, it does so happen that the body concerned communicated with my noble friend Lord Ferrers, who at one time would have answered this Question, and they say that they emphasise as strongly as they can that, despite allegations to the contrary, no pressure of any kind was placed upon the committee in regard to their decisions. I cannot take responsibility either for the accuracy of that statement or for any Government attitude towards it, but I thought it fair to communicate that to the House in the form in which it was received by us.

BUSINESS OF THE HOUSE
EARL ST. ALDWYN: My Lords, I should like to inform the House that my noble friend Lord Carrington will be making a statement on Skybolt at a suitable moment after 3.30 p.m.
At the same time, I should like to inform your Lordships that, as an experiment, instead of having dinners available to-night we are having a cold buffet, and I should be most grateful if your Lordships would let me have your opinion, about it when you have tried it.

PENSIONS (INCREASE) BILL
Returned from the Commons, with the Amendments agreed to.

WATER RESOURCES BILL [H.L.]
2.45 p.m.
Order of the Day for the House to be again in Committee read.
Moved, That the House do now resolve itself into Committee.—(Earl Jellicoe.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD MERTHYR in the Chair.]
Clause 33 agreed to.
Clause 34 [Licences of right for statutory users]:
(3) If the relevant statutory provision does not specify or otherwise limit the quantity of water authorised to be abstracted, then (subject to the next following subsection) the provision made by the licence as to the quantity of water authorised to be abstracted shall be such as the river authority consider appropriate, having regard to the terms of the relevant statutory provision and to such of the following matters as are applicable and are proved to the reasonable satisfaction of the river authority, that is to say—
(a)
LORD SINCLAIR OF CLEEVE LORD SINCLAIR OF CLEEVE moved, after subsection (3) (c), to insert
"(d) the extent to which the source of supply in question has during the relevant period been, or is intended to be, used—

(i) in conjunction with other sources of supply;

(ii) to meet maximum demands;

(iii) during certain months of the year only;"

The noble Lord said: A great deal remains to be done on this Committee stage, and I shall therefore endeavour to be brief in moving this Amendment. Subsection (3) deals with a case where the abstraction is made under a statutory provision which neither specifies nor limits the quantity to be abstracted, and it seeks to specify the matters which the river authority shall take into considertion, in so far as such matters are applicable, when determining the quantity licensed for abstraction from a particular source. These matters, listed in para-
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graphs (a) to (e), are clearly intended to be comprehensive or inclusive, for they are prefaced by the words, "that is to say", and not, "for example". Now the Amendment proposes a new paragraph (d), and if that paragraph (d) is accepted then the existing (d) would become (e) and the existing (e) would become (f).
The matters covered by the Amendment are no less relevant, I think, than others already listed, and are more important than some. I do not wish to weary the Committee by attempting to enumerate all the circumstances which the Amendment might cover: I would merely give this very brief explanation. First, where the right of abstraction relates to a particular source in conjunction with other sources, that is clearly a relevant consideration; secondly, the maximum or peak demand is of great importance in this connection, and it is something quite different from the total quantity abstracted or the special occasions or emergencies referred to in the existing paragraph (d); and, thirdly, there may well be in certain cases perfectly sound and sensible arrangements for confining abstractions to certain months of the year as a stated seasonal period—for example, boreholes operated as a group with provision for certain boreholes to be arrested for certain periods. These may perhaps seem rather fine distinctions, but I believe they have some practical significance; and if the present form of subsection (3) is to be preserved, then these points should be covered.
Before, however, formally moving the Amendment, may I say that if, on further consideration, the Government would prefer to omit the last phrase of the opening sentence of this subsection, to make it read—and I quote here:
"… having regard to the terms of the relevant statutory provision and to such facts as the river authority or the applicant for the licence may consider relevant",
and there finish, that might well be the best solution. An attempt to give in this Bill a list of relevant matters which will prove to be completely comprehensive is, I think, dangerous. Before these river authorities come into being I am sure someone will think of something else, however perfectly that list is drawn up. If, however, the Government prefer to adhere to the form of

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subsection (3) as drafted, then I hope that the new subsection incorporated in this Amendment may be accepted. I beg to move.
Amendment moved—
Page 31, line 29, at end insert the said paragraph.—(Lord Sinclair of Cleeve.)
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (LORD HASTINGS): This Amendment, and the following one, which will presumably be moved in a moment by the noble Lord, Lord Sinclair of Cleeve, would alter the factors in subsections (3) and (4) governing the determination of the quantity of water which a licence of right is to authorise to be abstracted. The Amendment would require consideration to be given to the extent to which the source of supply in question is an auxiliary source used along with other sources, or for peak or seasonal demand. Subsection (3) as drafted would take account, at paragraph (b), of any seasonal characteristics of an abstraction, but not in the sense of abstraction to meet seasonal peaks of demand, which appears to be in mind in this Amendment. The Amendment prompts further consideration of subsection (3), but it could not be accepted as it stands, for consideration ought to be given at the same time to the subsection as a whole and to the next following subsection, subsection (4).
In respect of the further suggestion made by the noble Lord, Lord Sinclair of Cleeve, that some other, more general, phraseology might be better rather than attempting a comprehensive assessment of all the factors to be taken into account, that is for consideration, but one's first reaction to it is, I think, that it would be to leave the river authority and the applicant to decide what factors should be taken into account. The practical consequence would probably be to land the Minister, by way of appeal, not only with arguments about the value set upon certain factors but also about what factors should be brought into account. And it may well be that this particular farm of Amendment would be more likely to slow down the process of settling licences of right and impede the working of the machinery than the present form of drafting. But in any case we feel that further consideration
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can be given to these subsections and the following subsection; and if the noble Lord would like to withdraw his Amendment now, either in the printed or in the verbal form, consideration will be given to that matter.
LORD SINCLAIR OF CLEEVE: I am grateful to the noble Lord, Lord Hastings, for his assurance and on that assurance I am happy to withdraw the Amendment.
VISCOUNT ALEXANDER OF HILLSBOROUGH: We have had the ordinary, detailed, what I call Civil Service answer, and I am happy to think that this matter is going to be reconsidered. But is it going to be effective only in respect of the larger and important public and company water undertakings or is it likely to spread to individual cases of farmers abstracting? It wants a little looking into. I have not heard all the surrounding matters, but I hope nothing will be done to interfere with the substantial rights of individual owners.
LORD HASTINGS: The clause is of course dealing with the licensing of rights for statutory users. The following clause deals with non-statutory users.
Amendment, by leave, withdrawn.
EARL WALDEGRAVE EARL WALDEGRAVE had given notice of his intention to move to leave out subsection (4). The noble Earl said: I feel it is hardly necessary to move this Amendment now, but I will do so in the briefest way after the very satisfactory reply that the noble Lord has given to the previous Amendment. The purpose of this subsection is simply to impose an overall limitation. By the method in which this clause is set out now, all these considerations have to be taken into account when determining how much water should be licensed. Then subsection (4) says, almost as a proviso, that in any case it cannot be more than the machinery at present installed, or likely to be installed, can use. I will not enlarge on this, because if the whole clause is to be looked at again then this subsection would have to be looked at too. I think perhaps it is best if I do not move this Amendment.
THE CHAIRMAN OF COMMITTEES (LORD MERTHYR): I think if the noble Earl makes a speech it would be better if he would formally move.
EARL WALDEGRAVE: I beg to move the Amendment formally.
Amendment moved—
Page 31, line 40, leave out subsection (4).—(Earl Waldegrave.)
LORD HASTINGS: There is just one word I should like to say in reply. The provision in the subsection as drafted is right in principle, but it can be admitted that (there is some possibility it may be too restrictive in that although it refers to plant installed or in process of installation, it takes no account of plant specifically authorised but where installation has not begun. I will not enter into the argument of the noble Earl about general finite restriction. We are dealing only with the licence of right, and that does not affect the fact that a further consideration may be given. This clause, as I said previously, will be looked at again also in the light of what has been said.
EARL WALDEGRAVE: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 34 agreed 10.
Clause 35 [Licences of right for non-statutory users]:
2.55 p.m.
LORD MERRIVALE LORD MERRIVALE moved to leave out Clause 35 and to insert the following new clause
Licences of Right for non-statutory users
35.—(1) The provisions of this section shall have effect where an application under section 33 of this Act is made in a case falling within subsection (1) (b) of that section; and in this section the relevant period' shall mean the period of five years ending with the second appointed day or the period beginning with the date on which the applicant or his predecessors began to abstract water from the source of supply in question and ending with the second appointed day, whichever is the shorter.
(2) The provision made by the licence as to the quantity of water authorised to be abstracted shall be such quantity as has been proved to have been abstracted to the reasonable satisfaction of the river authority, having regard to—

(a) the quantities of water abstracted by the applicant or his predecessors from the source of supply in question during the relevant period;

(b) the seasons of the year during which those quantities of water, or the greater part of them, were so abstracted;

(c) the extent to which works, machinery or apparatus were reasonably provided by the applicant or his predecessors in anticipation of future requirements

(3) The provision made by the licence as to the quantity of water authorised to be abstracted shall be such as will not permit the abstraction of water in excess of the quantity shown to the reasonable satisfaction of the river authority to be capable of being abstracted by means of works, machinery or apparatus which were constructed or installed before the second appointed day, or were in the course of being constructed or installed on that day, not being works, machinery or apparatus provided for use only in the event of an accident or other emergency involving a total or partial failure of other works, machinery or apparatus."
The noble Lord said: I beg to move the Amendment standing in my name and the name of Lord Fraser of Lonsdale. I hope that it will commend itself to your Lordships, for its purpose is to bring licences of right for non-statutory users in line with those for statutory users. The Committee will no doubt note a certain similarity between this new clause which I am proposing now and the provisions of the previous clause, Clause 34, in the Bill. Also the Committee will no doubt note that subsection (1) in this new clause has retained the gist of Clause 35(a) in the Bill and that the various subsections of the new clause are very similar to those of Clause 34 in the Bill, although not in the same order.
As my noble friend Lord Jellicoe (I believe it was on an Amendment moved by the noble Lord, Lord Lindgren) quoted from paragraph 67 of the Proud-man Report, I hope he will stand by the words he quoted then, particularly the first three lines. I will not read them again but I am sure he is well aware of that paragraph, which deals with the issue of licences. In the Bill this recommendation is only partially embodied. Though a licence of right will be granted to a person who wishes to abstract water where he has abstracted water at any period during the five years ending with the second appointed day, the quantities for which the licences will be given will be at the discretion of the river authority. And here, no doubt, my noble friend will remember the point I mentioned on Second Reading: that these are valuable rights appertaining to land, and any curtailment of them should be subject to adequate compensation in cash or kind.
Here I should like to refresh my noble friend's memory with regard to the letter he sent me on the 30th November,

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and particularly with regard to one paragraph, because it does not mention at all this question of compensation in the case of curtailment of rights. He wrote:
"First you said that there should be compensation where a licence of right granted to an industrialist is revoked … In fact, compensation for revocation of a licence is paid under Clause 45, which provides for disputes being determined by the Lands Tribunal. The clause does not in terms give the licence holder a choice of compensation in cash or in kind, but I should have thought that a river authority were generally likely to prefer to offer a licence for an alternative source of supply instead of paying entirely monetary compensation. It is perhaps worth adding that under Clause 42 (5) a proposal to revoke a licence has to be referred to the Minister of Housing if the licence holder objects. The Minister can surely be relied upon to think very hard before agreeing to the revocation of a licence covering a source of water which is essential to an industrialist."
But that statement does not cover my point with regard to curtailment. The reason why we feel it preferable to propose a new clause is that to amend the existing Clause 35 might be a little complicated.
Finally, I should like to ask my noble friend if he can give one assurance. He might say that this is a matter which I should more appropriately have raised under Clause 30, but as I am particularly interested in licences of right, rather than in licences generally, I hope that he will agree that this might be the appropriate moment to give an assurance that river authorities will not be able to discriminate in any way, when determining the quantity of water to be authorised under a licence of right, as to the purpose to which the water will be put. For I feel that if that were possible it could lead to a kind of retrospective planning permission for the development of industry in a particular area or locality. I beg to move.
Amendment moved—
Leave out Clause 35 and insert the said new clause.—(Lord Merrivale.)
LORD FRASER OF LONSDALE: May I invite your Lordships to look briefly at the position that arises in this matter. The water under the soil now belongs to the industrialist. He has bought it for the purposes of his business, and his rights in the water are protected by Common Law. The Bill proposes to take away not only the water, which is to be given to the State, but also, naturally, the
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Common Law rights which protect it. The industrialist, therefore, is losing some private property. I make no complaint about that. I think that it is for the common good that this scarce commodity, water, should be nationalised and that it should be brought under a measure of control for the benefit of all. But where private property has been taken away—property that has been bought for industrial usage by far-seeing people, who have put up plants and whose business and whose employment of their employees depend upon this water, perhaps for processing, perhaps for cooling (though I might mention that, in the case of cooling, the water goes back into the stream or into the subsoil and is therefore not lost)—it seems to me and to my noble friends only just that two or three things should follow. First, the owner should get a licence of right. And that is conceded. Secondly, if there is enough water, he should have an entitlement to the amount of water which he was using before. Therefore, he should be able to prove what he was using before, what he owns, so to speak, and he should have a priority for that. As my noble friend Lord Merrivale pointed out, the Proudman Committee used these words
"Where possible there should be a priority to the full extent—
meaning the full extent of the water—
"which the person had before."
The noble Earl referred to that the last time we met. It seems to me that equity requires at least that the person whose water is taken away from him should have a priority, where it is possible, for the amount he is losing. That is the essential difference between the clause my noble friend has moved and the clause we are seeking to delete.
VISCOUNT COLVILLE OF CULROSS: Without wishing to go into the merits of the case made by noble friends Lord Merrivale and Lord Fraser of Lonsdale, I hope that, whatever happens to Clause 35, my noble friend Lord Jellicoe will see that it is properly written out rather than left in this extraordinary drafting which is at present in the Bill. It would not take an excessive amount of printers' ink to set out the proper requirements for non-statutory users, and if that were done it would be much easier to find out what is the law on the subject. I would make an appeal to my noble friend

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to set this out properly in full, so that we do not have to refer back and strike out some words and put in others between inverted commas.
EARL JELLICOE: I am glad to know that we have now notched our century of Amendments; unfortunately, they still seem to be going strong. Parenthetically, I would also say how much I appreciate the assiduity with which my two noble friends who have moved this Amendment—I think it is their first on the Order Paper—have attended our Committee stage, even though they have had to wait through 99 Amendments before we reached theirs.
The Amendment proposes, first, to make certain drafting changes to Clause 35, and secondly, and more importantly, to vary factors to which attention must be paid in settling the terms of a licence of right. If this were just a matter of drafting, I could straight away assure my noble friends that I should be glad to look at the suggestion in the context of the drafting changes which will in any event require to be made to this portion of Part IV of the Bill, consequential upon the reconsideration of Clause 34, which my noble friend Lord Hastings has undertaken. Therefore, I am inclined to agree that there are drafting Amendments which could improve Clause 35; and if, in looking at this again we can go at least some way to making it more comprehensive, I shall be happy to do so. Moreover, when we are looking at it, I will certainly bear in mind the point which my noble friend Lord Colville of Culross has made. It has not fallen on deaf ears. I myself have had extraordinary difficulty in understanding Clause 35 as drafted.
But, having said that, I must add that my noble friends' Amendment goes a good deal further than mere drafting, and I fear that I cannot ask your Lordships to endorse some of the real objects of this Amendment, as I see it, and, indeed, as it has been explained. My first objection affects quantity. The Amendment would impose a burden of proof of the quantity of previous abstractions. I am sure that there will be cases of non-statutory abstractions, despite the warning conveyed by the publication of the Bill and our discussion of it in Parliament, where no information or evidence worth the name
888
about the quantity of water abstracted would be available to the river authority, when the question of a licence of right arises. On Amendment No. 59, which was moved by the noble Lord, Lord Lindgren, we dealt with the difficulty that in certain cases people just have not kept records. Therefore, to prove quantity will be virtually impossible. That is why we feel it necessary to have regard (and that is the wording in the Bill) to the quantity of water shown to have been taken. That the Bill would allow, but the Amendment would not.
My second objection is more fundamental and concerns purpose. The Bill states that the river authority may have regard to the purposes for which water is intended to be abstracted and the purposes for which water has been abstracted from the source of supply in question. The Amendment would exclude purpose entirely. This I find difficult to accept. First, where no definite proof can be obtained of the quantity abstracted, then consideration of the purpose for which water has been or was intended to be abstracted will be useful in helping to establish the right quantity which should be authorised in the licence. Furthermore, your Lordships will recall that there are some rivers which are sucked almost dry by excessive abstraction in a dry year. Here I must be quite frank and come straight on to the point which my noble friend Lord Merrivale put to the Committee. Where that is the case, let us quite frankly admit that the river authority may be faced at the outset with the problem of how best to apportion the available water. Abstractions made without statutory authorisation in purported reliance on Common Law or prescriptive rights may be for any of a wide variety of purposes. I do not depart from what I said in regard to paragraph 67 of the Proudman Committee's Report.
Of course it is the aim to give priority to existing abstractions, irrespective of purpose; but I think it would be wrong if we did not make provision in the Bill for the river authority to have regard to those purposes in settling the precise terms of an authorisation which it has been required to give as a licence of right. Where there is a real shortage of water for certain times of year, or in certain circumstances, if the river authority has not a right to determine purposes and if there is a need to establish some form

889
of priority it would be quite impossible for the river authority to establish any equitable system of priorities whatsoever.
A third important point is that, in our view, it must be up to the river authority to seek to establish that the intention is to continue in future to abstract for the same purposes as the abstraction has been made in the past. Only to the extent that this is so is there a solid case for a licence of right.
Those are the principal reasons why I suggest that this Amendment must be resisted if we are to build a really satisfactory system for dealing with these licences of right. But having said that I would repeat that we shall be requiring to make some Amendment to this clause in any event at a later stage, and I can undertake to see between now and then whether there are any specific points made by my noble friends in our discussion this afternoon which should be included in those Amendments. I must repeat, however, that it would be wrong and disingenuous of me if I were to convey the impression that we shall be able to give substantive effect to the main purpose of the Amendment as I understand it.
LORD MERRIVALE: First of all, I should like to thank my noble friend for the obvious trouble he has taken in endeavouring to meet our point as far as he can. I appreciate that there are differences of principle involved here, and that is why I am grateful to him for having gone as far as he can at this stage. As I understand it, one point on which we differ is that in my noble friend's opinion the proof of the quantity over the years might in many cases be difficult to ascertain. I regret that he feels that purposes should be taken into consideration so much. However, I am grateful for what he has said, and, without committing myself to what might be done at a later stage, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 35 agreed to.
Clause 36 [General restriction on impounding works]:
3.17 p.m.
LORD LINDGREN LORD LINDGREN moved, in subsection (2), to leave out "an alternative" and insert "a". The noble Lord said: I think it will be for the convenience of the Committee if we take with this
890
Amendment Numbers 102, 110, 111, 112 and 113, because they all cover the same point and would come within the general definition of consequential Amendments if this Amendment were accepted. Clause 36 provides that nobody shall construct or alter an impounding works without a licence from the river authority. Clause 36 (2) exempts the construction or alteration of impounding works which are authorised "by virtue of an alternative statutory provision," and subsection (3) defines that alternative statutory provision to mean, broadly speaking, a statutory provision in force before the new scheme comes into operation. The Amendment proposes that the exemption from licensing may be extended to cover works carried out by virtue of a statutory provision after the new scheme comes into operation.
The principal class affected by this Amendment is the statutory water undertaker who carries out impounding works under statutory provisions. As the clause stands, the statutory water undertaker who has obtained powers to carry out impounding works before the new scheme will not have to obtain a licence from the river authority to carry out those works. It appears, however, that when the new scheme comes into force the statutory water undertaker will not only be obliged to obtain statutory authority for impounding works, but will also have to obtain a licence from the river authority—that is, to obtain two authorities from two different sets of people. This machinery seems typical. Does the water undertaker go to the river authority for the licence in the first place, and then to the Minister or to Parliament for statutory authority, or does the water undertaker go to Parliament or the Minister first and then to the river authority? In any event, what happens if one body gives the authority and the other denies it? The Amendment proposes to deal with the problem by providing that if the water undertaker has obtained statutory authority for carrying out the impounding works, then he shall not have to go to the river authority for a licence. I beg to move.
Amendment moved—
Page 33, line 12, leave out ("an alternative") and insert ("a").—(Lord Lindgren.)
LORD HASTINGS: In a way, this is a continuation of a slightly different argument we had the last time we were

891
in Committee on this Bill in regard to licences for abstraction. The effect of the Bill in this clause as drafted is to except from licensing all past impounding works which have been statutorily authorised and any which may be authorised statutorily up to the end of the initial period; but after that, future impounding works would have to be licensed. Most of the alternative statutory provisions will have been orders made by the Minister of Housing and Local Government under Sections 23 and 26 of the Water Act, 1945. Their exclusion from licensing is natural and justifiable in all the circumstances up to the end of the initial period. In the future, though, it is intended that impounding works, even those from statutory water undertakers, should be licensed. The main beneficiaries of the exclusion would be the statutory water undertakers if these Amendments were to be accepted, and it is really in that respect that they follow on the noble Lord's Amendments Nos. 70 and 77, which sought to exclude from licensing control existing abstractions by the statutory water undertakers, only in this case they appear to go further in seeking to exclude future works by water undertakings as well as existing ones.
I think the noble Lord has overlooked a few points here, because he has not perhaps taken into consideration the provisions of Clause 37 (3), whereby application can be made for a combined licence to impound and abstract water. He referred to the difficulty of going through two different authorities, one to the Minister for the impounding works and the other to the river authority for the abstraction licence. He was suggesting that if they got the impounding works, then they need not have a licence to abstract. I really replied to that argument on the previous Amendment No. 77, which the noble Lord moved last week, showing that it was impossible to excuse anybody—statutory water undertakers or anybody else—from going through the ordinary channels or from getting a licence to abstract water. Obviously, it is the licence to abstract water which must come first in order before impounding works are authorised.
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Apart from the fact that a combined licence to impound and abstract water can be issued, I think the noble Lord is disregarding my previous argument, which was that a comprehensive and unified management of water resources is to be vested in the river authorities if our national water policy is going to be efficient. If impounding of water by statutory water undertakers or anybody else is not to be controlled by them, it would be extremely difficult for them to carry out their task properly. I do not see how we can allow statutory water undertakers to opt out of the licence system either for abstraction or for impounding works. Furthermore, where appropriate the Minister would no doubt require application to be referred to him under Clause 38, and would deal with the application from the very beginning. But in any case we feel that the statutory water undertakers cannot contract out of the new system. They really stand to benefit with all other abstracters from the comprehensive and positive management of their activities, and like all others must be brought within the system. The right of appeal against a decision of a river authority applies to applications for impounding works just as it does for applications for abstraction licences. There need be no fear that the interests of statutory water undertakers will not be properly considered.
As the noble Lord said, the next Amendment and four others, Nos. 110 to 113 inclusive, really go together with this Amendment, and, bearing in mind my reply, which was of considerably greater length and in greater detail than on the previous Amendments dealing with abstraction licences, and in view of the firm undertaking I gave that the statutory obligations in respect of domestic users will be recognised in the Bill, I hope he will feel that he can withdraw this Amendment.
LORD LINDGREN: I am most grateful to the noble Lord, Lord Hastings, for that very detailed reply. If I have put down an unnecessary Amendment, I apologise to him, but I think he will agree that this is quite a complicated Bill, and as the three clauses, Clauses 36, 37 and 38, all deal with the same point, I would agree that I have not quite appreciated that all dual applications for impounding and abstracting,

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where they go together, will come under Clause 37 (4). In view of his explanation, for which I am most grateful, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 36 agreed to.
Clauses 37 and 38 agreed to.
Clause 39 [Appeal against decision of river authority]:
3.28 p.m.
LORD CHORLEY LORD CHORLEY moved, in subsection (1), after "applicant" to insert "or any other person". The noble Lord said: I think I can explain this Amendment very shortly. The clause to which we have now come deals with appeals. An applicant whose application for a licence is rejected, or who gets a licence subject to terms which he does not think are right, is given the right of appeal, very properly, by this clause. The later subsections deal with the procedure in respect of these matters. What the clause does not do is to provide a right of appeal to those opponents of the grant of the licence who, if the licence is granted, may well suffer a great deal of damage. There seems to be no good reason why some person who has objected to the grant of a licence should not equally be given the right of appeal.
The noble Earl knows that in the Amendments which I have been putting down to this Bill I have been speaking on behalf of the amenities organisations, who are naturally very interested in this question of being able to resist the grant of a licence in certain circumstances. It seems only right and proper that, if their applications are overruled by the authority, there should be a right of appeal. Of course, this concerns not only the amenities organisations. In some ways private interests are even more concerned to have a right of appeal in this type of case. Only a minute or two ago the noble Lords, Lord Merrivale and Lord Fraser of Lonsdale, argued the position of private landowners who may already have valuable vested interests in water and who may find those interests overborne by the grant of a licence to somebody who has just come in, despite opposition from people who have long-standing interests in these matters. It may well be that the authority has decided against them, very properly, after due consideration
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of the facts. But is it right that there should be no possibility of their appealing in a case of this kind where landowners may be losing valuable interests and where quite possibly the authority may have overlooked some point to which the Minister, if an appeal to him were possible, would attach very considerable importance? It is quite possible, I suggest, that he would set aside the licence, or at any rate attach to it conditions which would go some distance towards meeting the very just case of the man whose vested rights had been overborne.
Therefore, from the point of view both of the private interests involved and also of the societies who carry on this very difficult and often frustrating task of trying to defend the interests of the public as a whole in the natural beauties and the amenities of the countryside generally, it would appear very reasonable and proper that a right of appeal should be extended to those who are resisting the grant of a licence just as much as to an applicant whose licence has been refused. I hope the noble Earl will, at any rate, be able to give me this Amendment, which is the last I have down. I beg to move.
Amendment moved—
Page 35, line 29. after ("applicant") insert ("or any other person").—(Lord Chorley.)
EARL JELLICOE: The noble Lord has just moved an important Amendment. Its effect would be, as he explained, that any person could appeal against the river authority's decision on a licence application. As Clause 39 stands at present, the right of appeal is confined to the applicant for the licence, as he made clear. First of all, I should like to make it quite clear to your Lordships that the Bill acknowledges, and quite rightly so, that third parties have a legitimate interest in licence applications. Clause 28 provides that every application—apart from an application for a licence of right—must be advertised. This ensures that anyone who would be affected if a licence is granted can find out about the application. That person is allowed 28 days in which to make representations to the river authority, and the authority are required to have regard to his representations when they come to deal with the application—and that, again,

