Sitting of 28 May 1963

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
MARINE SOCIETY BILL [Lords]
Read the Third time and passed, without Amendment.

MEDWAY CONSERVANCY BILL
[Queen's Consent, on behalf of the Crown, signified]
Bill read the Third time and passed.

SALVATION ARMY BILL
As amended, considered; to be read the Third time.
PIER AND HARBOUR PROVISIONAL ORDER (BEMBRIDGE HARBOUR) BILL
  PIER AND HARBOUR PROVISIONAL ORDER (GLOUCESTER HARBOUR) BILL
    PIER AND HARBOUR PROVISIONAL ORDER (YARMOUTH (ISLE OF WIGHT)) BILL
    Read a Second time and committed.
ORAL ANSWERS TO QUESTIONS
  SCIENCE

    U.S.-Financed Research
    Mr. Dalyellasked the Parliamentary Secretary for Science what is the monetary value of the scientific research, carried out in the United Kingdom, financed directly or indirectly by funds from the United States Public Health Department vote.
    The Parliamentary Secretary for Science (Mr. Denzil Freeth): A figure of 1,521,140 dollars equivalent to £543,000, has been published by the United States Public Health Service as the expenditure
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    by its National Institutes of Health on research projects in the United Kingdom in their fiscal year 1962.
    Mr. Dalyell: In the light of these considerable figures does not the Minister think that the remarks of his noble Friend in another place about American scientists were somewhat ungracious? Is the Parliamentary Secretary aware that the Americans are getting rather tired of financing European research and might well, for understandable reasons, divert their funds elsewhere?
    Mr. Freeth: The answer to the first part of the supplementary question is "No, Sir". In answer to the second part, it shows the recognition of the value of research done in this country and the esteem in which our research workers are held by the Americans that they wish to finance work here.

    Research, Scotland
    Mr. Benceasked the Parliamentary Secretary for Science (1) what percentage of the Government expenditure of £100 millions on support for private industrial research has been paid to industrial undertakings located in Scotland;
    (2) what percentage of the total Government expenditure on scientific and technical research in 1961–2 was spent in Scotland.
    Mr. Denzil Freeth: The Advisory Council on Scientific Policy estimated total Government expenditure in 1961–62 on research and development in the United Kingdom at £385 million, including £177 million on research and development carried out in private industry. The proportions of this spent in Scotland are not known.
    Mr. Bence: There are tables of statistics in the Advisory Council's Report which show the proportion of expenditure on development in Scotland. Why cannot we have these figures separated here?
    Mr. Freeth: Although I agree that it would be statistically feasible, I am advised that it would not be statistically significant because of the difficulties of disentangling the research undertaken by Scottish subsidiaries of English firms and

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    vice versa and, in particular, because of research sub-contracted across the Border.
    Mr. Bence: I referred clearly in the Question to "industrial establishments located in Scotland". Surely we can have the figures for research and development financed at plants, by whoever they are owned, located in Scotland?
    Mr. Freeth: As I have said, I do not believe that these would be statistically significant figures.

    Building Research Station
    Mr. Boydenasked the Parliamentary Secretary for Science, in view of the need for increased productivity in the building industry, what additional contributions his Department is making to the work of the Building Research Station.
    Mr. Denzil Freeth: In 1964–65 the non-industrial staff of this station will be increased by approximately 6 per cent. in order to increase those activities which contribute most directly to greater productivity.
    Mr. Boyden: In view of the major importance of the industry and the relatively low contribution from the industry itself to research, does the Parliamentary Secretary think this is adequate? Can he give an assurance that all the resources that are necessary will be devoted to cold weather research and that this particular difficulty will not hold up the building industry?
    Mr. Freeth: With regard to the first part of the supplementary question, money and manpower resources available for Government civil research are not unlimited and have to be divided amongst the various research stations, all of which are doing work of national importance. The hon. Gentleman will have seen the proposal made by my right hon. Friend the Minister of Public Building and Works for the establishment of a building research and information association.
    With regard to the second part of the supplementary question, if the hon. Gentleman cares to table a detailed Question to me I will willingly give him or send to him details of the research into insulation which has taken place at the Building Research Station.
    Mr. Wainwright: Will the Parliamentary Secretary give greater consideration to research into the traditional type of building, especially for private houses and houses built by local authorities, so that the rate of building these houses can be speeded up?
    Mr. Freeth: A considerable amount of research is going on at the Building Research Station. If any hon. Members would like to go there and see what is being done, I will gladly do my best to arrange visits.

    Meat Research
    6. Mr. Wolrige-Gordonasked the Parliamentary Secretary for Science whether the Director of the Meat Research Institute has now completed the drafting of his research programme.
    Mr. Buckasked the Parliamentary Secretary for Science what progress has been made in connection with the Meat Research Institute.
    Mr. Denzil Freeth: Plans for the building and for the organisation and staffing of the Institute are now under detailed study by the Agricultural Research Council. The Director's proposals for the research programme will be progressively developed in the light of the progress of research at the Low Temperature Research Station and other factors.
    Mr. Wolrige-Gordon: I thank my hon. Friend for that reply. Have any decisions yet been taken about sub-stations for this research institute?
    Mr. Freeth: No, Sir.

    Post-graduate Students (Facilities)
    Mr. Dalyellasked the Parliamentary Secretary for Science how many full-time university and college of advanced technology post-graduate students make use of the facilities at the Mechanical Engineering Research Laboratory, East Kilbride, the Radar Research Establishment at Malvern and the Royal Aircraft Establishment at Farnborough
    Mr. Denzil Freeth: Although the facilities available at the National Engineering Laboratory have been made widely known, they have not yet been used by post-graduate students. I am glad to

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    say that arrangements for closer co-operation between the Laboratory and the Royal College of Science and Technology at Glasgow are at present under discussion.
    The position at the other two stations is a matter for my right hon. Friend the Minister of Aviation.
    Mr. Dalyell: What plans do the various Government Departments concerned—the hon. Gentleman's Office and the Ministry of Aviation—have for bringing together students to make fuller use of this highly sophisticated and expensive equipment?
    Mr. Freeth: Certain universities permit post-graduates to spend part of their Ph.D courses away from the university at institutes where the particular nature of their work makes this desirable. I would hope that we might have an expansion of this type of activity, and doubtless this is one of the matters that the Robbins Committee will be considering.

    Aldermaston Atomic Weapons Research Establishment
    Mr. Crossmanasked the Parliamentary Secretary for Science whether, in view of the uncertainty among the staff, he will now make a further statement about the employment situation at the Aldermaston Atomic Weapons Research Establishment after March, 1964, and about his arrangements for dealing with the redundancy in the event of a reduction of work.
    Mr. Denzil Freeth: I regret I can at present add nothing to my statement of 19th March.
    Mr. Crossman: Surely the hon. Gentleman is aware of the undesirability of such large staffs being in a state of continual uncertainty, because it demoralises them? Cannot he at least give us the assurance that the team will be held together and not be disbanded?
    Mr. Freeth: I have said that it is very unlikely that there will be any redundancy of scientists. With regard to the other staff at Aldermaston, it has been said that the question of redundancy cannot be ruled out after March, 1964. The staff have been told that by the autumn of this year it should be possible to give a more precise indication of staffing
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    arrangements thereafter. I am afraid that at present I cannot add anything to my earlier statement.
    Mr. Crossman: Is not the hon. Gentleman at least able to give us the assurance that we are not concerned only about redundancy but about the breaking up of staff? Is not that something where his advance planning could at least ensure that where a large staff is built up it will be retained as a unit?
    Mr. Freeth: When the plans are fully made for the position after March, 1964, a statement will be made.

    Low Temperature Research Station, Cambridge
    Mr. Skeffingtonasked the Parliamentary Secretary for Science what changes are proposed for the Low Temperature Research Station at Cambridge.
    Mr. Denzil Freeth: As already announced, the Agricultural Research Council proposes to continue the work of this station at two new institutions, the Meat Research Institute near Bristol, and the Food Research Institute at Norwich, when the premises in Cambridge have to be vacated.
    Mr. Skeffington: Would the Parliamentary Secretary be able to say what is to happen to the staff now working at the Ditton Laboratory? Can he confirm or deny the suggestion that those working at the John Innes Horticultural Institute are also to go to Cambridge? If that is the case, what will happen to the new building which has recently been erected at Hertford?
    Mr. Freeth: With regard to the Ditton Laboratory, some of the work will be transferred to Norwich in due course and the staff concerned have been told. With regard to the John Innes Institute, this is a separate institute and it is unlikely to be moved to Cambridge.

    National Economic Development Council (Report)
    Mr. Skeffingtonasked the Parliamentary Secretary for Science what action it is proposed to take in respect of paragraphs 6 to 14 of the report of the National Economic Development Council, "Conditions favourable to Faster Growth."
    Mr. Denzil Freeth: The growing effort of the Department of Scientific and Industrial Research in the field of industrial research, and the Government's expansion programme in the fields of technical and higher education are all directed to the objectives referred to by the Council. The matters discussed in paragraphs 11–13 are to be further considered by the Council itself.
    Mr. Skeffington: In view of the highly significant section of the Report to which reference is made in the Question, does not the Parliamentary Secretary think that he ought to be a little more specific, or are we to take the paragraphs in the Report as so much window-dressing?
    Mr. Freeth: No. These are very important paragraphs which we are certainly considering. They really demand an intensification of effort rather than the establishment of some new path. These matters are now being discussed. I am informed that the Council itself will discuss this section of the Report again.
    Mr. Lubbock: Will the Parliamentary Secretary say something about the specific recommendation to extend the use of civil development contracts to industry?
    Mr. Freeth: We are in favour of this and I hope that, following the hon. Member's Question, we will receive even more applications from industry for D.S.I.R. support in this field.
    Dr. Bray: Will the Parliamentary Secretary read this part of the Report again, because it says specifically that Government and industry should work together, with the implication that they are not yet doing so in partnership in new fields of research? The Minister must be aware that the present effort to solve this immensely important problem is totally inadequate.
    Mr. Freeth: I fully agree that Government and industry should be in partnership in the research fields. We are already in very close touch with industry through the research associations and also through the industrialists who give up their time to help on D.S.I.R. committees and on the Council.
    Dr. Bray: On a point of order. In view of the extremely unsatisfactory nature of the Parliamentary Secretary's
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    reply, I give notice that I shall seek to raise this matter on the Adjournment.

    Research Projects (Qualified Staff)
    Mr. Boydenasked the Parliamentary Secretary for Science in what scientific fields desirable research projects are being currently impeded by shortages of qualified staff.
    Mr. Denzil Freeth: It is not possible to distinguish clearly difficulties arising out of shortage from those, which often occur, of finding high-class research workers with the right interests and aptitudes for particular projects. Among the fields in which the research councils report delay from these causes are engineering, genetics, soil physics and animal diseases.
    Mr. Boyden: What is the hon. Gentleman's Office doing about the particular delayed projects?
    Mr. Freeth: The essential thing is the production of more scientists. As the hon. Gentleman knows, the Government are having very great success in this field.
    Mr. Boyden: Especially in America, I take it.

    Geological Research
    Mr. Swinglerasked the Parliamentary Secretary for Science how many persons are at present occupied in official geological research; what steps he is taking to extend this research; and if he will consult the Minister of Transport about ways and means of achieving the most effective employment of geologists on the planning of roads.
    Mr. Denzil Freeth: Five hundred and eighteen persons are employed on geological research by the research councils, an increase of 23 per cent. in the last five years.
    The advice of geologists in the Geological Survey and in the Road Research Laboratory is available to my right hon. Friend and his agents.
    Mr. Swingler: Is the Parliamentary Secretary aware that there is obviously considerable room for improvement, both in research and in its application? If he has any doubts about this, would he enter into consultation with his right hon. Friend the Minister of Transport about

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    the amount of wastage and inefficiency that have occurred in the construction of the M.6 motorway, as a result obviously of a failure to employ sufficiently qualified geologists to do the initial work?
    Mr. Freeth: I think we must remember that not only is geology important but that pedology is equally important, and a great deal of research is going on in both these fields.

    National Chemical Laboratory (Site)
    Sir H. Legge-Bourkeasked the Parliamentary Secretary for Science whether a new site for the National Chemical Laboratory has yet been chosen; and what criteria have been used in making the choice.
    Mr. Denzil Freeth: I refer my hon. Friend to my reply to my hon. Friend the Member for Darlington (Mr. BourneArton) and the hon. Member for West Lothian (Mr. Dalyell) on 19th March, 1963.
    Sir H. Legge-Bourke: Will this decision be influenced by the proximity that the eventual site will have to the National Physical Laboratory? I know that many members of the National Chemical Laboratory staff would like to feel that they could be at fairly close hand.
    Mr. Freeth: I agree with my hon. Friend that it would be an ideal solution to have a new National Chemical Laboratory building within easy reach of the National Physical Laboratory building at Teddington. This appears to be unlikely to be achieved because of the difficulty of finding a suitable site in the near vicinity. However, we certainly place very great importance upon there being close contact between the working of the National Chemical Laboratory and the National Physical Laboratory, wherever either may be situated.
    Mr. Ross: Is the Minister aware that this is just the kind of laboratory that should be sited in Scotland where we want to promote the very industries that we expect will develop from the work of this laboratory?
    Mr. Freeth: I note the hon. Gentleman's intervention.
    Dr. Bray: Will the Parliamentary Secretary note the desirability of locating this laboratory near an existing centre of the chemical industry, in view of the great importance of securing a rapid transfer of views from the scientists to the industrialists?
    Mr. Freeth: I note the hon. Gentleman's suggestion as well, but of course it will not be possible to put it in both the North-East and Scotland.
    Sir H. Legge-Bourke: Is my hon. Friend now prepared to answer a little more clearly the second part of my Question, regarding the criteria which are being borne in mind?
    Mr. Freeth: The technical requirements must have an overriding influence. My noble Friend has for some years asked research councils to take the claims of areas of high unemployment into consideration, but I think that the technical requirements must have an overriding part in the decision.

    Building Projects (Manpower)
    Sir H. Legge-Bourkeasked the Parliamentary Secretary for Science what changes will result from the completion of various defence building projects relating to scientific research and development, with particular reference to the manpower involved and conditions of employment.
    Mr. Denzil Freeth: The reduction in the capital building programme of the Atomic Energy Authority, which is largely due to completion of civil projects, has been accelerated to some extent by further decline in building work for defence purposes. Most of the consequential reduction in staff in the Authority's engineering group is being dealt with by not replacing wastage and by redeployment, but there may be some redundancy. My noble Friend is responsible for no other defence projects.
    Sir H. Legge-Bourke: Will my hon. Friend give an assurance that as much warning as possible will be given to the men concerned? Is it a fact that they are already being warned of their discharge, before an actual decision or date has been arrived at?
    Mr. Freeth: Regarding the first part of my hon. Friend's supplementary question, we are doing our best to give as much warning as possible. Where it appears likely that there will be redundancy within any given category, we try to warn the men who may be concerned so that, if they wish to, they can start looking for another job and have the maximum amount of time in which to do so.

    Scottish Research Laboratories Mutual Assistance Scheme
    Mr. Willisasked the Parliamentary Secretary for Science to what extent a survey has been made of the results of the work of the Scottish Research Laboratories Mutual Assistance Scheme.
    Mr. Denzil Freeth: In the last year, the Scottish Research Laboratories Mutual Assistance Scheme has dealt with 230 inquiries: of these 85 came from industrial laboratories, 65 from universities and technical colleges, 63 from Government laboratories and there were 17 others. Over half these inquiries were given precise answers.
    Mr. Willis: Is the Parliamentary Secretary aware that a year ago we were told that the Government would try to make a survey of the final results of the work of this scheme? Could he say something about that?
    Mr. Freeth: We do not regard it as a scheme which has a once-for-all existence, but as something which will continue and be of immense value to industry. It is very important to remember that whatever the figure of the number of inquiries that go through D.S.I.R.'s headquarters in Edinburgh, many more inquiries are dealt with by people using the handbook and dealing direct with people who may have the facility they require.
    Mr. Willis: The hon. Gentleman is missing my point. We were promised a year ago that a proper survey would be made in order to find out the effectiveness of this work. What, if anything, has been done about that?
    Mr. Freeth: Perhaps the hon. Member would care to put down a detailed Question on that point. I do not myself recall making a promise of a published survey.

    D.S.I.R. Staff (Scotland)
    Mr. McInnesasked the Parliamentary Secretary for Science the number of scientific staff employed by the Department of Scientific and Industrial Research at the latest convenient date; and what proportion of these was employed in Scotland.
    Mr. Denzil Freeth: The number of scientific staff employed by the Department of Scientific and Industrial Research on 1st May, 1963, was 3,536, 13 per cent. of whom were employed in Scotland.
    Mr. McInnes: Is the Parliamentary Secretary aware that Scotland produces almost 20 per cent. of the total number of scientists and technologists in this country, yet only 13 per cent. of them find posts available in Scotland? Is he aware that his reply indicates that some action will have to be taken if employment is to be found for these people in Scotland?
    Mr. Freeth: Our present plans for the D.S.I.R. include some expansion in the total staff. Scotland will share in this expansion.
    Mr. W. Hamilton: Can the hon. Gentleman say what proportion of this staff is in London and if there is any necessity for them to be in London? Is this not an example of the way in which the Government could set a lead and disperse them?
    Mr. Freeth: The only people who are in London are at the D.S.I.R. headquarters, and they have to be there. If the hon. Member wishes to put down a Question about the Laboratory of the Government Chemist or the Tropical Products Institute, I will be glad to answer it.

    Agricultural Research Council Staff (Scotland)
    Mr. Gourlayasked the Parliamentary Secretary for Science the number of scientific staff employed under the oversight of the Agricultural Research Council at the latest convenient date; and what proportion of these was employed in Scotland.
    Mr. Denzil Freeth: On 1st October, 1962 the total, including experimental and scientific assistant classes, was 2,770,

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    of whom about a quarter were employed in Scotland.
    Mr. Gourlay: While we appreciate that there is a large percentage of research workers in this field in Scotland, may I ask whether the Parliamentary Secretary would agree that the excellent work which these gentlemen do could be extended into other forms of research? Will he undertake to expand the service?
    Mr. Freeth: I cannot guarantee to have a major expansion at any particular station in answer to a general Question of this nature, but if the hon. Member feels that there is a station under the scientific oversight of the Agricultural Research Council in Scotland which needs to be increased I will gladly answer a Question.

    Nature Conservancy Staff (Scotland)
    Mr. Hannanasked the Parliamentary Secretary for Science the number of scientific staff employed by Nature Conservancy at the latest convenient date; and what proportion of these was employed in Scotland.
    Mr. Denzil Freeth: The total number of scientific staff employed by the Nature Conservancy on 1st April, 1963, was 135, of whom about one-fifth were employed in Scotland.
    Mr. Hannan: Is the hon. Gentleman aware that there is not a single residential nature and field study centre in Scotland, although there are seven such centres south of the Border? Is he further aware that there is not one local nature reserve trust in Scotland, although every county in England has one? Will he consult his right hon. Friend the Secretary of State for Scotland on this matter to see if some improvement can be made?
    Mr. Freeth: We are dealing with the Nature Conservancy and I think that the hon. Member is confusing that with a number of voluntary bodies. The Nature Conservancy has 14 staff employed at the headquarters in Edinburgh, six at the Speyside Research Station, two employed on research on grey seals, and four on grouse and moorland ecology.
    Sir C. Osborne: Is not one-fifth in Scotland more than Scotland's fair share? [HON. MEMBERS: "Oh."]

    D.S.I.R. Development Contracts (Scotland)
    20. Mr. Bennettasked the Parliamentary Secretary for Science the value of Department for Scientific and Industrial Research development contracts placed at present with private industry; and what proportion of these contracts has been placed in Scotland.
    Mr. Denzil Freeth: Three development contracts have so far been placed by the Department of Scientific and Industrial Research having a total value of £593,000; one of these, for £57,000, has been placed in Scotland.
    Mr. Bennett: Is the Parliamentary Secretary satisfied with the proportion of contracts being placed with private industry in Scotland? If not, is he prepared to take such action as may lead to an increase in the number of contracts being placed?
    Mr. Freeth: My noble Friend and I are not satisfied with the rate at which applications have been coming in. I hope that more will come in and that everything that can be done to publicise development contracts will be done, to the benefit of the nation, including Scotland. My noble Friend has recently been having discussions with industrialists over this very question.

    Grant-Aided Research Organisations (Scotland)
    Mr. Milanasked the Parliamentary Secretary for Science the number of grant-aided research organisations now enjoying full membership of the Government scheme; and how many of these organisations are Scottish based.
    Mr. Denzil Freeth: Fifty-two. One of the research associations is centred in Scotland and three others have branch laboratories or use structure testing rig there. The liaison services provided by all the associations enable them to assist their members in Scotland.
    Mr. Millan: Is the hon. Gentleman aware that there is a great deal of evidence to show that industry in Scotland does not use research facilities to the extent it should? Would the Parliamentary Secretary say what special steps his Department takes to bring to

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    the attention of industrialists in Scotland and other areas of high unemployment the necessity of using the facilities afforded by research associations and Government laboratories?
    Mr. Freeth: Both the D.S.I.R. and the Office of my noble Friend publicise the work of the research associations; and there is later on the Order Paper a Question about the special liaison grants, which has this particular aspect of their work in mind.
    Sir H. Legge-Bourke: Would not my hon Friend agree that this attempt to wave the flag of the Cross of St. Andrew so strongly in science may lead, if it were to be implemented, to action which is highly unscientific? Would he do his best to instil into the minds of hon. Members who represent Scottish constituencies the fact that it is possible that information gained and research work done in England can be made available in Scotland, too?
    Mr. Freeth: I have never myself regarded the Border as an impenetrable barrier to the dissemination of information.

    D.S.I.R. and Grant-Aided Research Organisations (Conferences)
    Mr. Lawsonasked the Parliamentary Secretary for Science what major conferences between representatives of the Department for Scientific and Industrial Research and grant-aided research organisations have been held since the conference of April, 1961; and what representation from Scotland there has been at those conferences.
    Mr. Denzil Freeth: There have been no major conferences between representatives of the Department of Scientific and Industrial Research and the grant-aided research associations since the conference in April, 1961.
    Mr. Lawson: Is not that a great pity? These conferences were high-lighted in the last Report of the Department and, from the information then given, seemed to be exceedingly valuable. Will the hon. Gentleman see to it that other conferences are held speedily—and that Scotland is adequately represented at them?
    Mr. Freeth: As to the last part of the hon. Gentleman's supplementary question, attendance at such conferences has in the past normally been restricted to chairmen and directors of research associations. That would cover the point about the particular persons who might attend. With regard to the first part, I do not think that one wants to have these conferences too often; there is a great deal of follow-up work to be done. I would remind the hon. Gentleman that an unofficial committee of directors of research associations meets about three times a year, whose morn-hers, if they feel it desirable, invite members of the headquarters staff of the D.S.I.R. to attend.
    Mr. Lawson: Would the Parliamentary Secretary bear in mind that it is two years since such a conference was held? As these conferences were considered in the Report to be of such value, something might have been done in the meantime.
    Mr. Freeth: A great deal has.

    D.S.I.R. (Assistance to Industry Scheme)
    Mr. J. Robertsonasked the Parliamentary Secretary for Science how much was spent during 1961–62 in grants under the Department for Scientific and Industrial Research special assistance to industry scheme; and what part of those grants went to industries in Scotland.
    Mr. Denzil Freeth: £59,675. All the grants were made to research associations, membership of which is open to Scottish firms.
    Mr. Robertson: Is the Parliamentary Secretary aware that many hon. Members believe that the Department is doing a very good job of work in administering the scheme? Would he agree that this is a good example of some of the advantages of public enterprise, and would he encourage the Department to extend its activities in this regard, with particular reference to Scotland?
    Mr. Freeth: I am grateful to the hon. Member—and I know that the D.S.I.R. will be—for the kind words in the first part of his supplementary question. As for the second part, I think that Scottish members of research associations have

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    benefited generally from the increased liaison activities that have been made possible.

    National Lending Library for Science and Technology
    Mr. Rossasked the Parliamentary Secretary for Science the average number of books and scientific papers on loan per month from the National Lending Library for Science and Technology; and what proportion of current lending is to borrowers in Scotland.
    Mr. Denzil Freeth: The average number of publications lent by the National Lending Library for Science and Technology is now 11,900 per month; of these, about 4·5 per cent. are lent to borrowers in Scotland.
    Mr. Ross: Is the Parliamentary Secretary aware that this is an invaluable service, making available in the original language, or translation, knowledge of scientific development all over the world? Is he satisfied that its use is developing as much as he would like, and can he really be satisfied that our universities, our students, and those in industry and elsewhere are making the best possible use of this service?
    Mr. Freeth: Like the hon. Gentleman, I could not be more keen on trying to get this Library more widely used, and I hope that this will occur as people learn more about the facilities it can offer.
    Mr. Ross: Is it not up to the Minister, having made the Library available, to publicise as much as possible in the right quarters the fact that it exists, and the range and nature of the publications made available by it?
    Mr. Freeth: I think that my noble Friend does that, and has done since the day he opened it.

    Industrial Machine Design
    Mr. Dempseyasked the Parliamentary Secretary for Science what the Department of Scientific and Industrial Research is doing to develop more extensive research into the field of industrial machine design, with a view to countering foreign competition.
    Mr. Denzil Freeth: The Department has increased its research work at the
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    National Engineering Laboratory, its support of research associations and grants to university graduates and research workers, as well as instituting development contracts. Last July, it set up the Feilden Committee on engineering design.
    Mr. Dempsey: Is the Minister aware that the Department is not doing sufficient to stop the flooding of our workshops by German machines, some of which I inspected in Coatbridge only a few weeks ago? Does he realise that we have the material and the ingenuity, but not the design? Is it not time that we faced this situation realistically by competing in industrial design with foreign competitors?
    Mr. Freeth: I agree that our industrial design position is not all it might be. It is for that reason that the D.S.I.R., at the instigation of my noble Friend, set up the Feilden Committee, whose Report we hope to have soon. I would remind the hon. Gentleman of the grant of £140,000 made recently by the D.S.I.R. to the Institute for Advanced Studies in Engineering Sciences at Birmingham University for research into an interdisciplinary approach to the machine design problem. We are doing quite a lot.
    Sir C. Osborne: Why is Scotland such a backward country?
    Miss Herbison: Is the Minister aware that this Question applies to the whole of Britain? Is the hon. Gentleman really satisfied that sufficient research is being made into industrial design? Is he also satisfied that the machine tool industry in Britain—which includes England—is doing enough research into machine tools? Has he not had complaints time and time again from hon. Members who visit our factories, and find that the plant is made in Western Germany, made in Japan, made in Italy—the factories of a nation that once led the world in machine tool making?
    Mr. Freeth: I fully agree that Britain includes both Scotland and England—
    Mr. Bence: And Wales.
    Mr. Freeth: —and Wales. While one has to recognise that one cannot expect every single variety of machine tool to be made in this country, I agree with the

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    hon. Lady that research in the machine tool industry has not in the past been all that could be desired. The hon. Lady will remember that the Machine Tool Research Association was recently set up because of representations by the D.S.I.R. to the industry, and enjoys specially favourable grant terms.
    Mr. Woodnutt: Would not my hon. Friend agree that the British machine tool industry is increasing its exports every year; and that if hon. Members go round foreign factories they will find many with British machine tools and plant?
    Mr. Freeth: I fully agree with my hon. Friend. We have a very fine industry, but the fact remains that an enormous amount of research has to be undertaken, if we are to continue to be ahead and build on the excellent record that the industry has hitherto had.

    Fast Breeder Reactor Power Station
    Mr. J. H. Osbornasked the Parliamentary Secretary for Science what progress has been made with the fast breeder reactor power station.
    Mr. Denzil Freeth: The power of the experimental fast reactor at Dounreay was raised from 30 MW to 35 MW (thermal) during the last operating period. The Atomic Energy Authority informs me that it hopes shortly to raise the power still further.
    Mr. Osborn: Can my hon. Friend indicate when we can expect a commercial power station on this basis?
    Mr. Freeth: I think that it will be necessary to build a prototype power-producing reactor that is large enough to demonstrate that the engineering and scientific problems have been successfully overcome. The Authority is investigating the feasibility of this, and will doubtless ask Her Majesty's Government to authorise the building of such a station when it has its plan ready.
    Mr. Ross: Will the Parliamentary Secretary explain to his hon. Friend the Member for Louth (Sir C. Osborne) that when Scotland gets the oportunity, as at Dounreay, it can make a very good job of these things?
    Mr. Speaker: It is not the job of the Minister to give explanations to one of his hon. Friends.

    Atomic Energy Authority (Exports)
    Mr. J. H. Osbornasked the Parliamentary Secretary for Science what were the nature and value of the products exported by the Atomic Energy Authority last year.
    Mr. Denzil Freeth: During the last financial year, the Authority exported fuel elements and uranium worth£4¾ million, and isotopes worth£4¾ million, making £5½ million in all.
    Mr. Osborn: Has my hon. Friend any information whether this figure, and the range of products, is likely to increase?
    Mr. Freeth: I have every hope that it will increase, and I have been most impressed by the effort that the Authority is putting into its salesmanship.
    Mr. Snow: What information is at the disposal of our commercial counsellors on the availaible exportable potential?
    Mr. Freeth: If the hon. Gentleman is referring to commercial counsellors in embassies abroad—
    Mr. Snow: Yes.
    Mr. Freeth: —to the best of my knowledge and belief, they have full information, but if the hon. Gentleman has come across a case where he feels that information is deficient, I should be most grateful to him if he would let me know.
    Sir H. Legge-Bourke: Is my hon. Friend the Parliamentary Secretary satisfied that the price we are obtaining for the uranium we are exporting compares satisfactorily with the price we have been paying for uranium from Canada?
    Mr. Freeth: I think we have to remember that if we are to export fuel elements, we must in our costs reflect the current world price of uranium, irrespective of any price we may happen to have paid.

    Atomic Energy Authority and Euratom
    Mr. Skeetasked the Parliamentary Secretary for Science what are the relations between his Department and

    1111
    the Atomic Energy Authority and Euratom; and if he will give a report on recent discussions.
    Mr. Denzil Freeth: My noble Friend and the Chairman of the Atomic Energy Authority are members of the United Kingdom/Euratom Continuing Committee, set up under the Agreement for Co-operation of 1959. The President of the Commission and one of the Commissioners are the Euratom members. A successful meeting of this Committee was recently held at Ispra, near Milan, at which a number of possibilities for furthering co-operation were considered and remitted to the standing Joint Working Group of officials for further examination.
    Mr. Skeet: In view of the preeminence of England and Scotland in the use of atomic energy for peaceful purposes, what precisely has Euratom to contribute to the United Kingdom in nuclear technology? Will my hon. Friend indicate from his consultations on atomic energy what is the break-even point for nuclear power in Europe?
    Mr. Freeth: I should like to have notice of the last part of that supplementary question, because the calculations which Europeans make are ones for which, naturally, I am not responsible. As for the first part, I think that there are many fields where cooperation can be fruitful and where Euratom research may be able to help us, just as our research might be able to help them. I think that we may have an exchange of information on fast reactor developments and on the reprocessing in the United Kingdom of irradiated fuel from Euratom countries and co-operation, particularly in biology and in safety standards.
    Mr. Skeet: Apart from this reactor, in what way has Euratom contributed to our knowledge?
    Mr. Freeth: If my hon. Friend would like to put a specific Question about the benefits obtained from co-operation hitherto, I would willingly answer it. At a recent meeting of the United Kingdom Euratom Continuing Committee, at which I was present, it was obvious that there were fields where co-operation could be mutually advantageous.

    European Nuclear Energy Agency
    Mr. Skeetasked the Parliamentary Secretary for Science what contacts at present exist between his Department and the European Nuclear Energy Agency; and what are the prospects for the development of further joint projects.
    Mr. Denzil Freeth: The United Kingdom representative on the Steering Committee for Nuclear Energy of the Organisation for Economic Co-operation and Development is the head of my noble Friend's Office. The Atomic Energy Authority is participating in two of the three joint projects set up under the European Nuclear Energy Agency. Proposals for three new joint projects are now being studied but it is not possible to say what the outcome will be.
    Mr. Skeet: Would not my hon. Friend consider the European Agency, the International Agency and Euratom to overlap substantially, and is it profitable to belong to all three? Would my hon. Friend also give us some idea about our financial commitments to the European agency?
    Mr. Freeth: I think that it is useful to belong to all three. Both the European Nuclear Energy Agency and the International Agency cover different groups of countries and do not have the same aims. As for the last part of the supplementary question, if my hon. Friend would agree to putting down a detailed Question I would give him any figures at my disposal.

    Motor Vehicle Drivers (Visual Defects)
    Mr. Gresham Cookeasked the Parliamentary Secretary for Science what research is being carried out into the visual defects of drivers of vehicles and the effect on road safety.
    Mr. Denzil Freeth: A small amount of research in this field is in progress in independent institutions. Although no Government laboratory is currently engaged in such research the position is at present under review.
    Mr. Gresham Cooke: Is my hon. Friend aware that a number of responsible organisations are coming more and

    1113
    more to the conclusion that certain visual defects, such as tunnel vision and narrowness of vision, are having effects on road safety? Is he aware that a sample survey of drivers the other day revealed that 25 per cent. of them had some visual defect or other? Would my hon. Friend agree that further research is required to discover whether statistics show that these defects have the effect on road safety that is believed?
    Mr. Freeth: My noble Friend will discuss the research possibilities with my right hon. Friend the Minister of Transport. After that it may be possible to discover whether there are any openings where fruitful work might be done.

    Atomic Energy Authority (Redundancy Provisions)
    Sir A. Hurdasked the Parliamentary Secretary for Science if he will now state the terms of the redundancy provisions to be offered by the Atomic Energy Authority to staff with professional qualifications.
    Mr. Denzil Freeth: I am sending my hon. Friend a copy of the document which sets out the scheme in detail.
    Sir A. Hurd: Is my hon. Friend, who shares the representation of Aldermaston with me, reasonably satisfied that these redundancy terms are fair and reasonable? Is he satisfied that when there are vacancies for professional staff and others at Harwell and other atomic stations these are offered first to those who are no longer required at Aldermaston? There seems to be some doubt about this.
    Mr. Freeth: In answer to the first part of my hon. Friend's supplementary question, I believe that the terms are very reasonable and that with one minor reservation they have been accepted by the staff side. On the second part of the question, we look upon the Authority as one employer and we do our best by redeployment to prevent redundancy occurring.

    CAITHNESS, SUTHERLAND AND ROSS-SHIRE (AFFORESTATION)
    Sir D. Robertsonasked the Prime Minister if, in the national interest, he will consider using the land, transport
    1114
    and labour resources of Caithness, Sutherland and Ross-shire for increased afforestation, and for the integrated milling of wood pulp and paper.
    The Prime Minister (Mr. Harold Macmillan): It is the Government's policy to increase afforestation through the Forestry Commission and to encourage wood-using industries.
    The mill at Fort William towards which the Government are contributing loan capital of about £8 million to £10 million and which will cost some £19 million to £20 million in all as well as other existing wood-using industries, should for some time to come provide an outlet for wood grown in Caithness, Sutherland and Ross and Cromarty. But the Commission is always seeking suitable land to extend its operations.
    Sir D. Robertson: Is the Prime Minister aware that the greatest obstacle to afforestation in these three counties is the unwillingness of the sporting landlords to grow trees themselves or to permit the Forestry Commission to grow them? Is he also aware that I spent a fortnight in the constituency, coming back on Sunday, and I met all the forestry officials, who were unanimous in this view? In view of this neglect, may I ask the Prime Minister to deal with this as a matter of national urgency?
    The Prime Minister: The Forestry Commission is always looking for opportunities to extend its forests, but it is important to balance this with the proper outlets.
    Mr. Grimond: Can the Prime Minister say whether the Forestry Commission is satisfied with the amount of land it has and, if not, whether the Government will take steps to assist the Commission? Secondly, can the right hon. Gentleman say whether, with a view to improving transport and providing more employment in the Highlands, he will set up a Highlands development authority?
    The Prime Minister: The second part of the question is entirely different, and perhaps the right hon. Gentleman will put it on the Order Paper. As for the first part, nobody is ever satisfied, but I think that good progress is being made.

    LORD PRIVY SEAL (SPEECH)
    Mr. Stonehouseasked the Prime Minister if the public speech of the Lord Privy Seal to the Consultative Assembly of the Council of Europe on 7th May concerning the breakdown of the negotiations for Britain's entry to the European Economic Community represents the policy of Her Majesty's Government.
    The Prime Minister: Yes, Sir.
    Mr. Stonehouse: Does not the Prime Minister agree that this extraordinary speech, in which the Minister responsible for the negotiations for Britain to join the Common Market confirmed that Britain could not join a Europe which was protectionist, showed that the terms which we were being asked to accept were humiliating, and that this is a complete vindication of those of us who opposed Britain going in on these terms? Does not this confirm that Britain cannot re-apply to join, and is not the right hon. Gentleman aware that the almost complete acceptance of these humiliating terms has done irreparable harm to the Commonwealth and to Britain's standing in Europe and the world?
    The Prime Minister: No, Sir, all these deductions are quite false.

    NUCLEAR TESTS
    Mr. A. Hendersonasked the Prime Minister (1) whether he will propose to President Kennedy and Mr. Khrushchev the publication of their recent exchange of letters;
    (2) whether he will now state the new proposals to be put to the Geneva Conference on nuclear tests with a view to ending the present deadlock.
    Mr. Dribergasked the Prime Minister if, in view of the readiness of the United States Government, as now revealed by the publication of the testimony given on 26th February before the Senate Armed Services Committee by the Director of Defense Research and Engineering at the Pentagon, to accept only six on-site inspections after disturbances possibly caused by nuclear tests, he will make a new approach to Mr. Khrushchev and President Kennedy in an endeavour to secure a test-ban agreement.
    Mr. M. Footasked the Prime Minister if he will make a statement on the latest British proposals for securing an agreement banning nuclear tests.
    Mr. Frank Allaunasked the Prime Minister if he will now indicate the nature of the reply received by himself and Mr. Kennedy to their letter to Mr. Khrushchev regarding the stopping of nuclear test explosions; and what policy Her Majesty's Government will now adopt in order to reach an agreement.
    The Prime Minister: As my right hon. Friend the First Secretary told the House on 23rd May, President Kennedy and are still considering what our next step should be in the light of Mr. Khrushchev's reply to our communication. Our correspondence with Mr. Khrushchev was confidential, so that it would be inappropriate for me to say anything more at this stage.
    Mr. Henderson: In view of the fact that it is now estimated that there are 20 countries which soon will be able to manufacture their own nuclear weapons, does not the whole problem become one of considerable urgency? Would the Prime Minister consider in his consultations with President Kennedy the desirability of renewing the offer made some time ago to Mr. Khrushchev for immediate banning of all atmospheric and sea-water tests pending the solution of the problem of underground tests? If Mr. Khrushchev refuses, would the right hon. Gentleman consider consulting President Kennedy on the making of a unilateral moratorium on the part of the two countries in respect of these tests?
    The Prime Minister: I have great sympathy, of course, with the right hon. and learned Gentleman, as he knows. We would be ready at any time—we have made it quite clear—to agree to a general ban on atmospheric tests. That has not been acceptable so far to the Soviet Government. Therefore, we are still pressing on with the hope of getting a total ban. I hope within a very few days to agree with the President on the reply which we are making to Mr. Khrushchev, and I think that it would be better to leave it there for the moment.
    Mr. Driberg: With regard to the testimony referred to in Question No. Q5, may

    1117
    I ask the right hon. Gentleman whether he would agree that this statement, made under conditions of secrecy by a senior expert adviser to the United States Administration, represents one step forward on the American side? Would the right hon. Gentleman do his best to take advantage of this slightly increased flexibility?
    The Prime Minister: Yes, Sir. I am sure that we would try to find every possible means to reach an agreement, but I hope that the hon. Gentleman will not press me. Within a day or two I hope to agree to the reply we propose to make and I hope that that will lead to some forward step.
    Mr. M. Foot: Does the Prime Minister agree with the statement made by the Foreign Secretary in Ottawa last week that the United States at present possesses a very great superiority in nuclear weapons and nuclear strength over all other Powers? Does the right hon. Gentleman not think that a Power in such a position has a special obligation to make concessions to try to secure a general test ban agreement, and does he not think that that would justify the British Government m putting forward proposals of this nature to try to secure agreement?
    The Prime Minister: I think that the course I have been pursuing for the past three months is the one most likely to lead to some settlement. It is quite easy to make a unilateral statement, but that does not necessarily lead to the result we want. I hope very much that the procedure upon which we are about to engage will be the most fruitful.
    Mr. Frank Allaun: Since the differences are manifestly so small, what is really preventing agreement? Is it that neither the American nor the Russian Government genuinely want it and that our Government will not give an independent lead?
    The Prime Minister: No, Sir; that is a quite wrong account of the situation. There are two problems still to be resolved, both the number of inspections and their character.
    Mr. Longden: Will my right hon. Friend in the meantime make clearer to the world in general, since some American senators and a lot of people in this country
    1118
    do not seem to understand, that for very many months now the British and the Americans have offered to ban all tests everywhere, except underground, without any verification whatever?
    The Prime Minister: Yes, Sir. That has always been our position. I am glad that this has been brought out. The Soviet Government are not ready to agree to a partial ban and, therefore, we are still trying to get a total ban.
    Mr. H. Wilson: It is understandable that these discussions must for the moment continue most helpfully on a confidential basis, but is the Prime Minister in a position to say whether the reply from Mr. Khrushchev showed that he was to any extent forthcoming about suggestions for a high-level meeting between Heads of Government to discuss the final differences which still stand in the way of a test ban agreement?
    The Prime Minister: I think that I ought not to answer that question. We have made a number of proposals, and in the light of Mr. Khrushchev's reply, we are hoping to make an answer which may take up at least one of them. Then we shall, perhaps, make a little progress.

    HIGH-ALTITUDE NUCLEAR EXPLOSIONS
    Mr. Dribergasked the Prime Minister what comments or assurances he has received from the United States Administration in response to the views, warnings, and recommendations contained in the report made to Her Majesty's Government on the effects of high-altitude nuclear explosions on scientific experiments.
    The Prime Minister: The United States Government appreciate that scientists may well wish to put forward views on experiments that may have possible harmful effects. They have on a number of occasions declared their willingness, subject to defence considerations, to take account of these views. One such statement of American policy is annexed to the working party's report.
    Mr. Driberg: Does that reply mean that the Prime Minister has now received a firm assurance from Washington that there will be consultation with scientists

    1119
    internationally, including such scientists as Sir Bernard Lovell, before there are any more of these high-altitude tests?
    The Prime Minister: No, Sir, I should not go so far as that; but the United States Government are quite aware of our position and, subject to the overriding needs of security, I am quite confident that they will take all these matters into consideration.
    Mr. M. Foot: In view of the very startling statement made in this report of British scientists, have the Government specifically asked the American Government for an assurance that they would not embark on such tests without consultations with us?
    The Prime Minister: No, Sir. I should not try, and I should not lend myself to trying, to prevent something if it is really of great national security importance.