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as the noble Lord pointed out, is in Clause 29 of the Bill.
If the licence is refused—and any such refusal might be a direct or indirect consequence of the third party's representations—and the applicant appeals, the third party is again safeguarded. If he made representations to the river authority in the first instance he is given an opportunity of making a further representation to the Minister at the appeal stage, and the Minister is required to take the third party's representations into account along with those made by the appellant. If the Minister holds an inquiry, third parties will be able to attend and to speak. If, however, despite the third party's initial representations the river authority decided to grant a licence, that, of course, under the Bill as drafted, and as the noble Lord, Lord Chorley again made clear, would be the end of the matter.
The question how far third parties should be entitled to carry their objections was, I think, among the most difficult which arose in the course of preparing and drafting this Bill; and the question of how best to safeguard third party rights is not an easy matter at all. The basic problem here is how best to hold a reasonable balance between the legitimate interests of third parties, which are recognised, as I have just sought to explain, and the equally legitimate interests of abstracters or would-be abstracters. One thing, however, to which we feel the would-be abstracter is entitled is to receive a firm decision on his licence application within a reasonable time. As it is, the applicant may well have to wait two or three months before getting his decision under the procedure already envisaged. What would be the result if a third party were enabled to appeal against a grant of licence, as Lord Chorley's Amendment would provide? The licence holder could not then safely act on his licence, or incur any expenditure on plant or buildings on the strength of it, until either the time for making an appeal had passed without an appeal being made, or an appeal had been made and decided.
All in all, it seems to us that where no third party appealed, the applicant would often have to wait four months from the date of his application before
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his licence was firm. If we adopt the procedure recommended by the noble Lord, Lord Chorley, and there is an appeal, the period might well be six, seven, or up to eight months, and, in our view, it is not reasonable to expect would-be abstracters to wait as long as that. They may be industrialists needing more water urgently for increased production for new processes; they may be farmers needing more water urgently for irrigation; they may be water undertakers faced with a mounting and urgent demand from domestic consumers. I suggest that we must really weigh all this very carefully before opting for a procedure which would make procrastination the hallmark of the whole licensing system.
We must remember that an industrialist may need to abstract more water just as badly and urgently as he may need to draw more power from the grid, and the same applies to many farmers. We must bear in mind that under the present law many abstracters are free to take water without asking for anyone's consent, and I would suggest to your Lordships that we should be very careful not to make the new licensing system too onerous.
I am not without sympathy for the third-party case, but I should be more inclined to concede the noble Lord's case—and, I must confess, I am not inclined to, even though I have given him something on his previous amenity Amendment—if there were not various other safeguards for the third-party interests likely to be affected. Again, I do not want to go over ground already gone over, but I must recall the basic safeguard to your Lordships, which is the minimum acceptable flow; and there is a pretty thorough procedure by which that minimum acceptable flow is determined, giving plenty of opportunity for third parties to represent how they will be affected by it.
I know the deep concern of the noble Lord and other noble Lords that we should do all we can to safeguard amenity in this Bill. I have already suggested that there are in fact many safeguards other than that of the right of third parties to represent or to appeal, but apart from these safeguards it is, I think, very hard to visualise a project for taking water which would be really significant for amenity but which did

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not also involve at the same time buildings or works requiring planning permission or, in the case of water undertakers, an order of the Minister under the Water Act of 1945. In any such case, the application would still be subject to the whole planning machinery.
I must again apologise for having taken up quite a bit of your Lordships' time on an Amendment, but it touches on very important issues. Could I just summarise our arguments as follows? We claim that the Bill as it stands does preserve about as good a balance as one can reasonably get between the interests affected by abstraction and the interests of abstracters. The line taken in the Bill is, moreover, the same as that of the planning Acts; the applicant for planning permission can appeal, but not a third party. Moreover, as I have endeavoured to show, there are many other ways in which third-party interests, including, of course, amenity interests, are safeguarded. In all the circumstances, I am afraid that I cannot advise your Lordships to accept this Amendment.
LORD CHORLEY: I am grateful to the noble Earl for the care with which he has discussed this point. I must say I have seldom heard an argument which was less convincing. I suppose you could always say there shall not be an appeal because it leads to delay. There are obviously numerous cases where delays caused by appeals are just as unfortunate to the respondent as they are in this case, perhaps a good deal more serious, and yet the valuable interests involved have always been held to justify a right of appeal. The noble Earl really gave his case away, or part of it, by pointing out that the rights of third parties were very important indeed and that every effort had been made to give them an opportunity of putting their case before the authority. The logical next step from that is that if they are defeated there they should have some right of appeal, as the applicant has if he is defeated in the first instance.
It is quite true that there are general provisions in other parts of the Bill which no doubt will be operated: that is part of the general background of the whole Bill. But when we are dealing with an individual case, we are not really concerned with the general policies involved; we are concerned with
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what happened in respect of some particular matter, just as in litigation before a court when it is a question of appeal we are concerned not with the general law under which the judge decided the case but whether the decision he made in that case was a proper one or not, and, if not a proper one, whether it ought not to be repealed. Although I always listen with very great attention, and I am surprised often at the cogency with which the noble Earl succeeds in arguing the rather bad case he sometimes has, I must say that on this occasion he has not gone very far towards convincing me at all. I should like to look at what he said again, however, and possibly pursue this matter at the next stage. In the circumstances I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
THE LORD PRESIDENT OF THE COUNCIL AND MINISTER FOR SCIENCE (VISCOUNT HAILSHAM): I beg to move that the House do now resume in order to give my noble friend Lord Carrington an opportunity of making the statement of which the House has been given notice.
Moved, That the House do now resume.—(Viscount Hailsham.)
On Question, Motion agreed to: House resumed accordingly.

SKYBOLT
3.43 p.m.
THE FIRST LORD OF THE ADMIRALTY (LORD CARRINGTON): My Lords, with permission, I should like to make a statement on the recent talks which my right honourable friend, the Minister of Defence, had with Mr. McNamara in London on December 11.
The principal subject discussed was, as your Lordships know, the future of the Skybolt missile. We have, of course, known from the outset of our association with the United States Government on this weapon that it constituted a formidable development problem. We knew of various difficulties that had arisen, and of the steps that were being taken to surmount them. Such difficulties, of course, were not unexpected, nor are they unusual even in simpler missiles.

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However, when the Minister of Defence visited the United States in September of this year the situation was that, while the increase in costs was causing concern, he was assured that American plans assumed delivery of Skybolt. It was not until the beginning of November that Mr. McNamara, while assuring the Minister of Defence that no decision would be taken without the fullest consultation, informed him that the future of the weapon was in question. This consultation was carried a further stage last week, and will be continued between the Prime Minister and President Kennedy in the Bahamas.
From the point of view of the United States, the weapon is proving more expensive than originally estimated; secondly, it looks as though it will be late and possibly not as efficient and reliable as had at first been hoped; and, thirdly, alternative weapon systems available to the United States Government have proved relatively more successful.
The Minister of Defence has stressed throughout his talks with Mr. McNamara the serious consequences for the United Kingdom of a cancellation of this project, and I can assure your Lordships that the United States Government can be in no doubt on that aspect of the matter. The discussions have naturally included the possibility that the United States Government might provide us with alternatives to Skybolt of which the most important is Polaris, but I would stress that no decisions either on Skybolt or on possible alternatives to it have been taken.
Since discussions between our two Governments have not been completed, I am sure that your Lordships will accept that I cannot say any more at the present time. Indeed, as the Prime Minister said last week, it would not be in the interests of the country to do so.
Apart from Skybolt, the Minister of Defence's meeting with Mr. McNamara gave them an opportunity for informal and confidential discussion of a number of matters of joint concern to the two Governments.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, we have to thank the noble Lord, the First Lord of the Admiralty, for reading to us in this House the statement which has been made
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by the Minister of Defence in another place. I cannot help feeling that practically all sections of your Lordships' House will be exceedingly disturbed by the statement which has been made. Speaking first of all from the point of view of my Party, it is an extraordinary reflection of events of months and months ago when one of my colleagues, Mr. George Brown, came back from America and reported that there were very grave doubts as to whether this weapon would be likely to materialise. He was told by the then Minister of Defence that he was speaking with complete irresponsibility, as if there were no such likelihood of cancellation taking place at all. I think, therefore, looking back upon that side of the incidents which have occurred that Mr. Brown must have been completely justified in bringing to the notice of the House, and indirectly perhaps to the notice of the Government, that his report was a possibility which it was very important to consider at once.
Now we are told in this statement today that the possibility of increased costs and the like were causing concern in September when the present Minister of Defence went over to the United States, but he evidently understood at that time that there was no question of the continuation of the project of Skybolt not being within the plans of the Americans. We gathered, too, from the statement that Her Majesty's Government had no idea of a possible change until the beginning of November. This is an extraordinary position. I feel like saying a lot more, but I do not want to make the position too difficult for the representatives of this country who are going to discuss the whole circumstances of the possible future dangers to our country in the talks which are to take place in the Bahamas, at which I gather we are to be represented by the Prime Minister, the Foreign Secretary and the Minister of Defence. The country at large must be feeling the weight of the burden upon those representatives. According to discussions on defence we have had in your Lordships' House in the last three or four years, this present position looks like a disaster to the plans of the Government, which will have to be completely recast, anyway, if this situation goes on.
When the First Lord of the Admiralty was reading his statement I noticed in it

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a paragraph which referred to a possible alternative. I know that of course he was only repeating what the Minister of Defence said with regard to Polaris. Well, it would be one thing for Polaris to be available to the United States Navy, but to give it as an alternative to a nuclear deterrent for this country, to be used within reasonable terms, would call for a great deal of consideration.
I do not propose to press the First Lord of the Admiralty on the state of the Navy to-day, but I do not know of any naval vessel existing or building at the moment which would be capable of carrying such a missile as Polaris; nor have I ever heard anything to the effect that the Polaris missile could be used, in terms of transport and delivery, other than by submarine. At any rate, if you tried to use it I should think it would be one of the most vulnerable missiles that would exist in those circumstances. I greatly hope that something better may come out of the discussions with President Kennedy in the Bahamas. But, apart from what I have said about the terms here, I must say that I do not think that the United States of America has treated this country in quite the manner in which we ought to have been treated.
LORD CARRINGTON: My Lords, the noble Viscount the Leader of the Opposition has raised a number of points and he will not expect me to comment on them all at this stage; but there will be ample opportunity to discuss these things later. I would only draw his attention to part of one sentence in the statement which I read—namely, that:
"no decisions either on Skybolt or on possible alternatives to it have been taken".
I think it would really be better if we waited until after the Bahamas meeting before taking the matter any further.
LORD REA: My Lords, I do not want to prolong this discussion, but I should like from these Benches to thank the First Lord of the Admiralty for his statement. For the Record, I think it is an original statement and not a repeated statement on something, being delivered in another place. In view of his request that we should not press him, I do not propose to ask him any questions, but it seems to me that the country will be, one might say, scandalised at the state of
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affairs which has come to this point. The statement itself says that the weapon which we are going cap in hand to try to get is, from the point of view of the United States, too expensive, late, inefficient, not reliable; and then it says that no other weapons systems have proved any more successful. We are really rather in a bad jam here. But there is one ray of light from the political Party point of view: that my Party and, I believe, the Panty of the noble Viscount on my left have advocated that we should not have a British nuclear deterrent. That is one unhappy way out of that thing. But I suggest that Her Majesty's Government might find out more about the opinion of the actual people of this country as to their attitude towards the possession of an independent nuclear weapon.
LORD CARRINGTON: My Lords, I think perhaps I ought to put right, for the Record, that this is in fact a repeat of the statement being made by my right honourable friend the Minister of Defence in another place. I do not know whether the noble Lord the Leader of the Liberal party has got the Labour Party's defence policy right—I am not in a position to correct him on that—but I must say that I find it difficult to understand why the noble Lord, who I understand is a unilateral nuclear disarmer, seems to be upset when things seem to be going wrong with the Government, whose policy is exactly opposite.
LORD HENDERSON: My Lords, may I ask a question of the Minister? It has been said that, if Skybolt cannot be brought forward for use by the British Strategic Bomber Force, it would be disastrous. That, I understand, is the case because Polaris is a matter for the Admiralty and not for the Air Force. Would the noble Lord tell me what would be the position of the Strategic Bomber Force of the United States if there were no Skybolt?
LORD CARRINGTON: I think that the position of the United States Strategic Air Force would be exactly the same as that of the Royal Air Force.
LORD HENDERSON: So the effect would be that both the Strategic Bomber Forces would be scrapped?
LORD CARRINGTON: Not necessarily. Both of them have got interim weapons in the shape of Hounddog and Blue Steel.
LORD BALFOUR OF INCHRYE: My Lords, while not wishing to press the First Lord at the present stage, could I just ask him two questions, because obviously this is a most grave position and our defence policy has really crumpled around us; it has caused great disturbance throughout the country. My first question is this: While no decision is yet come to as regards Sky-bolt or any alternative, could we have an assurance that any future nuclear deterrent decision will be based purely and absolutely on the efficiency of the weapon and not on any political consideration, national or international? The second question, which is really addressed to the Leader of the House, is this: Will the House have to wait until the publication of the Defence White Paper, which may be well into next year, before we have an opportunity to debate this extremely grave position?
LORD CARRINGTON: My Lords, with regard to the first question which my noble friend asks me, I think it is obviously the policy of Her Majesty's Government to get the best deterrent weapons available. With regard to his second question, I think that depends a little on what happens at the meetings in the Bahamas, but I know that my noble friend the Leader of the House will do everything possible to facilitate an earlier debate if necessary.
LORD OGMORE: My Lords, may I ask the First Lord what evidence he has that my noble friend is a unilateral nuclear disarmer? I have none. Is the noble Lord aware that the Liberal policy is not for unilateral nuclear disarmament at all? It believes in retaining the effective and credible nuclear deterrent—namely, the one in the hands of the United States—so long as Soviet Russia also has one. Is this statement not evidence that our so-called nuclear deterrent is entirely dependent upon the United States, and is not an independent nuclear deterrent at all?
LORD CARRINGTON: No, that is not true. With regard to the noble Lord's first observation, I should have
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thought it true to say that, if this Government divested themselves on their own of their nuclear deterrent, that was unilateral nuclear disarmament.
LORD OGMORE: My Lords, may I point out to the noble Lord that this Government are supposed to be a member of NATO, which consists of fifteen nations, and that most of those nations have not got any nuclear independent weapons and yet they are not unilateral disarmers?
LORD CARRINGTON: My Lords, I do not understand how you can disarm if you have not got the weapon originally.
LORD OGMORE: You can believe in it. We do not believe in unilateral nuclear disarmament and we do not regard ourselves as unilateral nuclear disarmers while the Western world has the benefit of the United States' deterrent.
LORD SHEPHERD: My Lords, would the noble Lord not agree that one of the most disturbing features of this matter is that this country is a member of NATO, with the United States, and there is what we have liked to believe to be a special relationship? Would the noble Lord not agree that the disturbing feature is that this news has come as an obvious shock, perhaps without any prior knowledge, to the Government, and therefore we are faced with this position which should never have occurred among allies? If there had been difficulties, we as a country should have known of those difficulties, have been aware of them and been able to adjust our policies accordingly. My own view is that the most disturbing feature of this matter is the suddenness with which the Government have been confronted with this news.
LORD CARRINGTON: I do not think so. If the noble Lord opposite reads the statement I have made he will see that we have been kept informed of these various difficulties about Skybolt.
LORD SHEPHERD: In September?
LORD CARRINGTON: It was before September. I think he realises that these are complicated weapons and some have been cancelled four times before they reach service.
LORD SHEPHERD: Yet you base your whole defence policy on this one weapon.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, I am obliged to the Leader of the House for suggesting that, if necessary, he will give facilities to the House for the earliest possible discussion when we know what has been occurring at the conference. We shall have to see what the dates are, and whether it is possible not to have to wait too long for this debate. In the meantime I will only pass this last comment. In regard to the way in which this has been sprung upon us, as a nation, anyway, never mind how much notice the Government think they have had of steps on the way, and the putting of our eggs in one basket in the event of a war, if this is how we are likely to be treated, it fills me with gloom.

WATER RESOURCES BILL
4.1 p.m.
Committee stage resumed.
EARL JELLICOE EARL JELLICOE moved, in subsection (6), after "varied" to insert "or revoked". The noble Lord said: I think that this Amendment should be linked with that immediately following. I should therefore like to suggest that we take them together. Both Amendments are perfectly straightforward. Clause 39 (3) says that where an appeal is made against the decision of a river authority on an application for a licence, the Minister may deal with the application as if it had been made to him in the first instance. Where the appeal is against a decision of a river authority to grant a licence subject to conditions, the Minister might decide that, if he had been dealing with the application in the first instance, he would have refused a licence altogether. In that event he ought to be able to direct that the licence granted by a river authority be revoked. As subsection (6) of Clause 39 is drafted at present he would not be able to do this. These two Amendments intended to put this right.
Amendment moved—
Page 36, line 18, after ("varied") insert ("or revoked") —(Earl Jellicoe.)
On Question, Amendment agreed to.
EARL JELLICOE: This Amendment is consequential. I beg to move.
Amendment moved—
Page 36, line 21, at end insert ("or to revoke the licence, as the case may be").—(Earl Jellicoe.)
On Question, Amendment agreed to.
Clause 39, as amended, agreed to.
Clause 40 agreed to.
Clause 41 [Revocation or variation on application of holder of licence]:
LORD HASTINGS: This is a drafting Amendment. Clause 30, the reference to which we are proposing to leave out, applies in any case in its own right as it stands in the Bill. Therefore it is quite unnecessary to include reference to it here. I beg to move.
Amendment moved—
Page 37, line 3, leave out ("to 30") and insert ("and 29"). —(Lord Hastings.)
On Question, Amendment agreed to.
Clause 41, as amended, agreed to.
Clause 42:
Proposal by river authority to revoke or vary licence
42.—(1) Where it appears to a river authority that a licence under this Act granted by the authority should be revoked or varied the authority may formulate proposals for revoking or varying the licence.
LORD LINDGREN LORD LINDGREN moved, in subsection (1), after "by the authority" to insert:
"(not being a licence held by statutory water undertakers)".
The noble Lord said: Clause 42 deals with the powers of the river authority in respect of revocation or variation of licences which it issues. The Amendment exempts from the provisions licences held by statutory water undertakers. In the past, as has been pointed out on a number of previous Amendments, water undertakers have enjoyed the security of statutory rights for the abstraction of water required for public water supplies. If statutory authorisation is to be replaced in future by licences which are revocable or variable at the instance of the river authority, then statutory water undertakers will have no security for their supplies. The uncertainty of revocable licences, contrasted with the certainty of statutory powers, must in future make water undertakers hesitate before laying out

907
large sums of public money on the construction of waterworks, because the usefulness of waterworks depends fundamentally upon the power to take water. These uncertainties will make it difficult, if not impossible, for them to plan for the future.
The Amendment, by exempting statutory water undertakers' licences from revocation, gives them the certainty which they will require to enable them to construct their works and to plan for the future. I admit that this is an Amendment of special pleading, but I think this is special pleading in a good cause.
Amendment moved—
Page 37, line 8, after ("authority") insert the said words. —(Lord Lindgren.)
LORD HASTINGS: This is the last of a series of Amendments moved by the noble Lord, Lord Lindgren, attempting to take statutory water undertakers out of the general system of licensing. In view of my previous explanations the noble Lord agreed to withdraw his earlier Amendments in respect of licences to abstract and licences for impounding works; but he is still hopeful that he might be able to get special treatment in regard to the revocation or variation of licences. I am glad that he accepted my previous explanations. I hope I shall be able to satisfy him on this Amendment.
It is very largely a technical matter. If the best use is to be made of water resources, and if there are to be, as there must be, transfers of water between areas, it may well become necessary to bring about changes in the existing pattern of abstractions; also, if artificial recharge is to be introduced changes in ground water abstractions might be desirable. These activities are just as likely to affect statutory water undertakers as other abstracters, and it would be a serious matter if river authorities were debarred from embarking on a scheme, which might be of great and widespread benefit—perhaps a scheme worked out by the Water Resources Board—because they could not make the necessary changes in a licence held by statutory water undertakers. Another example would be in respect of impounding works. It may be necessary for a river authority to be able to vary the conditions imposed on an impounding of water, principally those relating to the discharge of compensation
908
water. It may be necessary because, with increasing knowledge and understanding of the behaviour of the requirements of a river, a different amount of compensation water or its discharge may be recognised as adequate; or with the construction of additional reservoirs of a river-regulating type in the same basin as a reservoir discharging compensation water, it may be in the interest of good management of water resources to make new or different provision for the quantity and place of discharge of compensation water. These variations will react by no means unfairly or harshly upon statutory water undertakers. In many cases they probably will react greatly to their benefit.
Finally, the noble Lord referred to the lack of security, or the uncertainty, of supplies. But certainly the undertakers can demand protection. First, they will get it now, in view of the new clause we intend to insert referring to the statutory obligations which must be met by the river authorities; and in so far as this particular clause is concerned, the statutory water undertakers are protected because they cam, in the first place, object to the authority's proposals. In subsection (5) of this clause the noble Lord will see that if they exercise that right of objection, a decision on the proposals can be taken only by the Minister. Then, furthermore, under the next clause, Clause 43 (2), if the undertakers insist upon it or ask for it, the Minister himself can reach the decision only after a local inquiry. I should have thought this was pretty good protection all round for the rights of the statutory water undertakers in respect of revocation or variation of licences, apart from which it is technically necessary and likely to be in the interests of the undertakers themselves. I hope the noble Lord will withdraw his Amendment.
LORD LINDGREN: I entirely agree that the undertaking which the noble Lords in charge of the Bill have given in regard to the new clause on statutory obligation does, to a degree, alter the circumstances in which this Amendment was put down. This was put down before that undertaking was given. In view of that, and of what the noble Lord has said, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD HASTINGS: Subsection (7) of Clause 42 provides that subject to subsections (4) to (6) the river authority may carry out their revocation of a licence, or may vary a licence in the manner which they first proposed or in any other way "not more detrimental to the licence holder". The wording is not altogether satisfactory, and could lead to disputes between the authority and the licence holder as to what is or is not "more detrimental" to the latter. The desired result will be better achieved if the Amendment is made, because if the river authority conclude that the licence ought to be varied otherwise than they first proposed, they will not be able to carry that variation into effect without giving the licence holder due notice and an opportunity to object—in other words, they will have to go through the whole rigmarole and start all over again from the beginning. But if they can get the consent of the licence holder, then that will not be necessary. This Amendment makes provision for the consent to the proposed new variation. I beg to move.
Amendment moved—
Page 38, line 11, leave out from ("or") to end of line 14 and insert ("with the consent of the holder of the licence, may vary it in any other way").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 42, as amended, agreed to.
Clause 43 agreed to.
Clause 44 [Special provisions as to spray irrigation]:
On Question, Whether Clause 44 shall stand part of the Bill?
LORD HAWKE: This clause deals with a situation in which, owing to drought or through some other cause, spray irrigation has to be cut down—a very natural thing to happen. But what I am not quite clear about, in my ignorance, is whether there are adequate provisions in the Bill to enable other takings of water to be cut down in drought or in natural calamity. Rivers have been known to disappear before now. What is the effect on the licence holders? Are all licence holders reduced pro rata; do they have to be compensated, and so on? This point is probably covered in the Bill, but I have not managed to find it in my searches, because it may be in many
910
different clauses. I wonder if my noble friend can answer that query.
LORD HASTINGS: I am not sure that I can give a direct and firm answer to the noble Lord. My impression is that in emergency the river authority can vary Licences generally but that before doing so they would be obliged to reduce the number of licences for spray irrigation. If there were a national emergency, obviously beyond that point it would be necessary to take further action. But I will confirm that and will let the noble Lord know if I am right. I think I am.
LORD HAWKE: My noble friend may be referring to Clause 34 (3) (d) in which the words "by reason of accident of other emergency" are used. I am not sure how, in that event, the licences would be revoked or reduced. If they are to be revoked or reduced, it appears that the relevant provision must be put into the original licence. Then the question of compensation appears, because if through an act of God there is not enough water for everybody, does compensation have to be paid for those who are short on their licences? Perhaps the noble Lord could deal with that point.
LORD HASTINGS: I think I had better look into this matter. It certainly cannot refer to licences of right, which I think were quoted by the noble Lord. I do not think there is any need to worry about this, but I will let the noble Lord know exactly how it works.
LORD LATHAM: Would the noble Lord agree that spray irrigation is perhaps one of the most prodigal uses of water in this country?
LORD HASTINGS: That is likely to be increasingly so in the future. It is also one of the most important uses. But it is recognised that in exceptional circumstances, it would have to be the first to reduce the quantity used; and that fact has been accepted by the agricultural industry.
LORD DE RAMSEY: I would make the same point as the noble Lord—namely, that if the quantity were reduced the charge would be reduced also. So far as the irrigator is concerned, it should also be borne in mind that to reduce the charge pro rata would not be compensating him fairly for the loss of

911
the water, because (though this sounds like something an Irishman might say) it is the water that is not there that is the most valuable to the farmer, and justifies his outlay for the equipment.
LORD HASTINGS: I think there will be an opportunity to discuss this matter further when we come to the part of the Bill dealing with charges. Perhaps the noble Lord would like to bring it up again there.
LORD HAWKE: I hope that there is no question of having to compensate farmers in a drought year for water that is not there, because there would be no end to that sort of thing.
LORD HASTINGS: There is a previous provision in the Bill, which we have already passed, allowing for charges to be settled from time to time. I remember that we had a discussion on that, which I think was on an Amendment of the noble Lord, Lord De Ramsey. I cannot remember the precise information at the moment, but it was made clear that, where there was a variation enforced upon users of spray irrigation, the charges would be based upon that variation and not upon the original licence. I think I am right in saying that.
Clause 44 agreed to.
Clause 45 [Compensation for revocation or variation of licence]:
4.20 p.m.
VISCOUNT COLVILLE OF CULROSS VISCOUNT COLVILLE OF CULROSS moved to add to subsection (1):
"Provided that no such compensation shall be payable by the river authority if the authority shall satisfy the Minister that they are prepared to grant a licence for an equivalent supply of water from another source."
The noble Viscount said: To some degree this is also concerned with the point that the water that is not there is the most valuable. Under Clauses 42 and 43 of this Bill, the river authority, if the Minister allows them, can revoke licences—and that includes, as I understand it, not only licences granted on an application after this Bill becomes law but also licences of right. If they do that, if they revoke or vary any existing licence, they are required by Clause 45 (1) to pay compensation, not only for the sort of work to which the noble Lord, Lord Lindgren, referred just now—works by a statutory water undertaker which then
912
become abortive—but also, under subsection (1) (b), for any other loss "which is directly attributable to the revocation or variation." Such loss might be the effect on the value of the factory or some other hereditament because the previous supply of water was no longer available to them. There are many circumstances which might arise.
The point of my Amendment is quite simple. I hope that my noble friend on the Front Bench will not take me up on either the drafting of it or some of the technicalities, because I have no doubt that, even if he were to accept the principle, this is not in fact the right way to do it; but I believe that there is something in the principle. After all, the person whose licence is revoked or varied at the instance of the river authority is unlikely to accept such a revocation or variation willingly. What he will want is water rather than money and my Amendment gives the river authority proposing such a step a definite incentive to supply him, if necessary from some other source, with an alternative supply of water rather than be forced to pay him money in compensation. This may have a considerable effect on that sort of industry, for instance, which could very well use non-potable water but which has, up to now, been using water which could be perfectly well drunk by the inhabitants of the area. The licence may be revoked because non-potable water is now going to be used by the statutory water undertaking, whereas the industry would still be perfectly happy if the river authority would give it water from some other source. My Amendment would give the river authority some such incentive to do that. In any case, it seems to me that it would be an excellent idea if they could avoid the necessity of paying compensation at all in most of these cases, because, as I have said, it is the water rather than the money that is wanted. I hope that my noble friend Lord Jellicoe will be able to give some consideration to the principle behind this Amendment, even if he does not like the exact scheme which I have put forward. I beg to move.
Amendment moved—
Page 39, line 44, at end insert the said proviso.—(Viscount Colville of Culross.)
LORD LATHAM: Before the noble Earl replies, may I ask whether, under