    FOREIGN SECRETARY (SPEECH)
    Mr. Emrys Hughesasked the Prime Minister whether the public speech by the Foreign Secretary at Ottawa on 21st May on the subject of an independent nuclear deterrent represents the policy of Her Majesty's Government.
    The Prime Minister: Yes, Sir.
    Mr. Hughes: Since the Foreign Secretary said that Britain intended to be strong enough and rich enough to support an independent nuclear deterrent plus conventional forces, will the Prime Minister tell us whether the Government think that they can possibly do this without a tremendous strain on the British economy? Further, will he say whether the Government still adhere to their policy that they are prepared to go into a nuclear war without the support of America and without the support of the N.A.T.O. countries?
    The Prime Minister: We debated all these matters at length in a two-day debate, and I think that they are much better dealt with in that way than by Question and Answer.
    Mr. Biggs-Davison: Does not the Opposition's policy in this respect rule
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    out any question of the independent lead for which they have been asking in the series of Questions just passed, and would it not, in fact, face the people of this country with a choice between defeat or dependence?
    The Prime Minister: Yes, Sir.
    Mr. Healey: Is the Prime Minister aware that that speech of the noble Lord specifically rejected the argument used by the Prime Minister and the Minister of Defence, when we debated this matter in the House, that we could not trust our allies in this respect? Would not the Government be wise to publish the real reason for their nuclear deterrent policy, namely, the desperate but ill-founded hope that it may prove a useful instrument for catching votes?
    The Prime Minister: No, Sir; it is based upon what we believe to be our national duty.
    Mr. Shinwell: Did not the Foreign Secretary welcome the concept of a mixed-manned nuclear force which would be under general control, not necessarily under British control? Does not that dispose of the concept of the British independent deterrent?
    The Prime Minister: No, Sir, no more than it disposes of the concept of an American independent deterrent.
    Mr. H. Wilson: Has the Prime Minister seen in a Sunday newspaper the long list of quotations showing that, on the subject of the noble Lord's speech, the Government speak with one voice when talking to their allies but with another voice for political purposes at home? Since the right hon. Gentleman and the noble Lord claim to have an independent deterrent, which is to be manufactured in America anyway, will he say whether he thinks that President Kennedy thinks that we have got an independent British deterrent?
    The Prime Minister: Yes, Sir; it was that arrangement which I made with him at Nassau.
    Mr. C. Pannell: On a point of order, Mr. Speaker. The hon. Member for Chigwell (Mr. Biggs-Davison) asked the Prime Minister to comment upon the Opposition's policy as though he were

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    responsible for it. Is it not a rule of the House that Ministers may answer only for malters within their own responsibility, not the responsibility of others?
    Mr. Speaker: It is extremely tedious to ask people to interpret other people's views or thoughts, but it wastes a lot of time to pull up all questions which are out of order.

    SCOTTISH TRADES UNIONCONGRESS (LETTER)
    Mr. W. Hamiltonasked the Prime Minister what was the nature of his reply to the letter sent to him last week by the Scottish Trades Union Congress concerning the employment situation in Scotland.
    Mr. Rossasked the Prime Minister if he will make a statement on the representations made to him last week by the Scottish Trades Union Congress concerning the serious economic situation in Scotland.
    The Prime Minister: In its letter the Scottish Trades Union Congress referred principally to the importance to the Scottish economy of stimulating activity in shipbuilding. My right hon. Friend the Minister of Transport is making a statement on this subject tomorrow, and I shall be replying to the Scottish Trades Union Congress letter shortly thereafter.
    Mr. Hamilton: Was not the letter more generalised than that? Did it not refer to the fact that jobs were not being created sufficiently quickly enough to take up the slack in the Scottish economy? Does not the Prime Minister know that, even after the winter is over, there are more than 100,000 still unemployed in Scotland and only 11,000 vacancies? Is it not this which concerned the Scottish T.U.C.? Cannot the Prime Minister match with deeds the fine words he has given to the Scottish T.U.C. in recent months?
    The Prime Minister: As everyone knows, the very large series of measures which we have instituted—I shall not trouble the House by reviewing them again—has made a very great contribution, which, as the months go by, will, I believe, help to solve the short-term problem. This is dealing rather with the longer-term problem.
    Mr. Ross: Is the Prime Minister aware that what he calls the large series of measures was described very temperately by the Scottish Trades Union Congress as a modicum of minor measures? Is he aware, also, that the day following that letter, the position was absolutely clarified by the publication of the unemployment figures showing that in mid-May there were over 103,000 unemployed in Scotland? Does the right hon. Gentleman recall that, just last week, he announced that the areas which pioneered the first Industrial Revolution would participate fully in the next industrial revolution? When does he propose to make a start in Scotland?
    The Prime Minister: Very large measures have been started, and, as everyone knows, the prospects are good.

    THE GAMBIA (ELECTIONS)
    The following Question stood upon the Order Paper:
    79. Mrs. WHITE: To ask the Secretary of State for the Colonies why he advised the use of an Order in Council whose object is to set aside the judgment of the West Africa Court of Appeal, which declared elections in certain constituencies in Gambia to be invalid; and whether, in view of the nature of such a precedent, he will now reconsider his statement published on 21st May and authorise the holding of fresh elections in the constituencies concerned.
    The Secretary of State for Commonwealth Relations and Secretary of State for the Colonies (Mr. Duncan Sandys): With permission, I will now answer Question No. 79.
    In order to explain my decision, I must give the House the facts which lie behind it.
    The Gambia is made up of two areas, the Protectorate and the Colony. It has a House of Representatives, three-quarters of whose members represent the Protectorate and one-quarter the Colony. The difficulty which has arisen relates to the register of voters in the Protectorate. The Colony has a separate register, the validity of which is not in question.
    The first register of voters in the Protectorate was compiled in 1959, but it was subsequently found to be very faulty.

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    This was largely due to the fact that the names had originally been written down in Arabic script and then transliterated into Roman script, in the course of which a large number of names became so corrupted as to be unidentifiable.
    It was, therefore, decided in 1961 to compile an entirely fresh register; and an amending law was introduced, the purpose of which was to substitute the new 1961 register for the defective 1959 register. This law was passed with the support of both Government and Opposition parties.
    In 1962, a General Election, held on this new register, resulted in the defeat of the United Party Government. Although it was their Government which had introduced the amending law in 1961, and, although they had never questioned the validity of the register before or during the election, one of their defeated candidates decided afterwards to challenge it in the courts. While the High Court upheld the validity of the new register, the Court of Appeal later reversed this decision, owing to the imprecise drafting of one phrase in the law of 1961. This ruling, of course, at once called in question all the elections in the Protectorate.
    Obviously, something had to be done to clear up this confused situation. I considered two possible courses of action. The first was to instruct the Governor to dissolve the House of Representatives and hold fresh elections. But since nobody can seriously recommend reverting to the faulty register of 1959, and since the court has declared the 1961 register to be invalid, it would be necessary before dissolution to compile a new register and that might take a considerable time.
    Meanwhile, all the Protectorate members might be unseated and in the absence of any legally valid register, it would be impossible to hold any by-elections. The House of Representatives might thus have been reduced to seven Colony members and four Chiefs' Representatives and it would obviously be improper to leave this wholly unrepresentative rump to determine how the new register should be compiled.
    The alternative course was to correct retrospectively the single defective phrase in the law of 1961 so as to give it the effect which both parties had clearly intended,
    1124
    and thereby validate the 1961 register and the elections held on it.
    Although I dislike as much as most hon. Members retrospective legislation, I decided that, in all the circumstances, it would be best to adopt this second course. I would, naturally, have preferred that the necessary amendment to the law of 1961 should be made by the Gambia House of Representatives itself. But, since the validity of the elections of three-quarters of its members is in doubt, the validity of any law it might pass would be in doubt, also. Thus, it seemed that the only sure method was to proceed by Order in Council. I shall, therefore, shortly be submitting a draft Order to Her Majesty for this purpose.
    I hope that the House will agree that, in view of the complex legal and constitutional tangle with which I was faced, the course that I have decided upon is fair and reasonable.
    Mrs. White: I thank the right hon. Gentleman for his most detailed reply which itself shows that there are serious constitutional issues at stake here. Would not he agree that it is, in general terms, and I should have thought even in this particular instance, extremely serious to set aside a ruling of a court by administrative action in a part of the world in which we are at least trying to show how important it is to maintain the rule of law?
    Mr. Sandys: We are not setting aside a decision of the court. What we are doing is to pass legislation—something which very often happens—which has been shown to be necessary by a decision of the court. [Interruption.] It is all very well for the right hon. Member for Belper (Mr. G. Brown) to say that this is setting aside the law. This is not the first time that elections which have been shown to be invalid have been validated. It has happened in this House of Commons within the memory of those sitting here, and there is nothing improper in that.
    Mr. Strachey: Would not the Secretary of State agree that it is vitally important that we should not even appear to play fast and loose with the Constitution of this Colony? [Laughter.] Hon. Members opposite may think this a joke, but, after all, constitutional development in Africa is fairly important. The only

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    possible way of putting this position right is to prepare a new register and hold new elections at the very earliest opportunity. This is the only urgent operation which can be undertaken. Otherwise, we shall be setting the very worst possible example to all the new independent states of Africa.
    Mr. Sandys: I do not think that the right hon. Gentleman can have heard my statement. I pointed out that I considered the very possibility which he suggests, which is dissolution after the compilation of a new register. But the question is: who is to compile the new register? We could have elections under the 1959 register, which would be hopeless; and I think that everyone agrees with that. If we are to have a new register, a new law is required. That new law will have to be passed by somebody. The only people who could pass that law would, I have no doubt, after a very short time be a rump of seven Colony members, and the Protectorate would be totally unrepresented except by Chiefs' representatives. That would raise the most serious objections and accusations of gerrymandering, and all sorts of things.
    It is, therefore, quite impossible to leave the present House of Representatives, whose very existence is in doubt, to pass a law setting up a new register. For that reason, it seemed to me that the only proper course was, by Order in Council, to validate what both parties thought that they had done in the law which they passed in 1961. It is only a very minor flaw in the drafting of that law which has raised all this difficulty.
    Mr. Healey: Is the right hon. Gentleman aware that the argument which he has just used was precisely that which is used in the West Nigerian Parliament to justify setting aside by retrospective legislation the decision by the Judicial Committee of the Privy Council yesterday? I am sure that many right hon. and hon. Members on both sides of the House will agree that it is a most dangerous precedent to set for the whole juridical system of the Commonwealth that decisions of a court of appeal should be set aside on a matter of this importance by retrospective legislation.
    Mr. Sandys: I have explained that that is not what we are doing.
    Mr. G. Brown: That is exactly what the Government are doing.
    Mr. Sandys: Nobody has so far suggested to me any practical course by which we can correct the situation other than by Order in Council. As for the question of validating legislation, I have already pointed out that this honourable House has itself done it in circumstances far less difficult than those with which I am now confronted.
    Mr. Paget: If the Minister can use the procedure of Order in Council to reverse a constitutional decision of the constitutional court, why cannot he use that same procedure to set up a new register? Would it not be a far less mischievous thing to do?
    Mr. Sandys: I have no reason to suppose, and nobody has seriously suggested, that the register—
    Mrs. White: It was suggested in the court.
    Mr. Sandys: Let us be quite frank. In countries which are in the early stages of democratic development, where people are not accustomed to registering as voters, it is inevitable that we do not get the same degree of accuracy as in a country such as the United Kingdom. I have, however, no reason to suppose that any new register would produce any more accurate result than the present register, nor have I any reason to suppose that the results of the 1962 election did not correctly reflect the opinion of the people of the Gambia.
    Mrs. White: Is not the Secretary of State aware that complaints were made in the court that, for example, six prospective candidates acted as registration officers, that due notice was not given, that there was a very limited time for objections, and that there were various other complaints about the register on which the last election was held? As my hon. and learned Friend the Member for Northampton (Mr. Paget) has suggested, if the Minister can use an Order in Council for one thing, surely he can use it to re-establish the proper processes of democracy.
    Mr. Sandys: It is worth remembering that the people who are complaining about all this are the party who were the Government when the register was

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    introduced and were responsible for administering the law.
    Mr. Strachey: If the Secretary of State says that the existing register is quite all right or, at least, no worse than any future one, what is the objection to holding new elections on it? The right hon. Gentleman is saying that no new register would be any better than the present one. Therefore, why not hold elections on it?
    Mr. Sandys: In that case, what is the need to hold new elections?
    Mr. Renton: Is my right hon. Friend aware that even in countries in an advanced state of development constitutionally like our own, when the courts draw attention to a defect of the law they may well be following that defect of the law because they have to; and the courts having drawn attention to the defect, it is then the duty of the legislature to cure it? Is that not all that is being done by my right hon. Friend in this case?
    Mr. Sandys: Yes. Perhaps the House should know that the difficulty arose over the phrase in the 1961 law which defined the register of voters which that law purported to validate. Although it was clearly the intention of both parties in the Gambia legislature—the law was passed without opposition, without a vote—to validate the 1961 register, the Court of Appeal has ruled that the phrase as drafted must, by a strict legal interpretation, be read as applying to the validation of the 1959 register, which would make complete nonsense.

ADJOURNMENT (WHITSUNTIDE)
Motion made, and Question proposed,
That this House, at its rising on Friday, do adjourn till Monday, 17th June.—[Mr. Iain Macleod.]
3.45 p.m.
Mr. Leslie Hale: I gave notice on Friday, Mr. Speaker, that I would raise a point of procedure arising out of this Adjournment Motion. On the other hand, I appreciate that we have before us three days of discussion of the Finance Bill and I have no desire to delay that. In the circumstances, I will do no more than state briefly the problem that arises.
The problem is that eight or nine Bills which received the unanimous assent of the House to their introduction, and three of which stand in my name, have been consistently objected to from the other side, usually by one or two hon. Members only on the benches opposite, who come for the purpose, every month in the case of my Bills since the beginning of the Session.
I introduced three Measures which received the unanimous assent of the House. All of them are virtually one-Clause Measures to deal with one small item of social reform. The first was designed to give disabled applicants for pensions the right to a rehearing on new evidence being obtained. I quoted in that connection a grave case, which I have now abandoned politically and am taking to the courts, so I can make no further comment upon that. The second Measure was intended to give a new definition to the definition of byssinosis, which affects my constituents, and the third was to correct an anomaly in the administration of unemployment benefit. Nobody criticised those Measures on their introduction.
Month after month, on Fridays, since then, however, the word "Object" has been called. I do not often pass compliments to the party opposite, but it is right and fair and generous to say that the Whips have recently had the greatest possible difficulty in obtaining any genuine Tory Member to object. On the last two occasions, the hon. Member for Tottenham (Mr. A. Brown), who was elected by Labour votes, was prevailed upon to say that he was now against

1129
these small social reforms. On the last occasion, we had the spectacle which, I think, has never happened before, of a Government Whip objecting from the Front Bench, because he was doubtful whether his last supporter, elected with Labour votes, could be relied upon to go through this again.
I have never disputed that it is fair to object to a Bill which has not had time for discussion. The only point I wish to make is that if the Government continue to deprive us of time for discussion of these matters, they should not ask us to adjourn for 15 days when the provision of a single day or two days would provide ample time for discussing a series of Measures, including the Bill introduced by my lion. Friend the Member for Eton and Slough (Mr. Brockway) the principles of which have been before the House for years and which has a great deal of support on the other side.
We have important business to do and I do not wish to delay it. I content myself with putting this objection on the record, bringing it to the attention of the Leader of the House and asking what steps he intends to take to prevent what is becoming a public scandal.
3.48 p.m.
The Chancellor of the Duchy of Lancaster (Mr. Iain Macleod): I should like to reply to the point made by the hon. Member for Oldham, West (Mr. Hale). It has always struck me as being a particularly difficult one to which to find an answer. Naturally, the hon. Member is concerned with the Bills—in this case, there are three of them—with which his name is associated and which, although they would have, no doubt, a wider impact, deal with a constituent or a case in which he has been interested for some time. That is understandable. There are, however, many other hon. Members, on both sides, who also have Private Members' Bills in which they are particularly interested. I calculate that this Session there have been 40 such Bills. 26 of which have been introduced from this side and 14 from hon. Members of Her Majesty's Opposition.
I should like to make one or two points and then come to the only solution which I can think of. First, a Ten Minutes Rule Bill, as we call it colloquially, is not a Bill at all. It is a Motion for leave to bring in a Bill.
1130
Naturally, the Bill has not been studied and, therefore, one judges on the impact that the presenter of the Bill makes to the House.
It cannot be assumed that because one listens in silence or without controversy to what is said—the hon. Member for Oldham, West will understand that I am not talking about his Bills, but about the general point confronting me as Leader of the House—and because leave is given to bring in a Bill, the House will necessarily be anxious to pursue that Bill in detail on Second Reading or subsequent stages.
The second point is that there are very many hon. Members who feel—and I think that this would be felt on both sides of the House—that where matters of considerable importance are involved, which is often true of Private Members' Bills, it is not right, necessarily anyway, that these Bills should be given a Second Reading on the nod unless there has been some examination by the House of the matters, in some cases of deep principle, which they choose to put before the House.
I just take that by way of introduction—that there are at least 40 Bills concerning both sides of the House. Perhaps I should add as well that objections do not by any means come only from the Government benches. There are a number of Bills, which hon. Members can find if they study the Public Bill list, which have been introduced by hon. Members on this side of the House and which have been at some stages, according to our system, objected to, usually at 4 o'clock on a Friday, by hon. Members of the Opposition. This is a problem which concerns us all as Members of the House of Commons, and it is not just one-sided.
Mr. H. Hynd: As one who is usually here on Fridays, may I assure the right hon. Gentleman, if he does not know it, that there is nothing like the same automatic shout of "Object" from this side of the House as there is from the Government side when the Bills come before us on Fridays?
Mr. Macleod: The hon. Gentleman will, I dare say, have studied the exchange which took place last Friday, as I did, and I recommend him to read

1131
the list of Bills, many of which have not been able to obtain a Second Reading.
So we have the position that a number of Bills have been introduced by Motion to bring in a Bill but they have not been examined on Second Reading, and, as we all know, at this stage of the Session and from now onwards their only chance of obtaining further discussion would be to get a Second Reading on the nod. A number of hon. Members feel that it is not right that Second Readings on the nod should be given except in cases where there is no conceivable argument about the principle, or, indeed, perhaps the details of the Bill.
The practical suggestion that I think I can make to the hon. Member is as follows. I have, of course, given some attention to this problem before, because it has been raised in the House by the hon. and learned Member for Aberdeen, North (Mr. Hector Hughes) as well as by the hon. Member for Oldham, West. We have a Select Committee on Procedure, and it might be appropriate, in due course, to ask that Committee if it would consider this point. I am bound to say that I can put that forward only entirely without commitment, because I think that it would be wrong to have a stream of Bills flowing through the House on the nod, as it were, on Second Reading at four o'clock on Friday, for we should certainly gum up all the channels, usual and otherwise, that we have at the later stages to deal with these Bills.
But I take note, not without sympathy, of the point which the hon. Member has put to me, and if there be a solution—which, frankly I doubt—I think that it is along the lines that I have suggested.
Mr. Edward Short (Newcastle-upon-Tyne, Central): Before the right hon. Gentleman sits down, would he tell the House whether he has carried out the consultations which he promised to have a few weeks ago about my Bill—Public Service Vehicles (Travel Concessions) Act, 1955 (Amendment) Bill—and whether he is aware that this Bill is urgently required by local authorities throughout the country? Is he aware that I have a letter here from my hon. Friend the Member for Liverpool, Exchange (Mrs. Braddock), in
1132
which her town clerk informs her that the Bill is urgently required in Liverpool as is it in Edinburgh, Birmingham, Newcastle and throughout the whole country?
Mr. L. M. Lever: And Manchester.
Mr. Short: Is the right hon. Gentleman aware that my Bill has been objected to by the hon. Member for Exeter (Mr. Dudley Williams) and many of his other hon. Friends week after week? Will he say whether he has carried out the consultations through the usual channels which he promised?
Mr. Macleod: Yes, Sir; I have. I think that I am right in saying that as we are on a Motion for the Adjournment it would probably be wrong for me to reply in detail now, but if any further reply is required from me on this and other points that hon. Members wish to raise, perhaps I could, by leave of the House, reply at the end of the discussion.
Mr. Frederick Lee: Would not the right hon. Gentleman think it wrong to ask the House to go into Recess for two weeks until he has taken the opportunity of correcting a most misleading statement that he made at Leicester on 5th April, namely,
"I am confident of a Conservative victory at the next General Election just as I are sure that Leicester City will win the Cup, and I am a good tipster."
Would the right hon. Gentleman care to comment on that?
3.54 p.m.
Mr. Richard Marsh: Without wishing to prolong this discussion, because there are other issues to be considered, I should like to turn briefly to a matter which, to hon. Members, is now becoming a major problem.
There are really two problems. There are hon. Members on both sides who would not wish to see legislation of importance and complexity pass on the nod. There are other issues with which hon. Members may disagree, so they object. The problem to which many of us take objection is concerned with a small number of back benchers from the other side of the House who arrive here on a Friday for no other reason than to object without any idea of what the Bill is to which they are objecting. To be

1133
perfectly fair to the hon. Member for Exeter (Mr. Dudley Williams), many of us believe that he is the worst offender.
I would suggest that one way out of this would be to maintain the present procedure for objecting, but to have the hon. Member making the objection stand in his place and have his name recorded in the OFFICIAL REPORT so that people could know what type of legislation was being deliberately obstructed by hon. Members who, at the moment, are able to hide behind their anonymity.
Mr. Dudley Williams: I have never disguised my dislike of legislation going through this House without proper consideration. I have without doubt objected on many occasions to Bills going through on the nod at four o'clock on Fridays, but that has not necessarily meant that I objected to the principle behind the Bill. In many cases I have subsequently extended the scope of the Bill or proposed extension of the scope of the Bill. It is quite wrong to say that I persistently object to every Bill that comes before us on Fridays. All hon. Members know that I regularly attend the House on Fridays, which is more than a great many hon. Members opposite can say, and I do it to ensure that proper legislation is passed through the House of Commons.
Mr. Walter Monslow: The hon. Member for Exeter (Mr. Dudley Williams) takes immeasurable pride in coming to the House on Fridays. So do many of us. But the fact is that he has made it his special theme to object to any Bill which comes before us on Fridays.
Mr. Dudley Williams rose—
Mr. Speaker: Order. No doubt hon. Members can argue that we ought not to go into Recess because we ought to discuss a Bill, but we cannot have a debate on our procedure.
3.59 p.m.
Mr. Arthur Lewis: You will no doubt recollect, Mr. Speaker, that I raised this issue on Friday last, and that led to my hon. Friend the Member for Oldham, West (Mr. Hale) putting forward this matter. In discussion with my hon. Friend the Member for Greenwich (Mr. Marsh) I put to him the view that we do not object to hon.
1134
Members on either side of the House rising in their places and objecting to the principle of a Bill or any other matter, but what we do object to is the fact that hon. Members come here to object to Bills and are obviously not anxious to have it known that they are objecting because some of these Bills are of great import. They slide in and then slide out and hope that no one will have noticed. [Interruption.] You will appreciate, Mr. Speaker, that I could not do that if I wanted to.
Mr. Speaker: Order. I do not want to interrupt this gliding process, but whether hon. Members glide in or no, and whether or no they shout "Object" when seated, concealed or standing up, I do not follow the bearing on the question of whether we adjourn until Monday, 17th June.
Mr. Lewis: I am continuing the debate which has taken place, Sir. Every hon. Member who has spoken so far has put the same or similar points. I suggest that we should not adjourn for this long period unless the Leader of the House assures us that the Select Committee on Procedure will discuss the various matters which have been raised, including whether or not an amendment of Standing Orders is necessary so that objecting hon. Members have to stand up.
We should also be assured that if hon. Members, by arrangement with the Government through the usual channels, have the opportunity of taking part in Ballots for Private Members' Bills, they will at least be guaranteed that Ministers of the Crown and the Whips will not object to those Bills. We want an assurance, before we adjourn, that the very limited rights of back benchers will be maintained. Already, back benchers do not get very many rights in this place, and if their Bills are to be objected to by the Whips and by Ministers I suggest that this makes a farce of our procedure of balloting.
Will the right hon. Gentleman also see that the Select Committee looks into this matter in such a way that it can be laid down that no Minister, or anyone acting on behalf of the Government, shall take part in objections to these Bills? Certainly, if a back bencher objects, he should at least stand in his place and have his name recorded.
4.2 p.m.
Mr. Iain Macleod: I will, by leave of the House, reply briefly to the points raised by hon. Members. The hon. Member for Newton (Mr. Lee) is quite right. I made a prophecy that Leicester would win the Cup. This was some time before the final. I was speaking in Manchester last Saturday and I did fairly well there.
The hon. Member for Newcastle-upon-Tyne, Central (Mr. Short) raised a point of detail. I have looked into that and, indeed, have read through the discussions that have taken place—in which he has played a leading part—since the Act of 1955. I came to the conclusion that it would be wrong to select this one Private Member's Bill from the total of 40 in this Session. I recognise, of course, that there is considerable interest in that Bill, which many people wish to see on the Statute Book. But that applies, as he will be fair enough to recognise, to many of the other Bills in which hon. Members are interested.
Mrs. E. M. Braddock: Did the right hon. Gentleman look at this matter in relation to the difficulties that have arisen where old people have had to move out of an area in which they were allowed free passes on the buses into areas where they could not have them? Most of them are being moved out of their old neighbourhoods because of overcrowding or other reasons. The old people who have been put in this position are very annoyed about the loss of their passes.
Mr. Macleod: I did look into this matter. It is true that wherever one draws a line in matters of travel concessions there are bound to be cases which are thought to be hard and which fall just the wrong side of whatever definition one chooses to make.
As the hon. Member for West Ham, North (Mr. A. Lewis) has said, all hon. Members have raised the same or similar points. I would like to reinforce something I said earlier. The hon. Gentleman said that private Members' rights were being denied to them because they were being denied a Second Reading of their Bills on the nod at four o'clock on Friday afternoons. But he must follow the logic of that argument through. If Second Readings were given on the nod on Fridays, then the rights of all other
1136
hon. Members who would have wished to make speeches, and perhaps criticise the principles involved, would thereby be taken away from them.
I can assure the hon. Gentleman that this is not as simple a point as perhaps may appear at first sight. But if there is to be any change in procedure, the Select Committee on Procedure is the right body to look at it. I undertake that we will have discussions through the usual channels to see whether it is appropriate to refer this matter.
Mr. J. Grimond: Would not the right hon. Gentleman agree that, if the matter is to be referred to the Select Committee, it is very desirable that what is referred is rather closely defined? If we simply discuss how private Members may get through their Bills more easily, this would lay open the whole of Parliamentary procedure. If we are to discuss initially the question, raised by the hon. Member for Oldham, West (Mr. Hale), whether the House should adjourn for 10 days or a fortnight at Whit-sun, this, again, is a very large matter.
On the other hand, we could simply discuss whether private Members should have their names reported when they should "Object". It is better to have the thing put in a definite form before the Committee.
Mr. Macleod: The right hon. Gentleman is, like myself, a member of the Select Committee on Procedure, and I agree very much with what he has said. This is a more complicated problem than appears, and we would have to try to define very clearly the road we wish to travel, if we want to embark on the journey at all. In this sort of solution lies the only possibility of an answer, if there is one, to this problem.
4.7 p.m.
Mr. E. Shinwell: The right hon. Gentleman seems very much concerned with the rights of back benchers. So are we all—I mean those of us on the back benches. Has it occurred to him that the Whitsun break, which is intended to enable hon. Members to escape from the House for a while, should apply only to members of the Government and the Opposition Front Bench? This would leave back benchers free to deal with all the Bills which we

1137
have had no time to tackle. That would be a simple solution.
I can never understand why Leaders of the House, and particularly the right hon. Gentleman, always seem to embark on disertations which lead to complicated situations. I believe in a simple approach. After all, that follows from the repeated assertion that back benchers have rights. The fact is that they have no rights at all. When, for example, a back bencher rises in his place, he has to search for Mr. Speaker's eye, but that never applies to speakers on the Front Benches.
Sir Gerald Nabarro: Nor to the right hon. Gentleman as a Privy Councillor.
Mr. Shinwell: In saying that, I am by no means being disrespectful to Mr. Speaker or even to the occupants of both Front Benches, but when all is said and done, referring this matter to the Select Committee on Procedure is a lot of nonsense. Indeed, the right hon. Gentleman admitted that. He said that he did not believe that it would be a solution.
I first came to this House forty-one years ago, and I recall many matters being referred to the Select Committee on Procedure in recent years—yet our procedure today is precisely the same as it was forty-one years ago. There has been no change. There is an old French proverb concerning such a situation, but I cannot pronounce it accurately, so I will leave it to other hon. Members. The fact is that the Government should give time for these matters—and that includes not only Bills, but innumerable Motions on the Order Paper. They relate to vital matters of national and international concern, and deserve as much respect as some of the Bills presented from time to time by hon. Members, though I have no objection to these Bills.
It seems to me that the Government have either to find time to enable some of these Motions or Bills to be presented—
Sir John Langford-Holt: You never gave any time.
Mr. Shinwell: If it were left to me, I would give everybody time. I am all for dispensing justice. Anyone who wants time can have it, any amount of it, and in the right places—the right institutions.
1138
But we are not discussing that and the hon. Member must not provoke me.
So what are the alternatives? Either we send this to the Select Committee on Procedure and nothing useful will be done and nothing fruitful will result, or the Government must find time. We have debated this matter often. We now have once a month, I think, an opportunity of discussing Private Members' Motions and Private Members' Bills. On Fridays, we can discuss these Bills. They seldom really come to anything, however desirable the contents of these Bills are.
For example, the Bill presented by my hon. Friend the Member for Newcastle-upon-Tyne, Central (Mr. Short), in which my hon. Friend the Member for Liverpool, Exchange (Mrs. Braddock) is very much interested, is a Bill of vital importance of a domestic character concerning human relationships and human needs. But we cannot get it through.
The Government should find time. They could if they wanted to, but, in fact, they do not agree with the contents of these Bills. Why does not the right hon. Gentleman, who is an honest man, get up and say quite definitely that the Government dislike these Bills and, therefore, no time will be provided for debating them and getting them through the House?
As I have said, there is a simple solution. Let the Government go away. We can do without them for a week or a fortnight. The Leader of the House may be required, but apart from him the rest could go. One or two could be selected from the Opposition Front Bench; even one would do. I will not suggest who it should be, but back benchers could come in if they like, particularly those who have been appearing to argue against the Adjournment of the House for the next couple of weeks. They could come in every day if they liked, even Saturdays and Sundays if they wished. They can also have me here if they want me.
Hon. Members may think that I am dealing with this in a spirit of levity—not at all. I have heard these sort of debates over and over again. On the eve of every Adjournment we have this type of debate. Back benchers complain that they have no time to present their ideas to the House and if they do present them they

1139
are not adequately debated and nothing of consequence happens. I do not care whether we say it, or the other side say it, or which respective Government or successive Governments do it. They have done it ever since I can remember and they will go on doing it for many years to come. Unless the back benchers rise in their wrath the Government will fail to act. If hon. Members will support me in the Lobby, I will vote against the Adjournment.
Mr. A. Lewis: Mr. Speaker. You will recollect that when I spoke a moment or two ago you stopped me, for what reason at that time I do not know because hon. Members who spoke before and after me did so in almost identical terms. None of them mentioned why the House should not adjourn—
Mr. Speaker: Is the hon. Gentleman rising to a point of order, or what is he doing? I cannot call him again on this question.
Mr. Lewis: I want to know, Mr. Speaker, why I and all those who have been taking part in this debate were pulled up, and why I was alleged to have wandered from the Motion when I was, in fact, the only one to refer to the Motion.
Mr. Speaker: I am not sure that the right hon. Gentleman would not have been pulled up had not the hon. Gentleman arrived at the Chair and I therefore had to ask him to let me listen to the right hon. Gentleman. This is not a hardship special to the hon. Gentleman. I did not follow why the question of someone rising to object or sitting down to object had much bearing on how long we went away for the Recess.
Question put and agreed to.
Resolved,
That this House, at its rising on Friday, do adjourn until Monday, 17th June.

PUBLIC HEALTH ACT 1961 (AMENDMENT)
4.17 p.m.
Mr. Julian Snow: I beg to move,
That leave be given to bring in a Bill to amend section 41 of the Public Health Act 1961.
I hope that the right hon. Gentleman the Leader of the House will accept that I have been listening to this debate with some fascination because I now wish to ask the House to give me leave to bring in a Bill to provide for the Amendment of Section 41 of the Public Health Act, 1961, to make compensation, now payable by local authorities to persons ordered to stay away from work because they are suspected of being carriers of disease, chargeable to the National Insurance Fund.
If the charging to that fund does not commend itself to the Government, I should be very happy to listen to suggestions if the Government would provide, in due course, the necessary Money Resolution, because, on advice that I have received from the Public Bill Office, I understand that a private Member cannot suggest a charge on central funds. The existing liability on local authorities under this Section was not discussed really at all at any stage in either House during the course of the Bill through Parliament. I suggest that to localise the liability in this way, in other words, to make local authorities chargeable for the compensation payable to people, is not logical for two reasons.
First, the man's place of residence may be, and usually is, very far from his place of work, yet it may be at the place of work that the damage may be done if he is a carrier of disease. This may apply when the person concerned lives in one local authority area and works in another. Yet under the existing provisions of the Act the charge is payable by the local authority where the man resides.
Secondly, supposing a man works in a food factory—this is the danger of the position—the product of that factory may have been contaminated and disseminated and marketed all over the nation. But the official exclusion from work is authorised either by the Section

1141
I have referred to, Section 41 of the Public Health Act, 1961, or the Public Health Infectious Diseases Regulations of 1953. Indeed, such may be the reluctance of local authorities to attract the financial liability of having to pay compensation that ingenious advisers of local authorities can draw on certain alternative measures, such as encouraging the person that is suspected, to "go sick," thereby attracting sickness benefit, although, of course, after a time general practitioners object to that. Also, they may have to seek other employment.
Thirdly, pressure can be brought on an employer either to dismiss or to suspend such suspected persons. Fourthly, that by dismissing a person from his employment this provides justification for the payment of unemployment benefit.
If poisoning can be traceable to a factory, it will be appreciated that a substantial number of people may be involved, and if people have to be laid off for this reason it may take time for them to receive the necessary clearance test. The Ministry of Health has accepted that this is possible, namely, that small local authorities may have to meet substantial compensation bills, because it is not just a question of unemployment benefit, or sickness benefit, but of compensation for the man's earnings, and, while not in any way attributing a wrong attitude on the part of local authorities, I suggest that there is a risk of a lack of energy by local authorities in using these powers if they feel that they will attract a substantial bill.
I have knowledge of a case in Staffordshire where action was delayed for some time when other means were sought to deal with the trouble and thus not attract this sort of charge. This case related to a big bakery; I think that I am also justified in reminding the House, although this is in respect of another country, of the Zermatt case. In this case, there was just a suspicion that there was a reluctance on the part of the health authorities to bring this matter into the open because of the effect on the tourist trade. It was tourism in Zermatt, but
1142
there may be an equivalent consideration in England, and the lesson to be learned is that everything should be done to encourage local authorities to use Section 41, but to make the charge a charge eventually payable from some sort of central fund.
I am advised that the Ministry of Health has suggested to local authorities that they should use their powers under Section 41 in a circumspect way. In other words, it is rather as though the Ministry is conniving with local authorities to use these other persuasion methods to which I have referred, and, incidentally, in the end, they can conceivably use Section 149 of the Public Health Act, 1936, which can result in a fine being imposed on somebody who stays at work if known to be a carrier of disease.
If hon. Members will read the section on notifiable diseases in the 1961 Report of the Chief Medical Officer of Health, they will realise the importance of encouraging in every possible way suspected carriers to stay away from work and the need to encourage local authorities to use the powers of Section 41. If one considers enteric fevers including typhoid, there were 97 cases in 1961. With regard to food poisoning, there were 22 fatal cases in which the human factor was one of the major considerations. The Report also contains details about a butcher who was found to be an excreter of paratyphoid; a man who was potentially capable of contaminating a lot of food.
In all these circumstances, I suggest that this is a justifiable charge on central funds.
Question put and agreed to.
Bill ordered to be brought in by Mr. Snow, Dr. Broughton, Mr. Harold Davies, Sir B. Janner, Mr. Neal, and Dr. Stross.

PUBLIC HEALTH Act 1961 (AMENDMENT)
Bill to amend Section 41 of the Public Health Act, 1961, presented accordingly and read the First time; to be read a Second time upon Friday, 21st June, and to be printed. [Bill 118.]
ORDERS OF THE DAY

  FINANCE BILL
  Considered in Committee [Progress, 23rd May].
  [Sir WILLIAM ANSTRUTHER-GRAY in the Chair]
  4.25 p.m.
  The Chairman: In calling the hon. Member for Cardiff, South-East (Mr. Callaghan) to move the new Clause "Purchase tax; exemption of goods hitherto chargeable at 10 per cent." I should tell the Committee that it will be possible also to discuss new Clause, "Purchase tax; reduction of rate of 25 per cent.", and new Clause, "Purchase tax: 15 per cent. rate reduced to 5 per cent.". If desired, a separate Division may be taken on the new Clause, "Purchase tax: 15 per cent, rate reduced to 5 per cent."

  FINANCE BILL

    New Clause.—(PURCHASE TAX: EXEMPTION OF GOODS HITHERTO CHARGEABLE AT 10 PER CENT.)
    Subject to any order of the Treasury made after the passing of this Act under section 39 of the Purchase Tax Act 1963, all goods hitherto chargeable to purchase tax at the rate of 10 per cent. shall be exempt from purchase tax; and accordingly Part I of Schedule 1 to that Act shall be amended by substituting for the words "10 per cent.", wherever they occur, the word "exempt".—[Mr. Callaghan.]
    Brought up, and read the First time.
    Mr. James Callaghan: I beg to move, That the Clause be read a Second time.
    The effect of the new Clause is to reduce the Purchase Tax on goods which are chargeable at 10 per cent. to nil, and thus to exempt from Purchase Tax that list of commodities. The effect of the other new Clauses is similar, except that they would not exempt from Purchase Tax certain of the commodities, but would reduce the Purchase Tax on them.
    There can be no doubt that we all feel that every time we go into a shop prices are going up, and that the £ is not going as far as it used to. This has been a consistent experience since the end of the war, but it is not one of which we have heard a great deal during the
    1144
    last two or three years. In fact, prices are still going up much too fast, and, in many households, this is causing real hardship, especially to elderly people and those on fixed incomes. The increased prices are hitting the groups of people who can least afford them. We are suffering again from a creeping price inflation, and the housewife is the first to feel, it. It is for this reason that we have moved to exempt from Purchase Tax a number of items which most clearly and immediately affect the home.
    If I were asked why this is important, and why this new Clause has been tabled, I would refer to the increases which have taken place. Since January, 1962, there has been an increase in the Retail Price Index of about 4 per cent., or a little more. This is too much. It ought to be less, and, indeed, it would be, if it were not for the actions of the Government, or, in some cases, their failure to act.
    For example, the increase in the price of sugar is a clear case where the Government have failed to act in time. Three months ago everyone knew that the price of sugar was going up, but the Government failed to take the necessary action which we are told they are to take this week. The price of bread is going up. We are promised that the price of meat is to go up. Over a wide range of food items there has undoubtedly been a substantial increase in price during the last eighteen months. We believe that a reduction in Purchase Tax, which is within the Government's control, would make a substantial contribution towards offsetting this increase.
    Mr. Raymond Gower: I am surprised that the hon. Gentleman should make such a sweeping statement about sugar. The price has gone up in many other countries, so presumably the Governments in these other countries have been equally negligent?
    Mr. Callaghan: The hon. Gentleman should pursue his researches further. Thanks to the Labour Government, we devised a Commonwealth Sugar Agreement which has enabled us to purchase our sugar at a lower price than that paid by the rest of the world. If the Government had taken their opportunities they could have reduced the price of sugar at an earlier date, when we knew that the

    1145
    Russians had bought the Cuban sugar crop. This fact was brought to my notice three months ago.
    If it was brought to my notice, I am sure that the Government must have known about it. I do not know why they did not take action earlier. But this is merely illustrative, and I should be out of order were I to proceed too far. I am sure that hon. Gentlemen do not wish to discuss rising prices, although this Clause indicates a way in which rising prices and the effect on the housewife and households could be offset.
    4.30 p.m.
    My second point is that it is the Government's own actions which have forced up the cost of living. Their action in increasing Purchase Tax twelve months ago; their action in connection with the Rent Act; their action in connection with rates; their failure to act in the case of food, has resulted in the housewife having to endure a higher cost of living than she has ever had to endure before in the history of this country. In our view, therefore, it is very desirable that the Government should take what action is within their power to reduce the cost of living in the spheres for which they are responsible. It is upon that that we hinge our case.
    I said earlier that it was the action of the Government which had put up the cost of living from the raising of the Purchase Tax last year. There were many items which were charged at the rate of 5 per cent. and upon which the tax was increased subsequently to 10 per cent. They include men's suits, women's dresses, shoes, boots, gloves, handkerchiefs, scarves, cushions, pillows, mattresses, domestic furniture, chairs, tables, beds, wardrobes, office furniture, garden furniture—all these were charged at the rate of 5 per cent. a year ago and that was increased in the Budget to 10 per cent. That action had a substantial effect on the cost-of-living index.
    If any hon. Gentleman doubts this, I invite him to examine the cost-of-living index in respect of the items which I have mentioned. He will see how the index was stationary in respect of these items for a number of years and started to move up when the Purchase Tax was increased a year ago. This was foreseen by hon. Members on both sides of the Committee. If hon. Gentlemen refresh their memories
    1146
    by reading the debates of last year they will see how supporters of the Government prophesied that as a result of increasing Purchase Tax the cost of living would go up.
    They commented on other aspects, too. They were certainly right. We were told that it was necessary that this should be done. But we must rub into the Government the fact that they are responsible for a substantial part of the increase in the cost of living. When buying any of these items every housewife may say, "Thanks to the Government of the day, the prices are higher than otherwise they would have been."
    We propose to exempt these items from Purchase Tax and so reduce the financial burden on the housewife. The amount collected in Purchase Tax has gone up over the years in which the Government have been in office. About ten years ago it started at about £300 million. It is now over £500 million. This amount is being collected out of the consumers' pockets. I have no doubt that the Government will be putting it up again. But not before the election—after the election, if some hon. Gentlemen opposite have their way.
    We had a long discussion a year ago in which a substantial case was made by hon. Members opposite for increasing all the ranges of Purchase Tax to 16⅔ per cent. The Government will probably shy away from that before the General Election. But I have no doubt that if those who are advocating a flat-rate Purchase Tax had their way, and if the country should be so unfortunate as to return this Government again, we shall see further moves in this direction once the General Election is over.
    Sir Gerald Nabarro: Will the hon. Gentleman give way?
    Mr. Callaghan: No. Therefore, I warn the Committee—
    Sir G. Nabarro: The hon. Gentleman has no guts.
    Mr. Callaghan:—that if the Government are returned we can look forward to further increases in the Purchase Tax and, therefore, to further increases in the cost of living.
    The hon. Member for Kidderminster (Sir G. Nabarro) says that I have no

    1147
    guts. On the contrary, I know better than to give way to the hon. Gentleman who is so loud-mouthed that he will make any irrelevant interjection. Let him wait and make his speech when the time comes.
    Sir G. Nabarro: I shall not give way to the hon. Gentleman.
    Mr. Callaghan: I can assure the hon. Gentleman that I shall not attempt to intervene.
    Sir G. Nabarro: Good.
    Mr. Callaghan: I would not bother with him.
    There is no doubt that there is a substantial lobby in the Conservative party in favour of putting up prices through an increase in Purchase Tax. This should be clearly understood. I hope that we shall have a clear answer from the Government about what is their policy in this matter. A year ago the Financial Secretary, who was then the Economic Secretary, told us that the increase in Purchase Tax was a deliberate measure of Government policy, putting it up from 5 per cent. to 10 per cent., and represented
    "only part of the general reform…"—[OFFICIAL REPORT, 16th May, 1962; Vol. 659, c. 1441.]
    By that the hon. Gentleman meant reducing the Purchase Tax at the top and increasing it at the bottom of the scale.
    Sir G. Nabarro: Hear hear,
    Mr. Callaghan: I wish to ask the Chief Secretary what has happened to the next instalment of the general reform which we were promised, because that was only the first part. We were told that. But we have not seen any further steps this year. Has the new Chancellor lost interest in the whole idea of reforming Purchase Tax? Does he believe that there is nothing further to be done? Have the Government changed their mind over this, as over so many other issues? What are we to think about it?
    Speaking of changing their mind, I do not know whether any of my hon. Friends have read the reports of last year's debate. If they have they may well remember with amusement—and hon.
    1148
    Members opposite will remember with chagrin—that we moved Amendments then to reduce Purchase Tax by about £100 million. That was the amount we were told by the Government Front Bench would be involved. At that time the Financial Secretary told us that the only conceivable case for a reduction of this size was that
    "the Opposition had given up all hope of tackling the question of inflation".—[OFFICIAL REPORT, 16th May, 1962; Vol. 659, c. 1447.]
    This was in May. In October and November the Government reduced Purchase Tax to the extent of about £100 million by reducing the tax on motor cars and perfumery. So we have the measure of the priorities of the Government. Purchase Tax is put up on furniture, on suits and on dresses and it is reduced on perfumery. In the interval the Government explain that to do so would be to give up any hope of tackling inflation. Not only do they change their mind, but they are dishonest in explaining the reason for doing so.
    It is incredible that a Government should so alter their own economic policy and still have no sense of shame. Having told us between the summer and autumn, that to reduce Purchase Tax would be giving up any hope of tackling inflation in the autumn they propose exactly the same amount of reduction that we had proposed three months earlier. Therefore, we should like to hear from the Chief Secretary whether there are further instalments of the general reform to come, or whether the statement of the Financial Secretary last year was a misquotation. Was it part of the general reform or not?
    Last year, the Government were warned of the effect on employment of an increase in Purchase Tax. They were warned by hon. Members on both sides of the Committee. They shrugged off these difficulties. But is there any hon. Gentleman who represents a constituency in which furniture is made, or clothing manufactured, or where boots and shoes are made, who has not been told by his constituents that there are difficulties in the factories which have been added to as a result of the Purchase Tax increases?
    If the representations made to me are any guide, many manufacturers have found that this increase from 5 per cent.