913
this clause or any other clause, a third party who is injured as a result of the revocation of a licence—not a licence issued to him, but a licence issued to somebody else—will be entitled to compensation?
EARL JELLICOE: I wonder whether I could deal straight away with the question the noble Lord has just asked me? The position is that a third party who considers himself injured has a right to make representations under Clause 29, but I do not think that that includes the right to compensation. He has the right to make representations, which will then be taken into account. I do not think that there is any automatic entitlement to compensation. I should like, however, to check on that particular point.
LORD LATHAM: Would the noble Earl agree that, if that be the case as regards the Bill as it now stands, it is a matter which should be looked into, because a public water undertaking might be seriously injured as a result of the revocation of a licence issued to somebody else?
EARL JELLICOE: I should certainly like to consider this point. May I say straight away that I rather like the idea or the principle behind my noble friend's Amendment as such, more especially since it allowed him the opportunity of introducing the words "hereditament" and "potable". But I think that acceptance would, in fact, involve us in a number of practical problems which at the moment I cannot see my way through. On the face of it, it sounds quite simple and acceptable; that if and when a licence was revoked the river authority should not have to pay compensation if they were able to offer the abstracter an equivalent supply of water "from another source"—which is the phrase used in my noble friend's Amendment.
LORD LATHAM: In similar terms.
EARL JELLICOE: Or in similar terms. The practical difficulty lies in determining what would be an equivalent supply of water. If by that phrase is implied a criterion based on quantity, this clearly would not do, because this would exclude quality, a factor of equal importance. I
914
did not gather from what my noble friend said that this difficulty would necessarily arise, but it might under the wording.
Moreover, even if the abstracter were to be offered an equivalent supply, both in quantity and quality, he might nevertheless be faced with considerable additional expenditure. The new point of abstraction, for example, might well be in quite a different place, or further away from his existing point of abstraction; and this might well involve considerable expenditure in transferring, and possibly altering, his pumping and distribution plant. In fact, the whole operation, even when an equivalent supply was offered, might well involve new plant, for one reason or another.
Therefore, while, as I have said, the idea behind the Amendment is attractive, it would, I think, be extremely difficult to work out in practice. In any event, I am inclined to doubt whether it is necessary to make this change even if, by drafting or in other ways, we could get over the sort of difficulty which I have mentioned. It seems to me that the procedure which we have at present written into the Bill gives us a perfectly reasonable way out. It seems to me that under the Bill as drafted the river authority already have the power, if they wish to withdraw or alter a licence, to inform the licence holder that if he applies for a new licence they will be willing to grant him a new one on certain stated terms—and, of course, it would have to be subject to the consideration of any possible objections from third parties.
If the licence holder accepts that proposition and there are no such objections, then we are, as it were, home and dry; we have already found the alternative solution which I think my noble friend was suggesting. But if the licence holder feels that the conditions offered are more onerous, or if the conditions become more onerous as a result of objections from others, then he is already under the Bill entitled to compensation. All this, as I see it, could quite easily be done under the Bill as it stands, and I should have thought that this would meet the position without involving us in the great practical difficulties which would be involved, I think, in the acceptance of my noble friend's Amendment.
VISCOUNT COLVILLE OF CULROSS: I am very grateful to my noble friend. I have one supplementary point, which occurred to me when I was listening to his comprehensive reply. I recognise that in a case where the whole thing can be amicably settled and, in his delightful phrase (if I may counter it) we are "home and dry", it would probably be all very well. But I wonder what would happen under subsection (5) of this clause if one of these cases should go to the Lands Tribunal. As a rule there is some specific date on which the compensation will be payable. I should expect that to happen. At any rate the Lands Tribunal must have some sense of finality when it grants compensation. What would it do if there were some possibility that the river authority would be prepared to grant a licence in the future? Would compensation be payable in such circumstances, and would the river authority be allowed to receive it back? I feel that the noble Earl has not covered all the possibilities about this matter, and it might be that circumstances would arise in which a river authority was hardly done by. I should be pleased if he would look at those points again.
EARL JELLICOE: Although I thought I was adequately armoured against my noble friend's Amendment, I do not think I am adequately armoured against his ingenious supplementary. I do not think his theme as it stands would in fact meet the circumstances of the case, but I will certainly look at the supplementary point.
VISCOUNT COLVILLE OF CULROSS: I thank my noble friend, and I also should like to study what he has said in reply to my Amendment. I beg leave to withdraw.
Amendment, by leave, withdrawn.
On Question, Whether Clause 45 shall stand part of the Bill?
THE DUKE OF ATHOLL: Could I ask one question before we leave this clause? It seems to me it is going to be very difficult to apply for a licence before one has made plans. Therefore I do not see how subsections (2) and (3) will fit together. Could the noble Earl please explain that to me?
EARL JELLICOE: Any approximation which I give, thinking aloud on this,
916
would be inaccurate, and if my noble friend will permit me I promise to look at this point and write to him about it. I should probably get it wrong if I tried on my feet to answer this point.
Clause 45 agreed to.
Clauses 46 and 47 agreed to.
Clause 48:
Right of action against river authority
48.—(1) The duty imposed by section 29 (2) of this Act, or by that subsection as applied by any other provision of this Part of this Act, shall not be enforceable by any criminal proceedings or by prohibition or injunction, but shall be enforceable at the suit of any person entitled to a protected right under this Act, by an action against the river authority for damages for breach of statutory duty.
4.32 p.m.
EARL JELLICOE: The purpose of this Amendment is to make it clear that action taken by a person entitled to a protected right under the Bill for damages for breach of the river authority's statutory duty not to derogate from protected rights is to be against the river authority and the river authority alone. The need for the Amendment is as follows. Where an application is referred to the Minister for determination under Clause 38 or where there is an appeal to him under Clause 39 or Clause 40, the Minister will be under a duty corresponding to that imposed on the river authority by Clause 29 (2). It is not, however, intended that there shall be any right of action against the Minister or against any tribunal under Clause 104 to which an appeal could be referred in respect of breach of that duty. If the decision on an appeal is that a licence be granted or varied it will be the duty of the river authority, on the Minister's direction, to grant or vary the licence. Action for breach of the statutory duty imposed by Clause 29 (2) will be against the river authority alone. But the river authority's safeguard lies in the Minister's power to indemnify the authority, which is to be found in Clause 49. That is the purpose behind this Amendment. It is, I think I can assure you, primarily of a drafting nature and seeking clarification in this respect. I beg to move.
Amendment moved
Page 41, line 14, after ("authority") insert ("but not against any other person").—(Earl Jellicoe.)
On Question, Amendment agreed to.
EARL JELLICOE EARL JELLICOE moved, in subsection (2), to leave out all words before "it shall be" and to insert
"(2) Where under any provision of this Part of this Act a river authority are directed by the Minister to grant or vary a licence—

(a) the reference in section 29 (2) of this Act to the time when the application is determined by the river authority shall be construed as a reference to the time when that direction is given;

(b) as between the river authority and the Minister, the duty of the river authority to comply with that direction shall (in the case of a conflict of duties) prevail over the duty imposed by the said section 29 (2); but

(c) as between the river authority and any other person, the duty to comply with that direction shall not be taken to affect the duty imposed by the said section 29 (2) and shall not constitute a defence in any action for breach of the last-mentioned duty.

(3) In any action brought against a river authority in pursuance of subsection (1) of this section "
The noble Earl said: This Amendment is designed to make more explicit the duty of a river authority in a case where a conflict of duties could arise under the Bill. Clause 29 (2), which I mentioned in the context of the last Amendment, stipulates that the river authority shall not grant a licence authorising the abstraction of water so as to derogate from any rights which, at the time when the application is determined by the authority, are protected rights under the Bill. In certain circumstances—where, for example, the Minister has determined or called in an application for a licence or an appeal, or has taken a decision to vary a licence despite the objection of the holder—the river authority will be required by ministerial direction to grant or vary a licence. At this juncture they will be under two conflicting duties—that imposed by Clause 29 (2), which I have mentioned, and that imposed by Clause 95 (5) to comply with any directions received from the Minister. The duties may conflict in the sense, for example, that the river authority could feel certain that if they complied with the direction the abstraction which they were proposing to license would derogate from protected rights.
The effect of the Amendment which I am moving is, in the first place, to adopt Clause 29 (2) to the circumstances in which the river authority are acting under the direction of the Minister. That is why the Amendment substitutes a reference to "the time when that directive is given" for the existing reference to "the time when the application is determined by the river authority". Secondly, if there is a conflict of duties then the duty to comply with the Minister's direction is to prevail over the duty written into Clause 29 (2). Thirdly, as between the river authority and any other person the authority's duty under Clause 29 (2) is to be taken to be quite unaffected by the direction. The duty to comply with the direction is not to be a defence in any action brought for breach of the duty not to derogate from protected rights. I do not think the Amendment introduces any new principle into the Bill. It is merely intended to define the position as accurately and specifically as possible. I beg to move.
Amendment moved—
Page 41, leave out lines 16 to 18 and insert the said new subsections.—(Earl Jellicoe.)
LORD LATHAM: Will the noble Earl agree that it certainly does not introduce any additional clarity!
EARL JELLICOE: I should hope that when the noble Lord has had time to read and digest the statement I have just made, a little light may dawn, but I am not very optimistic—not because of the noble Lord, but because of the opacity in which I have wrapped this subject. But I should hope that when he comes to read Hansard this may become clearer, though I should be the first to agree this is not uncomplicated stuff.
LORD LATHAM: What an opportunity for Her Majesty's judges!
On Question, Amendment agreed to.
EARL JELLICOE: I can assure the Committee that this Amendment is purely drafting. I beg to move.
Amendment moved—
Page 42, leave out line 16 and insert ("which would be within the scope of the licence if granted in accordance with the application").— (Earl Jellicoe.)
On Question, Whether Clause 48 shall stand part of the Bill?
LORD HASTINGS: I am sorry that my noble friend Lord Hawke has left the Chamber, because I wanted to take the opportunity of saying a word on my noble friend's question on Clause 44 in respect of spray irrigation and compensation for the loss of the right to use water in emergency. I understand now that it is only spray irrigation which can be reduced in states of emergency; otherwise the principle remains as it is to-day: namely, if there is an emergency of drought, and beyond doing away with spray irrigation temporarily, it is not possible to control people in order of priority; everybody has a right of water in so far as they can get it. That is what would happen to-day under a national emergency.
Under Clause 48, as your Lordships will see from lines 21 to 26 on page 41, river authorities are expressly protected if they are not able to supply water for reasons that are
"wholly or mainly attributable to exceptional drought, or to an accident or other unforeseen act or event not caused by, and outside the control of, the river authority."
This is mainly talking of emergencies, about which my noble friend asked; so there would not be any variation, apart from spray irrigation, in that situation, and there would not be any compensation, either.
Clause 48, as amended, agreed to.
Clauses 49 to 52 agreed to.
Clause 53 [Curtailment of certain protected rights]:
LORD HASTINGS: This is a drafting Amendment. Its purpose is to make clear that where the clause refers to an occupier as being entitled to abstract water, it means entitled under Common Law and not under the licensing provisions of the Bill or other statutory provisions. I beg to move.
Amendment moved—
Page 45 line 12, at end insert ("and 'entitled' (except in subsection (1) of this section) means entitled apart from this Act or any other statutory provision").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 53, as amended, agreed to.
Clause 54 [Transitional provisions for purposes of Part IV]:
EARL JELLICOE: This, again, is a drafting Amendment, which I beg to move.
Amendment moved—
Page 45 line 34, leave out from beginning to ("as") in line 36 and insert—
("(4) Sections 27 to 29 of this Act shall not have effect with respect to applications made to a river authority under the last preceding subsection, but sections 39 and 40 of this Act shall have effect (with the necessary modifications) in relation to such applications".—(Earl Jellicoe.)
On Question, Amendment agreed to.
Clause 54, as amended, agreed to.
Clause 55 [Licence fees]:
LORD CHAMPION LORD CHAMPION moved, in subsection (1), to leave out other "and to insert less". The noble Lord said: Clause 55 (1) provides that for licences granted there shall be charged a fee of £5 or such other sum as is prescribed by the Minister for the time being. My Amendment deals with a simple point, to which my attention has been drawn by the National Farmers' Union, who feel that this is a matter which should be looked into by the Government. We all know that thousands of farmers have to rely on boreholes and wells for a supply of water for simple agricultural purposes and domestic use in farmhouses. They have had to put down boreholes or install pumping equipment or sink wells, all of which must have cost them money, although in the case of wells it is much more likely that they were put down generations ago and have served these farms for a very long time.
I agree that where farmers draw considerable quantities from boreholes, the river authorities must have some control and that there must be a licence fee charged and charges made for water abstracted, because, under the Bill, the duty of re-charging the aquifers will fall upon the river authorities. But it seems to us to be particularly hard to charge an annual licence fee of £5 on those who use bores or wells for normal farm purposes. I believe that wells of the old type should be entirely exempted from the payment of an annual licence fee. I think that that would be only simple justice. And I think that in the case of farm boreholes used only for

921
normal agricultural purposes, for watering stock and the rest of it, the charge for the licence should be a nominal one.
I think that this £5 annual fee, in some of the circumstances I have mentioned, will be an imposition and will hit the smallholder particularly hard. I know that there is a tendency always to draw in the small farmer in support of a plea of this sort, as one tends to drag in the poor widow in other circumstances, when perhaps much bigger interests may take advantage of her skirts for the purpose. But we think that there is something in this. Perhaps this form of Amendment does not really do the trick, but we think there ought to reside in the local authority the right to decrease the licence fee in the circumstances that I have mentioned. I beg to move.
Amendment moved—
Page 46, line 24, leave out ("other") and insert ("less").—(Lord Champion.)
THE EARL OF ALBEMARLE: I have great sympathy with the words which have just fallen from the noble Lord. I have also been approached by farmers on this subject. It seems to me that when we talk of a well, we want to be more specific. We want to know the bore of the well and the depth. When I first went to live in Norfolk, our well in the chalk was only about 20 feet deep and we had very hard but beautiful water. As recently as 1934 we suddenly found, I suppose because the water level in our part of South Norfolk had dropped, that we had to import somebody to make the well so many feet deeper. Those old-fashioned wells have been badly treated by the modern need for water. I heartily echo what the noble Lord has said, and I think it would be helpful to have some specific definition of what is meant by a reference to these old-fashioned wells. I hope my noble friend will see his way to ease the annoyance of farmers who think that they have to pay £5 for a well that was there during their grandfather's time.
LORD WILLIAMS OF BARNBURGH: I should like to ask the noble Lord one question. The words in Clause 55 (1) are.
"a fee of five pounds or such other sum as is for the time being prescribed…"
922
Is this £5 going to be uniform for all kinds of abstracters? For instance, is a fellow with one acre, who perhaps has just the supply he requires and does not need any buildings or extra capital expenditure, going to pay the £5 in the same way as the man with 250 acres who has perhaps the same sort of facilities on a larger scale? I am not sure that I could argue intelligently and successfully that there ought to be a variation between farm and farm, whatever the acreage, because I do not think that would be a practical proposition. However, I should like to know exactly what is meant by these words. Is it intended that the £5 for a licence is to be uniform, covering every kind of extractor, including the small farmers referred to by my noble friend Lord Champion?
LORD ST. OSWALD: If this Amendment as it stands were accepted it would debar the Minister from prescribing a sum greater than £5 as the annual fee for an abstraction licence or a combined impounding and abstraction licence, although it would not affect his power to prescribe a greater fee for a licence to impound water. I should explain that licence fees are not intended to be, and, indeed, cannot be expected to be, a major source of revenue for the water resources accounts of river authorities. Payment of fees can, how ever, reasonably be required in recognition of the fact that protection accorded by the licensing system will not be achieved without some administrative expenditure by river authorities on behalf of the licence holders. The provisions for payment of annual fees will, moreover, provide a very useful means whereby river authorities will obtain an up-to-date picture of the demand for water on the sources of supply in their area. A fee of £5 was not thought to be excessive having regard to the benefits which occur to the holder of a licence. Compared with the cost of abstraction works, which in the case of large undertakings might well run into many thousands of pounds, an annual payment of £5 is indeed fairly small.
I must, however, agree that there is one strong argument against a flat £5 licence fee. As the noble Lord, Lord Champion, said, this arises in the case of

923
abstractions of water in underground strata, from wells or boreholes, for agricultural uses other than spray irrigation. While the Bill provides that there would be no charge for such abstractions, they would be subject to licensing. The reason for this is that the quantities abstracted, while possibly in small amounts, might in total be large enough to affect other abstractions under licence. In some areas, farmers, many perhaps on small farms, such as the noble Lord, Lord Champion, has in mind, are dependent for all or part of their water supply upon wells or boreholes, and no other source of supply or no piped supply is available. It has been represented that it is unreasonable that, having had to incur considerable cost in putting down a well or borehole, and perhaps installing the necessary pumping equipment, they should be required to pay an annual licence fee of £5, more especially when abstracters of water in inland waters (rivers, streams and the like) are not only exempt from licence fees but have no need to install such expensive equipment.
I am glad to be able to give an assurance to the noble Lord who moved the Amendment, and to the noble Lord, Lord Williams of Barnburgh, that the Government sympathise with the idea of a reduced rate of fee for licences of this particular sort and are considering what Amendment of this clause, if any, is necessary to allow the Minister to prescribe such a reduced fee. But the Amendment in the name of the noble Lord, Lord Champion, and his colleague would go much further and would affect all fees for all abstraction licences. I hope that noble Lords, including the noble Lord, Lord Champion, will agree that the Minister must be in a position to adjust the fee, whether by increasing or reducing it, in the light of any changes in the value of money or any other circumstances which he may consider to be material. The flexibility afforded by the clause is necessary to secure fairness to both licence holders and river authorities.
I may add that Parliament will have the last word on this question, and any order of the Minister will be subject to annulment by Resolution of either House. In view of this explanation and the assurance that we are at work on the point, I hope the noble Lord will not feel like pressing the Amendment.
LORD CHAMPION: I regard the reply of the noble Lord as wholly satisfactory. I knew perfectly that my Amendment was badly worded, but it was worded sufficiently well to enable me to call attention to the point, and that really served my purpose. In the circumstances, and because of the happy nature of the reply I have received, I beg leave to withdraw.
Amendment, by leave, withdrawn.
Clause 55 agreed to.
Clause 56:
Charging schemes
56.—(1) As soon as practicable after the second appointed day, each river authority shall prepare and submit to the Minister a scheme (in this Act referred to as a "charging scheme") providing for the levying of charges (in addition to fees charged under the last preceding section) in respect of licences to abstract water granted under this Act.
(2) A charging scheme shall provide that the charges to be levied under the scheme in the case of any licence shall be calculated by reference to the quantity of water authorised to be abstracted from time to time in pursuance of the licence.
4.58 p.m.
LORD LINDGREN LORD LINDGREN moved to add to subsection (1):
"and thereafter from time to time as may appear to the river authority to be requisite they may prepare and submit to the Minister a new charging scheme varying the provisions of the charging scheme then in force".
The noble Lord said: Here, again, far the convenience of the Committee, we might take this Amendment with Amendment No. 121D, because the two are really dependent one upon the other. Clause 56 deals with the preparation of a charging scheme by the river authority. Unless I have missed it, there does not appear to be any provision in this clause to enable the initial charging scheme to be altered in the future, even though Clause 56 (5) visualises a variation in charging schemes. I would suggest that there must be some provision for varying the initial charging scheme, and the purpose of the Amendment is to enable the river authority to make proposals to the Minister for a variation in initial charging schemes. I beg to move.
Amendment moved—
Page 46, line 42, at end insert the said words.—(Lord Lindgren.)
EARL JELLICOE: I do not think the noble Lord has missed anything. I entirely agree with him that provision for variation of the charging schemes is necessary. He has put his finger on a gap in the Bill, as drafted, and I am glad to be able to assure him that, if he can agree to withdraw this Amendment now, I will undertake to get an Amendment covering the point drafted between now and the Report stage.
LORD LINDGREN: Like my noble friend Lord Champion, I am delighted that we are making such excellent progress, and I happily agree to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.0 p.m.
LORD DE RAMSEY LORD DE RAMSEY moved to leave out subsection (2) and to insert instead:
"(2) A charges scheme shall provide that the charges to be levied under the scheme in the case of any licence shall be calculated with reference to the quantity of water actually abstracted as measured or assessed from time to time in pursuance of the licence."
The noble Lord said: This Amendment deals with the difficult matter of charges. If an abstracter did not feel strongly about anything else in the Bill he would be bound to be deeply concerned with the application of this clause. It must provide a fair basis for a charges scheme. Perhaps it does, with one important suggestion to which I shall return. But may I deal first with the point that was raised under Clause 44, which empowers the river authority to reduce the quantity of water authorised to be used for spray irrigation in times of drought? To the farmer this is a distasteful but probably inevitable enactment. I was concerned that the irrigator might have to pay for water which the authority did not allow him to take. But I understand that the words "from time to time" in Clause 56 (2) will enable river authorities to take care of the point, and reduce the charge where, under Clause 44, they have reduced the abstraction. I should be glad if that point could be confirmed.
The exception to which I referred earlier is the position of the irrigator under this clause. It appears to me that he will pay the highest scale of charges under this clause. That is probably right and proper in the circumstances; but it also appears to me that
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he is going to pay for twice the amount of water that he uses. The clause says that the charges are to be based on the quantity of water "authorised to be extracted" by the licence. That may well suit the industrialist and the water undertaker, who will know perhaps just about how much water they will need to take. But the position of the spray irrigator is different.
Let me give your Lordships an example—that of the farmer growing 100 acres of potatoes. In the driest year he will require 10 million gallons of water; therefore when he asks far a licence he must ask for 10 million gallons. As the Bill is now worded, he will be required to pay for 10 million gallons, although he will not use 10 million gallons, except in the driest year. In a wet year he will not use any at all. Perhaps over a five-year period he will ruse 25 million gallons, an average of 5 million gallons a year; but, as I see it, he will pay for 50 million gallons. This seems wholly inequitable, and for this reason I suggest that the proper remedy is to amend the clause so as to base the charge not on the quantity of water authorised, but on the quantity of water abstracted or assessed as abstracted. This seems to me to be a much fairer way of levying the charges on an irrigator.
It may be objected that the new authorities must know where they stand; that they must know what their revenues will be, and that if they know this only at the end of the season when the water has already been taken, they cannot budget properly. This does not seem to me to be a strong argument, because I believe that the gas and electricity undertakings, and, indeed, the Post Office with regard to telephones, labour under the same difficulties. Again, it may be urged that the new authorities will have to carry out capital works to conserve water, and that as these capital works will benefit the spray irrigator in a dry year, therefore he should pay for them in a wet one. This is a better argument, but my feeling is that for a good many years after this Bill has come into force the vast majority of spray irrigators will be taking only water which is flowing naturally in the river. The argument, about a contribution to capital expenditure in due course does not apply to them. If the Government are disposed to accept my Amendment but consider

927
that some variation may be necessary where capital works have to be carried out, I shall, of course, be prepared to consider such a variation. I beg to move.
Amendment moved—
Page 47, line 1, leave out subsection (2) and insert the said new subsection.—(Lord De Ramsey.)
LORD CHAMPION: Amendment No. 121 covers precisely the same point, and I imagine that the reply will be on the two together. I have very little to add to the excellent statement of the position given by the noble Lord, Lord De Ramsey. I am glad to be on the same side as the noble Lord in this instance. Not so long ago in this Committee he helped to shoot me down. I forgive him for that, and support his Amendment.
The only thing I wish to add is that I am bound to admit that neither of the Amendments to this subsection is entirely satisfactory for, as framed, they would apply to all water extracters. I believe that the scheme as proposed is the best possible in normal circumstances—and here I do not include spray irrigation in "normal circumstances". I think the scheme is administratively sound. It is simple, and that is a good recommendation for it. It will enable the river authority to calculate the demands they will have to meet, and to prepare their annual budget, which of course will be part of their job. But I think that the Government might try to find some words to cover the points which were raised by the noble Lord—that is, about the spray irrigator who, having been authorised to take perhaps a considerable quantity of water, does not in the average or wet year take any at all, yet under this scheme would have to pay for it. We feel that that would be wholly unfair to him, and I therefore support the Amendment moved by the noble Lord.
LORD ST. OSWALD: I should like to say at the outset that when I first saw this clause and studied it, my own reaction was that it would be more reasonable to make charges for water actually taken rather than charge for the right to use a specific quantity of water. I am grateful to the noble Lord, Lord Champion, for being ready to take these two Amendments together, because, as he said, they cover exactly the same
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point. But having started out, as I said, somewhat on their side, when I considered it further, from the river authority point of view, as well as the abstracter's point of view, it seemed clear to me that the management of water resources could not be carried out effectively on the basis of an uncertain income. It will be the statutory duty of the river authority to take action to make water available to meet all reasonable demands in their area. At the same time, they must not license abstractions in such a way that protective rights will be interfered with. In effect, the river authority must always ensure that there is sufficient water available to enable each abstracter to take the quantity for which he has a licence—that is to say, the authorised amount of water must be provided. Clause 48 (2) makes allowance for exceptional circumstances but this does not alter the general principle. Noble Lords on both sides of the Committee have recognised the importance of the fundamental duties imposed on the river authority. If maximum quantity is to be available and is to be protected by new legal rights it seems to me right that the charge should be related to the guaranteed quantity.
Another important aspect is the financial one. The river authority must have an assurance of a broadly predictable revenue to meet both day-to-day expenditure on administration and capital expenditure on new works that will be expected of them. If charges were related to quantities actually taken, the revenue would be subject to fluctuations and the river authority would be faced with a special difficulty in meeting the duty imposed by Clause 56 (15) to secure that, taking one year with another, the income and expenditure on water resources business are in balance.
The noble Lord, Lord De Ramsey, suggested that charges on the basis of an authorised quantity will work unfairly for the agricultural irrigator, who will need to obtain a licence for the maximum quantity likely to be required in a dry season, yet who very often, as a result of the vagaries of the English weather, will take a much smaller quantity, or perhaps none at all. This difficulty we recognise, but it is due to the complexity of our weather, which is a fact of life. It is, of course, a fair point, but, as I have