    1149
    to 10 per cent. has made a substantial difference. In fact, the increase was a little over 5 per cent. to a little over 10 per cent., because of the effect of the regulator. They have found those increased difficulties regarding employment and there is already a substantial amount of unemployment in industry which needs taking up and the position improving.
    I said that it was the Government's responsibility, and so it is in a number of these fields. If we look at prices since the new index was introduced, we see that in men's clothing price rises have been of the order of 5 per cent., women's clothing of 3 per cent., and boots and shoes of 6 per cent. All these are directly the responsibility of the Government. The cost of housing, whether it be in rent or rates, has shown an increase since January, 1962, of over 6 per cent. In food prices generally, since January, 1962, the increase has been over 6 per cent.—between 6 per cent. and 7 per cent. Most of these things are within the control of the Government.
    The Government have an incredible habit of allowing one section of their policy to fight against another. It is astonishing that the Chancellor of the Exchequer should go to Sheffield to address the Cutlers' Feast on 23rd May and tell us that the annual increase in incomes, that is to say, in wages, salaries, profits and dividends, should not exceed 3 per cent. to 3½; per cent. and that rises in real wages are based on rising living standards. Of course, he was right, but we are not having rising living standards at the moment and have not had them in the last couple of years.
    There have been falling living standards. In so far as the Chancellor succeeds in keeping increases in wages down to 3½ per cent. and in so far as the increase in prices of food is 6 per cent., in housing 6 per cent., in men's clothing over 5 per cent., in books, newspapers and periodicals 4 per cent. and boots and shoes 6 per cent., he is undercutting the standard of living of the people.
    The standard of living of the average working-class household today is not going up. Unless there is more than one income coming into the household, it is going down. The Amalgamated Union of Building Trade Workers made
    1150
    a very interesting investigation into this subject. It produced a memorandum which has been, or will be, sent to the Chancellor, showing the effect on the budgets of members of that union caused by the increase in retail prices. It showed, what we might expect, that the three largest items in the ordinary budgets of those members are food, the cost of housing in rent and rates and the cost of clothing and footwear. For not one of those items has the cost of living since January, 1962, not gone up by more than 6 per cent.
    Yet the Chancellor told them that they can have an increase of only 3 per cent. to 3½per cent. Are the Government setting out deliberately to reduce the standard of living of these groups to solve the Government's economic problems? The Committee is entitled to know the Government's views on these matters. This memorandum concerns a group of workers, over 1 million, part of whose increases in wage rates is determined by a sliding scale based on increases in the Retail Price Index. They have made their analysis showing that of all the increases in basic rates in the building trades since the war at least 30 per cent. can be accounted for by increases in the Retail Price Index.
    If the Government are concerned about an incomes policy they should make a really substantial contribution by themselves working for a reduction in the cost of living instead of putting it up. Where the Government by their actions put it up, it seems not only absurd, but also to have no logic, because they are responsible for so much of the increase in the retail price increases over the last twelve months.
    4.45 p.m.
    I have no doubt that much of the ridiculous increase which took place last year was in anticipation of our early entry into the Common Market. The Government put it up from 5 per cent. to 10 per cent. because they thought that one way of easing ourselves into a general flat-rate sales tax spread over the whole range of consumer commodities. What the public were saved from as a result of the failure to get into the Common Market, whatever other merits that had, was a substantial increase in prices which would have been brought about partially by this attempt to adjust

    1151
    the Purchase Tax and to squeeze it both upwards and downwards.
    I am not persuaded that this is the right way to tackle the problem. If they want to reform the Purchase Tax they should do so on a different basis. What I and my hon. Friends are utterly opposed to is any general conversion of the Purchase Tax into a sales tax covering the necessities of life by which every brick which goes into a new house and every loaf of bread which is bought pushes up the cost of living of the people of the country.
    Such a system would, of course, reduce the price of perfumery. The Government did that last year. It would also reduce the price of a Rolls-Royce, or other car, but it would increase the cost of living of the ordinary wage-earning family. For that reason I am strongly opposed to it. I hope that we shall hear from the Government whether this is a first instalment of the policy and, if so, whether they intend to go further.
    It is time that we brought this creeping towards inflation to an end. The Government have not only allowed it to go on too long, but have encouraged it and at times initiated increases. They themselves are responsible for a great deal of the difficulties in which housewives find themselves. A housewife should know when she goes to a shop and finds that prices have gone up that she can thank the Government for a financial and fiscal policy which has resulted in her having to pay higher prices. In turn, they result in increases in wages over a considerable section of the economy. The Government are fighting against their own policy on incomes to keep wages on a stable level and this is having an effect on unemployment. It has undoubtedly increased unemployment in some areas.
    For all these reasons there is a substantial case now for reducing Purchase Tax on these essential commodities. Then the housewife may know that it is not as a direct result of Government action that her bills have gone up.
    Sir G. Nabarro: The hon. Member far Cardiff, South-East (Mr. Callaghan) would not show me the courtesy of allowing me a single intervention in his speech. I shall reciprocate in kind, notwithstanding that we are in Committee
    1152
    on the Finance Bill and it is customary, or has been during the modest thirteen years that I have been in this House, for hon. Members to give way to one another in Committee. However, I will now permit no interventions from the hon. Member, in any circumstances.
    Mr. A. V. Hilton: Get on with it.
    Sir G. Nabarro: Having dealt with the hon. Member's discourtesy, I propose to get on with it.
    The three new Clauses we are debating would, if accepted, result in a substantial reduction of indirect taxation. It is an extraordinary thing that a shadow Chancellor of the Exchequer can make a speech for 20 minutes advocating very large reductions in indirect taxation without having the perspicacity or intelligence to tell the Committee what the total cost of the concessions would be. I propose to do it for him. The hon. Gentleman accused my hon. Friends of dishonesty. I thought that his speech was not dishonest; it was disingenuous and naive. He deliberately omitted to tell the Com-tee the huge cost of what he was proposing.
    The first of the new Clauses proposes the abolition of the 10 per cent. rate of Purchase Tax. The estimated revenue of the 10 per cent. rate of Purchase Tax in the current year 1963–64 is £170 million. Thus, the hon. Member proposes by his first new Clause to reduce indirect taxation by £170 million this year.
    The second new Clause which we are discussing, to reduce the 25 per cent. rate of Purchase Tax to 20 per cent., would cost the Treasury £64 million in the current year. The reason is that the revenue estimated from the 25 per cent. rate of Purchase Tax in 1963–64 is £320 million. If the rate were reduced from 25 per cent. to 20 per cent., and assuming that the overall national purchases of goods covered by this rate remained the same, the abatement of the 25 per cent. rate in this context would be a sum of £64 million. The first new Clause would cost £170 million and the second would cost £64 million.
    The proposal in the third new Clause which we are discussing is to reduce the 15 per cent. rate of Purchase Tax to 5 per cent. The revenue from the 15 per cent. rate in the year 1963–64 is £55 million, and it therefore follows by simple

    1153
    arithmetical processes that the cost of reducing that rate to 5 per cent. would be £37 mililon. Summarising, the first of the three new Clauses would cost £170 million, the second would cost £64, and the third would cost £37 million—a total, as an aggregation of the three proposals, of £271 million. The hon. Member for Cardiff, South-East is not very good at arithmetic. He need not go to Nuffield College at week-ends. It would be much better if he went to a secondary school evening class to learn to use a slide rule. He could then carry out the simple calculations which I have given to the Committee.
    Mr. Dan Jones: One does not need a slide rule for that.
    Sir G. Nabarro: The hon. Member for Cardiff, South-East would need a slide rule because he has not the mental capacity to work it out otherwise. Mine are the correct figures. Evidently the hon. Member has not taken the trouble to obtain a copy of my right hon. Friend's answer to my Question No. 64, which was answered today. It will be printed in HANSARD tomorrow and it gives all these figures.
    It states that the yield on Purchase Tax in the current year is £170 million from the 10 per cent. Rate, £55 million from the 15 per cent. rate and £320 million from the 25 per cent. rate, making a total of £545 million. These figures have been published today for the first time, but they were available to the hon. Member for Burnley (Mr. D. Jones) on the letter rack and, failing that, as he knew that my Question was on the Order Paper, I would gratuitously have furnished him with a photocopy of my figures, on application.
    The hon. Member for Cardiff, South-East not only accused my right hon. Friends of dishonesty, but made a further blunder. Not having done his homework, he said that the yield of Purchase Tax had risen year by year. The tendency has certainly been upwards, a reflection of the enormous increase in the consumption of durable and other goods subject to Purchase Tax, during the eleven years of Conservative administration. As an aside, I remind the hon. Member, who talked about the current price of sugar and how the Labour Government, prior to 1951, negotiated a Commonwealth Sugar Agreement, that, notwithstanding
    1154
    that agreement, the housewives of Britain were doomed under his Administration to a 2 oz sugar ration per week. That was the cost not only of a Labour Government, but of keeping prices down to an artificially low level.
    The increasing yield of Purchase Tax in eleven years is a reflection of the enormous improvement in living standards in this country during the last eleven years of Conservative administration. Let me give one example at random. My right hon. Friend the First Secretary to the Treasury will confirm my figures readily. Today, there are 12½ million television sets in use. When the Conservative Government came into power in 1951 there were 1 million television sets in use.
    Mr. Hilton: What about the number of people on National Assistance?
    Sir G. Nabanro: National Assistance is not dealt with in the new Clause. I will deal with it in a debate on the subject and will then knock the hon. Member over the fence for six, as usual.
    The point which I am making is that whereas, eleven years ago, there were 1 million television sets, today there are 12½ million. The average cost of a television set, including Purchase Tax, has been £63 and 11½million additional television sets have been bought in those eleven years. Not only have they provided lively entertainment, leisure and happiness in the homes of the people, but they have been largely responsible for building up year by year the Chancellor's revenue from Purchase Tax.
    I remind the Committee that in 1959 the Purchase Tax on a television set, as on a radio set, as on a motor car, as on a gramophone, as on a disc, as on perfumery and toilet waters, was 60 per cent. As a result of the Conservative Government's actions during the last four years, that rate of 60 per cent. first came down to 50 per cent., then to 45 per cent. and now to 25 per cent.; and the 25 per cent. rate of Purchase Tax on a motor car compares with the 100 per cent. rate during part of the period of years of the Labour Government, after the last war.
    The big reduction of tax has been a very substantial advantage to the ordinary buyer of goods for which he has worked, and which he wishes to provide

    1155
    for his family to enjoy. Moreover, it has contributed to keeping down prices for these goods on the export markets.
    Mr. Douglas Jay: Does the hon. Member mean that Purchase Tax was 100 per cent. on motor cars? It was never higher than 66⅔per cent.
    Mr. Arthur Lewis: The hon. Member for Kidderminster (Sir G. Nabarro) is always wrong.
    Sir G. Nabarro: The hon. Member for West Ham, North (Mr. A. Lewis) would be wise to listen to my figures rather than to those of the Co-op. At least mine are accurate, whereas those of the Co-op are Socialist propaganda. He would be wiser to listen to mine. The 100 per cent. rate of Purchase Tax was applicable at the tail end of the war, and for most of the period of the Labour Government it was 66⅔ per cent. The plain fact of the matter is that it is now 25 per cent.
    It is all very well for the hon. Member for Cardiff, South-East to point out that the 5 per cent. rate has been doubled to 10 per cent. To try to give emphasis to the point, he read a long list of consumer articles, including mattresses and pillow cases. He would have been wiser had he stuck to the Purchase Tax terminology and simply stated that furniture and clothes were the two categories which were raised from 5 per cent to 10 per cent. last year by the Chancellor of the Exchequer who, in addition, put confectionery and soft drinks on a new special rate of 15 per cent.
    I was the strongest possible supporter of the Chancellor's decision last year to double to 10 per cent. the rate of 5 per cent. on clothing and furniture. I was his strongest possible supporter in putting sweets, confectionery and soft drinks on a 15 per cent. rate of Purchase Tax. I asked him to do just that in my speeches on Purchase Tax in the Budget debates of 1961, all in pursuit of an important principle.
    5.0 p.m.
    The hon. Member for Cardiff, South-East talked about substantial support on the Conservative benches for a flat rate of tax. I am the culprit in that regard. I have advocated every year for the last ten years that Purchase Tax should be placed
    1156
    on a uniform rate, non-discriminatory in character, because when there is a superabundance of consumer goods of every kind and description, from motor cars to clothes, to furniture, to cameras, to floor coverings, to a huge range of consumer goods, there is, in my philosophy, no such thing as a luxury. Neither is any article more essential than any other article.
    It is fatuous to say that clothes are an essential of life and, therefore, should be free of Purchase Tax when the rich can buy a Saville Row suit at 60 guineas and the poor put up with a suit at 10 guineas. Luxuries are to be found in every bracket of consumer goods. There is expensive luxury furniture, as there is cheap furniture. Everybody in the Committee knows that it is virtually impossible to draw a dividing line for taxation purposes between a luxury article in a particular Purchase Tax category and a non-luxury article. It would be an impossible proposition for officers of Customs and Excise to be required to tax, for example, pottery up to a certain level of price at one rate and over that level of price at another rate. It would lead to endless complications, incongruities and anomalies and would worsen, by a great deal, in my opinion, the vicious difficulties that we already fall into by having only three Purchase Tax rates.
    Mr. A. E. Oram: Would the hon. Gentleman, in advancing the theory that it is difficult to distinguish between luxuries and necessities, at least agree that there are some items which enter more into the purchasing of poorer families and others which enter more into the purchasing of richer families and that it helps the poorer families if the tax on the goods that they buy is kept low?
    Sir G. Nabarro: No, I do not accept that proposition at all, for a variety of reasons. I will deal with most of them, I hope, in the remainder of my speech.
    My reason for saying that in times of abundance there is no such thing as a luxury is simply that all manufactured goods, in my philosophy, contribute to two important things. The first is the employment of our people, because they are manufactured goods. The second is the building up of our export trade, because all classes and kinds of manufactured goods are exported in one way or another, practically without exception.

    1157
    In that set of circumstances it is, to my mind, nonsense to try to discriminate, article by article, on grounds of essentiality or otherwise to the consuming public. This is a sharp division of fiscal philosophy between Socialists and Conservatives—Conservatives of my type. I am perfectly well aware of the arguments of right hon. and hon. Members opposite in this matter of Purchase Tax. As I have argued publicly elsewhere and in this Chamber for ten years with them, they would try to segregate groups of goods which they consider are essential to the life of the community and they would try to remove Purchase Tax from them. Other goods they would try to segregate elsewhere and say that they are luxurious in character and should carry a high rate of Purchase Tax.
    I believe that this is a totally wrong fiscal policy, and that good progress has been made by my right hon. and hon. Friends towards a single flat rate of Purchase Tax. It is to that that I wish now to apply myself for a few moments.
    When this Purchase Tax campaign of mine started—
    Mrs. Harriet Slater: Of whose?
    Sir G. Nabarro: Of mine. I happened to start it with my first 100 Purchase Tax Questions in 1958.
    Mrs. Slater: It was started a long time before that.
    Sir G. Nabarro: Yes. It was started in a desultory and slapdash fashion by the hon. Lady, but she never really got down to the details of it. She never really learned what Purchase Tax was all about. She imagined that it was confined to pottery, but there are other things as well, such as carpets. They are all important. When the Purchase Tax campaign of mine started in 1958 the top level was 90 per cent. The bottom level was 5 per cent. There were seven rates of Purchase Tax in all.
    We now have a situation, after various changes in 1958, 1959, 1961 and 1963, whereby, instead of seven rates, there are only three rates. The top rate, instead of being 90 per cent. is only 25 per cent. The bottom rate, instead of being 5 per cent., is 10 per cent. There is one intermediary rate put in at 15 per cent.,
    1158
    but it applies only to the very narrow group of sweets, confectionery and soft drinks.
    As I have explained earlier, on this basis of 25 per cent., 15 per cent. and 10 per cent., the total yield of Purchase Tax this year is £545 million. It compares with last year's yield of £571 million. So, actually, a reduction of £26 million is proposed in Purchase Tax over the whole field this year, as compared with last year. If the flat rate that I recommend of 16⅔ per cent. were initiated, the Chancellor's yield would be not very different. His yield would be £558 million were all articles currently subject to Purchase Tax standardised at 16⅔ per cent., or 2d. in the 1s. The yield would then be £558 million compared with his estimated yield on the three-rate current basis this year of £545 million. That is a difference of only slightly over 2 per cent. in order to eliminate discrimination altogether.
    I hope that this steady process under a Conservative Government of compressing Purchase Tax rates towards the desirable goal, as I understand it, of a single and flat rate, non-discriminatory, a uniform rate of Purchase Tax of 16⅔ per cent., or 2d. in the Is., will be pursued by this Chancellor later this year and next year as well, until we arrive at the goal of a single flat rate. I am not dogmatic about the 16⅔ per cent. rate. If the Chancellor can afford it, let him make it a 15 per cent rate.
    I am not alone in these thoughts, either. I will read to the Committee a recommendation from the National Institute Economic Review No. 23, February, 1963, which used these words as a means of injecting further purchasing power into the economy:
    "there may be special social reasons for not concentrating so much of the tax reductions these,"
    By "these" is meant tobacco, spirits and beer.
    It continues:
    "An alternative would be to consolidate all Purchase Tax rates at 10 per cent. This would release just over £200 million."
    In other words, if there were a single Purchase Tax rate of 10 per cent. instead of my proposed l6⅔ per cent. the yield from Purchase Tax would not be £558 million, but would be approximately £350 million.

    1159
    Again, the National Economic Development Council, in its publication "Conditions Favourable to Faster Growth", 1963, had these words to say about Purchase Tax, in paragraph 168:
    "The coverage could be widened and its incidence made more uniform. The Purchase Tax has considerable advantages over the value-added tax in ease of collection, since it is collected at one stage and not several."
    There is a powerful body of thought in the country today which believes in nondiscrimination in Purchase Tax.
    The hon. Member for Cardiff, South-East seems to think that a uniform rate of Purchase Tax is a sales tax. He displays his ignorance of taxation matters, for the sales tax as operated in the United States, on a wide basis, is a retail tax collected over the counter on retail sales. The tax at source as in Germany, is a turnover tax and is another alternative method of doing much the same thing. In Britain, we operate Purchase Tax at the wholesale level, the principal operational advantage being that we have only 160,000 collection points by that method instead of 680,000, which we would have with a retail or sales tax, over the counter.
    As I say, a retail tax over the counter is a sales tax. I have never wanted that. I do not particularly want a turnover tax. Unless we have an added-value tax I want it to be continued as a tax at the wholesale level; but that is not a sales tax, I dislike having to repeat myself, but I must remind the hon. Member for Cardiff, South-East—because he is in a muddle—that it is not a sales tax. I am saying that the tax should be levied at the wholesale level, but at a single, uniform and non-discriminatory rate, as low as possible.
    I would be content with it being 16⅔ per cent., or 2d. in the shilling, in the immediate future because that would be easy to operate. It would mean that those articles which are at present charged at 25 per cent.—motor cars, radios, television sets, cosmetics, cameras, gramophones and discs—would all come down from 25 per cent. to 16⅔ per cent. It would mean that the articles charged at 15 per cent.—sweets, confectionery and soft drinks—would go up from 15 per cent. to 16⅔ per cent. which is only a marginal increase. It would also mean that the whole of furniture, clothes, floor
    1160
    coverings, including carpets—and I represent Kidderminster—and pottery, glass and everything on the 10 per cent. level would go up to 16⅔ per cent.
    If this were done we would have a simple, non-discriminatory system of indirect taxation. It would be equivalent to the continental systems. Such a system would require very little change if and when there were, in the future, an association—economic, political or otherwise—with Western Europe. I strongly believe that this is, as a broad philosophical and fiscal proposition, very important to the future of both manufacturers and consumers in this country.
    I hope that my right hon. Friend will emphatically reject the spurious proposition of the shadow Chancellor of the Exchequer, who did not even have the guts or courage to tell the Committee that the cost of the three propositions he was supporting would be £271 million this year, or £2 million more than the whole of the Chancellor's P.A.Y.E. and Income Tax concessions of £269 million. This shows that the hon. Member for Cardiff, South-East does not want tax reductions this year of £269 million—which he has already voted through—but total tax reductions of £540 million.
    The hon. Member has not the courage to tell the Committee that that is what he is proposing. He did not go to Nuffield College, Oxford, last weekend. He has not done his homework. His arithmetic is very poor and I hope that his propositions will be treated with the contempt they deserve, and that the new Clause will be voted down.
    5.15 p.m.
    Mr. J. Grimond: The discussion of the proposed new Clauses gives the Committee an opportunity of probing the Government's mind on two points. The first is whether the Government are satisfied with the general results of this year's Budget. In that Budget, in the coming year, they will, compared with last year, give a considerable stimulus to the economy and, naturally, they hope to have a response from it, to take up the under-employment of both men and machines and generally to increase productivity and overall production.
    We are entitled to ask if they consider that the stimulus in the Budget is and

    1161
    will be sufficient. Will they be releasing enough purchasing power really to start the economy on an upward cycle? It is extremely important, when considering this point, that the Government should take firm and sufficient measures—and such measures are likely to be much more effective if they are given out with decision and not dribbled out in the coming months.
    We have had an indication from the First Secretary that later in the summer the Government might be prepared to use the regulators to increase purchasing power. I believe that this way of attempting to solve the nation's problems would be a psychological and economic mistake. If they are discovering that they are not getting an adequate response from the economy, the Government should take this opportunity of reducing some of the indirect taxes we are discussing.
    There are signs from economists and industry that the Government have not restored sufficient confidence by the proposed releases of purchasing power. Here again is an opportunity for them, if they feel that it is necessary to give an added incentive, to take action, because industry will respond above all if it is thought that markets will be found for their goods. Whatever is done by way of investment allowances and so on, it is essential to bear this in mind. Thus the first question I wish to discuss is whether or not the Government consider that the measures taken in the Budget will be sufficient, for I believe that, to date, the response generally to the Budget has been disappointing.
    My second point leads me to follow up some of the questions asked by the hon. Member for Cardiff, South-East (Mr. Callaghan) regarding the Government's general policy towards Purchase Tax. This form of taxation has undergone considerable changes over the years. Lord Amory, when Chancellor of the Exchequer, turned down the idea of a Sales Tax. He said at the time that it had been examined and had been found to be impracticable, undesirable or both. I understand that that, among other possibilities as an alternative to Purchase Tax, is being considered again.
    Last year there was an effort, of which I approved, to reduce the number of rates of Purchase Tax and to make the
    1162
    whole structure more rational. Nevertheless, an extra rate of 15 per cent. was brought in on sweets and soft drinks. Are the Government now saying that they will not formulate any policy or take any steps to alter the present structure of Purchase Tax until the Committee which has been set up to consider this matter has reported? This matter is of vital importance to the economy, because Purchase Tax must be looked upon not merely as a method of raising revenue, although that is important, but also on its effect on consumers and industry.
    It is high time that the Government concluded their investigations into the various forms of indirect taxation and informed the country of their conclusion. I would like to know when the Committee of which I spoke is expected to report and whether we are likely to have to wait until, say, next year's Budget for action on its recommendations.
    The hon. Member for Cardiff, South-East pointed out certain objections to either a single rate of Purchase Tax, a sales tax or an added-value tax. I do not deny that his objections have force in that there might be an increase in the cost of living for certain people and that there is a case for a sumptuary type of tax. But I would urge certain counter arguments, particularly in favour of an added-value tax. They are well known, but I think that they are worth placing on record again in view of the proposed new Clauses we are discussing.
    It is generally considered that this would enable us to give some assistance to exports; an important matter on which we are all agreed. It is very often argued that if we give assistance to exports other countries will do the same, but most other countries have already gone considerably further than we have in giving this assistance. I am not convinced that this country should hold back because of possible retaliation—retaliation has, in most cases, already been taken.
    Although I appreciate that an added-value tax might be more difficult to collect, it is, at least, likely that many stages of production would be prepared to absorb the tax and not to pass it on. To that extent, the results feared by the hon. Member for Cardiff, South-East might be less than expected. This form

    1163
    of tax would give an incentive to the efficient industry, and if it were combined with alterations in other forms of taxation it might make a considerable difference to the efficient industry that was using its materials, machinery and men to the best advantage, as against the less efficient industry that was being extravagant with comparatively scarce sources of production.
    I hope that the Government have this type of taxation very much in mind. I hope, too, that they will remember that if it were to appear that there were certain valid objections to the tax, those objections might be met by concessions in other directions. I am not by any means putting the objections entirely aside. The committee set up by the Government will no doubt consider them very carefully, but this Committee on the Finance Bill should direct its mind particularly to the effect of taxation on efficiency, and to seeing whether we cannot so reform our system of Purchase Tax as to make it a positive encouragement to the efficient firm, and not a disincentive.
    Many of the newer industries, the efficient industries of the type we want to encourage—indeed, the type of industries quoted by the hon. Member for Cardiff, South-East in his speech, I think, on the Budget, when he drew attention to an article by Professor Barna—are exactly the type that an added-value tax might encourage to some extent. That is to say, they are concerned, not so much with the basic necessities, as they are generally called, but with, if not exactly sumptuary goods, goods that are well above the level of basic necessities. This would seem an argument for the tax.
    Whatever we may feel about the operations of Purchase Tax, we cannot wait indefinitely for a clear indication of the Government's mind, and a clear indication, also, that they will pursue a more consistent policy than has been the case over the last two or three years.
    Mr. Peter Walker: One of the advantages that the right hon. Gentleman the Leader of the Liberal Party enjoys when he speaks about the proposals of his party is that if we want to compare them with his party's performance we have to go back for a long time. This is not an advantage shared
    1164
    by the hon. Member for Cardiff, South-East (Mr. Callaghan). Whilst I welcome the hon. Gentleman's return from Washington and his attendance here—because, if I may say so, I find his contributions both cogent and interesting—I found his argument today rather below his usual performance. He tended to try to concentrate on making a party political point that does not really stand very much examination from his own point of view.
    The theme of his argument was that because there had been a rise in the cost of living it was the duty of the Government to reduce Purchase Tax in order to make some amends for that rise. I would remind him that, for example, in November, 1947—and 1947 was not a good year for falls in the cost of living but one in which it rose—the Labour Government doubled many items of Purchase Tax, including those on the lower levels, from 16⅔ per cent. to 33⅓ per cent.
    During the period of office of the Labour Government from 1945 to 1951, the cost of living rose virtually every year, but there was no compensating reduction in Purchase Tax. Indeed, during that period, the tax was definitely increased—[Interruption.] In 1946, it increased. In 1947, it increased. In 1951 it was increased, and when the Labour Government went out of office the rates of Purchase Tax were 33⅓ per cent., 66⅔ per cent. and 100 per cent. Those have all been substantially reduced—
    Mr. D. Jones: It is not quite fair of the hon. Member for Worcester (Mr. Walker) regularly to trot out this hoary tale. The position of the country at that time was vastly different from its position today.
    The Temporary Chairman (Mr. F. Blackburn): I hoped that the hon. Member for Worcester (Mr. Walker) would work round to 1963.
    Mr. Walker: With respect, Mr. Blackburn, the argument was that it was correct to reduce Purchase Tax to meet the rise in the cost of living, and I was merely pointing out that the opposite course was pursued when the party opposite was in power. Under this Government, some form of reduction in Purchase Tax has taken place almost every year on many basic household items. Carpets,

    1165
    floor coverings, furniture and clothing have had the tax substantially reduced.
    I want to make a specific point concerning a product that would come under the new Clause 26, because it is affected by the Purchase Tax level of 15 per cent. imposed on soft drinks and sweets. One of the most important facets of British horticulture is the soft fruit industry, and the section that produces blackcurrants has been very seriously affected by the imposition of this 15 per cent. tax. This section sells the bulk of its production to factories making blackcurrant syrup. I ask my right hon. Friend very carefully to consider the effects this tax has had on this section of British horticulture. During the past year, purchases of its production have been reduced by about 25 per cent.—and this was a growth section of British horticulture.
    I know that in the past my right hon. and learned Friend the Member for the Wirral (Mr. Selwyn Lloyd), when he was Chancellor of the Exchequer, gave very careful consideration to the problems of our horticultural industry and made certain concessions to it, but, having undertaken considerable capital expenditure in preparing to increase the total acreage for the production of blackcurrants, the industry finds that the imposition of this tax has resulted in a serious decline in sales. Whereas, last year, the prices increased for almost every commodity under the heading of soft fruits, prices for blackcurrants came down because of surplus supplies. I ask my right hon. Friend to give very careful consideration to this problem.
    Mr. Donald Chapman: The hon. Member for Kidderminster (Sir G. Nabarro) referred to the customs of the House, but, first he must know that the custom on an occasion like this is to put down as many new Clauses as possible in order to have, for example, a wide discussion on Purchase Tax. We are not committed to them all, or to them all at once. This is an attempt by the Opposition, quite rightly, to stage a full-scale debate on Purchase Tax. To add up the figures, as the hen Gentleman did, and to pretend to make a point of it, will only be laughed at by anyone who knows Parliamentary procedure.
    1166
    Secondly, although the hon. Gentleman treats us to a good deal of knowledge in such matters, and to a robust presentation of his case, it might be a good thing for him to use a little less personal offensiveness. Most of us are tempted entirely to disregard, or to write down, what he says because of the offensive tone he continually adopts. I wish that after his eleven years here the hon. Member had learned a little better.
    5.30 p.m.
    I want to speak about the effect of the new Clause which proposes to reduce the 25 per cent. rate of Purchase Tax on motor cars. This gives me an opportunity which I have seized on previous occasions to talk about the effect of Purchase Tax on an industry which is making no mean contribution to our export drive and, indeed, to our livelihood as a whole. The industry is now exporting to the tune of £600 million worth of production a year, which is a considerable slice of our total. We have been pleading for years—and I was glad then to have the hon. Member for Kidderminster on our side—for a reduction of Purchase Tax on motor cars to that with the strength of a big and expanding home market behind it the industry could make a vigorous effort in the export trade.
    I want to look at what has happened in recent years. When I made these pleas for the reduction of Purchase Tax on motor cars in the late 1950s, in speech after speech, year after year, I pointed to the dangerous trends which were facing us and to the dangers of Government policy as it was afflicting the motor industry at that time. I was saying then that here we were in the early 1950s, the undoubted world leaders in the production of motor cars. Even in the middle 1950s we were well ahead and there was no reason to believe that, given a vigorous effort, we could not stay well ahead. But if we look at the later years of the 1950s, as I said at that time, the danger which was creeping up on us—owing to Government policy, particularly on Purchase Tax—was that Germany was catching up and passing us; that France, which had started miles behind us, was beginning to be a notable competitor; and that Italy, from having been an also-ran, was beginning at last to challenge us very strongly throughout the world.

    1167
    I made plea after plea that Government policy should not show this prevarication on Purchase Tax which should be brought down to a level comparable with that of our main competitors in Europe so that our industry could say, "We can go ahead now and see whether we can beat our competitors." I made these pleas year after year, giving precise figures for the growth in production and exports among our competitors.
    If we now bring these figures up-to-date, it will be seen that nothing illustrates more vividly or epitomises more clearly the failure of the Government's "stop-go" policies over the last few years. This is also what is brought out in the desperate possibilities for the industry in the future. This is the legacy of policies in the 1950s.
    After giving this word of warning year after year, I should, then, like to note now where we have landed ourselves in 1963, as a result of those policies of the 1950s. The latest figures are for the complete year 1962. We were then producing about 1·2 million cars and exporting 500,000. But what happened to our competitors compared with only a few years previously? Germany, from being level-pegging with us, produced last year nearly twice as many motor cars as we did. She knocked us for six in world markets, and was selling double the number of cars that we sold in those markets. To our shame France, which was not a desperately important competitor in the middle 1950s, was ahead of us for the first time last year, producing 1·3 million compared with our 1·2 million and selling nearly as many as we did in the export market. Italy, from being of no importance and no challenge to us in world markets in the middle 1950s, was producing in 1962, 877,000 or more than two-thirds of our total production and selling abroad more than half as many as we sold.
    These figures are important not only because of the totals reached but because they show the progress in our industry compared with the industries of our competitors. Year after year, given suitable economic conditions, including a coherent policy on Purchase Tax with it reduction to realistic levels over the home market, our competitors were not showing the
    1168
    swings shown in our production, the dropping back and the lurches forward, and worries every year as to what the figures would bring. They were showing a steady, gentle growth based upon the coherent economic policies of their Governments.
    Mr. Gower rose—
    Mr. Chapman: I am in the middle of this argument. I will give way later.
    While our industry was in danger of dropping back and was going through a very bad period, production in France went up steadily—from 600,000 to 700,000, then to 950,000, to 1,080,000 to 1,100,000 and finally to 1,340,000. This was the steady progress of an ordered economy, compared with the stop-go policies and the incoherence and largely reactionary policies on Purchase Tax from which our industry suffered.
    One year our industry was told that if Purchase Tax on motor cars was reduced it would cause inflation and release too much purchasing power. The next year the industry was told, "We have got into difficulties in the export market and if we reduce Purchase Tax we shall have too many cars sold on the home market."
    We never got anywhere until we had one big break-through last year and the rate of Purchase Tax was reduced to 25 per cent. All honour to the Government that they reached that stage, but hon. Members should consider how late all this is. It is done at a time when Germany is producing and selling twice as many cars, when France is way ahead of us, and Italy has nearly caught us up. In terms of population and industrial concentration we ought to be equal in production and exports with France and Germany. There is no good reason why we should have been beaten in this way.
    Is it too late? We never had the momentum in the 1950s. Can we now capture enough momentum to begin to catch up with those who have a head start on us? This year things are going reasonably well and perhaps we shall produce 1·4 million or even 1·5 million cars. On present figures we should sell over 600,000 cars in the export market, compared with 500,000 last year. But we shall have to work very fast now to catch up with those who have this head start and this developed momentum. We shall have to continue this pressure for the

    1169
    reduction of Purchase Tax because we have such a leeway to make up. We are just at the highest level of Purchase Tax compared with our competitors. I think that one other competitor has a Purchase Tax level of 24 per cent., whereas some of the others have a tax of 19 per cent. and even 12 per cent. Those of us who represent constituencies where these things are matters of life and death must continue to insist that the time has come for a further reduction in the tax to help to make up for the lean years when our industry was so afflicted by what the Government did.
    Much though I am happy to pay tribute to the reduction last year. I hope that the Chief Secretary will not take it that any of us are entirely satisfied. No doubt, he would reply that no one is ever entirely satisfied, so I will say, let him not even expect that many of us will be very satisfied. There is a good deal still to be done to help the industry forward now that, his Government have let it fall so far behind some of our main competitors. We shall be returning to this subject year after year to press our case yet again.
    Mr. Gower: It may be desirable, as the hon. Member for Birmingham, Northfield (Mr. Chapman) said, that there should be greater continuity in the level of Purchase Tax, particularly as it affects the motor industry, but the hon. Gentleman exaggerated his case by speaking of the sensational increase during the early 1950s in production in Germany, Italy and France. That increase was not due either solely or largely to the incidence of Purchase Tax. The hon. Gentleman distorts the picture when he chooses to ignore the fact that those countries were countries which received a great deal of financial aid and new equipment immediately after the war, in many cases brand new factories, and were able to build up their production. When he spoke favourably of our ascendancy in 1950, he forgot that we were ascendant then because we had no competitors.
    Mr. Chapman: The hon. Gentleman has got it entirely wrong. I did not begin my figures in 1950 deliberately for this reason. I started in 1955 and 1956 and spoke of the momentum since then. I did not once refer to the early 1950s.
    Mr. Gower: I accept that correction. Reluctantly, in the end, the hon. Gentle-
    1170
    man admitted that there had been some improvement. He should know that one of the stops to which he referred has, during the past twelve months, occurred in the continental motor industry, too. For instance, when I was in Italy recently I found that during the past year or so German exports to Italy had taken a steep dive, while British exports to Italy had taken a steep rise. This has not occurred since the last Purchase Tax change. It happened before then.
    In his opening remarks, the hon. Gentleman said that these new Clauses were merely intended to explore the position and not in any way to commit the Opposition to support of any reductions of Purchase Tax. But this was not the case put by his hon. Friend the Member for Cardiff, South-East (Mr. Callaghan), who introduced the new Clauses, making clear that the main motive was to reduce the cost of living. They were not exploratory at all, according to him. I presume that the hon. Member for Cardiff, South-East wanted the Government to accept these new clauses and he wanted them to reduce the Purchase Tax levels. If so, he went about it in a strange way, and his case was less than persuasive and less than objective.
    The hon. Member for Cardiff, South-East chose to concentrate on certain aspects of the cost of living, making no comment at all upon the standard of living. He commented only on the desirability of reducing the Purchase Tax and took no account of other reductions in other forms of taxation which have taken place in the last six months or so. One has to consider these proposals in the light of those reductions and consider what effect the reductions have had or are likely to have.
    I do not wish to do him an injustice, but I was not clear whether the right hon. Member for Orkney and Shetland (Mr. Grimond) was warmly in favour of these proposed reductions or firmly opposed to them. On the other hand, I have the firm impression that the hon. Member for Cardiff, South-East was very firmly in favour.
    What steps have been taken so far? The hon. Member for Northfield referred obliquely to one of them. There were the Purchase Tax reductions towards the end of last year. Also, there was the announcement in February by the

    1171
    Minister of Pensions and National Insurance of considerable increases in several benefits under the National Insurance Scheme, including retirement pensions, and, of course, lots of other things, too. In the Budget there was the announcement of considerable changes in direct taxation and Income Tax allowances and the announcement of special assistance to the development districts.
    5.45 p.m.
    Some of these measures cannot yet have taken effect. Many of the benefits of the National Insurance changes are to apply for the first time this month.
    Mrs. Slater: And the increased charges.
    Mr. Gower: I accept that, but the benefits also will take effect only this month. The benefit of the Income Tax changes will not take effect for a month or two and, therefore, can have had no influence yet.
    Mr. James Dempsey: Negligible.
    Mr. Gower: The hon. Gentleman may say that, but they cost in toto £269 million, so they cannot be negligible.
    Mr. Dempsey: Does the hon. Gentleman realise that the change in Income Tax applied, for instance, to a head teacher in Scotland produces an average of 2s. a week, which is already more than offset by increased National Insurance contributions, apart from all the other increased charges?
    The Temporary Chairman: May we deal with the Purchase Tax?
    Mr. Gower: I was relating my argument to the Purchase Tax, Mr. Blackburn. I said that one could not consider the virtue or value of these new Clauses without taking into account all these other things. I hope that you will not regard that as outside the terms of the new Clauses.
    It would be most unreasonable at this time to call for further reductions in tax by the very large amounts proposed in the new Clauses. It was notable—my hon. Friend the Member for Kidderminster (Sir G. Nabarro) made this very fair comment—that the hon. Member
    1172
    for Cardiff, South-East did not refer at all to the cost of the new Clauses. To add to the £269 million, which the hon. Member for Coatbridge and Airdrie (Mr. Dempsey) seems to think is very small, another sum of about £270 million for these Amendments, on top of all the other items to which I have referred, is surely out of the question now. All these things could lead to what we do not desire, an excessive release of purchasing power in the autumn.
    I submit that on those grounds it would be better at this stage to see to what extent the other concessions will take effect. The right hon. Member for Orkney and Shetland thought that these changes had shown themselves already to be inadequate. I respectfully submit to him that it is too early yet to arrive at any such conclusion. It would be much wiser on balance, to wait. Hon. Members opposite may say, "If you do not do this now. you have lost your power to act". They are wrong. My right hon. Friend still retains the regulator which he can use to effect some of the desirable aims implicit in the new Clauses if conditions are favourable. We should take time to assess the effect of the concessions made already. The changes proposed in the Finance Bill are very considerable.
    There has already been a more than promising upturn in production. Despite some criticisms, there is an encouraging trend in exports. It would be most unwise at this stage to imperil the important changes which have been made and the encouraging trends which can be seen. My right hon. Friend has in reserve the power of the regulator and, if the changes which have already taken place show themselves to be inadequate, he can use that additional power. On those grounds, I urge that the new Clauses should be rejected.
    Mr. Victor Yates (Birmingham, Lady-wood): It seemed to me that the hon. Member for Barry (Mr. Gower) was terribly confused about this matter. He entirely ignored the fact that the action of the Chancellor of the Exchequer in reducing the tax on motor cars had led to an increase in the sale of motor cars. This is an argument which has been used in the past by the hon. Member for Kidderminster (Sir G. Nabarro). I am