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recently sought to show, the authorised quantity must be protected, and it seems to me that the quantity of water with which the consumer has obtained a right to be provided should be the basis of the charge. It may happen that in a dry season, when the need is greatest, it will be necessary for the river authority to exercise the right under Clause 44 to reduce the quantity of water available for irrigation. In such circumstances (and this is the question which the noble Lord, Lord De Ramsey, put to me) the farmer or the abstracter will be entitled to a reduction of any charge for the period in question. That follows from Clause 56 (2), which provides that charges shall be related, as he said, to the quantities authorised to be taken from time to time. And it follows, as he wished me to confirm, that there will be a reduction in charge if the quantity authorised to be taken is reduced.
If the Amendment were carried, the river authorities would be placed in a most difficult position; and in order to protect themselves would be forced to make very high charges for water intended for spray irrigation. That would be most unfortunate for the very people whose welfare the noble Lord has in mind. He implied, I thought, that charges related to the maximum quantities authorised would particularly penalise the very abstracter who wished to be sure of his supplies of water well in advance. Two points seem to me to apply here. First, if a water user wishes to sequestrate (because that is what he is doing) a source of supply very much in advance of actual requirements, it is only just that he should pay for that privilege and for that guarantee—the right to be protected. Second, if conservation works have been built by the user, there will be a case for an agreement under Clause 57 whereby the cost of the works can be taken into account. But the whole system brought in by this Bill is based on forward planning, and a regular and adequate income for water authorities must be assured if the scheme is to work.
To sum up, the purpose of Clause 56 is to lay down general principles about charges and to provide the means whereby conservation activities of the river authorities can be put on a secure footing, while at the same time ensuring that justice is secured as between
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different categories of abstraction, and for all of them. There will clearly be room for wide variation in charges and in the precise arrangements to be made for fixing them. These are all issues which can be settled in charging schemes. Clause 56 (4) and (5) lay down the principles to be followed. I can give an assurance that the Minister proposes to give guidance to river authorities on the preparation of such schemes, and this guidance will include factors to be taken into account in preparing the charging schemes. There will also, of course, be the opportunity for objections.
The noble Lord, Lord De Ramsey, invoked the examples of gas and electricity, but he will appreciate that gas and electricity differ from water in that they do not flow away into nothing if they are not used whereas water flows into the sea and cannot be recovered. If, therefore, a river authority have undertaken to supply, and have supplied, water, even if it is not paid for, they cannot recover it. There will be opportunity for objections and for local inquiries into these objections. Provision will be made for the variation of schemes in the light of practical experience, but I would argue that the fundamental reasons for basing charges on the quantity authorised to be taken should be accepted. I believe that in the long term the best interests of irrigation will be served by the adoption of this policy. For the reasons I have given, I cannot advise noble Lords to accept this Amendment, and I hope, in view of the explanation I have tried to give, that the noble Lords will not wish to press either of the Amendments.
5.18 p.m.
LORD WILLIAMS OF BARNBURGH: Before we reach a conclusion I should like to ask the noble Lord who has just replied whether subsection (2) as now printed in the Bill would cover the possible variations in charges that he referred to in his speech. Personally, I am not sure that either of the two Amendments down on the Order Paper would achieve that possibility. We are all agreed that the river authority must have the power to make charges comparable with the expenses to which they are put in providing the water, and we

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know that it will help the river authorities if users are made to appreciate that the river authorities must know what the financial situation is with which they are confronted. What I should like to know is: does Clause 42 (2) or Clause 56 (2) of the Bill as now printed cover the point raised by the noble Lord when he said that, an certain circumstances, where a user no longer consumed or could consume the amount of water that he is supposed to be charged for, as is referred to in Clause 44, the charge would be reduced?
We are told that it is quite proper that in a year of drought the first persons whose supplies would be cut off would be spray irrigators—and I do not think anyone could complain about that. But one could complain if the spray irrigator had to pay as though he had consumed the maximum supplies normally available to him. If the noble Lord could satisfy us that Clause 44 (2) and Clause 56 (2) gives the river authority power to vary the charges in a year of drought, or in any year where the charge should be varied, then perhaps noble Lords would not feel disposed to press the Amendment. On the other hand, if the spray irrigator knows that in any year of drought his supplies can be cut off, and there is power in the Bill for that to be possible, he would not be very happy to become a spray irrigator. What we are seeking is not to scramble the powers of the river authority; I should like to see them perfectly free to do a business deal with all consumers which was fair to the river authority and fair to the consumer. If the noble Lord could satisfy us that the right power is embodied in Clauses 44 and 56 we should take a different view altogether.
LORD WALSTON: May I ask a further question which perhaps the noble Lord can answer at the same time? I understood from what he said that it would be open to the river authority, if they had to cut off the supply for spray irrigation water, to make a reduction in charges for that year to the would-be user. But where the trouble seems to me to arise is not in that particular year. Let us take the case of Lord De Ramsey's potato grower using ten million gallons of water in a drought year. He would be paying over a period of years as if he were using ten million gallons every
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year, though in fact in most years not being serious drought years he might be using only five million gallons. But he would be prepared to do that as an insurance in case of drought that he would have available ten million gallons. If when the drought year arises he is cut down to five million gallons he will have paid an insurance premium for four years to no effect. It is of little consolation to him that his charge will be reduced only in that fifth year when he really needs it, when he has been paying the preceding four years and has not wanted or used it. That is, I think, the gravest problem in this matter.
Perhaps I may very diffidently put forward a compromise suggestion whereby he may pay a reduced figure, whatever the figure is going to be calculated at, as it were as a standing charge for the right to use a given amount, but with a supplementary gallon-age charge on what he actually uses. There would be a certain security to the river authority for income and a certain recompense to the farmer in that he would pay some of his annual payment only on what he has used.
LORD ST. OSWALD: Replying, first of all, to the noble Lord, Lord Walston, I would, if I may, look at his sliding scale rather more carefully when I have read it in Hansard, and not commit myself now. As to the general burden of his question, I think, in justice, it must be said that when the farmer reckons up how much water he wishes to have authorised for spray irrigation, while taking into account that he may have to over-insure in some years he will also take into account that the river authority clearly cannot provide water which they have not got. It is only then that they can reasonably remit the charge as they are entitled to do under the Bill.
In answer to the query of the noble Lord, Lord Williams of Barnburgh, it seemed to me that he was still doubtful about the protection contained in Clause 44 (2) and also Clause 56 (2), which had satisfied the noble Lord, Lord De Ramsey. In answer, I can tell him that we are satisfied that these provisions give the necessary cover. If he is still doubtful about it, perhaps we could talk privately. If he explains his precise doubts perhaps I can satisfy them. But

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I am not at the moment able to understand precisely where his doubts lie. If he is asking me whether we are satisfied ourselves, the answer is, Yes, we are satisfied.
LORD WILLIAMS OF BARNBURGH: One is bound to accept the noble Lord's statement that the Government are wholly satisfied that this is fair and reasonable. Should it turn out in practice and by experience that the Government are wrong, then they stand to meet the blame; but as they are not likely to be in office when that happens they will have nothing to worry about.
LORD DE RAMSEY: May I thank the noble Lord for his confirmation on the point on Clause 44? I must say that I thought that the noble Lord, as an agriculturist, was not really seized of the position of the irrigator and what he would be faced with under the charges scheme the clause sets out at present. I think one of his main points of disagreement with me was the question of the uncertain income of the authority. That, I feel, could be got round. As the clause stands, at the moment, as I pointed out, the irrigator will pay the highest charge of all when the different factors as set out in paragraphs (a), (b), (c) and (d) are taken into account; when, in addition, he may have to pay for twice the quantity at that high charge he will naturally consider that he has been very badly done by. Surely it would be possible to take into account, as the noble Lord, Lord Walston, said, that the irrigator is bound to over-insure against a dry year, and is bound to ask for authorisation of twice the quantity which he would need. If that could be taken into account under either Clause 56 (2) or in the circumstances that have to be taken into consideration in laying down the charges, perhaps the difficulty could be got round and the authority would be then assured of its income in advance.
The second point, as I understood it, was that it is necessary to charge irrigators on the basis of the water which they are authorised to take because there must be some means of keeping demand at a level which the river authority can satisfy having regard to the needs of other consumers. I wonder whether the noble Lords, particularly the noble Lord, Lord St. Oswald, who represents the
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interests of agriculture in this House, have considered the implications of this intention. If the irrigator is to be authorised to take only part of the water needed in a dry year, when that year comes he will, in theory, have to consider how much of his crop he will irrigate. I say, "in theory", but in practice he could not consider the point at all unless he were a more accurate prophet than the experts in the meteorological office. I have no doubt that if irrigators are to be charged in the way laid down in this clause, the process of irrigation will be discouraged. It will undoubtedly inhibit the process of irrigation, which has considerable economic potentialities. That would be most regrettable. We are bound to do all we can to make farming efficient and economic, and one of the most practical ways of doing this is by means of irrigation. I hope that, perhaps before the Report stage, the noble Lord would give an opportunity for going into the possibilities of devising a fairer means of charging the irrigator, and that I can reserve my position on that understanding and bring it up again, if necessary, on Report stage. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.31 p.m.
LORD LINDGREN LORD LINDGREN moved, in subsection (4) (d), after "way" to insert "or the area". The noble Lord said: Where water is conserved by one river authority and supplied to users in the catchment area of another the first authority may wish to charge the licence holders concerned more than the standard charge provided for in their charging scheme. It is doubtful whether the Bill as drafted would permit them to do so. I would suggest that river authorities are likely to regard arrangements for discharging water after use as material in assessing the charge for water abstracted. If the water is to be returned to the authorities' river system substantially unaltered in both quality and quantity, it would be reasonable to charge less than for water which is not returned.
This point is partly covered by Clause 56, which provides that the charges levied by the river authority under a charging scheme shall generally
"be levied on all persons at the same rates in respect of the same quantity of water

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authorised to be abstracted in the same relevant circumstances."
Subsection (4) defines the circumstances to be taken into account, and paragraph (d) is the one which I seek to amend. To quote again, it reads
"the way in which the water is to be disposed of after being used for the purposes specified in the licence."
The definition would clearly enable any river authority to distinguish, for instance, between water returned after use direct to a river and water returned indirectly in such a way as to suffer substantial loss through evaporation. However, it might not allow a river authority to distinguish between water returned to their own river system as against that of a neighbouring river authority. The proposed Amendment would make it quite clear that such a distinction could be drawn. I beg to move.
Amendment moved—
Page 47, line 25, after ("way") insert ("or the area").—(Lord Lindgren.)
LORD HASTINGS: There are of course, as the noble Lord has said, instances where water abstracted in a particular catchment, perhaps for purposes of the public supply, is returned as effluent to a different catchment. Where this is the case the water abstracted is a net loss to the water resources of the area in which abstraction takes place, and it would not be unreasonable to specify a higher charge for such abstractions than for those which do not result in a net reduction of the water resources. Conversely—this is the way the noble Lord put it, I think—it might be reasonable to charge less for water returned to the same area from which it came than for water which was returned outside that area. Therefore, this Amendment is in principle acceptable to the Government, although we are not quite sure at the moment whether it is really necesary to add these three words. The point may already be covered, but we will look at it again, and if on further consideration we think that this point needs elucidation in the way the noble Lord has suggested, we shall bring forward an Amendment accordingly.
LORD LINDGREN: I am most grateful to the noble Lord for that concession, which is accepted, and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD HASTINGS: This is a drafting Amendment, the first of two or three paving the way for the main Government Amendment 123N which seeks to delete the existing Clause 78 making provision for vehicle replacement funds, and to substitute a revised clause widening the scope of the replacement fund to cover other mechanically propelled equipment besides vehicles. Therefore, in this case it is necessary to remove the word "vehicle" confining the effect of this clause to vehicle replacement funds only. I beg to move.
Amendment moved—
Page 48, line 6, leave out ("vehicle").—(Lord Hastings.)
On Question, Amendment agreed to.
LORD DE RAMSEY LORD DE RAMSEY moved to add to the clause:
"( ) Every charging scheme shall make provision for securing that no charges shall be levied under the scheme in respect of water authorised to be abstracted from an inland water at periods of high flow (such periods to be defined in the scheme) for the purposes of storage for subsequent spray irrigation."
The noble Lord said: The object of this Amendment is to make use of water during the winter when there is plenty of it and when the irrigator, if he has built his own reservoir, can take it without embarrassing the river authority or other water users at a difficult season of the year. There is a further advantage if the owner builds his own reservoir and does his own conservation work, which saves the river authority themselves not only the cost of doing the work necessary to conserve the equivalent amount of water, but also the odium of acquiring the land, perhaps under compulsion. The irrigator would be saving the taxpayer a considerable outlay, and he would be providing these facilities willingly, which must surely be worth something.
I think the Committee would agree that these are desirable objects; but if they are to be carried out there must be a sufficient inducement. The inducement which I suggest is that those who construct their reservoirs and take the water when there is a surplus, or perhaps even a flood, should get it free. I have no doubt at all that the river authority will benefit as much as the owner, and if the river authority benefit so will other users of water. I know that Clause 58

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empowers the authorities to enter into agreements with those who have done conservation works, under which they may provide free water or water at reduced rates; and I believe that the Government may be willing to give a right of appeal where a satisfactory agreement has not been reached. Nevertheless, I think it is important that the right for which I am contending should be given in black and white in the Bill. Obviously, it is not possible for the Bill to lay down the periods at which water may be taken free. That must be done with respect to each river authority, each river authority area, and possibly with respect to each river. That is why in the Amendment I have suggested that the period of high flow should be defined in the scheme.
It may well be that the noble Earl is sympathetic to the intention behind this Amendment, but does not wish to commit himself so far in advance, or to commit the authorities. With respect, I would suggest that over-cautiousness in this matter will inhibit the conservation of water. If the farmer who is going to build his own reservoir does not know whether he is going to be able to conserve the flood free of charge, he will think several times before he lays out the capital and may well decide against it. I agree that there is power under the clause to make a nominal or reduced charge. I suggest that that reduced charge will cause a great deal of indignation and will inhibit the conservation of water by farmers to a far greater extent than the collection of this small amount of water would justify.
Amendment moved—
Page 48, line 7, at end insert the said subsection.—(Lord De Ramsey.)
LORD WALSTON: I should like briefly to support the Amendment of the noble Lord, Lord De Ramsey. It apparently has the advantage of encouraging irrigation which, from the agricultural point of view, is a good thing. It encourages it in such a way that the strain on water resources when they are at their most strained is not increased, but is in fact somewhat diminished; and it to a minor extent, as the noble Lord said, reduces the strain on the disposal of water at the peak period of drainage problems. Therefore it must surely be in the
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interests not only of agriculture but of all water users, and also of the drainage authorities, to see that farmers do as much as possible to conserve their water during the peak periods of water flow. It seems not only reasonable but fair to them that no charge should be made for the use of this water which they, in the public service, are taking out of circulation. I hope that the Government will look sympathetically on this Amendment.
EARL JELLICOE: I should like to make it clear straight away that we are not unsympathetic to the purpose behind this Amendment. I think I made it clear during our Second Reading debate that, for example, we very much wished to encourage farmers to build their own reservoirs so as to be able to conserve water at times of high flow for use during the dry summer months added that I thought that the provision for differential charging, which a combination of paragraphs (b) and (c) of subsection (4) of Clause 56 would provide for, would in fact encourage this, but I held out little hope to the noble Lord that we should be able to write into the Bill a specific provision—an obligatory provision—for nil charging in these cases. I am afraid I must inform the noble Lord that we are still unable to agree, despite his advocacy and that of the noble Lord, Lord Walston, that Clause 56 should specifically state that no charges should be made for water abstracted in this way.
In the first place, we consider that the proposal is open to objection in that it singles out those abstracting for one particular purpose and puts them in a privileged position. Acceptance of the principle embodied in this Amendment would inevitably lead to requests by others to be considered in the same way. If we were to provide for the spray irrigator to be let off scot free when he abstracts at times of high flow, we should find it extremely hard legitimately to refuse similar demands from the industrialist or indeed the water undertaker. My second objection is this. I would agree that at times of flood, water may well be surplus in a river and, if not captured, go to waste; but I am sure that the noble Lords who have argued this Amendment would be the first to agree that the diminution in flow resulting from the sort of farm reservoirs which

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we are speaking about would in fact hardly be noticed during flood periods. It would be a real "drop in the ocean", as it were, in regard to rivers.
The real difficulty here is that the Amendment, as drafted, is not confined to flood periods. I think it will be extremely difficult to define what we should have in mind here if we were to try to write this sort of specific obligation into the Bill. If we were to confine this sort of statutory obligation for nil charge to times of normal flood level it would, of course, hardly benefit the potential spray irrigator, as the number of cases would be extremely small. But if the ceiling is to be lowered to include periods of high flow, then I should have thought that it would be difficult to define a period of high flow; and, in any case, there would be a real danger of the finances of the river authorities being very seriously jeopardised.
I think that those are at least three very powerful objections to the Amendment as put down by the noble Lord, Lord De Ramsey. But, having mentioned these objections, I should like again to emphasise that there may well be a strong case for fixing a lower rate of charge for abstraction by farmers in winter, for storage and subsequent use in summer, in other words for abstractions in periods of low flaw. I think there is a strong case for inducement, to use the word used by the noble Lord himself; but I would submit that the provisions of the Bill in fact allow amply for this-not only subsection (4) (a), (b) and (c) of Clause 56, but also Clause 58, which the noble Lord has mentioned.
I would again remind noble Lords that all charging schemes will have to be approved by my right honourable friend, and, as the noble Lord, Lord St. Oswald, mentioned just now, we are proposing to give guidance to the river authorities on the preparation of their charging schemes. It would certainly be the intention of my right honourable friend to cover this point in any such guidance. Again, I would just mention that all such schemes have to be submitted to the Minister for approval. If he were to feel that a particular scheme in a particular river authority area, one in the Eastern Counties, for example, did not
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give sufficient encouragement of the sort which noble Lords would like to see given, my right honourable friend could very well refuse to approve it until this had been taken care of. In so doing, he might in certain circumstances very well feel, even if the river authority did not, that there was a case for a total exemption such as is proposed in the noble Lord's Amendment.
But, that said, I feel that I must advise noble Lords that, in my view, it would be wrong to write into the Bill a specific obligation totally exempting one particular case of licensed abstracters. I think it would be wrong completely to tie the hands—to scramble the powers (to use the phrase of the noble Lord, Lord Williams of Barnburgh) of river authorities—in the way proposed; and that it would be better to give river authorities, subject to the safeguards I have mentioned, a certain and reasonable discretion in this matter. In view of what I have said in regard to those safeguards and also in regard to the objections which I see to the Amendment, I hope that the noble Lord will not wish to press it.
LORD DE RAMSEY: I appreciate the difficulties mentioned by the noble Earl. I would only mention that I think it would be very much easier to lay down the maximum flow above which water can be considered to be flood water, than to arrive at the minimum flow, the obligation for which is on the authority now. I think the noble Earl said that, owing to the short period for which it existed, the flood water as such would be of no benefit to fill the irrigators' reservoirs. He certainly said that it would not materially affect the flow, and there of course he is completely correct. It would scarcely influence it by a matter of so much as an inch. But undoubtedly irrigators could take immediate benefit from a flood, and in a matter of hours they could have their storage against the summer completely filled up.
I had not intended that this should be a privilege only for irrigators, but in fact I considered that it was one of which irrigators, or any other undertaker who had his own reservoir, could take advantage. But if you are extracting direct from the river, it is not possible to take advantage of the circumstances from which the irrigator can

941
benefit. I understand that most of the water undertakers who are extracting and impounding water will be pumping on some 200 days. It would be totally uneconomic to install the equipment necessary to take advantage of a short flood, in order that they could impound the water in a matter of a few days flood. That being so, I was not under the impression that I was asking for a privilege for one section. I appreciate that the noble Lord will be giving guidance to the authorities in this matter, and that he considers there may be justifiable cases for a nil charge. Under the circumstances, I beg leave to withdraw the Amendment.
LORD LATHAM: Could I ask the noble Earl a question? He stated that the Minister could call in a charges scheme, and that in any case charges schemes have to be approved by the Minister. Is there any provision in the Bill giving an abstracter the right of representation to the Minister, whether on appeal or when the Minister has called in the charges scheme?
EARL JELLICOE: I wonder whether, before I reply to this point, to which I do not think I know the answer, I could just clear up two misconceptions which I think arose between the noble Lord, Lord De Ramsey, and myself. It was certainly my understanding that the Amendment as drafted would single out spray irrigators for a particular privilege in this respect, because of the wording of the Amendment itself, but I quite realise that that may not have been the purpose behind the Amendment. The other point which I wished to clear up was that I was certainly not wishing to imply by what I said that potential spray irrigators would not be able to to take advantage of flood periods by drawing off the amount necessary to fill their reservoirs. Of course, I grant that that can be very easily arranged. All I was seeking to show was that, by so doing, they would not necessarily be conferring any vast benefit on the river or the river authority or those further downstream, in that the amount they would be able to draw off would be minimal compared, of course, to the flood itself. I did not wish to have any other interpretation placed on what I said there.
I am afraid I have given the noble Lord, Lord Latham, this reply twice
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already, but I would prefer to check, if I may, on this particular point which he has asked me, and if necessary I can write to him about it.
LORD SINCLAIR OF CLEEVE: Could I ask the noble Earl whether the phrase which he used, I think in the concluding sentence of his first reply, about giving a certain measure of discretion to the river authorities to vary, was applied solely to this Amendment, or would it also apply to No. 120, the previous one, about spray irrigation? I have great sympathy with the point made by both the noble Lord, Lord De Ramsey, and the noble Lord, Lord Walston, on that, and if the discretion could so apply it would be a great help.
EARL JELLICOE: I am grateful to my noble friend for asking me that, because I think I can assure him that river authorities will have a clear discretion in applying their various charging schemes according to the circumstances of their area. That will obviously apply to their interpretation of the various factors listed in Clause 56 (4). I am also grateful to my noble friend, because it has given me time to check on the point which the noble Lord, Lord Latham, asked me. I think that his point is satisfactorily covered. If he will glance at subsection (1) of Clause 57, he will see that that applies the provisions of Schedule 6 to the charging scheme, and the provisions of Schedule 6 include the right of objection to the Minister in the sort of case which he envisaged.
LORD LATHAM: On the part of the abstracters?
EARL JELLICOE: Yes, indeed.
Amendment, by leave, withdrawn.
Clause 56, as amended, agreed to.
Clause 57 agreed to.
5.58 p.m.
LORD LINDGREN LORD LINDGREN moved, after Clause 57, to insert the following new clause:
Proposals by licence holders for variation of charging schemes
".—(1) Any statutory water undertakers holding a licence to abstract water granted under this Act, or any twenty or more persons holding such licences, may at any time submit to the Minister proposals for varying a charging scheme for the time being in force.
(2) The provisions of Schedule (Procedure relating to variation of charging schemes at instance of licence holders) to this Act shall have effect in relation to the variation of a charging scheme under this section."
The noble Lord said: Previously we were dealing with an Amendment to Clause 56 on the initial charging scheme, or its variation, by the river board, and the noble Lord, Lord Hastings, gave such a satisfactory reply that we withdrew the Amendment and the Government are going to look at it later on. The present Amendment is in a way complimentary, because it makes provision for the licence holder to seek a variation of the charging scheme. The Amendment is based on Section 40 of the Water Act, 1945, and the first subsection of that reads:
"The Minister, on an application made to him by any statutory water undertakers supplying water under a local enactment, or by a local authority within whose county or district any such water undertakers supply water, or by twenty or more persons supplied with water by any such undertakers, may by order make such alteration in the rates and charges which the undertakers are authorised to levy and make as he considers reasonable".
In other words, consumers who take water from statutory water undertakers may apply to the Minister for a variation of the water charges levied by statutory water undertakers. There is every reason, I would suggest, why a similar provision should be inserted in the present Bill to enable a licence holder to seek a revision of the charging scheme which authorises a river authority to make charges for water abstraction.
With this Amendment we could take, if it were agreeable, Amendment No. 161A, to insert a new Schedule after Schedule 6. That proposed Schedule, which sets out the procedure to be followed in dealing with proposals for the variation of a charging scheme at the instance of the licence holder, is substantially paragraph 1 of Schedule 6 suitably amended. In other words, the procedure proposed is the same as that proposed for the approval of a charging scheme by the Minister under Clause 57. I beg to move.
Amendment moved—
After Clause 57, insert the said new clause.—(Lord Lindgren.)
LORD HASTINGS: While the Bill does not at present contain provision whereby charging schemes can be varied, it has been made clear in relation to the noble Lord's Amendment No. 119A that the Government will, at a later stage, introduce an Amendment to empower river authorities to submit proposals for varying their schemes. This new Amendment follows upon that previous one; and, since river authorities will be in the nature of monopoly undertakings, the principle involved in the noble Lord's Amendment seems to Her Majesty's Government a perfectly reasonable one, and we are going to deal with this matter. But, before saying precisely in what way or how, there are two points which arise, and perhaps it might be helpful if the noble Lord who has moved this Amendment, and other noble Lords who are interested, would express an opinion upon it.
In the first place, we feel it is probably wrong to enact that "any" statutory water undertakers or "twenty or more" other persons holding abstraction licences should be able to make this application for a revision in charges. We feel that it should be restricted—and this may, in any case, be the intention of the noble Lord—at least to holders of abstraction licences within the area of that particular river authority. The second point is, is the number twenty right? The noble Lord has referred to Section 40 of the Water Act, 1945, but that, of course, is concerned with statutory water undertakings whose domestic or commercial consumers are numbered in thousands. It may well be that twenty is too many. If applications are going to be made to a river authority, there may be a comparatively small farming group or manufacturing group in a particular river authority and ten might appear to be a more appropriate number. I do not know what Members of the Committee think; but, in any case, I suggest that if the noble Lord will withdraw this Amendment and his new Schedule, the Government will introduce suitable Amendments to look after this point in the light of further comments noble Lords may make.
LORD LINDGREN: Again, I am most grateful to the noble Lord, Lord Hastings, for that reply. I am becoming

945
almost dizzy with success. One cannot, of course, be wedded to a suggestion put forward as part of an argument in moving an Amendment, and on the basis of the noble Lord's statement I would beg leave to withdraw, assuring him that, provided the Government's Amendment is fair and reasonable (as one has every reason to believe it will be), then we can deal with it on Report stage, when, if we want to vary it, we also shall have an opportunity of putting an Amendment down ourselves. I beg leave to withdraw.
Amendment, by leave, withdrawn.
Clause 58 [Exemptions from, and reduction of, charges]:
6.6 p.m.
LORD LINDGREN LORD LINDGREN moved, after subsection (3), to insert:
"( ) Every charging scheme shall make provision for securing that no charges will be levied under the scheme in respect of water authorised (in whatsoever terms, and whether expressely or by implication) to be abstracted by statutory water undertakers by a statutory provision which was passed, made or issued either—

(a) before the end of the initial whether before or after the passing Act, or

(b) after the end of that period, pursuance of an application made Minister before the end of that whether before or after the passing Act,

and that the charges to be levied under the scheme in respect of other water authorised to be abstracted by statutory water undertakers shall be at such reduced rates as will take account of—

(i) the expenditure which those undertakers or their predecessors have incurred or will incur on any works constructed or to be constructed for the purpose of abstracting the water; and

(ii) any other material considerations".