    1173
    sorry that he is not in his place. His argument against my hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) was that my hon. Friend had not stated what the cost of this proposal would be.
    The hon. Member for Kidderminster has from time to time asked my hon. Friends and myself to support him in his demand for reductions in Purchase Tax. We have even had communications from the Society of Motor Manufacturers and Traders asking us to support the hon. Member. The measures which the hon. Gentleman proposed would have cost millions of pounds, but that did not alter the argument used by the motor car manufacturers, which I think was very legitimate. It was that if the tax were reduced it would lead to an increase in sales and, therefore, to an increase in Exchequer funds.
    What I cannot understand is that the Chancellor of the Exchequer has made no concessions in respect of Purchase Tax in the Budget. If we can point to the fact that there is unemployment as the result of the imposition of Purchase Tax, that should be very carefully considered by the Government. I am very sorry that all the arguments which we have advanced on behalf of the motor car and bicycle industries have fallen on deaf ears. The tax on bicycles has led to the closure of at least six bicycle factories. Yet there is a wide market for bicycles. Where we can show that the imposition of this tax is adding to the unemployment difficulties, the Chancellor of the Exchequer should examine what we say very carefully.
    My hon. Friend the Member for Cardiff, South-East referred to the effect of Purchase Tax on the cost of living. Increases in the cost of living restrict the demand for goods and services. If we restrict the demand for goods and services, the number of people in employment declines. I do not know that the result of a reduction in tax would be that worked out by the hon. Member for Kidderminster. I do not know how he worked out his figures. But if it can be shown that a reduction in tax leads to an increase in employment, there is a lot to be said for it.
    I do not apologise for again referring to the tax on confectionery. I think
    1174
    that it was regrettable that this 15 per cent. tax should have been imposed a year ago. It is argued that there should be no discrimination, but I would certainly discriminate against a tax on the food of the people. I think that it was a calamitous action on the part of the previous Chancellor of the Exchequer when he taxed soft drinks, ice cream, lollipops, sweets, and so on. He also included chocolate biscuits, which form an essential part of the housewives' shopping. It is extremely difficult to discriminate between this type and other types of biscuit. If the Chancellor of the Exchequer had put a tax on every item of food, there would have been a greater outcry than there was.
    In imposing this tax on confectionery, the Government included chocolate biscuits, a commodity which is made up of flour, fats, and so on. It is not made up of the same things as sweets. There is discrimination between the ordinary sweet biscuit and the chocolate biscuit. Chocolate biscuits, like ordinary sweet biscuits, are supplied by grocers. Seventy-six per cent. of them are sold in food shops, whereas the smaller single chocolate biscuit is sold as confectionery in confectioners' shops. Sweet biscuits are tax free. If a biscuit has chocolate on one side of it, it is tax-free. If it has chocolate in the middle as a sandwich, it is tax-free. Only if it is wholly covered with chocolate is there a tax on it.
    I understand that in 1961 the output of biscuits was 480,000 tons, of which 40,000 tons were chocolate biscuits. The firm of Cadbury decided to take a factory in Moreton, in Cheshire, a development area, for the sole purpose of producing chocolate biscuits. It took the production of chocolate biscuits from Bournville, Birmingham, to Moreton, only to be told after it had got the factory going very well that a tax was to be put on chocolate biscuits.
    The figures show very clearly that as a result of putting this tax on chocolate biscuits employment in the Moreton factory which on 1st April, 1962, stood at 2,940—a very important contribution to employment on Merseyside—went down as at 1st April, 1963, to 2,454, a drop of practically 500 in a development area. There was a reduction of 20 per cent. in employment among women and 11 per cent. among men.

    1175
    There is no sense or reason in asking a firm to take a factory in an area of unemployment and, when it gets there, impose a tax which brings down employment by 500 in a year. It is neither right nor fair. I think that this matter should be examined very carefully. I hope the Government have looked into it.
    6.0 p.m.
    I want to give one other case. I wrote to the chairman of the directors of United Biscuits, who told the annual meeting of shareholders that this tax had had a serious effect upon the biscuit industry. In reply, Sir Peter Macdonald informed me that in the firm of Crawford's there had been a reduction of, I think, 30 per cent. in a year, and he said that this instance could be multiplied in a number of industries. A number of industries have shown a reduction in employment because of this tax.
    I suppose that there has been a reduction also in the confectionery trade, although not to the same extent. I understand that the figure is more like 3 per cent. It is not quite as serious as the effect which the tax has had on the housewife in her choice of food.
    Why should the chocolate biscuit be classed as sweets or confectionery when chocolate biscuits can be included in tins of mixed biscuits which are sold as sweet biscuits? This is unfair discrimination. I want the Chancellor to remove this discrimination and to make a big contribution to the employment situation by doing so.
    Mr. D. Jones: I support the new Clauses because of the effect they would have on the cotton textile industry, which is an important industry in Lancashire and certainly in my constituency of Burnley. First, however, I hope that I may be forgiven in joining my hon. Friend the Member for Birmingham, Northfield (Mr. Chapman) and taking exception to the manner of the right hon. Member for Kidderminster (Sir G. Nabarro).
    Mr. J. T. Price: He is not right hon. yet.
    Mr. Jones: I stand corrected. Nevertheless, my point remains, and I shall be brief.
    1176
    I do not mind a good slamming in debate, nor do I mind the offensiveness with which the hon. Member treats the Committee. I object that he should treat the House of Commons as though he were on the stage at the Old Vic and we were nothing but an admiring or critical audience. Having said that, I will deal with our proposals, which, I hope, will influence the Minister in accepting the new Clause.
    I repeat that my interest is confined to the cotton textile industry, but once again I might, perhaps, be permitted to refer to the amount of money that the hon. Member for Kidderminster said was involved in the new Clauses. He gave a figure of £271 million. I do not quarrel with his analysis or his arithmetic—I should like to accept it. I point out, however, that the £271 million to which the hon. Member objects is far less than the amount that Her Majesty's Government are preparing to spend in trying to convince the world that we are an independent nuclear Power. That should be noted not only by the hon. Member for Kidderminster but by the whole Committee and the Government.
    While I do not want to go into all the points relating to the cotton textile industry, I will mention at least certain salient points. This industry has suffered hard at the hands of the Government. We know that there was a tremendous reorganisation in 1959. We know that Ministers assured the cotton textile industry that given co-operation, there was a period of stability and prosperity ahead. It is not strictly relevant to my argument that those views were expressed in the pre-election period. The point is that those statements were made and have been repeated. For that reason, the Government are under a moral obligation to the industry, which they could show by accepting the new Clause.
    I should like to draw attention to the number of people who are entitled to have some new glad rags at least once a year. This appears to be a source of merriment to the Chief Secretary to the Treasury, but I dare say that his good lady and his daughter—
    The Chief Secretary to the Treasury and Paymaster-General (Mr. Boyd-Carpenter): I am sorry. I was amused by an interjection from one of the hon.

    1177
    Member's hon. Friends below the Gangway. If the hon. Member had heard it, he, too, would have been amused.
    Mr. Jones: I accept the Minister's explanation. The wives, daughters and sons of Ministers would undoubtedly claim for themselves that elementary right. I have figures, in which the Committee might be interested, showing that there are 5,821,000 old-age pensioners, 2,046,000 people on National Assistance, 553,000 unemployed, 1,196,000 absent from work because of sickness and 64,000 absent from work because of injury—I notice your look of bewilderment, Mr. Blackburn—making a total of 7,737,000 people who would benefit from the new Clause.
    The Temporary Chairman: I thank the hon. Member for resolving my bewilderment.
    Mr. Jones: I saw that you were puzzled, Mr. Blackburn, and, perhaps, rightly. Nevertheless, I want the Committee to appreciate that there are 7,737,000 people who, it could be claimed, are leading sub-standard lives.
    The person who is away from work because of sickness, accident or unemployment has his income reduced by about two-thirds. I am arguing that if the Clause were accepted such persons would have an opportunity to adorn themselves far better than they can today. Some old-age pensioners have told me that they have not bought a new garment for themselves in ten years. That strikes me as distinctly unfair. If the position were altered, it would represent a great contribution to an industry which has been very hardly treated by the Government.
    I want now to deal with certain observations made by the industry. There is 10 per cent. Purchase Tax on all cotton textile handkerchiefs but none on paper handkerchiefs. This is a further discrimination to which the industry objects. Notwithstanding that in 1959 Ministers said—and it has been repeated since—that the industry would quickly have an up—turn, I am reliably informed that the industry, which really expected an upturn in September, 1962, is still waiting in vain. The industry—in order to keep myself in order, I repeat that it would very much helped by the Clause—is ticking over on its present very unsatisfactory level because many mills are making
    1178
    a loss and choose to do that rather than go out of business. I ask the Government seriously to consider the Clause in relation to an industry to which the Government certainly owe something.
    Before I close I want to refer briefly to an observation made by the President of the Board of Trade in our last debate about the cotton textile industry:
    I look forward to co-operating with the Co on Board in future and to discussing with it the industry's plans for the future as soon as it is able to do so."—[OFFICIAL REPORT, 28th June, 1962; Vol. 661, c. 1386.]
    I am in a position to say that the Cotton Board and the trade unions would very much support the new Clause for the reasons which I have given, and I hope that it will be a very seriously considered for the purposes which I have outlined. It is the kind of co-operation that would be appreciated.
    Mr. A. V. Hilton: During the discussions on the Finance Bill I have often wondered why there is any need to have a Tory Chancellor of the Exchequer or anybody else on the Treasury Bench. To listen to the hon. Member for Kidderminster (Sir G. Nabarro). He created the impression in the Committee this afternoon that he alone is responsible for the Government's policy with regard to Purchase Tax and that it was his idea that Purchase Tax on furniture, clothing, shoes and other things should be increased a year ago and that 15 per cent. Purchase Tax should be imposed on soft drinks.
    6.15 p.m.
    But the hon. Member is so obsessed with his own importance and his own words that, as he admitted this afternoon, he is unable to distinguish between essential and luxury goods. I suggest to him that there is a vast difference between the real necessities of old-age pensioners and other large groups in the country who desperately need a new suit, a new pair of boots or new furniture and those of persons requiring perfume or even a Rolls Royce. However, it is obvious that the hon. Member is not alone in his view that there is no difference between necessities and luxuries, and that is shown by the empty benches on the other side of the Committee. I am pleased to see that my hon. Friends are at least interested in the important matters that we are discussing and are present in large numbers.

    1179
    There are two matters to which I want specifically to refer. One is the tax on soft drinks, which includes blackcurrant juice.
    Sir G. Nabarro: Ribena.
    Mr. Hilton: As the hon. Member says, blackcurrant juice is another name for Ribena. In my constituency agriculture is the most important industry, and for many years many large and small farmers have grown many acres of blackcurrants, and that crop represents the main income of the holding in many instances. The imposition of 15 per cent. Purchase Tax on soft drinks, which covers blackcurrant juice, has meant that the blackcurrant growing side of the horticultural industry has been very badly affected. As was mentioned by the hon. Member for Worcester (Mr. Walker), sales have gone down by 25 per cent. It is a serious matter for those who have been growing the important blackcurrant crop in recent years. Not only has the crop been a very useful source of revenue for farmers, but blackcurrant juice is a very valuable substance for children suffering from the usual ailments and for people with colds.
    I hope that the Minister will take note of this plea in spite of the fact that he has the support of his hon. Friend the Member for Kidderminster on imposing the tax on blackcurrant juice, and I trust that he will reduce that tax on this and on all soft drinks.
    Sir G. Nabarro: I am very much in sympathy with what the hon. Member has said. It was an accident that Ribena was taxed. Ribena is not a soft drink. It is a preparation principally for the use of infants and should not be regarded as a soft drink. For that reason the Purchase Tax on it should be removed.
    Mr. Hilton: A moment ago the hon. Member for Kidderminster admitted that he, and he alone, was responsible for the tax on Ribena. Now he says it was an accident. I should like this cleared up one way or the other.
    Sir G. Nabarro: Then I will tell the hon. Member.
    Mr. Hilton: I agree with the hon. Member when he says that the tax should be knocked off now. I am pleased that
    1180
    I now have his support. It is injurious to people in my constituency and in the County of Norfolk as a whole and in other areas where this crop is grown, and to the people who benefit by consuming it.
    Sir G. Nabarro: Will the hon. Gentleman permit me—
    Mr. Hilton: I would remind the hon. Member that he was reluctant to give way to someone else. I heard him say that he refused to give way. However, unlike him, I will give way.
    Sir G. Nabarro: I was merely reciprocating to the hon. Gentleman the Member for Cardiff, South-East (Mr. Callaghan). My constituency grows far more blackcurrants than does that of the hon. Member for Norfolk, South-West (Mr. Hilton). In the Dee Valley and the Vale of Evesham it is the centre of this branch of the horticulture industry. It is an accident that Ribena has been taxed at all. It is a mistake in classification. Ribena is not a soft drink but a preparation for children alone. The hon. Member does not drink it and nor do I. We drink ale. That is a different matter.
    Mr. Hilton: I do not drink ale or Ribena. I drink orange squash, which also carries a 15 per cent. Purchase Tax. I hope that the hon. Member's constituents will remember at the General Election, which he says is coming in October, that it was he who imposed this iniquitous tax on blackcurrant juice. But I agree with him that it should never have been imposed and that it would be in the best interests of very many people in this country if it were removed.
    My hon. Friend the Member for Birmingham, Ladywood (Mr. V. Yates) referred to the effect of Purchase Tax on bicycle manufacture. I want to refer to bicycles in another context. My constituency is completely rural. Some of the railway lines in Norfolk have already been taken from us. Dr. Beeching has certain proposals for the county, and if these are carried through, as we have every reason to believe that they will be quite soon, many more people in rural Norfolk will be deprived of public transport.
    The main means of transport for the majority of people there is the bicycle. But the existing Purchase Tax on these

    1181
    machines means hardship for these people, the majority of whom are on the bottom rung of the wages ladder. Not long ago, I put a Question to the Chancellor about this, and I think he said that to remove the tax from bicycles altogether would lose him £1¼ million a year. This is really a very modest sum, and if it is correct, I am sure that the Committee will agree that this would neither make nor break the economy. It would hardly affect the Chancellor at all, but it would be a blessing to very many people. I hope that the right hon. Gentleman will look sympathetically at the problems of the many people in rural areas all over the country who have to rely on bicycles. If he cannot agree to removing the tax altogether, I hope that he will at least sympathetically consider its reduction.
    Mrs. Harriet Slater: This debate has covered a number of subjects, ranging from chocolate biscuits—on which my hon. Friend the Member for Birmingham, Ladywood (Mr. V. Yates) put so strong a case—to bicycles, textiles, horticulture and general items under the Purchase Tax. I want to put the case from the point of view of the ordinary person affected by the large variety of items subject to Purchase Tax.
    The hon. Member for Barry (Mr. Gower) said, in support of leaving things as they are, that we must weigh against Purchase Tax all the benefits which the Government have given to us in return. But I suggest that large numbers of people paying Purchase Tax on many necessities are not benefiting by one brass farthing. This can be seen when these benefits are weighed against the terrific increase in the cost of necessities.
    Let us examine some of the items. Everyone has to wear clothes. This week the old-age pensioners will get an increase in benefit. That can be whittled away by having to buy a new coat or a new dress or new shoes. They may need new household commodities, such as pillow cases, blankets, sheets and curtains, in order to make their homes look presentable. They may want wallpaper to make their living rooms look a little better. But on all these things they must pay Purchase Tax.
    Surely some of them are entitled to some new furniture occasionally. Their rocking chairs, mattresses and other
    1182
    articles of furniture all need replacing or repairing from time to time. But they will have to pay Purchase Tax. It is the same situation when we consider new floor coverings, new tiles and new cutlery. All these things affect ordinary people.
    When the hon. Member for Kidderminster (Sir G. Nabarro) talks about Purchase Tax, he is very fond of referring to a 60-guinea suit. I am thinking of the person who can afford to pay at the most only 10 guineas for a suit. I think of the persons who can afford only the bare necessities of life, who must seek out the cheapest possible shops. It is they who are carrying the heaviest burden. Yet these are the very people to whom the Government, at the election, will say, "Look what a marvellous job we have done for you."
    The Government say that they need the £271 millon involved in Purchase Tax. Admittedly, they would not want to lose that sum, but if I had to choose between various items, I would not cut Purchase Tax on expensive items but on those which matter most to ordinary people.
    My hon. Friend the Member for Birmingham, Northfield (Mr. Chapman) spoke of the effect of Purchase Tax on the motor car industry. I appreciate that. I have just bought a new car, so I myself have benefited from the cut in Purchase Tax on cars. But if I had to choose between paying more Purchase Tax on a new car and the Purchase Tax on necessities for old people, the man earning less than £10 a week, and the woman with a large family, I would willingly pay more Purchase Tax on the car.
    Do not let the Government have their tongues in their cheek at the next election. Let them remember that they have not dealt justly with the ordinary consumer. They have maintained Purchase Tax an goods from which they could have removed it if they had had the will to do so. It is no good telling us that the standard of living has increased. We must judge them on the fact that if increases in wages or benefits are offset by increased taxation, the standard of living of these ordinary people does not go up one iota.

    1183
    I am also interested in pottery. The industry is not doing so well as it was a few years ago. Fewer people are employed in our area, because plants other than pottery factories have been forced to move to Northern Ireland and places like that. It means an awful lot whether the tax is kept on good china or good earthenware, and the home market might be considerably benefited by at least a reduction of Purchase Tax.
    6.30 p.m.
    Another item is musical instruments. We have spoken about this time and time again. After all, we are entitled to a little culture in this country as well as having to work hard. To keep the tax on musical instruments is not good enough. The schools have never had it so good. They are doing a tremendous job in increasing the standard of culture in music and the appreciation of music. Yet when people want to buy a new violin, or a new recorder, or a new piano, they have to pay Purchase Tax. These are things from which the Minister might consider taking the tax.
    The same applies to articles like trophies. The schools are doing a tremendous job in encouraging high standards both academically and physically. Yet when a school wants to buy a trophy—a cup or a bowl—or get some one generous enough to buy it, Purchase Tax has to be paid. I believe that shields are exempt, though I have never understood why there should be a distinction.
    I ask the Minister to look at the question of Purchase Tax on clothing, furniture and essential commodities in the home, and to realise that if the Government mean what they say and are really concerned to give the shopper a fair deal, they should take Purchase Tax off these items which the ordinary person has to buy.
    Mr. Brian O'Malley: I support the new Clause because I believe that it would help that section of the community which most needs help. I refer to that section of the community which is not paying Income Tax at all. I particularly have regard to the desperate plight—it is a desperate plight—of the old-age pensioners. Their situation has been alleviated somewhat by the increases which, I think, come into effect this week,
    1184
    but nevertheless, their position is still extremely difficult.
    We heard earlier this afternoon the hon. Member for Kidderminster (Sir G. Nabarro) saying, when talking about television sets, wireless sets, foodstuffs, shoes, clothing, carpets and so on, that one thing was not more important than another. I would tell him that my parents are old-age pensioners. I have practical experience and knowledge of this, and I wonder whether he has? Does he realise the difficulty of old-age pensioners when they want to buy a new carpet, or curtains or a new coat? I wonder whether he realises as fully as he should the difficulties of the poorer section of his own constituents, and particularly those of the family man with a very small income who finds the utmost difficulty in furnishing his house and in buying those things which are at the 10 per cent. rate. I think that the remarks we heard from the hon. Member for Kidderminster—I do not want to spend a great deal of time on them, but I feel bound to make some comments—were on the surface, facile, extremely superficial and inaccurate generalisations on sugar, television and all kinds of things.
    In fact, the hon. Member for Kidderminster has the capacity, if it is something that is worth having, of making the economic problems of this country appear so simple that he can deal with them when practically no one else can. One sympathises and understands perhaps why the Government for lack of a Borgia has no alternative but to promote him to put him out of their way. I do not think that I need spend any more time on the facile generalisations and nonsense that we have heard from the hon. Member for Kidderminster.
    Sir G. Nabarro rose—
    Mr. O'Malley: I shall not give way for a moment, because I have not yet come to my important point. We are told that the Chancellor has decided, and I think rightly, although at a very late stage, that the economy needs stimulation. I would agree with him on that. He has looked at the overall economic situation and has come to a certain decision about how much he considers should be pumped into the economy to get what he describes as expansion without inflation. One feels, however, that he has neglected to consider sufficiently the large number