The noble Lord said: Clause 58 enables a river authority to grant exemption from the payment of charges, and allows for the payment of charges at reduced rates. Furthermore, Clause 58 (4) provides that every charging scheme shall make provision to secure that no charges are levied in certain circumstances. This Amendment contains two proposals. The first is that no charge shall be levied for water abstracted by statutory water undertakers under statutory powers granted to them before the coming into operation of the new
946
scheme. Secondly, the Amendment proposes that when the new scheme comes into operation the charges to be levied on statutory water undertakers shall be at reduced rates where money is expended by the statutory water undertakers on building works to enable the water to be abstracted. They are the two points largely within the Amendment.
On the first point, there does not seem to me to be any reason why statutory water undertakers should now begin to pay for water which Parliament has authorised them to take after full inquiry and after all objectors have been satisfied by compensation and otherwise—and, as many Members of the Committee know, that compensation has sometimes been quite heavy. Statutory water undertakers have already incurred the considerable cost of building waterworks and, as I mentioned, of compensating any interests adversely affected. It is difficult to see how any works constructed by a river authority in the future will benefit the existing abstractions by statutory water undertakers. Moreover, the statutory water undertaker is in the position of an agent for the population at large, and abstracts water for the domestic purposes of the inhabitants at large. Nobody has suggested that riparian owners should be obliged to pay for water which they take for their domestic purposes. Nor is there any suggestion that a person who takes water from underground for his own domestic purposes should pay for the water.
By the same argument, water undertakers who have already abstracted water and have paid for the works necessary cannot in fairness now be asked to pay for the water. This would mean that the ratepayer—that is, the payer of the water rate—would pay twice, once for the existing waterworks and again for any new works that may be constructed by the river authority for the benefit of other and new abstracters. Once the new scheme comes into operation, however, the river authority may incur the cost of works necessary to make water available. In the future, therefore, the water undertaker may be relieved of the direct financial responsibility for works, and it will then be right and proper that he should pay his due proportion of the cost of the river authority's works. However, this will not always be the case.

947
The water undertaker would himself continue to build waterworks and to pay for them; and it is necessary to provide for this. Paragraph 44 of the White Paper of April, 1962, reads:
"Where an abstracter has himself carried out water conservation, e.g. where a water undertaking has built an impounding reservoir from which compensation water is discharged there will be a case for a lower rate of charge and perhaps for no charge at all."
Clause 58 does not cover this situation adequately. It is necessary, in the terms of the Amendment, to provide that the charging scheme makes reduced charges for water abstracted by undertakers who have constructed their own works.
As it stands, there is no provision in Clause 56 to enable expenditure of water undertakers on conservation works to be taken into account when the original charging scheme is framed. The water undertakers would, it seems, be debarred from making any representations to ensure that a charging scheme took properly into account their expenditure on conservation works. This means that water undertakers who have carried out conservation work in the terms of paragraph 44 of the White Paper just quoted will have to wait for the charging schemes to be approved by the Minister. Then, and only then, will they be able to ask the river authority to exercise the discretion given by Clause 58 to reduce the charge to be paid by the statutory water undertakers.
Clause 58 recognises the difficulty, because it is provided in Clause 58 (3) that the Minister may give directions to the river authorities on the exercise of their discretion to reduce charges under subsection (1). This is not, however, in my view, a satisfactory piece of machinery. In many cases the financial problems involved in making allowances for expenditure by statutory water undertakers on conservation works will have a significant impact on the charging scheme. These matters ought to be considered when the charging scheme is being evolved. It will never be satisfactory to endeavour to tackle the problem after the charging scheme has been approved. All the Amendment seeks to do is to ensure that these matters are dealt with in the right place which is on the consideration of the charging scheme itself. To sum up, the two proposals in
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the Amendment are straightforward: first, that the statutory water undertakers should not have to pay for the water they now take, because they have already paid for it; second, that the future charging scheme should take into account money already expended or to be expended by the statutory water undertakers on conservation works. I beg to move.
Amendment moved—
Page 48, line 47, at end insert the said subsection.—(Lord Lindgren.)
VISCOUNT COLVILLE OF CULROSS: I very much hope that my noble friend Lord Hastings will not accept this Amendment, or at least the first half of it. I do not say that because I lack sympathy for the case of the statutory water undertakers, but because I think the noble Lord has misconceived the case altogether. There is no suggestion, as I understand it, that under the charging scheme the water will have to be paid for a second time. That is not so. What is being paid for is the new functions of the river authorities. The noble Lord will see from Clause 56 (5) (b) that the charges levied are to cover only that amount required for balancing the water resources account; and the water resources account is dealt with in Clause 76. As may be seen from subsection (2) of that clause the money from the charging scheme will be only part of the financial resources going into that fund and from which the river authorities will be able to draw money to pay for the conservation schemes which this Bill, by its nature, is laying upon them. I do not think, therefore, the noble Lord is right in saying that the statutory water undertaker will be paying for the water twice. What he will be doing will be to take his share in the cost of this very necessary work, together with the other people who will have to pay for it.
The main reason that I object to the first part of the Amendment is that if it were to be successful, there would be few people left in the field to carry the burden of this charging scheme. As I understand it, agriculture is out; the domestic user is out. Now the noble Lord suggests that all nine existing statutory water undertakers, so far as the present sources are concerned, should be out. The result would be that the whole charge, so far as future sources

949
are concerned, would fall on the statutory water undertakers and on industry, with, I suppose, a few other smaller contributors.
If the noble Lord complains about the existing sources of statutory water undertakers, I would ask: what about the existing sources used by industry?—and they are very large indeed. It has been felt in many places in the industrial world that it is unfair that an industry which has paid possibly large sums for water to which they have every Common Law right, whether as riparian owners or because the water comes from underground and there are no other claims on it, should have this taken away from them; that their rights should be lost and that they should have to pay a charge instead. I do not think this is so. I do not believe the scheme of this Bill will be workable at all unless the cost of the new functions of the river authorities is fairly widely shared. I sympathise with the industries and their existing sources; but if the noble Lord is right it will mean that industry is going to carry almost the entire burden of this scheme, and that cannot be fair. Therefore I hope that my noble friend will relieve my mind and make it clear that Her Majesty's Government cannot limit the charging scheme just to industry in this way.
LORD HASTINGS: This is really a case of the statutory water undertakers trying to opt out of paying a basic charge and denying the basic principle upon which the charging arrangements are calculated and workable. I can put my noble friend out of his agony straight away by saying that the first part of the noble Lord's Amendment is wholly unacceptable to Her Majesty's Government. The basic principle of the charging arrangements in the Bill is set out in paragraphs 42 and 43 of the White Paper. The noble Lord opposite quoted paragraph 44 in his favour but he did not look at paragraphs 42 and 43. Perhaps he had forgotten what they said. There it was stated (this is based upon the Report of the Proudman Committee) that expenditure on water conservation—in other words the new functions referred to by the noble Viscount, Lord Colville of Culross—should be a charge bearing upon all licensed
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abstracters and users of water. The cost of works carried out to meet the general gross demand where benefit cannot be precisely apportioned must necessarily be spread over all abstracters.
A further justification for this is that unified control and management of water resources by the river authorities will bring greater reliability of supply. That is one of the main purposes of a national water policy and of this Bill. In fact, many abstracters at present have no assurance of supply, and it is only reasonable that the cost of the conservation of water should be evenly spread over all abstracters. This principle is just as valid in the case of statutory water undertakers as it is in the case of any other sort of abstracter. If the issue is whether or not to spread the charges over all abstractions, both those existing before the coming into operation of the licensing system and those begun after it, there is no real distinction to be drawn between statutory water undertakers and the others. All will benefit from the conservation works. In addition, the statutory undertakers will have the same temporary period of exemption from the charge as other existing abstracters under licence of right, but they must otherwise be subject to the charging system like the rest.
I now turn to the noble Lord's second point, which is that the charge should be at reduced rates. The Bill looks after this point very adequately. The noble Lords seems to have put an interpretation on Clauses 56 and 58 which is different from ours. I hope to convince him that there is not much difference between us. It is only the wording of the second part of his Amendment which makes it unacceptable. For example, the noble Lord would have it that charges for water abstracted by statutory water undertakers shall in the circumstances be at reduced rates. The Bill says that a water authority may make agreements to bring about the same effect and has in reserve the Minister's power to give directions under subsection (3) of this clause, a power which specifically refers to subsection (1), allowing for exemptions altogether or reduced charges.
The noble Lord quoted paragraph 44 of the White Paper. I should have thought that this clause carries out the

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intention of the White Paper, which says that there will be a lower rate of charge, and perhaps no charge at all, where an abstracter, specifically mentioning the statutory water undertaker, has carried out conservation works. I do not see how the noble Lord can say that this clause does not allow for the very thing for which he is asking.
In respect of Clause 56, which deals with original charging schemes, the noble Lord said that conservation works were not being considered under that clause at all, but subsection (4) (a) refers to characteristics, either general or special, of the source of supply. Presumably a source of supply, so far as water undertakers are concerned, would be their own reservoirs. So I do not think that there is much substance in that point either. But we are dealing with Clause 58, which, I suggest, adequately deals with the situation over reduced charges or no charges at all. So far as the first part of the Amendment is concerned, I agree entirely with my noble friend behind me who said that water undertakers are not paying twice and that it was a basic principle of the Bill that everybody must contribute towards conservation work, otherwise the national water scheme would not work. I hope that the noble Lord will be reasonably satisfied and find his way to withdraw his Amendment.
LORD LINDGREN: After my success on the last few Amendments, I am far from satisfied in regard to this one. The noble Lord, Lord Hastings, has had a powerful ally in the noble Viscount, Lord Colville of Culross. With the greatest respect to both noble Lords, a statutory water undertaking is in a totally different position from that of an industry. First of all, it has had to come to Parliament to promote a Private Bill, with expensive costs—the lawyers have got a lot out of it—and there have also been the expenses of making concessions in order to get the Bill through. They have also had the cost of the works they have already carried out, usually amounting to many hundreds of thousands of pounds, which they have had to borrow from financiers, who have made in interest a gain almost as great as the lawyers'. And the people who have to pay are the ratepayers who draw water through the taps provided by
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the statutory water undertaking. So it really is paying twice.
The only argument of the noble Lord, Lord Hastings, that weighed with me was that there was a greater reliability of supply. I would concede to him that even where conservation works have already been constructed by a statutory water undertaker, it is possible that new works might benefit the existing source of supply and its reliability. But I think that my point is fairly reasonable. Like everybody else, the statutory water undertaking should pay for the new functions the river authorities are taking over. Then they will be relieved of many of the heavy costs which they have had to bear in the past, because the main new function of the river authorities will be that of conservation, which up to the present time has been done by the statutory water undertakers and others who have water held up for their own use.
I appreciate the noble Lord's answer in regard to the second part, but should like to read in Hansard what he said about the first part. I do not think that I should flog this issue, in view of the noble Lord's statement, and I therefore beg leave to withdraw my Amendment; but we may come back to the first part of it on Report stage if I am not satisfield after reading the noble Lord's statement.
Amendment, by leave, withdrawn.
6.29 p.m.
LORD DE RAMSEY: The object of this Amendment is to place the discretion of ultimately deciding whether a beneficial contribution has been conferred under this clause or not, with the Minister and not with the river authority as it is at present under the clause. I believe that the noble Earl, Lord Jellicoe, is not unsympathetic to the principle behind this and at a later stage may be introducing a clause to cover this point. If I am correct, I will beg leave to withdraw this Amendment on receiving that assurance. I beg to move.
Amendment moved—
Page 48, line 47, at end insert—
("(4) Where an application is made to a river authority to enter into an agreement under this section and the applicant is dissatisfied with the decision of the river authority on the application he may, by notice in writing

953
under this section, appeal to the Minister and the provisions of section 39 of this Act shall apply to that appeal.").—(Lord De Ramsey.)
LORD MERRIVALE: I should like to support the noble Lord, Lord De Ramsey, on this Amendment, because I feel it is one which should commend itself strongly to industry. It seems to me only appropriate that an applicant should have the right ultimately to appeal to the Minister if he is dissatisfied in regard to an application that has been made to a river authority. I think there is a precedent for this, and my noble friend Lord Jellicoe may agree, in Section 27 (2) of the Water Act, 1945, which is concerned with agreements between statutory water undertakers and non-domestic users. It there says:
"Any question arising under this section as to the terms and conditions on which water is to be supplied thereunder and any question whether the undertakers are justified in refusing to give a supply, shall, in default of agreement, be referred to the Minister, and the Minister may determine it himself or, if he thinks fit, refer it for determination by an arbitrator appointed by him."
Therefore, I feel that there is a precedent for the request made by the noble Lord, Lord De Ramsey, and I hope my noble friend will give careful consideration to this Amendment.
EARL JELLICOE: I have listened carefully to what noble Lords have had to say on this point. It may seem rather odd to them that no appeal procedure has as yet been provided for under Clause 58, especially given the procedure to which the Amendment calls attention in Clause 39 for dealing with appeals against decisions by river authorities on the applications for licences themselves. The reason why no such provision is included in Clause 59 is that the Minister will already have power under subsection (3) of that clause to give directions to river authorities as to the exercise of their powers under it. That is why no specific appeal procedure has been included here.
I am not certain of the precise extent to which the precedent referred to by my noble friend Lord Merrivale is relevant. Nevertheless, in view of what noble Lords have said, I am inclined to think that we were wrong not to provide for an appeal procedure in this clause. I do not think the Amendment, as it
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stands, would be appropriate, since it applies Clause 39, which is specifically concerned with appeals arising from licence applications, and that clause is adapted to the particular circumstances of the licencing system, which might not be appropriate here. However, as I have said, I think noble Lords have a point here, and I will gladly respond to the invitation of the noble Lord, Lord De Ramsey, and say that, if he will withdraw the Amendment now, I will undertake to see whether we can produce something on the next stage covering the point.
LORD DE RAMSEY: I am grateful to the noble Earl, and I am delighted to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 58 agreed to.
Clause 59 [Charges pending commencement of charging schemes]:
LORD LINDGREN LORD LINDGREN moved, in subsection (1) to leave out the third "a" and insert:
"water abstracted in pursuance of a licence of right and used or discharged within the area of the river authority granting the".
The noble Lord said: No doubt noble Lords in charge of the Bill will be able to twit me on this occasion, because previously I was asking far charges not to be levied and bore I am proposing a charge which, as I see it, is not levied in the Bill. In any case, as I read the Bill, it will be some time before there is any charging scheme in force. Clause 57 (3) gives April 1, 1969, as the outside Limit, but even that has an escape clause. So until that time no money will be paid by anyone who has a licence of right. An undertaker, therefore, being entitled to a licence of right and taking his water from outside the catchment area, will escape entirely: he is not subject to precept because of his geographical position, and he is not subject to an interim charge under Clause 59.
I have had brought to my notice an interesting case of the River Severn and the City of Birmingham. The City of Birmingham has recently been granted the right to abstract very large quantities from the River Severn at a point in Shropshire, whence it will pipe the water to Birmingham and discharge it in the Trent area. As things stand under

955
the Bill, they cannot be charged for the water they will take until a charging scheme comes into force; nor can they be caught by a precept, because they are not within the rateable area of the Severn. In the course of time things will work out satisfactorily, because, in partnership with other authorities, they will be building up a large conservation reservoir at the head of the River Clywedog. But this will take a good many years. Meantime, the suggested Amendment would ensure that if such users are able to avoid the payment of a precept, they will be obliged to pay an interim charge. I beg to move.
Amendment moved—
Page 49, line 8, leave out "a" and insert the said words.—(Lord Lindgren.)
LORD HASTINGS: I was wondering why the noble Lord, Lord Lindgren, was moving this Amendment; I rather thought that it would be moved by the noble Lord, Lord Champion. As the noble Lord said, he has just been asking us to absolve statutory water undertakers from ever paying anything for water supplied under what amounts to a licence of night, and now he is asking that there should be exceptions made to that rule. I am afraid that, because of the principle upon which this Bill is based, his two requests will cancel each other out, and he is going to be disappointed on this occasion, as he was previously.
This Amendment would narrow the scope of the temporary exemption from charges, and there is really no reason why that should be allowed to happen. The noble Lord mentioned Birmingham, which draws water from the Elan Valley reservoir system in the Wye river authority area. If this Amendment were accepted, then Birmingham would pay for that water from the beginning instead of waiting until charging schemes are brought into effect later on. Sheffield would be similarly affected, as would Birkenhead and Liverpool. But there can be no justification in principle for the Amendment. The intention of the Bill is that existing abstracters who become the holders of licences of right should be exempt from charge in the initial period. This is a principle which has no geographical or hydrological limit to its application.
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I do not think the noble Lord has made out a case. Is it a question of something to do with the precept in the river authority areas concerned? We feel that the provision of a material benefit, in addition to the extra revenue received in the form of rateable income, is a matter which cannot be dealt with in general fashion in a Bill of this kind. The Amendment seems to use altogether too broad a brush to secure a result which may or may not be right for particular future schemes in Wales—and I imagine it is Wales about which the noble Lord, Lord Champion, is thinking—and the noble Lord would involve past schemes in both England and Wales. We really cannot accept this. There is no case for special and specially onerous treatment in this way of schemes of this one type which chance to involve a transfer of water—and that is all it amounts to. We cannot see our way to accepting this Amendment, and I hope the noble Lord will agree to withdraw it.
LORD LINDGREN: I must say I think the noble Lord has made a far better case against this Amendment than he did on the previous occasion. The only point is that here you get water being abstracted well away from its source of use. Therefore, the persons using the water are not making any contribution to the cost of the works in the area whence the water is derived. Other undertakings in the area, such as ratepayers and the rest, are paying the precept from the river authority on to the county council or county borough and, therefore, are making some contribution, even though not for works. In view of what the noble Lord has said, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 59 agreed to.
Clauses 60 to 67 agreed to.
Clause 68 [Control of discharges into underground strata]:
LORD HASTINGS: This Amendment goes with two others in Clauses 70 and 71. Clause 68 (6), Clause 70 (6), and Clause 71 (6) all apply certain of the provisions of Clause 39 dealing with appeals against the refusal of, or conditions attached to, a licence to abstract

957
or impound. Among the implied provisions is Clause 39 (4) dealing with representations about the original application for a licence. This subsection is not, however, applicable to Clauses 68, 70 and 71, where a different procedure for considering applications is prescribed. These Amendments deal with references to Clause 39 (4) in each of those three clauses. I beg to move.
Amendment moved—
Page 56, line 23, leave out ("(4) to") and insert ("(5) and").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 68, as amended, agreed to.
Clause 69 agreed to.
Clause 70 [Revocation or variation of consent under s. 68]:
LORD HASTINGS: I beg to move. This Amendment is on the same point.
Amendment moved—
Page 58, line 8, leave out ("(4) to") and insert ("(5) and").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 70, as amended, agreed to.
Clause 71 [Borings not requiring licences under Part IV]:
LORD HASTINGS: I beg to move.
Amendment moved—
Page 59, line 5, leave out ("(4) to") and insert ("(5) and").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 71, as amended, agreed to.
Clause 72 agreed to.
Clause 73 [Provision of recreational facilities at reservoirs]:
6.47 p.m.
LORD LINDGREN LORD LINDGREN moved to add to the clause:
"( ) To facilitate the use by boats of any inland water to which bye-laws made under the preceding section apply, a river authority may, if it appears to them reasonable to do so, carry out improvements to the inland water and provide, or otherwise make available, facilities for use by persons using such boats."
The noble Lord said: This Amendment is far and away different from many of those which I have moved on this Bill. My attention has been called
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to the fact that there is no provision in the Bill to give power to the new authority to spend money on the improvement or conservation of existing waterways in order that facilities for boating may be provided or improved. The purpose of the Amendment is to supply that power.
I understand that the problem arose in the Parliamentary discussions on the Great Ouse Water Act, 1961, when the boating interests were pressing for safeguards as to the depth of water in parts of the Great Ouse during the time of low flow. No difficulty occurred in agreeing the amount of contribution from the water authority to the water board to protect the interests of navigation, but the river board disclaimed any liability as navigation authority, and would only accept the money on the basis that it would be used under their land drainage powers for dredging and clearing weeds, et cetera. In order that all the river authorities may have the opportunity, in so far as their water courses allow, of facilitating this amenity value, I beg to move this Amendment.
Amendment moved—
Page 61, line 18, at end insert the said subsection.—(Lord Lindgren.)
EARL JELLICOE: I wish to draw your Lordships' attention to the provision in Clause 73 dealing with the power of river authorities to provide public facilities on reservoirs which they own and manage. That, of course, is a reflection of the growing popularity of sailing and the increasing readiness to permit such activities on reservoirs, particularly those not providing directly for the public water supply. As I mentioned earlier, on a rather similar point during the Committee stage, that in itself seems to us to be a very good thing, and it is a process which we should like to see extended and encouraged wherever possible.
As I see it, the purpose of the noble Lord's Amendment would be, in effect, to extend those powers to every inland water although it would be restricted to those waters in respect of which the river authorities will have by-law-making powers under Clause 72. We think it proper in this respect to make a distinction between inland waters over which the river authority has an overall

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responsibility and reservoirs which the river authority will directly own and manage. Clause 72 properly applies the by-law-making power to all inland waters because the activities which are mentioned there, boating, swimming and the like, obviously need to be regulated in certain respects if damage to works of a river authority, whether land drainage or fisheries interests or whatever they may be, is to be avoided.
On the other hand, on reservoirs owned or managed directly by them, we think it might be a good thing to go further than merely controlling recreational activities and give river authorities power to encourage and assist them; because the reservoir, unlike the river—which, in fact, impinges on many private interests—will be under the direct control and ownership of the river authority itself. We doubt whether we should go as far in the case of the inland water, where the river authority will not have this direct control, as we are suggesting we should go in the case of those reservoirs. To do so would be to extend the functions of river authorities in a manner not directly related to their major responsibilities.
LORD LAWSON: Could I ask the noble Earl the following question? Am I to understand him to say that a river authority could take over reservoirs built by another authority and own them?
6.53 p.m.
EARL JELLICOE: Certainly not under this clause. I was merely trying to draw a distinction between the two types of inland waterway over which the river authority will have control. They will have an overall control over the river, a direct control over certain reservoirs. That was the distinction for the purpose of this Amendment, which I was trying to make. The case which I wish to make is that we think it unwise to extend these recreational powers over these inland waters over which the river authority will have only the overall and not the direct control.
Here, first, I should like to pray in aid what the Proudman Sub-Committee have said. In paragraph 81 (ix), page 19, of their Report they refer to the amenities and they say:
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"The amenities we have in mind here are the use of reservoirs and rivers for boating, swimming and fishing and similar purposes incidental to the management of water resources."
We have decided that this question of "incidental to the management of water resources" is extremely important and that to confer these additional recreational powers directly in order to encourage recreational activities of this sort might well take the river authorities' eye off the main ball. Second, there is the vexed question of finance. It is not at all clear to me how noble Lords would wish river authorities to finance the sort of activity which they have in mind under this Amendment. May I remind noble Lords that, so far as I know, there is hardly an inland navigation in this country which pays its way? For example, the navigation fund of the Thames Conservancy runs at a loss, I gather, of some £300,000 a year, which is made up mainly from the statutory payment made by the Metropolitan Water Board to the Conservancy. If this sort of activity is not to be self-supporting and if, indeed, considerable expenditure is to be involved, then I should have thought that the abstracters, who, so far as I can make out, would be the people who have to pay for it, might well have a very legitimate arouse because it would be increasing the cost of the water on which many of their activities very largely depend.
Of course, I realise that members of the great and growing pleasure boating public and many private boat builders and hiring companies would welcome the prospect of a river authority carrying out improvements to an inland water in the way suggested. But this can be a very costly business, and I myself am doubtful whether it is really a proper responsibility to lay on river authorities except where they are specifically equipped, as in the case of the Thames Conservancy, with all the powers of a navigation authority or in the case of the reservoirs which, as was mentioned, are already going to exercise direct control. The last thing I would wish in arguing against this Amendment would be to appear to be a spoil-sport, but, in all the circumstances. I do not feel I can really advise your Lordships to accept it.
LORD LINDGREN: One can think of very many rivers up and down the

961
country in which boating, from the point of view of both the boat club and the normal casual pleasure boater, is quite an amenity of the river; and the reason for this Amendment was, as in the case of the Ouse, where the statutory water undertaker was anxious and prepared to make a contribution in order that there could be the facility of boating on the river, and the amount in order that it could be done was agreed with the river authority, that it was understood the river authority had no power to take it except on the basis of their land drainage function. One would have thought that in a river where this would have been an added facility, statutory water undertakers as and where they so desired, and in co-operation with a river authority, could make contributions towards it. But if the noble Earl thinks it is not feasible, then I am quite willing to withdraw the Amendment.
EARL JELLICOE: I just want to ask the noble Lord—I did not get this quite clear—in the case of the River Ouse, for example, did the river board receive a payment or was there an offer of payment from someone?
LORD LINDGREN: From the statutory water undertaking; and the difficulty arose upon the river board's acceptance of the payment. They could accept it, it was said, or at least as I understood it, only in regard to their land drainage function and not in regard to any activity they might carry out in making the river more attractive from the point of view of boating, removing weeds and the rest of it. It was from that point of view that the Amendment was moved, but in view of what the noble Earl has said, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 73 shall stand part of the Bill?
LORD AIREDALE: This clause makes use of the expression "such reasonable charges as a river authority may determine". Is it intended that river authorities shall have power finally to determine the reasonableness of their own charges, or is it intended that they are to be liable to be called upon to justify the reasonableness of their charges before some other tribunal or body?
EARL JELLICOE: This is only in respect of the recreational use of the reservoirs, I take it?
LORD AIREDALE: Yes.
EARL JELLICOE: As I understand it, in all their major charging schemes the river authorities will have to get ministerial approval, but in this particular respect I think the situation is self-contained. I speak subject to correction, but I do not think that we have either written in or intended to write into this section of the Bill a right of appeal against the charges which the river authority would lay down for these restricted recreational purposes.
LORD AIREDALE: That means that an aggrieved person who felt that he was being charged excessively for the use of recreational facilities would have nowhere to air his grievance except before the river authority concerned, whose decision in the matter would be final.
EARL JELLICOE: I think we were seeking to apply the same sort of principle as appears when one goes to a theatre. So far as I know, one does not have an appeal against the 19s. 6d.—or 6s. if it is a cinema—which is levied on one. I should have thought that in this relatively minor and restricted sphere we should not wish to introduce an extra appeal procedure. I am speaking subject to correction, but I do not think it is there.
On Question, Clause 73 agreed to.
Clause 74 agreed to.
Clause 75:
Future transfers of functions or property of other authorities and undertakings
75.—(1) A river authority may at any time apply to the Ministers for an order under this section transferring to the river authority any one or more of the following, that is to say—
(e) the functions of managing and operating any such reservoir or work as is mentioned in paragraph (c) or paragraph (d) of this subsection, but without a transfer of the ownership of the reservoir or work.
(4) An order under this section may contain such transitional, incidental, supplementary and consequential provisions as the Ministers consider necessary or expedient, including (but

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without prejudice to the generality of this subsection) such provisions as they consider necessary or expedient—

(a) with respect to the transfer of assets and liabilities, the payment of compensation and other financial adjustments;

(7) Where by an order or agreement made by virtue of this section any functions are transferred to a river authority as mentioned in subsection (1) (e) thereof, references in this Act to the new functions of the authority shall be construed as including, and references to their transferred functions as not including, a reference to those functions.
7.2 p.m.
LORD LINDGREN LORD LINDGREN moved, in subsection (1), to leave out paragraph (e). The noble Lord said: With your Lordships' permission, I will speak on this Amendment together with Amendment number 123H, because in fact that is consequential on it. Clause 75 makes provision for a river authority to obtain an order of the Minister transferring to the river authority functions and property of other authorities. The things that may be transferred are set out in paragraphs (a) to (e) of subsection (1). Under paragraph (c) the Minister may transfer a reservoir belonging to a statutory water undertaker, and under paragraph (d) a well belonging to a statutory water undertaker may be transferred. Under paragraph (e) there may be transferred
"the functions of managing and operating any such reservoir or work as is mentioned in paragraph (c) or paragraph (d) of this subsection, but without a transfer of the ownership of the reservoir or work."
The Amendment that I move is to delete paragraph (e). There may be a case for transferring to a river authority a reservoir belonging to a statutory water undertaker, and there may equally be a case for transferring a well or borehole. In either case there is provision for the payment of compensation to the statutory water undertaker, and that will apply. But I would suggest that it is altogether wrong that it should be possible to transfer to a river authority the complete control over a reservoir or a well without actually transferring the ownership. The ownership will remain with the statutory water undertaker. The statutory water undertaker would receive no compensation for the loss of the reservoir. The statutory water undertaker
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would continue to be responsible for paying the loan charges on the reservoir and would be responsible for its maintenance and repair. It is harsh and unjust that all the advantages of ownership of the reservoir or well will be transferred to the river authority while all the burdens of ownership will be left with the statutory water undertaker.
If it is desirable that any reservoir or well at present operated by a statutory water undertaker should be operated by a river authority, then the ownership can be transferred by order of the Minister under paragraphs (c) or (d) of subsection (1). Therefore paragraph (e) which provides for the transfer of the control without the ownership is not necessary, for the control can be transferred with ownership. Paragraph (e) would enable the river authority to obtain the control over and benefit of a reservoir or well belonging to a statutory water undertaker without being obliged to assume any of the financial or practical problems of ownership. I would suggest that this cannot be justified; and the Amendment therefore proposes to delete paragraph (e). I beg to move.
Amendment moved—
Page 63, leave out lines 6 to 9.—(Lord Lindgren.)
LORD HASTINGS: The noble Lord has made a strong case for striking out the possibility of transferring management of a reservoir without ownership, but I can assure him he has completely misunderstood the purpose of this clause. We are here seeking only to retain flexibility, and, to prove that, we have said not only that the river authority must apply to the Minister before one of these transfers can take place but that the statutory water undertaker can also apply to the Minister for precisely the same sort of transfer if it wishes to. It does not seem to have occurred to the noble Lord and his friends who have spoken to him outside this House about these matters that a statutory water undertaker might want this sort of transfer and it might suit it very well. We feel that the provision is potentially a valuable one and the statutory water undertaker might be quite happy to transfer to a river authority the right to manage or operate a reservoir or borehole, perhaps by agreement between the authorities, which is allowed for

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under subsection (5) of the clause, rather than by ministerial order, when it would be unwilling to transfer the property itself. It may be that the reservoir concerned is one of a chain of reservoirs or the borehole one of a group of boreholes. Possibly the agreement might even envisage transfer for a limited period of time only. I think this Committee might take cognisance of the fact that there can be great advantages in providing for these transfers, for example in connection with the river management functions of the new authorities and the experiments into artificial recharging of aquifers, and I do not think we should limit this clause in the way the noble Lord has suggested.
His case rests on his belief, which I am sure is quite mistaken and not the intention of this clause at all, that the river authorities will try to take over the convenient rights to manage and operate while leaving with the water undertakers the burdensome business of ownership maintenance and repairs. The noble Lord said they would have no compensation far the loss of the use of the reservoir, but that is not at all the case. They will indeed have compensation, and that is allowed for under subsection (4) which refers to the provision for financial adjustments, and which is the subject under a different aspect of a further Amendment the noble Lord is going to move in a moment. But under subsection (4) all these complicated financial adjustments are allowed, and that would most certainly look after the question of the duties of the undertaking if it had to maintain the reservoir while at the same time the river authority was using, or managing, it for its own purposes. That is allowed for in the subsection.
I hope that the noble Lord will accept my assurance that, after all, the Minister of Housing is interested in the welfare of water undertakers just as strongly as he is in the welfare of river authorities—he is really responsible for both. It is in his interests and those of all concerned that any such transfer shall be carried out in an equitable and absolutely fair manner. We want only the flexibility to be able to do these transfers on occasions when it should be convenient and necessary. That is the intention of the clause, and I hope the noble Lord will withdraw his Amendment.
LORD LINDGREN: I must admit that I did not see it at all in the light in which the noble Lord has just put it to the Committee. My immediate reaction was that where there is to be management, management can be much more effective and efficient where in fact there is ownership as well. Even now, I cannot see under subsection (4) where, if the management is taken over, there is a payment to the water undertaker. But in the light of what the noble Lord has said, which we can look at again at a later stage should that be necessary, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD LINDGREN LORD LINDGREN moved, in subsection (4), to leave out all words from the second "necessary" to the end of paragraph (a) and to insert instead:
"just and equitable with respect to the transfer of assets and liabilities, the payment of compensation and other financial adjustments, and such provisions as they consider necessary or expedient with respect to—"
The noble Lord said: Clause 75 gives Ministers power by order to transfer to authorities certain properties belonging to statutory water undertakers. We have been discussing this in the previous Amendment. Subsection (4) provides that the order transferring the property may contain such provisions as the Minister considers necessary or expedient with respect to the transfer of assets and liabilities, the payment of compensation and other financial adjustments. It is contended that the provision with respect to the transfer of assets and payment of compensation should not be on the basis of expediency but on the basis of what is just and equitable. The purpose of the Amendment is to provide that the compensation for compulsory transfer of assets shall be just and equitable and not merely expedient. I beg to move.
Amendment moved—
Page 63, line 24, leave out from ("necessary") to the end of line 27 and insert the said new words.—(Lord Lindgren.)
LORD HASTINGS: I think this is really a question of words. There is no difference about intention in this matter, and the Committee may be assured that the provisions that the Ministers think it necessary or expedient to make in a matter like this will, where questions of justice and equity enter into it, be just and equitable. But justice

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and equity may not in fact enter into all these matters—some may be just questions of fact, such as how to secure an effective transfer of some particular asset or other.
I hope that the noble Lord will withdraw this Amendment so that the words "necessary and expedient" may continue to stand, comprising within themselves the necessity and expediency of being always just and equitable, and without drawing distinctions, possibly invidious distinctions, between various parts of the job which is to be carried out by the Ministers. In a way, of course, this links up with another Amendment that the noble Lord will be moving in respect of the Schedules and the procedure to follow. We can discuss that when we come to it. In respect of this wording there is, of course, every intention to be just and equitable; and I hope that the noble Lord would not infer that Ministers, of whatever Party they happen to be, would act in any other way.
LORD LINDGREN: I would not make that suggestion or imputation against Ministers, past or present, or in the future; but what is expedient is not always fair and reasonable—at any rate, not in ordinary everyday life. Whether it will be so under an Act of Parliament remains to be seen. But in the light of what the noble Lord has said I beg leave to withdraw the Amendment.
Amendment, by leave withdrawn.
7.16 p.m.
LORD LINDGREN LORD LINDGREN moved to add to the clause:
"( ) The provisions of Schedule (Orders authorising transfers of functions or property of other authorities and undertakings) to this Act shall have effect in relation to an order under this section."
The noble Lord said: The purpose of these Amendments—there are a number of them—is to lay down a formal procedure to be followed in making orders authorising the transfer of functions of property belonging to authorities. Under Clause 75, as we have already mentioned, a river authority may apply to Ministers for an order to transfer to the river authority property belonging to the statutory water undertakers. Under subsection (3) the Ministers are to consult with the statutory
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water undertakers or other body from whom the order proposes to take property, and the Ministers must consider any representation made to them.
This appears to be the only formal procedure that must be observed before an order may be made by the Ministers. The machinery is not adequate to make public any proposal for the transfer of property or function under this clause, nor does it provide for a full and proper hearing of the proposal and objections in public, if there be the need. An order made under Clause 75 may deal with a reservoir costing £1 million or more; the water undertaker owning the reservoir may have the strongest objection to the transfer of the property to the river authority. It may be that other parties will be affected by the transfer; the local authority representing the public may be opposed to the transfer. It would not be satisfactory that issues so large and important should be dealt with behind closed doors at the Ministry. The Amendment therefore proposes that the machinery set out in the proposed new Schedule should apply to the making of orders under Clause 75. The machinery of the Schedule would require adequate publicity for any proposal in an order to be made under Clause 75. It would require the service of notices on persons affected and, in the event of objection, it would require a local inquiry or hearing before a person appointed by the Minister for the purpose. The new Schedule 7 is in similar terms to the existing Schedule 7.
While we are on the point of Clause 75, another important matter has been brought to my attention—I gave the noble Earl, Lord Jellicoe, a little preliminary notice of this paint. I think this might be a convenient moment to deal with it, because it seems to me to tie to with this Amendment. This is a case involving a water undertaker, Liverpool Corporation, and their Tryweryn reservoir. In order to meet the requirements of their undertaking, the Corporation have provided a reservoir for impounding water in order to release water lower down in the river. Under the Liverpool Corporation Act, 1957, the Corporation are at present engaged on constructing a reservoir (the work is not yet completed) in the Tryweryn valley, in Wales, with a capacity of not less than 16 million gallons, for regulating the

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flow in the River Dee and thus facilitating the abstraction by the Corporation of water from the Dee at Huntington, near Chester. Under the Bill the Corporation will be entitled to a river authority licence of right (Clause 33), but will face payment of appreciable charges to the river authority by reference to the authorised abstraction (Clause 56 (2)), unless Clause 58 is operated and an agreement entered into in regard to the Corporation's expenditure on the Tryweryn works.
The Corporation would naturally expect, in view of the scale of expenditure in this direction, that they would be exempt from such charges. If it is at all possible, some pronouncement on this point would be appreciated. The main point is that the Tryweryn reservoir will be a river-regulating reservoir. It could perhaps be said to be operated "wholly or mainly for the supply of water to consumers" (Clause 75 (1) (c)). In that event the river authority could apply to the Minister for an order to transfer either the reservoir, or its management and operation, to the authority. It would be useful for the Corporation to know whether or not the Tryweryn reservoir would in fact fall within the terms of Clause 75 (1). That is not the only case, but is a case that has been specifically brought to my attention. I understand that a number of other people are in exactly the same position. I beg to move.
Amendment moved—
Page 64, line 9, at end insert the said subsection.—(Lord Lindgren.)
LORD HASTINGS: My answer will be extremely short because Her Majesty's Government can accept this Amendment in principle. It will need to be equipped with some procedural matter for dealing with these orders, and clearly something very much on the lines the noble Lord has put forward will be wanted, with provision for public notice, a right of objection and a local inquiry or hearing. But we should like to think over how this provision can be inserted most economically into the Bill. We are prepared to introduce an Amendment and Schedule in order to meet this point. Having given that undertaking, I hope that the noble Lord will withdraw his Amendment. My noble friend will reply to the detailed points that were raised.
EARL JELLICOE: I was grateful to the noble Lord for giving me notice of these points. I think I can give him satisfaction on both the specific queries that he put to me. I can assure him straight away that the Tryweryn scheme would quite certainly be one which would justify consideration of a reduction of charges, or exemption from charges, under the procedure laid down in Clause 58 of the Bill. I can also assure him that the Tryweryn scheme, and others like it, would also fall within the terms of Clause 75 (1) (c).
LORD LINDGREN: I am most grateful to bath noble Lords for the answers they have given, and I beg leave to withdraw the Amendment. I will not, of course, move the Schedule when we come to it.
Amendment, by leave, withdrawn.
Clause 75 agreed to.
LORD BURDEN LORD BURDEN moved, after Clause 75, to insert the following new clause
Compensation to staff
".—(1) The Ministers shall by regulations make provision for the payment by such river authority as may be prescribed by or determined under the regulations, subject to such exceptions or conditions as may be so prescribed, of compensation to persons who are, or but for any national service of theirs would he officers or servants of any statutory water undertakers and who suffer loss of employment, or loss or diminution of emoluments, which is attributable to an order under the last preceding section or anything done in pursuance of any such order.
(2) Different regulations may be made under this section in relation to different classes of persons, and any such regulations may be so framed as to have effect as from a date earlier than that on which they are made, so however that so much of any regulations as provides that any provision thereof is to have effect as from a date earlier than that on which they are made shall not place any person (other than a river authority) in a worse position than he would have been in if the regulations had been so framed as to have effect only as from the date on which they are made.
(3) Regulations made under this section may include provision as to the manner in which, and the persons to whom, any claim for compensation under this section is to be made, and for the determination of all questions arising under the regulations.
(4) In this section 'national service' means any such service in any of Her Majesty's forces or other employment (whether or not in the service of Her Majesty) as may be prescribed by regulations under this section."
The noble Lord said: We have just been discussing the transfer of functions and properties of other authorities to river boards, under which arrangements have been made, quite rightly, for the payment of compensation, and so on. I think it is fairly clear that in the event of property or functions of other authorities and undertakings being transferred it is possible for members of the staff to be adversely affected. For example, if part of the properties of great corporations, like Sheffield, Manchester, and others, were transferred to a river board that might have an adverse effect on the staff. My new clause makes provision for payment of compensation to members of staff who may be so adversely affected. I do not think it necessary or desirable to argue this case, because it is accepted in the Bill. In fact I think my new clause substantially reproduces Clause 90, and it is because we feel Clause 90 is not linked or related in any way to Clause 75 that we have felt it necessary to put forward this new clause.
Amendment moved—
After Clause 75, insert the said new clause.—(Lord Burden.)
EARL JELLICOE: I should like to make it quite clear to the noble Lord at once that we have no objection in principle to his new clause. I hope, however, that in the light of the explanation I shall now give him he will agree that it may be unnecessary, and possibly also incomplete. In the first place Clause 75 (4) enables orders under that clause to provide for the payment of compensation by applying, subject to such exceptions, adaptations and modifications as may be specified, the compensation regulations required to be made by the Ministers under Clause 90 covering persons affected by the transfer of river boards' functions under the Bill.
I understand that what was worrying the noble Lord was that there was not a bridge or connection organically in the Bill between Clause 75 (4) and Clause 90. I think that in fact there is. Clause 90 (1) is so drawn that the regulations may cover all persons, no matter by whom they are employed, who suffer loss of employment or reduction in pay attributable to the transfer of river boards' functions under this Bill. Clause 75 (4) enables the provisions of these regulations to be
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applied to all persons, however employed, who so suffer in consequence of any transfer of this nature. I feel that there is a perfectly clear organic connection, which leads back from Clause 90 to Clause 5, and then from Clause 5 to Clause 75. I should like to be able to assure the noble Lord on that point.
There is a difficulty about his proposed new clause, in that, as I read it, it is incomplete, since it refers only to officers and servants of water undertakings, and does not cover other persons who may be affected by orders under Clause 75—for example, employees of navigation, conservancy and other authorities. I had thought that a point which might be worrying the noble Lord was the fact that Clause 75 (4) was permissive, while the new clause which he seeks to embody in the Bill makes it clear that Ministers would be required to make the necessary regulations. He did not mention that point, but I should like to take this opportunity of assuring him that it is most certainly our intention that any particular orders made by my right honourable friend under Clause 75 (4) shall include the provision for compensation, applying the regulations under Clause 90 with any necessary adaptations and modifications. Noble Lords can be quite sure that this will, in fact, be done. I therefore suggest to the noble Lord that the position is adequately covered in the Bill as drafted. I realise that he may wish to read in Hansard what I am now saying. But I hope that in the light of the explanation which I have sought to give, and of my assurance about my right honourable friend's intentions here, he may not wish to press this Amendment.
LORD BURDEN: I am extremely grateful to the noble Earl for the explanation which he has given to the Committee. I feel sure, from the emphatic manner in which the noble Earl gave the assurance, that he feels it is quite all right, and, subject to careful consideration of his words, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
EARL JELLICOE: I think that we agreed to adjourn our discussion at half past seven, to sample this new form of supper which the Chief Whip mentioned just now. In the light of that, if noble

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Lords are agreeable, I beg to move that this Committee do now adjourn until half past eight o'clock.
Moved, That the Committee do now adjourn.—(Earl Jellicoe.)
On Question, Motion agreed to.
[The Sitting was suspended at twenty six minutes before eight o'clock and resumed at half-past eight o'clock.]
Clause 76 [Water resources accounts of river authorities]:
LORD HASTINGS: I move this Amendment formally. As I have explained on previous Amendments, it is a question of drafting in view of another Amendment to come later. I beg to move.
Amendment moved—
Page 65, line 10, leave out ("vehicle").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 76, as amended, agreed to.
Clause 77 [Reserve funds of river authorities]:
8.32 p.m.
LORD LINDGREN LORD LINDGREN moved, after subsection (1) to insert:
"( ) Any river authority establishing a reserve fund in accordance with the preceding subsection shall thereupon become an authority to which Section 11 of the Trustee Investments Act 1961 applies ".
The noble Lord said: This Amendment, I would suggest, is really self-explanatory. Under the Trustee Investments Act, 1961, local authorities (and other trustees as well, of course) were empowered to invest their capital funds in a wider range of securities than had previously been possible. As a result of that Act the Local Authority Mutual Investment Trust was set up to give local authorities wishing to invest their capital funds facilities similar to those afforded to investors by a unit trust. Large authorities, of course—the county councils and the rest—can, with the aid of panels, make a wide range of investments, including equities, which gives them a cover, and they are thereby able to hedge against inflation. The purpose of this Amendment is to give river authorities, large or small, and particularly
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the smaller ones, the opportunity of being able to invest their funds with the advice of specialists in order that they can get the best spread and the best advice, and also, by these investments, be able to protect their funds against inflation. I beg to move.
Amendment moved—
Page 65, line 15, at end insert the said subsection.—(Lord Lindgren.)
EARL JELLICOE: As the noble Lord knows, Section 11 of the Trustee Investments Act, 1961, is pretty closely confined to local authorities in the ordinary sense of the term, and to certain other authorities wholly composed of or concerned with local authorities. As a result, river boards cannot take advantage of the provisions of Section 11 of that Act, since they are not authorities to whom the section applies. I should like to grant straight away that very possibly it would now be right for us to consider, in the light of what the noble Lord has said, whether river authorities, when they are set up, should be able to take advantage of this section of the 1961 Act but I am sure that, in view of the noble Lord's long experience of local government matters, he would agree that it would be wrong for us to reach a decision now, without the opportunity for proper consultation on this matter with the local authority associations.
If he and his colleague who is associated with him in this Amendment would agree not to press it now, I, for my part, am very willing to undertake to look into the possibility of our consulting the appropriate local authority associations without delay about the admission of river authorities to the benefits of schemes established under Section 11 of the 1961 Act. In so doing I would make it clear that we feel that the question of the admission of outsiders (if I may use the term, not inappropriately, to the scheme established under this Section 11) is in our view very much a matter for the local authorities themselves to decide. But I hope I have said enough to assure the noble Lord that I am certainly not in disagreement with him over the principle behind the Amendment.
LORD LINDGREN: I am most grateful to the noble Earl for that reply.

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I can tell him, from my general knowledge (I have no authority to speak for them) of the local authority associations, that they will be only too pleased; and I am delighted that he will consult with them. I am sure they will be pleased because, having set up this local authority mutual investment trust themselves in order to give to the smaller local authorities facilities which big county councils and the others, because of their size, can enjoy on their own, I am certain they would like to get added custom for it if custom were available. In view of what the noble Earl has said, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD HASTINGS: This is a purely drafting, preparing the way for the next Amendment in the new clause. I beg to move.
Amendment moved—
Page 65, line 33, after ("this") insert ("and the next following").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 77, as amended, agreed to.
Clause 78 [Vehicle replacement funds]:
LORD HASTINGS LORD HASTINGS moved to leave out Clause 78 and to insert instead:
Replacement funds of river authorities
"78.—(1) A river authority may at any time establish and thereafter maintain a replacement fund, and, subject to the following provisions of this section, may pay into that fund any receipts of the authority.
(2) Any moneys for the time being comprised in the replacement fund of a river authority may be applied in or towards the acquisition of any vehicle or apparatus to which this section applies by way of replacement of any such vehicle or apparatus owned by the authority.
(3) This section applies to the following vehicles and apparatus, that is to say—

(a) mechanically propelled vehicles;

(b) any other mechanically propelled mobile apparatus; and

(c) any apparatus constructed or adapted for use in conjunction with any vehicle or apparatus falling within either of the preceding paragraphs.

(4) No sums shall be paid into the replacement fund of a river authority at any time when the amount then comprised in that fund is equal to, or exceeds, one per cent. of the
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aggregate amount of capital expenditure incurred by the authority before that time; and the amount paid into the replacement fund of a river authority in any financial year shall not exceed one-tenth of one per cent. of the capital expenditure incurred by the authority before the beginning of that year."
The noble Lord said: This is the new clause to which I have referred, to extend the vehicle replacement fund to include other vehicles. As it appears the Bill empowers river authorities to establish and maintain a vehicle replacement fund. Monies may be put to the fund from any receipts of the authority, and there is no limitation as to the functions of the authority for which the vehicles are required. It has been suggested, and the Government accept the point, that the fund could usefully be extended to cover other forms of mechanically propelled vehicles and apparatus commonly used by river boards such as bulldozers, and draglines. The Amendment seeks to delete the existing clause and to substitute a provision which embraces not only vehicles but other mechanically propelled mobile apparatus and any apparatus adapted for use in conjunction with such vehicles. Additionally, the clause follows the precedent of similar provisions included in orders setting up new water undertakings and prescribes an annual limit on the contributions made to the fund and the overall size of the fund. I beg to move.
Amendment moved—
Page 65, line 35, leave out Clause 78 and insert the said new clause.—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 79 [Precepts by river authorities]:
LORD HASTINGS: This Amendment, 123O, and Amendment 123P are both drafting Amendments consequential upon the last one which introduced a revised version of Clause 78. I beg to move.
Amendment moved—
Page 66, line 1, leave out ("vehicle").—(Lord Hastings.)
On Question, Amendments agreed to.
Clause 79, as amended, agreed to.
Clause 80 [General provisions as to finances of river authorities]:
LORD HASTINGS: I beg to move.
Amendment moved—
Page 68, line 4, leave out ("vehicle").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 80, as amended, agreed to.
Clause 81 agreed to.
LORD CHAMPION LORD CHAMPION moved, after Clause 81, to insert the following new clause:
Grants in respect of conservation works
". The Minister may, with the approval of the Treasury, make out of the moneys provided by Parliament grants to river authorities in respect of expenditure properly incurred by them with a view to carrying out water conservation works in their areas."
The noble Lord said: I have the temerity to think that this is an important clause and I hope that your Lordships will forgive me if I take some time in moving it. The Bill as at present drafted makes no provision at all for financial assistance to river authorities, no matter what the obligations imposed upon them by the need for water conservation. As I see it, the Bill is intended to secure that there shall be a national policy for the conservation and redistribution of water resources in England and Wales, and to provide the necessary machinery to see that that policy is effectively carried out.
At the centre will be the Minister, whose duty will be to formulate policy and to secure that under his control and direction the policy will be effectively executed. To advise him in the formulation of that policy and, if necessary, to prod him into activity, if he appears to be falling down on the job, there will be the Water Resources Board. That Board, if I may quote the strong words used by the noble Earl, Lord Jellicoe, on Second Reading [OFFICIAL REPORT, Vol. 244 (No. 12), col. 1089]
"will have clear-cut promotional responsibilities."
And a little later on, in the same column, he said:
"This Bill makes it a duty for the river authority both to formulate schemes and to carry out schemes implementing the recommendations of the Board, and that duty of the river authority to implement the recommendations of the Board is clearly set out in subsection (1) (c) of Clause 14 …".
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In the same paragraph of his speech, he invited us
"… to note that we have … given the Board this clear directive power over river authorities."
To carry out these directions to be given by the Minister and the Board, there will be, of course, the river authorities, each of which must itself formulate a scheme for its own area and, in the words of Clause 4
"… take all such action as they may from time to time consider necessary or expedient, or as they may be directed to take by virtue of this Act, for the purpose of conserving, re-distributing or otherwise augmenting water resources in their area, of securing the proper use of water resources in their area, or of transferring any such resources to the area of another river authority."
So we see that the river authorities will have to carry out the schemes they have formulated themselves for the use of water in their own areas, the schemes recommended by the Water Resources Board and also the directions of the Minister for transferring the water which they have conserved into the area or areas of other authorities. This will mean—again I quote the noble Earl—that
"… promotion in its widest sense—promotion, for example, of these great conservation schemes which will be coming—as likely to become increasingly important in the future …".
How are these great conservation schemes to be paid for? Surely such schemes envisage great conservation works. Without them, this talk of great conservation schemes would be nonsense. There must be great works, if we are indeed to conserve water to meet future demands, which have been estimated variously but by the Proudman Committee as something like an increase of 25 per cent. over the next ten years. If all the river authorities have to do is to restrict the extraction of water from the sources of supply in their areas, issue licences and charge for the water to be extracted, then I regard the financial provisions of the Bill, as at present drafted, as completely adequate. If that is the sum total of their work, then the Water Resources Board will be a shocking waste of experts' time and of public money. But if the Bill is really intended to make legislative provision for great conservation schemes and the necessary work to implement them, then in certain cases the cost of the schemes must come

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initially from a source other than those sources provided in the Bill itself.
The certain cases to which I refer are, of course, the poorer authorities. I think it must be noted in this connection that these poorer authorities are, in the main, those where ample supplies of water are available for conservation. The Proudman Committee clearly had such cases in mind when they made their recommendation in paragraph 122. They there said:
"We have expressed the view that conservation should in general be financially self-supporting. Nevertheless, in view of the importance of water in the national economy, we think that circumstances may arise in which it would be in the national interest to make financial assistance available from Exchequer funds."
The same point has also been expressed by the County Councils Association; though, with the well-known propensity of such associations to make claims on the Exchequer, their point of view may be a little suspect. Surely, however, that cannot apply to the Proudman Committee, which is not in the same position. It seems to me that the strongest case for making an Exchequer grant would be that in which the Water Resources Board or the Minister directed the river authority to carry out a scheme which the river authority would not otherwise have undertaken, either because of their poverty or because they had ample water for the abstractions within their own area which they proposed to license. I should think that the Water Resources Board, in advising the Minister, ought in some cases to be able to say to him: "We are convinced that there is a need for great water conservation works in the area of such-and-such an authority. We are also convinced that their income from abstractions, from precepting et cetera, is such that the authority would be unable to carry out the schemes that we recommend, and that in this case, an Exchequer grant should be made."
It does not seem to me that in most cases there will be any necessity for a grant at all, but I feel that these exceptional cases must arise wherein it would be in the national interest for the Exchequer to be in a position to make a grant. This Amendment only empowers the Minister to make grants, and it would be for him to decide the circum-
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stances which would justify such action. Thus an application by a river authority, or a recommendation by the Water Resources Board, would be subjected to the closest possible scrutiny. It would have to go through the process of approval by the Treasury, a body not notoriously open handed—and rightly so, I would say; it is the job of the Treasury to safeguard the taxpayers' money. But any application such as I am mentioning would, of course, have to go through the mill of the Treasury. I know that all Ministers have a fear of opening the floodgates of applications, and of the pressures which the various associations can bring to bear through Members of Parliament and others upon the Minister. But I must say that I have every confidence in the Treasury's well-known aptitude for closing such floodgates firmly and completely where necessary. If we are not going to make a mockery of this task of solving the problem of Britain's water supplies; if we are not going to flout the wise recommendation of the Proudman Committee—and that Committee recommended what I am now putting forward—then I think we must include in the Bill the clause that I am now proposing.
I have been fortunate twice recently when the noble Earl has replied to me, when he has acceded to the requests I was putting forward. This will be the third time, and they say "Three tries for a Welshman". I do not happen to be a Welshman, but I am trying again for the third time to get exactly the same effect. I hope that when the noble Earl replies he will make as good a reply as he has on the two previous occasions.
EARL JELLICOE: I do not wish to reply at this stage to the noble Lord, but although I followed him closely in his argument I am afraid I allowed my attention to be diverted at one moment. If I followed his argument correctly, he was saying that, in the great majority of cases perhaps, an Exchequer grant would not be necessary, but he then gave examples of various circumstances in which he thought there should at least be the possibility of Exchequer grant. One was the poorer authority, but he then mentioned another example which I am afraid I missed. Would it be asking too much for him to put me on the right track?
LORD CHAMPION: Not at all. I thought there were two other circumstances in which the Minister ought to be empowered to make grants. They were, first, where the Water Resources Board itself directs the river authority to undertake works of conservation, and, secondly, where the Minister himself issues such a direction to a river authority. In both those cases it would appear to me that an extremely strong case could be made out for an Exchequer grant. I beg to move.
Amendment moved—
After Clause 81 insert the said new clause.—(Lord Champion.)
THE EARL OF LUCAN: There is little that needs to be added to what my noble friend has said in moving this Amendment, but it seems to me that one of the strongest arguments is that works of conservation are things that are only rarely undertaken, probably in any one river basin only at very long intervals after many years. The expenditure for these things is, therefore, essentially capital expenditure. It is not the type of expenditure which should be collected by means of a precept on local authorities, because if a river authority precepts on their component parts so much money that they will have a surplus which they can store up against the time when they have to make a big capital expenditure, then they are gathering too much in the form of local taxation from the area. It seems essentially a case, therefore, where Parliament, in these rare cases of large expenditure on large works, should help.
THE EARL OF ALBEMARLE: I should like to say a word on this, because we are coming soon to the amalgamation of areas, some of which do not want to be amalgamated. If an area on one side of the watershed thinks it has a good project and wishes to carry out experimental work just over the watershed, they would not be allowed to do so and to ask for a grant, although it might be essential to the scheme because the other area was unwilling to join in it. Therefore, in the noble Lord's Amendment—which I think would be a wise one to have—the only words I do not like are "in their areas". If we leave out those words, then, with the advice of the Water Resources Board and the
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approval of the Minister, we might get a scheme going which we might not get going if we left in the words "in their areas".
LORD WILLIAMS OF BARNBURGH: I do not intend to detain your Lordships for more than a few moments, but I think I ought to say a word about this Amendment, and I cannot quite see how the noble Earl who is in charge of the Bill can them reject it out of hand. I well remember when the Drainage Bill, 1930, was passed. There, of course, it was permissive for the Treasury to make a grant in a special case. I recall that one scheme in my own Parliamentary Division, or a great part of it, was to cost somewhere in the region of £1¾ million. In 1931 the first offer the Treasury made was a grant of £10,000—so that the Treasury were not overflowing with human kindness on that occasion. Obviously, nothing happened, and within two years between 700 and 800 men, women and children were flooded from their homes and had to live in elementary schools for seven or eight weeks while their houses were cleaned. Ultimately, the Treasury came to their senses and made a very sizeable grant. A scheme has been carried out and there has been no flooding since.
Just as it was important for that drainage work to be carried out for one purpose, it is equally important for the Government to produce a Bill to conserve water in certain areas so that supplies will be available for agriculture and horticulture as and when called for. So, in the two things, I see little or no difference between the Treasury's making a grant in a suitable case for water conservation and their making a grant for the prevention of flooding in certain otter areas.
I think in terms for the moment of the Great Ouse Scheme which was likely to cost in the region of £7 million. I forget the exact figure but it was around that sum. The scheme was very necessary and was called for for years, but it was all a question of finance. It was supposed to be a poor rateable area and they could not hope to face a bill of that magnitude. Finally, however, one Government had to say the right word and provide something like four-fifths or five-sixths of the total cost. My recollection sometimes serves me well and

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at other times not so well, but I think it was a Labour Government which provided the grant; and the scheme has been beyond count in its good qualities so far as that area of the country is concerned. I repeat, I see little or no difference where the Water Resources Board finds a scheme to be absolutely necessary in the interests of agriculture and for other purposes. It may be a costly scheme or not so costly; in their wisdom the Treasury would be able to determine whether or not a grant should be given, and the size of it.
Under this Bill the Minister is given great powers. He is in the Bill from Clause 1 to the end of time. In Clause 96 he has powers of default; if the Water Resources Board provide a scheme, direct the river authority to carry it out, and the river authority, for one reason or another—perhaps because of the financial implications—fail to carry it out, then the Minister has the power to direct them to carry it out—more power, I think, than the Minister has with regard to land drainage. So it seems at least as important that the permissive power should be there for the Treasury to provide a grant if the Minister or Ministers feel that such a grant is necessary. I hope that the noble Earl who is going to reply will retain his pleasantry to the end of the night's session anyhow, and at least tell us that the Treasury in 1962 are no less good financiers, wise administrators who will help only where they know help to be really necessary, and will at least be given a permissive power to make the grant, should the necessity arise.
9.2 p.m.
EARL JELLICOE: The noble Lord, Lord Champion was perfectly correct in describing this as an important Amendment, and I think that he made a very powerful speech in support of it. It is true that in paragraph 122 of their Report the Proudman Sub-Committee recommended that in certain cases Exchequer grants should be payable to river authorities to cover at least part of the expenditure incurred by them on works of conservation. A glance at paragraph 122 would, however, make it perfectly clear that this particular recommendation was couched in extremely guarded terms. The Government's position on this has been perfectly consistent throughout. We have taken
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the view, and it was made crystal clear in the White Paper, that the cost of conservation should be paid by those who benefit by conservation, namely the water abstracters. Exceptionally, of course—and there is an exception—during the initial period before charging schemes come into operation conservation will, as your Lordships know, be mainly financed by precept upon the local authorities.
This general principle, that conservation should be paid for by those who benefit from it is, I suggest, entirely in line with what happens now in the public water supply service. That service is entirely financed by charges paid by the customers, and, save in three very limited cases, it is not in any way subsidised by the taxpayer. I would urge that we should think very carefully before we decide to depart from that principle, and I further believe, on the basis of such trial studies or spot surveys as have been undertaken, that the financial resources of the river authorities will fully match their new responsibilities for water conservation. And because I believe that, I am in no wise inclined to retreat from what the noble Lord, Lord Champion, quoted me as saying during our Second Reading debate on this matter.
Noble Lords have advanced a number of cogent arguments against this view, and I admit that there can be two sides to this question. I think that the first argument which the noble Lord, Lord Champion, deployed was that some of the richest areas in water supply may well be the poorest in finance, and that while, for example, costly schemes of conservation may well be needed in those areas the river authorities responsible for them will not have the necessary financial resources to undertake such work. I think that that particular argument is misconceived. If costly works are needed in the poorer areas, which tend to be those which are rich in water, it is likely to be mainly for export to other areas poor in water but often rich in financial resources. To the extent that this is so, the importing authorities should bear the cost, by capital contribution or by annual contribution to loan charges, and that is the principle as provided for in the Bill. I would have thought that in itself it was an absolutely sound principle.
The noble Lord also suggested that it might well be that the Water Resources

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Board, or the Minister himself, as part of our national planning for water conservation, might require a local authority—I take a sort of semi-hypothetical example—to develop a more expensive source than they would themselves have chosen. I do not think that that sort of necessity for direction would come in in that way. In that case noble Lords are inclined to argue that the Exchequer should make up the extra cost. I would submit that if we are to have truly national planning of our national water resources it is inevitable that some areas will have to face higher costs than they would have done if there had been no planning in the first place, and if it were simply a question of first come, first served. I would have thought that we should accept this as a consequence of a national water policy; but I would not have thought that that in itself was a reason for an Exchequer subsidy, because as a result of that policy the abstracters will be obtaining both direct and indirect benefits.
The third argument, which the noble Lord, Lord Williams of Barnburgh, deployed, was the argument that Exchequer subsidy is paid for land drainage; if Exchequer subsidy is paid for land drainage, why should we not make provision for the possibility of the payment of Exchequer subsidy for purposes of water conservation? I would grant that in itself there may be a certain rough justice about this particular argument. But in thinking about the argument, I think we should bear in mind the history, as I understand it—the noble Lord, Lord Williams of Barnburgh, will correct me here if I am wrong—of the Exchequer subsidy paid in respect of land drainage.
I think, as he said, that that was first provided for in the Land Drainage Act, 1930, following the Report of a Royal Commission on the subject. If my understanding is correct, the Royal Commission envisaged that as far as this was concerned, there should be a contribution by agriculture to such land drainage schemes. But before the proposals could be given effect to, the Local Government Act, 1929, intervened with the derating of agricultural land which was written into that Act. This, of course, largely torpedoed the contribution which was foreseen for agriculture in this respect. It was for that rather
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particular reason that the Exchequer subsidy in respect of land drainage crept in, rightly or wrongly.
LORD WILLIAMS OF BARNBURGH: But the noble Earl will not forget, of course, the very vital point that a scheme may be a costly one to those operating in the lowlands, because the agriculturists in the lowlands were frequently flooded—in fact, I have seen their barley, oats and wheat floating down the river, and even across the fields—and they just could not afford to face the bill for any considerable land drainage scheme. For the first time in the history of the country those resident in the upland cities were called upon to pay through precept on their rates. It was the ratepayers who jibbed, after the 1930 Act was passed, at making some of the hefty contributions they might have had to make had it not been for some Treasury assistance given at the time, and also at present, I think. That situation, as well as the derating of agriculture in 1929, should also be remembered.
EARL JELLICOE: I should not wish to bandy expertise with the noble Lord on this particular point, but I think he would grant that there were particular historical reasons which led to the Exchequer subsidy being paid in this respect. I do not think that those particular historical reasons can necessarily be said to apply in this particular respect, but on the supplementary point he has made, I certainly should like to consider his argument and should not wish to cross swords with him.
There is another argument that could be used by noble Lords who would like to see provision made for Exchequer grant here, and I was rather surprised that it was not advanced. I was wondering whether I could deal with the argument, even though it has not been made.
LORD CHAMPION: Make it for me.
EARL JELLICOE: Yes, I will do so. One could argue that conservation works may be necessary under this Bill in order to achieve objects of national policy—such as the movement of industry to areas of unemployment, or the movement of people to overspill areas. We hear a great deal these days about growth points and growth areas, and we had a very interesting speech on this subject from my noble friend Lord

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Eccles only a week or so ago. I would concede that if we are going to stimulate growth deliberately in certain areas of this country, part of the essential infra-structure must include important conservation works to safeguard the water resources of those areas. But if there is a case for grant here—and I concede that there may be—it seems to me that it would be better and more cleanly provided under legislation governing the policy in question, just as at the present time grant is payable in certain special cases for public water supply.
To summarise my argument at this stage, I suggest that we should be very careful indeed before departing from the principle, which I think is a good principle, and with which I do not think noble Lords as a whole would disagree—the principle of making water conservation self-supporting. The noble Lord, Lord Champion, himself would, I think, accept that in the vast majority of cases that is the right principle. I should think otherwise if it could be demonstrated beyond doubt that there was a clear need for Exchequer subsidy here, but I submit that this is not the case. I would certainly submit that it is not the case when one is dealing with a poor area, which may well be directed to export water to another, richer area—poorer in water but richer in financial resources—because there is provision in the Bill for that area to pay in that sort of case.
I think we must remember (and this, I think, was an argument which the noble Lord, Lord Williams of Barnburgh, employed in talking about opening the flood-gates) that if we allow for Exchequer subsidies in the cases which we now think will be exceptional, the exceptional tends soon to become the rule; and if we provide for subsidies here we shall certainly diminish the ability of the Exchequer to make subsidies available in fields where they are very possibly, or very arguably, more necessary. For those reasons, I suggest to your Lordships that this Amendment should be resisted.
9.17 p.m.
LORD CHAMPION: I cannot, of course, be satisfied with the noble Earl's reply. It is true that the Government have been perfectly consistent throughout the whole of the discussions on this
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Bill, and in the White Paper. I would remind the noble Earl that Emerson said that
"A foolish consistency is the hobgoblin of little minds."
I suggest that the Government are looking at this through very little minds indeed. I think they are consistent, but quite wrong. If I did not think that, I should not have moved the Amendment.
It is true, as the noble Earl said, that water users, or potential water users, at present pay for conservation. Of course, they do that only to meet the immediate need, or the need of the immediate future. But what we are doing in this Bill, it seems to me, is seeking to conserve water for a use which is not immediate. That is why I think we should make provision for that sort of case. I thought that the noble Earl's semi-hypothetical case, as he put it, was a perfect argument in favour of the Amendment which I moved on this matter. The noble Earl said that I might have made use of the point which the noble Lord, Lord Eccles, made. I must admit that I had it very much in mind. I marked this passage in his speech, because I thought it was an extremely important one. The fact that I did not overlook his speech is made fairly clear; I quoted it in the debate on the Coal Industry Bill last week. But I felt that there was a limit to the extent to which I could become the noble Lord's public relations officer; there are limits to the amount of advertising that I am prepared to do on behalf of any noble Lord.
But I am bound to say that I tremendously welcome the support of my noble friend Lord Williams of Barnburgh. It would be impertinent of me to comment on his speech. I can only welcome it as being in support. I do not want to withdraw this Amendment yet. I feel that there is something more to be said, and if anything I have said in my reply has stimulated someone to get up and support me, I shall find it very welcome indeed.
EARL JELLICOE: I should like to have the chance. The noble Lord has stimulated me to reply to at least one point which he made just now, and I should like to deal with it. That was his view that we should not be shortsighted here. Here I would entirely agree: we must look to the future. We

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cannot have regard only to the immediate needs of the country for water conservation schemes. That I would concede; but I would not necessarily concede that we need therefore make provision for Exchequer subsidy. For example, in many other fields we look to the future. When a new power station is built in this country, the Central Electricity Generating Board are very foolish if they do not see to it that surplus capacity is not built into that power station. Of course, they build surplus capacity into it; but the consumers pay for that surplus capacity. Again, absolutely the same principle applies, as I understand it, with the Post Office. If the Post Office are planning a new telephone exchange, they do not necessarily build an exchange which is suitable for our telephone service subscribers in 1962: they plan for the future—but the subscribers pay. Again, the same principle applies, I think, sometimes, nearer home—indeed, to our own homes. There we plan for the future. If we are building a new home, we sometimes build a new nursery on to it even if we do not have children at the time, or, possibly, even a wife.
LORD LINDGREN: The noble Earl will forgive me, but there are limits, and one depends upon one's age.
EARL JELLICOE: I would agree. But I do think that this factor of the principle of intelligent anticipation, if I may so call it, applies in a great many fields, but does not necessarily carry with it, I would urge, the absolute need for Exchequer subsidy.
LORD WILLIAMS OF BARNBURGH: May I add one word before we go to a division of shouts? I quite agree with the noble Earl. The general principle which he expounds is quite good; but may I remind him that from 1948, so far as I can recall, when the River Boards Bill was passed, the Government retained the power to make grants in appropriate cases. They were not obliged to, and presumably the river board had to satisfy the Minister first and later the Treasury before they got a grant at all. The grants have been large and they have been small. So far as I can recall, over the fourteen years there have been many deputations from here, there and somewhere else to the Treasury or the Minister, telling the
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Treasury or the Minister that the grant was not enough, but I do not think the noble Earl will recall one occasion when there has been any sizeable outcry about a grant or no grant. All we are asking for is that the river authority to begin with, the Water Resources Board secondly, and the Minister finally, feel that this is a special case of its kind, and really deserves some modest encouragement. That is all we are asking for. We do not want to destroy the basic principle enunciated by the noble Earl, but we should like a bit more favour at half-past nine at night on an Amendment such as this.
EARL JELLICOE: Before we go to a division, of shouts or otherwise, I should like to say, with regard to the discussion on this important point, the significance of which I think I was very willing to recognise, that I should welcome the chance of considering the arguments which have been advanced by noble Lords opposite. I am not at this stage at all convinced by them, but I will consider them, without promising anything, between now and the Report stage.
LORD CHAMPION: I am afraid that I have to accede to the blandishments of the noble Earl. Once again he has shown the remarkable mastery of handling the Committee that he showed formerly through the passage of this Committee stage. I envy him this capacity, but I must not continue in this vein for too long. I beg leave to withdraw this Amendment.
Amendment, by leave, withdrawn.
Clauses 82 to 95 agreed to.
Clause 96 [Default powers]:
LORD HASTINGS: This is purely a drafting Amendment to correct a minor error of grammar.
Amendment moved—
Page 79, line 42, leave out ("may transfer") and insert ("transferring").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 96, as amended, agreed to.
Clause 97 agreed to.
Clause 98 [Reports and accounts]:
LORD HASTINGS: The Amendment makes clear that this is a reference to any direction given to the Board and

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not, for example, to river authorities generally. It is purely a clarification. I beg to move.
Amendment moved—
Page 81, line 30, after ("given") insert ("to the Board").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 98, as amended, agreed to.
Clauses 99 and 100 agreed to.
Clause 101 [Power to take samples of effluents]:
LORD HASTINGS: This Amendment together with Amendments 124G and 124H have a common purpose, which is to make it clear that notices about, and samples of, effluent taken by the river authority, as prevention of pollution authority, from a vessel are to be sent to the owner or master of the vessel. I beg to move.
Amendments moved—
Page 85, line 18, after ("or") insert ("the owner or master of the")
line 23, after ("or") insert ("the owner or master of the")
line 28, at end insert ("the owner or master of the").—(Lord Hastings.)
On Question, Amendments agreed to.
LORD HASTINGS: This is purely a drafting Amendment which is necessary in view of the definition of "local authority sewer" in Clause 117 (3), which will be effected by a subsequent Amendment. I beg to move.
Amendment moved—
Page 85, line 37, leave out from ("authority") to ("by") in line 38.—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 101, as amended, agreed to.
Clause 102 [Power to require information]:
LORD HASTINGS: This Amendment is re-enactment. Section 9 (5) of the Rivers (Prevention of Pollution) Act, 1961, which dealt with certain extensions of river board area for the purpose of the powers of the river board under Section 9 (8) of the River Boards Act, 1948, and Section 15 of that Act is repealed by the Bill. The substance of the section needs to be applied, however, to
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river authorities, and this is carried out by the Amendment. I beg to move.
Amendment moved—
Page 86, line 5, at end insert ("or into any waters falling within paragraph (b) or paragraph (c) of subsection (1) of the last preceding section").—(Lord Hastings.)
On Question, Amendment agreed to.
LORD HASTINGS: Subsection (2) of Clause 102 as it stands in the Bill at the present time is too sweeping. The effect of the Amendment is to reduce the powers conferred by the subsection to those available to river boards now. Those boards have power to require the furnishings of certain information about effluents which need their consent under the Rivers (Prevention of Pollution) Act, 1961. The extent of the information they can demand is prescribed in regulations made under Section 3(1) of the Act of 1961. The clause as drafted would empower them to demand such information in respect of all effluents. The revised subsection restricts the power to the effluents dealt with in the Act of 1961. I beg to move.
Amendment moved—
Page 86, line 9, leave out subsection (2) and insert—
("(2) In the case of a person who has applied to a river authority for any consent required by the Rivers (Prevention of Pollution) Act 1961, the information required by directions under the preceding subsection may include any particulars prescribed by regulations under Section 3 (1) of that Act.").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 102, as amended, agreed to.
Clauses 103 to 106 agreed to.
Clause 107 [Service of documents]:
LORD HASTINGS: This is little more than drafting. It introduces into Clause 107, dealing with the service of documents, an obviously desirable provision, on the lines of Section 19 (1) of the River Boards Act, 1948, to make clear that notices to be given by or to a river authority are to be in writing. I beg to move.
Amendment moved—
Page 89, line 30, at end insert—
("(5) Any notice which is required or authorised by or under this Act or any other

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enactment to be given, served or issued by or to a river authority shall be in writing.").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 107, as amended, agreed to.
Clauses 108 to 112 agreed to.
Clause 113 [Provision as to Rivers Esk and Tweed]:
LORD HASTINGS: This is a drafting Amendment. Line 29 in Clause 113 serves no useful purpose, since subsection (1), to which it refers, deals with fishing and in no way affects subsection (3), which deals with the "new" functions of river authorities. I beg to move.
Amendment moved—
Page 93, leave out line 29.—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 113, as amended, agreed to.
Clause 114 agreed to.
Clause 115 [Repeal, amendment and adaptation of local enactments.]
9.34 p.m.
VISCOUNT COLVILLE OF CULROSS VISCOUNT COLVILLE OF CULROSS moved to add after subsection (4):
"(5) Nothing in this section shall enable the Minister to vary any provisions for the discharge of compensation water made by or under any statute without the consent of all persons for whose benefit any such provisions have been made."
The noble Viscount said: I know that the provisions of Clause 115, which enable the Minister, if he thinks that any Local Act is going to impede the process of this Bill, to repeal or amend or adapt that particular measure, is something of a standard in this sort of enactment. Nevertheless, there may be somewhat unusual circumstances in this field. There may be occasions—I confess that I do not know of any specific examples, but I am sure that they must exist—where provisions of some Local Act have protected specifically some riparian owner or somebody of that nature, when, for the sake of argument, a reservoir was built by perhaps a statutory water undertaker and special provision was put into the Local Act which allowed enough compensation water to come down the river below the reservoir at
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all times, perhaps to drive the machinery in his mill or for some similar purpose. It may have been for the protection of one individual, or a company or some institution which will be continuing to this day and who still have the advantage of the special protection given them by the Local Act.
Nowadays the advances in the knowledge of water resources and so on may have made it possible to relax, to some degree, the statutory provision for a permanent flow of compensation water. It may be that it would be suitable that the water should come down only in the daytime and not at night-time, or that it should come down during weekdays and not at the week-end, and that the person for whom the Local Act provided protection is agreeable to some changes taking place in the provisions so as to allow the minimum acceptable flow in the river to come up to the standard Which is thought to be suitable. Nevertheless, I think it would not be right for the Minister to have quite such sweeping powers as he seems to have in the Bill. He can, it seems to me, without any form of consultation with, or consent of, any such person as I have mentioned alter the special protection given by a Local Act entirely to suit his purpose or to suit the purpose of a river authority.
The purpose of this Amendment, therefore, is to require him, before he repeals or amends or adapts the Local Act, if it affects the compensation water which has been allowed to some person under Statute, to consult with that person first. I do not think this would be an unreason-able requirement to lay on the Minister. He would probably do it anyway, but I would rather have the statutory provision put in the Bill to make certain that he does. I beg to move.
Amendment moved—
Page 94, line 41, at end insert the said aragraph.—(Viscount Colville of Culross.)
9.44 p.m.
LORD ST. OSWALD: I regret that I shall not be able to speak either as briefly or as lucidly to this Amendment as my noble friend has done in moving it. It has seemed to me a far more complicated matter than it sounded as he spoke on it, and if it is any satisfaction to him it has caused me a considerable amount of thought in the last few days.

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This Amendment seeks to incorporate in Clause 115 (which confers power for the repeal, amendment or adaptation by ministerial order of local enactments inconsistent with the provision's of the Bill or anything done or any order made under the Bill) a provision which would secure that no order was made to vary any provisions for the discharge of compensation water without the consent of all persons for whose benefit any such provisions had been made in the local enactment in question. Before I address myself to the intention of my noble friend's Amendment, I must digress for a moment in order to persuade him that his intention is not apposite to this particular clause. Although Clause 115 provides an order-making power which will be available for the purpose of varying provisions contained in any local enactment relating to compensation water, it is not the primary means by which variations in compensation water will be effected. If my noble friend will forgive me, I will first direct my attention to those primary means and then go on to consider the point he has raised. To do this I shall need to recall one or two paints from clauses already passed.
First, your Lordships will recall that for the future (that is, after the end of the "initial period" when the licensing system begins), impounding will, except as provided in Clause 36 (3) need the river authority's licence. This licence will include such requirements as to the provision of compensation water as the authority—or, on appeal, the Minister—considers appropriate, and any such licence will be subject to revocation or variation under the provisions of Clauses 41 to 43. Then your Lordships will recall that Clause 36 (3) gives to those local enactments authorising the impounding of water which remain in force after the end of the initial period the title "alternative statutory provisions". The authorisation to impound water under any such alternative statutory provision is, by virtue of Clause 46 (1) to be treated as a licence for the purposes of Clauses 41 to 43. This means that any such authorisation (called in Clause 46 "the relevant authorisation") will be subject to variation or revocation just as a licence to impound first granted under the Bill would be. By this means it will fall
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to a river authority to provide if necessary for the discharge of compensation water in amounts and at times which differ from those required by the "relevant authorisation".
These, in practice, are the powers which river authorities will use. But it must be acknowledged that their use may still leave the need for amendment of the local enactments which conferred the relevant authorisation—if only for the purpose of adapting such enactment so as to bring them into accord with the action taken by the river authority. This is, under the clause to which my noble friend has addressed himself, a tidying-up and consolidating process. Provisions contained in local enactments with respect to the discharge of compensation water are unfortunately often quite complex, and they may be found in interlinked or interacting provisions contained in a whole series of Local Acts and statutory orders. There must be some means of keeping such local enactments intelligible and up to date, taking account of anything done in the performance of functions under the Bill. Clause 115 is included in the Bill for that purpose. It is a necessary provision: but as I have already explained it is not (if I am right in my view of the real purpose of the Amendment) the main provision to which my noble friend's attention should be directed. I felt it was necessary to make this clear before answering my noble friend's main purpose in proposing this Amendment.
The effect of the Amendment would be to prevent, in the context of Clause 115, variation of compensation water provisions except with the consent of all those for whose benefit the provisions had been made. The wording of this Amendment runs closely with proviso (a) to Section 33 (1), of the Water Act, 1945, which confers on the Minister of Housing and Local Government powers to vary local enactments relating to statutory water undertakings. This is appropriate where the protection of lower riparian interests against the effect of an impounding of water must rest on the discharge of compensation water and where nothing else is at stake. But this is no longer so. We are coming to a time when, as the noble Lord, Lord Molson, has stressed earlier in the deliberations of the Committee, economy of water for the general good must be

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earnestly pursued. Moreover, we are coming to a time when some reservoirs are likely to be built not to remove water permanently from a river, but rather to allow it to flow down them in a controlled manner. If we are going to effect such comprehensive and planned regulation of our rivers, then clearly the unco-ordinated ad hoc practices of the past must be overtaken and revised where the wider pattern of control demands it.
Quite often the compensation water provisions are such that a statutory water undertaking is required to discharge compensation water in a uniform quantity day in and day out, without regard to conditions in the river to which the water is discharged. There are many examples of compensation water being discharged under a statutory obligation even though the river is in spate. I venture to suggest that the interests of the lower riparian owners might be better served by a diminution of flow at such times rather than by its augmentation with compensation water. Such arrangements—and they are not uncommon—are wasteful of water and benefit nobody, least of all the lower riparian owners.
After river authorities have set about their work, in due time they will begin to regulate the flow of rivers, by building regulating reservoirs and other works. During this period the condition of the water in rivers should improve as a result of the operation of the Rivers (Prevention of Pollution) Acts. Accordingly, the need to maintain compensation water provisions exactly as they were enacted will be much reduced. One might remember that many of these provisions emerged from a bargaining process as long ago as the last century when our knowledge of river behaviour was much less than it is to-day. We are going to become much more knowledgeable about rivers; and our ability accurately to predict river flow and behaviour is going to improve. As it does so we shall see more clearly where economy of water can be secured without harm to anyone. Then it will be highly desirable—indeed necessary—that these compensation water provisions should be capable of variation.
It must he recognised that if we are to conserve and manage water successfully,
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and if we are to meet the growing demands for water with due economy, we must have the requisite powers. These must include power to vary the present compensation water arrangements which, as I have sought to show, are sometimes wasteful and often could be altered without doing any harm at all to the interests affected. It must be made possible to make such changes where this appears to the Minister to be necessary or desirable. The Amendment of my noble friend would effectively prevent this since it would enable one intransigent individual effectively to prevent the optimum use of water resources, possibly to substantial public detriment, even though it might well be shown that the individual's interest, far from being prejudiced, would be fully safeguarded and perhaps supplemented.
On this ground I must invite the noble Viscount to withdraw his Amendment both on this general ground and on the point which I mentioned at the beginning. If this Bill is to achieve success and enable us to have the intelligent and economical management of water resources which users of all sorts desire, then the provisions of the Bill in this particular should be allowed to stand as they now are.
VISCOUNT COLVILLE OF CULROSS: I am very grateful for the fruits of my noble friend's thought. It occurs to me, however, to ask him in what way the Bill as it is now drafted protects the interests of the people whom I am envisaging in my Amendment as requiring protection. I hope the noble Lord will forgive me if I have failed to understand this, as I must confess I had not realised there was quite so much of relevance to this point in Clauses 41 and 46, and so on. If I am right in my rapid reading of the previous clauses of the Bill, it seems to me that this is the situation. The statutory water undertaker who is now authorised by a Local Act to impound water does not himself fall subject to the restrictions in Clause 36 (1), but he may be subject to a variation or revocation of a deemed licence by virtue of Clause 46.
If he is subject to a revocation or a variation he is put in the same position as any other licence holder whose licence is being revoked or varied, and he will

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have a right of appeal under Clause 44 to the Minister; at any rate he will be put in the same position as a licence holder whose licence is being revoked. I do not understand that the person who is protected under a Local Act in respect of his compensation water will have a like right of appeal to the Minister, so that his protection under the Local Act will be before the tribunal which decides whether or not it is a good revocation or variation. I can see no protection whatever in the Bill which will give this third party the right of appeal to the Minister.
Then to go on to Clause 115, the noble Lord very rightly said that some of the compensation provisions of these Local Acts are out of date. That is what I said in my speech in moving the Amendment. I did not for a moment deny that some of them may have to be amended or revoked. All I am asking is that something should be written into the Bill so that the person specifically given protection under a Local Act should have some say in the matter and it is not left to a pact between the Minister and the river authority to deal with his interests in his absence. Surely there must be some protection for a person to whom Parliament has already given protection in respect of compensation water. I am not trying to put a veto on the Minister's powers to bring the procedure up to date, but I do think the person in that position should be given some rights.
EARL WALDEGRAVE: It is all very well for the noble Viscount to say he is not putting a veto on the Minister's powers, but surely the wording of the Amendment is doing that. He is not moving an Amendment to say these people should be consulted or their rights taken into consideration; he puts it roundly that the Minister cannot do these things without their consent, and their consent may be most unreasonably withheld. If my noble friend had used the word "consult" or some such word instead of "consent", I think the Committee might have had more sympathy with him; but the word "consent" I, for one, cannot go along with.
VISCOUNT COLVILLE OF CULROSS: I entirely agree with my noble friend. I
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think probably my Amendment goes too far, and I think consultation or some inquiry or hearing by the person appointed by the Minister would be more appropriate. It may be I have drafted it too severely, but I still think there are merits in the principle I have sought to put.
LORD ST. OSWALD: My noble friend Lord Waldegrave brought out the point which had bothered me. It is clear from this speech and from this later intervention that my noble friend Lord Colville of Culross intended to provide consultation, but what he in fact was providing in his Amendment was something much stronger than consultation and something which we find it very difficult, indeed impossible, to accept. I should like to speak to him about this in the new light of what he has said, but for the moment, perhaps, I can content him if I tell him that riparian are now protected by the minimum acceptable flow provisions to which every new river authority must have regard in making proposals for their licences, which are included in Clause 42 (6). In so far as procedure is concerned, which is I believe the matter that interests my noble friend, I think that he has something; I think he has a point in saying that some form of procedure should be recognised and written into the Bill. To that extent, if he will allow me to say so, I think he has made a very useful contribution which I, for one, will certainly follow up, and I shall be grateful for the opportunity to speak to him about it later.
VISCOUNT COLVILLE OF CULROSS: I am most grateful to my noble friend. I shall be only too glad if same method can be found by which this can be included in the Bill. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 115 agreed to.
Clause 116 [Regulations and orders]:
9.55 p.m.
LORD AMHERST OF HACKNEY LORD AMHERST OF HACKNEY: moved, in subsection (5), after "that is to say—" to insert:
"(a) any order under section 3 of this Act not being an order which falls within paragraph (a) of the next succeeding subsection".
The noble Lord said: Your Lordships know that Clause 116 deals with orders

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and regulations under this Bill, and the object of my Amendment is to bring under Affirmative Resolution the orders which set up river authorities under Clause 3 of the Bill. As your Lordships know, the form of these authorities will vary from authority to authority; the number of members can vary from between 21 to 31, and the number of people representing each of the various interests—industry, fisheries and agriculture—will vary from authority to authority. If the Minister is bringing in an order for an authority which has over 31 members, then it is subject to the Negative Resolution precedure of Parliament. In the ordinary case, as I understand it, Parliament would have no say in these orders. Although I realise that before the orders are brought in there will be a great deal of consultation with all the various interests concerned, I think that the form of the river authorities is most important and may be controversial, and the orders that bring them into effect should be subject to some Resolution of Parliament. I beg to move.
Amendment moved—
Page 95, line 17, at end insert the new paragraph.—(Lord Amherst of Hackney.)
EARL JELLICOE: It is, of course, true that when the river boards were originally set up two orders were required in each case. The first dealt with the area of the river board, and this could be carried to Special Parliamentary Procedure. I have already explained at an earlier stage that the circumstances are quite different now from what they were in 1948. Then the setting up of the areas for the new river boards (as they then were) was a major operation, and a first time operation at that, in a great many parts of this country. Now, relatively small changes are proposed in the areas concerned, and where we are suggesting changes it is quite clear, from a glance at the Amendments down to Schedule 1 of this Bill, that we shall have plenty of Parliamentary discussion.
It was further laid down in 1948 that orders were also required for the actual constitution of the river boards. The order was to be made after the usual stately minuet of consultation, preparation of draft orders, advertisement, objection, public inquiry and so on; but the decision of the Ministers as to the actual constitution was thereafter to be
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finial. Again, I think one should remember, in deciding whether the procedure which my noble friend has suggested is appropriate, that the River Boards Act made much less precise provision for the constitution of the river boards than Part II of the Bill does for the new constitution of the river authorities. As noble Lords will see from a glance at Clauses 6 to 8, the size of the authorities and their detailed composition is in fact provided for in this Bill. Moreover, as my noble friend Lord Amherst of Hackney recognised, as a result of the Amendment to Clause 3 which I moved at an earlier stage in this Committee, Ministers will now be under a specific obligation to consult the persons and the representative bodies concerned before making the order constituting a particular river authority. However, as he said, if the Ministers consider that exceptional circumstances justify an authority larger than 31 members, the resulting order will be subject to the Negative Resolution procedure. I cannot, in those circumstances, recommend your Lordships to accept this Amendment. It really does not, as I see it, seem to be justified by the circumstances with which we are now dealing—the circumstances of 1962.
Moreover, it might well have the effect of delaying still further the "second appointed day", the day when the authorities will begin to function. We might have to find time to debate up to some twenty constitutional orders. If this were really necessary time could, and would, be found. But the Ministers will be giving effect to Parliament's intentions as prescribed in Clauses 6 to 8, which we have already worked over very closely and will be working over again no doubt, as will another place, and very possibly after prolonged debate here and in another place in regard to the areas prescribed in the First Schedule. Only where in the light of exceptional circumstances they wish to depart from the normal formula will they be required under the Bill, as it stands, to submit their decision to Parliamentary scrutiny. In the circumstances of 1962, which I would repeat seem to me to be very different from those of 1948 in this respect, I should have thought that that was about as far as it was reasonable to go. In the circumstances, I hope that my noble friend

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will not feel constrained to press this Amendment.
LORD AMHERST OF HACKNEY: I listened very carefully to what my noble friend had to say. Would it be possible for him to consider whether these orders should come under the Negative Resolution procedure? I think that possibly what I have asked for in my Amendment goes too far. As the noble Earl has said, it would mean that all these various orders would have to be debated before they were passed. Would he consider—because I do feel that these orders are important—whether they could be subject to annulment by Resolution of either House or Parliament—in fact under the Negative Resolution procedure?
EARL JELLICOE: My noble friend is putting a new point to me. I feel that, with all the safeguards which we have written into this Bill in this respect, and in particular the Amendment which I moved to Clause 3, the procedure we have provided is adequate. I confess that I am a little unwilling to concede this point.
LORD CHAMPION: Does not subsection (6) cover this:
"an order under Section 3 shall be subjec to annulment—"
which is the Negative Resolution procedure?
LORD AMHERST OF HACKNEY: Surely that is where the board consists of more than 31 members.
EARL JELLICOE: I think that my noble friend is quite right. It is designed to cover the exceptional circumstances where we feel that more than 31 members are required. I should have thought that only in those exceptional circumstances is this procedure justified. Of course I will undertake to consider what the noble Lord has said, particularly his last suggestion, but I think it would be wrong for me to hold out any real hope that I will meet him on this point.
LORD AMHERST OF HACKNEY: I am grateful to my noble friend. I do not intend to press the Amendment, and I beg leave to withdraw it.
Amendment, by leave, withdrawn.
Clause 116 agreed to.
Clause 117 [Interpretation]:
VISCOUNT COLVILLE OF CULROSS VISCOUNT COLVILLE OF CULROSS
moved, in subsection (1), after the interpretation of "additional members," to insert:
"'agriculture' shall have the same meaning as that set out in subsection (1) of section 119 of the Town and Country Planning Act. 1947, and 'agricultural' shall be construed accordingly".
The noble Viscount said: I think that it is a defect in this Bill that it contains no definition of the words "agriculture" or "agricultural". It is important in this respect, because under Clause 24 a person whose land adjoins inland water is allowed without a licence to abstract water from that inland waterway for the purpose of agriculture, unless he wants it for spray irrigation. So, too, if a farmer has a well he is protected by Clause 58 (4), and he will not be subject to any charging scheme in respect of water that he abstracts from his well for agricultural purposes other than spray irrigation. He will have to pay a licence fee, but he will not be subject to the charging scheme.
There have been various definitions in Acts of Parliament of the word "agriculture". There is one in the Rating and Valuation (Apportionment) Act, 1928, Section 2, and there is another in Section 119 (1) of the Town and Country Planning Act, 1947. I think it might be very difficult, in view of the fact that Parliament has specified a definite meaning for "agriculture" in those other two Acts of Parliament, for the courts to interpret with any degree of certainty the word as it is used in this Bill, without any definition. My noble friend Lord Hastings said last week, when we were talking about Clause 25, that "agriculture", in his view, meant horticulture and various other similar things, such as osier-growing, and various matters that are dealt with in Section 119 (1) of the Town and Country Planning Act. The definition that I have chosen does not include forestry, and it occurs to me to wonder whether perhaps it should. Nevertheless, I feel that, as the Bill stands at the moment, the horticulturist is liable to find himself outside the exemptions in this Bill; and it is the same with the other varieties of agriculture which are normally grouped within that class for an Act of Parliament of this nature. I therefore think that some

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definition of "agriculture" should go in the interpretation section of this Bill. I beg to move.
Amendment moved—
Page 96, line 10, at end insert the said words.—(Viscount Colville of Culross.)
EARL WALDEGRAVE: Before the noble Lord replies to this Amendment, I am a little disturbed to hear from the mover that such a definition would not include forestry, because obviously what we are trying to make quite clear here is that irrigation or watering of crops, whether they be osiers or watercress—which was talked of the other night—and so on, is covered in the definition section of this Bill. It would seem that it may be necessary to consider some other definition of "agriculture" than the one in the Amendment, if that particular definition does not include forestry, which covers growing plants and seeds, nursery gardens and so on.
LORD ST. OSWALD: Without any doubt at all, the point raised by my noble friend needs to be looked at. But I will say merely that this particular Amendment is not quite appropriate, since by the time the Bill is enacted the Town and Country Planning Act, 1962, will be in force; and if there is to be a reference to the definition in a planning Act (and this in itself is something that will have to be looked at) it will need to be a reference to Section 221 of the Act of 1962. Quite clearly we must go into this, and see that a reference to a definition of "agriculture" is written into this Bill. I give an undertaking that when we have found the answer it will appear again in the form of a Government Amendment.
VISCOUNT COLVILLE OF CULROSS: I am very grateful to my noble friend. I chose this because it was a definition I knew well. I think it would probably cover my noble friend Lord Waldegrave's tree nurseries, but it might not cover the trees when they were a bit bigger. But I shall be very glad to see what my noble friend Lord St. Oswald can produce on Report stage, and, subject to what my noble friend Lord Albemarle says, I beg leave to withdraw the Amendment.
THE EARL OF ALBEMARLE: In order to save time, I should like to raise
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the subject—I gave written notice, because I had intended to put down an Amendment, but I may be able to save time by saying this now—of the definition of the word "wholesome". This Bill was discussed by experts at a recent conference of the Institution of Civil Engineers, and it was pointed out that "wholesome" is not defined anywhere in this great Bill but is the subject of the opinion of any individual medical officer of health of a local authority. I do not think that can really he allowed to go on any longer, and I hope my noble friend agrees. The other thing is this: a statutory authority has, by law, to give wholesome water.
EARL WALDEGRAVE: With great respect, may I suggest that this would Come more appropriately on the Question whether the clause stand part? I myself have a point that I should like to raise on the Question whether the clause stand part. I think this can hardly be discussed by the Committee on the question of the definition of "agriculture".
LORD ST. OSWALD: I think my noble friend Lord Waldegrave is right here. Whatever written notification has been given by my noble friend Lord Albemarle it has not, unfortunately, reached me; but if my noble friend is withdrawing his Amendment then perhaps we can get on with these other matters under the Question whether the clause stand part.
Amendment, by leave, withdrawn.
10.12 p.m.
VISCOUNT COLVILLE OF CULROSS VISCOUNT COLVILLE OF CULROSS moved, in subsection (1), in the interpretation of "inland water", after "watercourse" to insert "or canal" The noble Viscount said: This is not quite so naïve an Amendment as it might seem from its wording. The purpose of it is this. Under the Transport Act, which your Lordships passed last Session, the Inland Waterways Commission was given the power to sell water out of its canals to industrialists aft a certain charge which it could impose upon them in order, partly, at any rate, to make a canal pay its way. I have no idea at the moment whether or not the inland Waterways Commission will have to pay to the river authority under the charging scheme for the water which

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it puts into its canal; and, further, I have no idea, as the Bill is at present drafted, whether the Inland Waterways Commission having paid under that charging scheme, the industrialist who has already paid the Inland Waterways Commission to extract water from the canal will have to pay a further charge to the river authority for that water under the charging scheme in this Bill. Therefore I thought it ought to be made quite clear, one way or the other, whether an inland water, in the definition of this Bill, did include or did not include a canal run in these circumstances by the Inland Waterways Commission.
It may be, I am afraid, that the way I have put down this Amendment has not made this point altogether clear to my noble friends on the Front Bench, and, if it has not, I will forgive them if they cannot give me an answer this evening. However, it would, I think, be a relief to those who have entered into an arrangement for a considerable supply of water from the canals to know where they stand in this particular matter. I beg to move.
Amendment moved—
Page 96, line 24, after ("watercourse") insert ("or canal").—(Viscount Colville of Culross.)
LORD ST. OSWALD: Until a moment ago I had hoped I might persuade my noble friend that his Amendment was unnecessary. I have now abandoned that idea. I should like to point out, since it is speaking to the point of the Amendment, though not the central point, that the definition of "inland water"—that is to say, the wider definition within which watercourse is included—embraces
"…so much of any river, stream or other watercourse, whether natural or artificial"
as is within any of the river authority areas. A watercourse is defined in this clause as including rivers, streams, ditches, drains, culverts, dykes, sluices, sewers and passages through which water flows. That is the definition as in the Land Drainage Act, 1930, and the Water Act, 1945. We had thought it was complete. On the other hand, the point raised by my noble friend on the matter of double payment has been in the manner of enfilade fire, and I would, if he will permit me, offer to look into it, and
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let him know what we discover and possibly it will require some alteration or addition to the Bill.
VISCOUNT COLVILLE OF CULROSS: I am grateful to my noble friend. I am sorry that the message I attempted to get through to him as to the purport of this Amendment did not reach him in time. However, I have the greatest confidence in his researches before the next stage. I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD HASTINGS: This is purely a drafting Amendment. I beg to move.
Amendment moved—
Page 98, line 43, at end insert ("a sewerage authority and 'sewerage authority' means any of the following, that is to say").—(Lord Hastings.)
On Question, Amendment agreed to.
LORD HASTINGS LORD HASTINGS moved, after subsection (4), to insert:
Page 99, line 14, at end insert—
"( ) Except in so far as this Act otherwise expressly provides, and subject to the provisions of section 33 of the Interpretation Act 1889 (which relates to offences under two or more laws) the restrictions imposed by sections 23, 36, 68 and 71 of this Act, or by byelaws made by virtue of section 72 of this Act, shall not be construed as—

(a) conferring a right of action in any civil proceedings (other than proceedings for the recovery of a fine) in respect of any contravention of those restrictions, or

(b) affecting any restriction imposed by or under any other enactment, whether contained in a public general Act or in a local or private Act, or

(c) derogating from any right of action or other remedy (whether civil or criminal) in proceedings instituted otherwise than under this Act."

The noble Lord said: This is the last wicket and, as it is a Government Amendment, I am hoping I am not to be bowled out but will be allowed to carry my bat. It is rather an abstruse point on a legal matter and the Amendment is designed to avoid any doubt about rights of action under Statute and at Common Law. The "restrictions" to which the Amendment refers are those against abstraction without licence; impounding without licence; discharge of effluent to underground strata; boring without consent; and include by-laws for protection of water against pollution. Contravention of any of these restrictions

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is a criminal offence for which the penalty is prescribed under the Bill. The Amendment says, first, that the restrictions are not to be construed as giving any right of civil action in respect of a contravention (except that there may be proceedings for recovery of a fine). Second, nothing in these restrictions affects any restrictions imposed in or under another enactment, public or local or private. Third, nothing in these restrictions is to derogate from any right of action or remedy otherwise than under the Bill. Similar provision has been made in other enactments imposing restrictions of a parallel kind, for example, the Radioactive Substances Act, 1960.
If the Amendment were not moved into the Bill it would, for example, be doubtful whether, if a person were to abstract water under the Bill without licence when the Bill required him to have one, other users of the same source of supply would be entitled to a right of action against him under the Bill in reliance purely on the breach of statutory duty. The Amendment makes it clear by paragraph (a) that no such right is to exist. On the other hand, by virtue of paragraph (c), any right of action or other remedy (whether civil or criminal) available otherwise than for breach of the statutory duty—for example, a right of action at Common Law in respect of infringement of riparian rights—is left untouched by the restrictions imposed by Clauses 23, 36, 68 and 71 of the Bill or by the by-laws under Clause 72.
The new subsection is for the purpose of removing any doubts that might otherwise arise about the effect produced by imposing the new statutory restrictions I have mentioned. It is not concerned with the effect produced by other provisions of the Bill. Thus, although the right of a riparian owner to take action in respect of any sensible diminution of the flow of water past his riparian tenement is unaffected by the restrictions imposed by Clause 23, it may be affected by the protection afforded to licence-holders by Clause 31. The effect of paragraph (b) in the Amendment is to make plain that the Bill stands on its own and does not touch in any way upon other restrictions, such as, for example, the need to obtain planning permission to construct works associated
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with a borehole where the Town and Country Planning Acts would so require it. I trust that this has not been too confusing to your Lordships. I beg to move.
Amendment moved—
Page 99, line 14, at end insert the said subsection.—(Lord Hastings.)
On Question, Amendment agreed to.
On Question, Whether Clause 117, as amended, shall stand part of the Bill?
EARL WALDEGRAVE: May I ask the noble Earl to look at one point before he comes back? I apologise to the noble Earl for not putting down an Amendment on this point, but I think that I can do it on the Question that the clause stand part. The definition of spray irrigation is
"…the irrigation of land or plants (including seeds) by means of water or other liquid emerging (in whatever form) from apparatus designed or adapted to eject liquid into the air in the form of jets or spray;".
I wonder whether this definition would not cover pesticides, weed-killers and sprays of that sort, which I do not think are intended to be covered. I do not want to make a speech at this stage, but would ask the noble Earl whether he would look at this definition and be quite clear that the Government are not catching something that they do not intend to catch in this Bill.
EARL JELLICOE: I wonder whether I could cover the point raised by my noble friend Lord Albemarle at the same time. Of course, I will undertake to have a look at the point on spray irrigation about which my noble friend Lord Waldegrave has just asked me. Clearly, we do not want to spray anything we do not intend to spray. I am in slight difficulty on the point regarding "wholesome", of which my noble friend gave me notice. The difficulty here is that, so far as I know—I speak subject to correction "wholesome" does not appear in the Bill, and I think that it would be ultra vires for the draftsman to try to define the meaning of a word which does not appear. I think that what my noble friend is after is that we should seek a definition of a word which appears in the Water Act, 1945. I am

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inclined to think that it would not be within the scope of the Long Title of this Bill, because it does not include an Amendment to the 1945 Act. All this is extremely recondite (I hardly understand it myself), and I should like to look at my noble friend's point. But, as I am advised at present, that is the difficulty.
Clause 117, as amended, agreed to.
Remaining clauses agreed to.
EARL JELLICOE: I think that we have reached the stage of the Bill which we agreed to aim at for this evening, and therefore I beg to move that the House do now resume.
Moved, That the House do now resume.—(Earl Jellicoe.)
On Question, Motion agreed to, and House resumed accordingly.
House adjourned at twenty-five minutes past ten o'clock.