    1185
    of human problems which arise. I suggest that we have to consider these human problems when we are taking economic decisions. We have to look at the problems of the people who are very heavily affected by the 10 per cent., 15 per cent. and 25 per cent. Purchase Tax on all kinds of necessities.
    I shall not say a great deal about protective clothing, because I understand that one of my hon. Friends intends to discuss it in more detail at a later stage. I realise that in the collieries and in the steel industries in and around my constituency the National Coal Board and the steel companies have done, and are doing, a great deal to try to solve the problem of accidents and to make their industries safer. However, we still have a situation, which is important particularly to many of the small firms, where the 10 per cent. Purchase Tax on protective clothing perhaps militates, even though marginally, against the standards of safety and the lowering of the accident rate which is desired by all hon. Members.
    The main point that I wish to raise is on the question of musical instruments to which my hon. Friend the Member for Stoke-on-Trent, North (Mrs. Slater) referred. We all realise that music is of importance educationally, and is vital to the cultural life of the community. The case for the abolition of Purchase Tax on musical instruments, which, in my opinion, is overwhelming, has long been argued in this Chamber and elsewhere. I would not wish to bore the Committee by going into the history of it. The Purchase Tax on musical instruments is 25 per cent. on the wholesale price, and this means that the purchaser has to pay an added one-seventh on the retail price. However, we observe that pianos, organs—and presumably that includes electric organs, but if I am wrong I hope I shall be corrected—and musical stands are the exception to this 25 per cent. Purchase Tax.
    I should like first to examine some of the anomalies which have arisen as a result of the present Purchase Tax rates on musical instruments. The parent who wishes to have his child trained as a pianist pays no Purchase Tax when he buys a piano. I agree that this is a good thing. On the other hand, the parent who wishes to have his child taught to play a violin, or a cello, or a trumpet,
    1186
    or a clarinet, has to pay 25 per cent. Purchase Tax.
    Next let us look at this from the point of view of the professional musician, and by this I mean the musician who receives payment of £100 or more per year. He may be employed part-time or full-time in a dance hall. The trumpeter, the violinist, the saxophonist, the clarinetist, and the trombonist have to pay tax on their instruments, yet the pianist pays no tax on his piano. The individual musician has to pay 25 per cent. tax on his instrument, but the breweries, the large dance hall companies, and the owners of public houses do not have to pay tax on the electric organs they buy and which constitute a great threat to employment in the musical profession.
    The second anomaly arises in connection with music stands. As a result of a ridiculous decision by the Board of Trade that music stands equal bandstands and that bandstands are another form of building, as a building is not subject to Purchase Tax, music stands are no subject to it either. One would have expected the Government to say something which made sense, and when I was a trade unionist in the Musicians' Union I had on a number of occasions to put forward this peculiar reason for there being no tax on music stands.
    When, in 1940, because of the difficulties caused by the war the question of Purchase Tax was considered, the then Chancellor of the Exchequer proposed a Purchase Tax on books. There was a tremendous outcry, the argument being that books constituted part of the cultural pattern of the country and therefore should not be subjected to Purchase Tax or to tax of any kind. The Chancellor of the Exchequer yielded to that pressure. The result is that musical instruments are the only items concerned with culture which are subject to Purchase Tax. In fact, with the exception of Japan, and to a lesser extent the United States which imposes a small tax on musical instruments, we are the only country in the world which taxes musical instruments. And even in Japan educational authorities and youth associations can claim in rebate from the Government the full amount of tax paid on musical instruments.
    next consider the position of the professional musician in relation to the

    1187
    imposition of this 25 per cent. Purchase Tax. When I talk about a professional musician, I mean the person who earns money working either part-time or full-time in the musical profession. The saxophone, the violin, and the various other musical instruments which are subject to this tax are the tools of a musician's trade. No other craftsmen or professional men have to pay Purchase Tax on the tools of their trade. The Purchase Tax on musical instruments is high because these tools of a man's trade are expensive. For example, the trumpet which the average musician might purchase in London today costs between £50 and £100. I am speaking of the average musician, buying the average instrument, and not the expensive instrument which some people like to use. If a saxophonist wished to buy a Selmer tenor saxophone, it would cost him £140. Of this figure, one-seventh is represented by Purchase Tax.
    Mr. J. T. Price: I am following my hon. Friend's argument with interest and sympathy. I support the new Clause fox the general relief of tax on musical instruments, but does not my hon. Friend think that there is a case for doubling the Purchase Tax on saxophones?
    Mr. O'Malley: A saxophone played well produces a very pleasant sound, and I am sorry that my hon. Friend has not learned to appreciate it.
    6.45 p.m.
    Many people think that professional musicians are highly paid. Some are, but many of them are not, and having to buy an instrument costing £100 or more imposes a severe burden on them. I have employed many musicians during the last eight to ten years. They perform a useful public service. They work for perhaps three or four nights a week throughout the year, and are extremely busy throughout the winter season. They do not turn out until one or two o'clock in the morning for pleasure, although I agree that they get satisfaction from their work. If one does not get satisfaction from a job, one should not do it. Nevertheless, these musicians who do a job during the day, as I was doing before I came to this House—
    Mr. Wilfred Proudfoot: The hon. Gentleman said that he had
    1188
    an interest in this. Can he tell me whether a band gets an investment allowance on new instruments? It also occurs to me to ask what is the expected life of a saxophone?
    Mr. O'Malley: I shall deal with that in a moment.
    The musicians who work out several nights a week get some satisfaction from their work, but it is hard work to turn out until one and two o'clock in the morning. Their total income is about £300 to £350, a year and having to pay 25 per cent. Purchase Tax on their instruments is a heavy burden.
    Turning to the question asked by the hon. Member for Cleveland (Mr. Proud-foot) about Income Tax—
    Sir G. Nabarro: My hon. Friend asked about investment allowances.
    Mr. O'Malley: I think I am right in saying that the hon. Member for Cleveland asked whether, when a musician buys a new instrument to replace one which has worn out, he gets an allowance for it.
    Mr. Proudfoot: If an owner provided his band with new instruments, would he receive an investment allowance for them?
    Mr. O'Malley: No. Band leaders do not buy musical instruments for their players. The members buy their own instruments and claim Income Tax refund for the replacement of their instruments. The point is that this does not help the situation. If one is to get even a 7s. 9d. in the £ rebate on £30 or £40 eight, ten or twelve months afterwards, it does not help with the purchase of these expensive instruments.
    I think it relevant to a discussion on Purchase Tax on musical instruments to refer to the importance of music generally in society. It has a great deal to do with the cultural pattern of the country. Many people derive a great deal of enjoyment from music. There is a problem which will become increasingly difficult to solve in the future arising from the increased amount of leisure time resulting from automation and the use of modern industrial processes. As has been apparent in the first 60 years of this century, because of the kind of society in which we live, we are becoming increasingly a nation of passive listeners

    1189
    rather than active performers. When television programmes are abused, as sometimes they are, it is true that television is becoming the comic strip substitute for reading and a soporific alternative to performance. If people had the opportunity to acquire a musical training they would be more able to enjoy the kind of music to which they listen.
    Some people maintain that the standard of popular music is lower than is desirable. Perhaps it is lower than almost anyone would desire. One reason is that far too few children are being trained to play musical instruments because education authorities cannot afford to buy the instruments. I was recently at a school where that kind of situation prevails and even there the situation is not so bad as in other places. In the United States there are far more school orchestras than exist in this country. According to statistics—I find this hard to believe, perhaps because of the kind of society we have in this country—one in six of the pupils in the United States plays a musical instrument.
    This morning I was speaking on the telephone with a representative of Boosey & Hawkes, and he told me that 75 per cent. of the clarinets which his firm sells, the cheaper clarinets, are bought by young people between the ages of 10 and 15. I suggest that the 25 per cent. Purchase Tax on musical instruments is a drain on the future progress of culture in this country. We find a situation in which local authorities are handicapped by the imposition of Purchase Tax on musical instruments, and not sufficient numbers of young people are coming into the musical profession.
    I come from a colliery area and it is a fact that the brass bands, a feature of these areas for a long time, are now declining. Mining communities derived a great deal of pleasure from the performances given by such bands, but now the bands are going out of existence because of the Purchase Tax imposed on the instruments. By means of the Arts Council the Government hand out money for the promotion of interest in and the development of knowledge and understanding of the fine arts. But, with the other hand, the Government are taking back the money in the form of Purchase Tax.
    1190
    I support the new Clauses. I regard a reduction from 25 per cent. to 20 per cent. in Purchase Tax as at least a step in the right direction and something which may enable us to keep a flourishing music industry in this country. If we could get rid of Purchase Tax, or reduce it, that would alleviate the difficulties facing the music profession in 1963.
    Mr. J. T. Price: I hope that I may be expressing the feelings of all hon. Members if I say how much we enjoyed the speech of the hon. Member for Rotherham (Mr. O'Malley). He is a recent recruit to our counsels, although this was not his maiden speech, and we appreciated the lucid and well-informed manner in which he spoke.
    I do not wish to refer to the matters which are usually dealt with in Purchase Tax debates, but rather to deal generally with the implications of what it is sought to achieve by introducing these Amendments. It would be a strange sort of discussion on the Finance Bill if we did not at some time have a debate on Purchase Tax. On such occasions as this hon. Members, quite rightly, take the opportunity to refer to matters which affect the employment of their constituents, and we appreciate the reason for the special emphasis placed by my hon. Friends the Members for Birmingham, Northfield (Mr. Chapman) and Birmingham, Lady-wood (Mr. V. Yates) on the motor car industry and the chocolate making industry.
    If I wished to raise a constituency matter, I think I should be entitled to refer to the textile industry, because I represent a part of Lancashire where that industry has been largely destroyed by the foolish and stupid policy of the Government. But this is hardly the occasion on which to discuss that in detail. Unfortunately, some of the textile mills where formerly constituents of mine earned their livelihood now stand stark and empty. There is no one to make use of them for other purposes, and on a siutable occasion I shall deal at greater length with that situation.
    We are glad to see the Chief Secretary of the Treasury again in the Committee. I wish to put it to the right hon. Gentleman that there was a time when the Government defended the existence of present Purchase Tax rates and even an

    1191
    increase in them. The right hon. Gentleman will recall that his right hon. Friend the present Minister of Education, when he was at the Treasury, maintained that the purpose of the Government in retaining Purchase Tax at its present high rates was not in order to produce revenue for the Treasury, but to mop up surplus purchasing power. This became known as "Boyle's Law". When I went to school, Boyle's Law was something entirely different and related to physics, but in this Committee "Boyle's Law" relates especially to the former Financial Secretary to the Treasury, who is now the Minister of Education. The right hon. Gentleman then argued most tenaciously and with great skill and erudition, and with all the other qualities for which we give him credit, that Purchase Tax was imposed in order to mop up the surplus purchasing power.
    Mr. Chapman: Was not the "Boyle's Law" to which my hon. Friend refers that by increasing prices you brought prices down? That was what it became.
    7.0 p.m.
    Mr. Price: I do not want to be deflected into that branch of metaphysics. I want to keep on the straight and narrow path. I think that the general purpose was as I have stated it.
    This Government have had periods of blowing hot and blowing cold, of turning the tap on and turning it off, of stop start and go. All these things have been heavily criticised even by such reputable newspapers as The Times. Now we are told that in 1963 as we get nearer and nearer to a General Election, inflation has been brought under control by the wise policies of the last Chancellor of the Exchequer, who got the sack for those policies. Today we must reverse the engines and put more purchasing power into the economy. We are to have a period of expansion which we on these benches have been arguing for for many years. The Government have changed their pictures like a local cinema changes its programme twice a week.
    This does not square with opposition to the new Clause. I am concerned, as my hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) is concerned, with the domestic economy of ordinary people. I am not so much concerned with the academic high-falutin' arguments
    1192
    of politicians. I make no apology for batting on my own wicket. In parts of my constituency 6 per cent. of the electorate are unemployed as a result of the collapse of the cotton industry, the removal of industry from the district, the closure of coal mines and other industrial decay which has not been dealt with. If first-aid is to be brought to those who are suffering unemployment because of the wrong policies of this Government, I agree that long-term policies are needed to redistribute industry. We have argued tenaciously for that, but in the short-term what hits the ordinary person, particularly the unemployed, the old and those on low incomes, is the ever-rising cost of living.
    I am very much honoured by the fact that the Minister of Education has now come to listen to our debate. We are always pleased to see him. As I look round the Chamber tonight and compare the present situation with that in the House last night, I think it is a commentary on the way in which our affairs are conducted that when we are discussing bread and butter problems, the standard of living of the people reflected in cost of living and difficulties of meeting weekly housekeeping bills, practically all the Government benches are empty. Yet last night when we were discussing the fate of a remote African chief the House was packed. I do not complain that the House was so full then because we were discussing questions of great importance and human decency. Nevertheless the subject tonight is something which affects ordinary people's housekeeping accounts.
    Hon. Members opposite seem to regard it as a matter of little account which comes up year after year. No doubt when the Division bells ring Members on the Government side will come in and vote whichever way the Government wish. It is all right for the hon. Member for Kidderminster (Sir G. Nabarro), who has recently left the Chamber—
    Sir Kenneth Pickthorn: Another one gone.
    Mr. Callaghan: The hon. Member for Carlton (Sir K. Pickthorn) is alive.
    Mr. Price: I am very glad to have the interest of the hon. Member for Carlton (Sir K. Pickthorn).
    Sir K. Pickthorn: The hon. Member for Westhoughton (Mr. J. T. Price) is anxious for us to get on with the bread and butter matters, but he still has not got on the road there. The most definite thing he has said so far is that there are not so many on the back benches as there should be. I called attention to the fact that he has just lost one more.
    Mr. Price: I am very much obliged to the hon. Member. It all adds to the joy of battle and I very much appreciate it.
    On the merits of my statement that this is a matter of vital importance to ordinary people, the hon. Member for Kidderminster, who has recently left the Chamber, has argued blandly, naively and ignorantly that there is no distinction in the minds of most people because we are in the Welfare State and many are doing well from expense accounts and so on. He has suggested that they cannot tell the difference between ordinary necessities of life and luxuries. He should tell that to a young couple who want to get married and are faced with the problem of buying a house on a mortgage at 6 per cent. interest plus, the hire-purchase charges for furnishing the Purchase Tax at 10 per cent. We have not always had Purchase Tax on furniture at 10 per cent.
    Mr. Walker: It was 33⅓ per cent.
    Mr. Price: That was when our Government were restoring the foundations of the country after the most devastating war in history. With great respect to the hon. Member for Worcester (Mr. Walker), who is usually very fair-minded, he does not know much about it except what he has read in books, but some of us here now lived through those days and know what the situation was.
    This 10 per cent. is an important addition to the cost of living not only on necessities of life but on the capital goods which many people need to start a home. We are suggesting by this Clause that it should be removed from those goods. No one opposite would deny that for many years, with all the difficulties economic and otherwise, when clothing and textiles had to be strictly controlled by quality and price controls we did not have Purchase Tax at 10 per cent. on clothing. That has been introduced recently. I claim that the cost of clothing, particularly men's and children's clothing, is disgracefully high at present.
    1194
    Since many people cannot provide out of current income the payment necessary for such items as furniture and clothing, they are compelled to go into heavy debt by hire-purchase transactions to which 10 per cent. is added, making anything up to another 10 per cent. on the transaction. It is quite unreal to say in debates of this kind that if this new Clause were agreed to it would cost £170 million. I am prepared to accept that figure, but only about a fortnight ago I had some exchanges with the Chancellor of the Exchequer about business expenses allowed under Schedule E under existing legislation. There was a gasp of astonishment when the Chancellor revieled, what was not generally known, that last year they amounted to £263 million. Those business expenses were often based on bogus claims. It is wrong for any hon. Member to suggest that £170 million for this proposal would break the camel's back. If it is socially desirable to give this concession, the right hon. Gentleman and his right hon. Friends ought seriously to consider it.
    From time to time we have heard statements from the Government Front Bench, from those in charge of Government policy, that they cannot deal adequately with the economic control of the country's affairs unless they have an incomes policy. They have set up machinery to that end. They have set up the National Economic Development Council, which in many ways is an excellent body, and they have set up the National Incomes Commission, which we on this side of the Committee have not seen fit to support, for various reasons with which hon. Members are familiar.
    Where is the sense of trying to enforce a policy which will limit the rise in wages to 3½ per cent. when, as a result of increased interest charges, Purchase Tax and higher rent, there is a much bigger rise in the cost of living than 3½ per cent.? I believe that there is a difference of at least 3 per cent. between the amount to which the Government seek to limit wages, 3½ per cent., and the 6 or 7 per cent. rise in the cost of articles in common daily use. People find prices increasing every time they go into a shop.
    Ingenious arguments are produced with all the polemics which all hon. Members can use if they are so minded, but the fact remains that if the cost of living

    1195
    rises more than do wages, there is a reduction in the standard of living. I was surprised earlier to hear hon. Members opposite intervene, perhaps in complete ignorance of the fact that we were discussing not the cast of living but the standard of living. The standard of living is being eroded for millions of people in this country, although many fortunate people are doing very well out of the system. Those who are taking this stand—and some of them are represented on the Conservative benches—are concerned not so much with wages and salaries as with having an unlimited expense account to which they can charge everything.
    As long as the Government claim that we are in a period of expansion they should bear in mind that the easiest way to provide more purchasing power is to release some of it by relief of Purchase Tax. That is what we are asking. I hope that the Minister will at least give us the courtesy of a considered reply instead of the platitudes which we have had in previous years. In the past we have had all sorts of platitudes, and then they ring the bell and get all their available supporters in the Lobby to vote us down.
    Mr. Denys Bullard: I hope that the hon. Member for West-houghton (Mr. J. T. Price) will not be offended by the fact that I have just come into the Chamber, but I have been on the Committee of the Water Resources Bill otherwise I would have not troubled this Committee at this late hour. I have a new Clause on the Order Paper dealing with the Purchase Tax on blackcurrant juice. I understand that it is not being called, and I thought it proper to take this opportunity to ask my right hon. Friend to give the matter very earnest consideration, for reasons which I will very shortly advance.
    The blackcurrant industry is very important for the horticulturists in this country, being second in size to the strawberry industry. After a very depressed period, during which the acreage declined rapidly in the late 1950s, it has been staging a considerable recovery, and the figure has risen to 16,000 acres, compared with the original 16,800 acres in 1950. It has climbed back to a relatively large scale of fruit growing.
    1196
    7.15 p.m.
    Now, as a result of the Purchase Tax imposed last year, there is a definite turn for the worse, so much so that the sale of blackcurrant concentrated syrups since the imposition of the 15 per cent. Purchase Tax has declined by 25 per cent. below the figure of 1961. This has led to a drop in the average price of blackcurrants from 168s. a cwt. on the contract to 161s. a cwt. This is at a time when, in general, the price of soft fruit is rising.
    It is desirable that the industry should not suffer from the trade cycle which it has experienced in the past. Bushes take a long time to grow. When there is a depressed feeling in the industry, it leads to the grubbing up of bushes until plantations decrease in size to a point at which supplies become inadequate for the market, and a return then sets in and we have the type of cycle which affects other sides of agriculture and which is liable to occur with blackcurrants.
    I plead with my right hon. Friend to see whether anything can be done about this, because this appears to be the kind of cycle into which we are liable to move with blackcurrant growing. The blackcurrant syrup industry is an important outlet for the fresh fruit trade and the Purchase Tax, which I should like to see removed altogether, is a very serious matter for blackcurrant growers. In Norfolk we grow a great acreage of the crop, and my growers have asked me to plead with my right hon. Friend to do what he can to exempt this very nutritious juice from the incidence of Purchase Tax and so prevent the recurrence of the troubles into which the industry is liable to sink if this Purchase Tax continues.
    Mr. Norman Dodds: I hope that I shall persuade the Minister to be in a sympathetic mood by making my contribution in less than five minutes, by being to the point and by putting the case without too much detail. I support the new Clauses and in doing so I wish to make a particular plea for the footwear industry.
    Various aspects of the footwear industry have been mentioned by my hon. Friends, but I want to draw to the Minister's attention—if he does not already know, and I think he does—that the footwear industry is passing through a

    1197
    very bad time. Despite what the hon. Member for Barry (Mr. Gower) said, there is no sign that the industry is moving out of the doldrums. Many people, the private trade as well as the co-operative trade, feel that the introduction of the Purchase Tax has had a serious effect on the industry and that if it were removed the industry would have a much better future than appears likely.
    I said that private trade as well as co-operative trade was having a very bad time because there came into the footwear industry one of Britain's most successful business men, Mr. Clore. He has recently had to admit that the industry in which he is so prominent has had a very bad time, and there appears to be no sign that the boot and shoe trade will get out of this situation.
    May I also put the human problem? Boot-and-shoe factories are to be found in many parts of Britain, and the amount of redundancy and short-time working in them is particularly severe for men and women who have given a life-time to the industry. It is a sad state of affairs when they have to go out of it because of redundancy and to try to find work in other areas.
    The Treasury must have information about the severe redundancy and unemployment in the footwear industry. If there were any sign that there was likely to be an improvement, I should not be making a special plea for the industry. There are plans in hand to close a number of footwear factories. I ask the Minister to be particularly sympathetic. I hope that he will have some message tonight that will indicate to those working in the industry that there is some recognition in the Treasury and on the Government Front Bench of the human problems involved, which many believe have been made much worse because of the Purchase Tax.
    It could be argued that we cannot continue to have an industry which obviously needs some retraction—in other words, that people are not walking as much as they used to and therefore not so many boots and shoes are required. If this is so, it is all the more reason why Purchase Tax should be removed. It is not a reason why it should be continued.
    One or two of my hon. Friends have mentioned old-age pensioners, who above
    1198
    all need good footwear. They now find it very difficult—and the way things are going they will find it even more difficult—to maintain their footwear in a state which will prevent them having wet feet. Mention has not been made of the fact that the average child is now bigger, and that means that he has bigger feet. Many schoolchildren aged about 14 have feet as big as adult feet. Millions of people are not paying Income Tax and for many families it is difficult, and in some cases impossible, to acquire proper shoes.
    I ask the Minister to bear in mind the fact that good footwear is essential for young people. Many people are now homebound largely because in the past they did not have good footwear. Bad footwear can cripple people. It is vital that good footwear should be available to young people as well as to the elderly.
    I therefore ask the Minister to give some indication that the problem is understood by the Treasury. We hope that the Treasury is at least sympathetic. Better still, if there is to be some easement of the problems of the footwear industry, which the Treasury could easily bring about, it should abolish altogether the Purchase Tax—not on luxuries, but on essentials used by everyone. I hope that the Government will be sympathetic if for no other reason than that there is a likelihood of a General Election in the not-too-distant future and it would be helpful, for whatever purpose, if Purchase Tax were removed.
    Mr. Cyril Bence: I wish to be brief. I make no apology for raising three specific cases of Purchase Tax affecting small industries in my constituency. The first is the Singer sewing machine industry. The sewing machine is a piece of essential capital equipment for the young housewife and, added to the other problems of the young couple about to marry—buying a house, getting a home together—the tax on a sewing machine is unjustified in a modern society.
    Secondly, the Purchase Tax on soft drinks is unjustifiable, even on blackcurrant juice and orange juice. It is unjustifiable and stupid to put Purchase Tax on a form of refreshment which should be encouraged in the motoring age.

    1199
    I come to the case with which I am principally concerned. I have had sent to me from the Gymnastic Equipment Manufacturers Association its correspondence with the Treasury over the last ten years. To escape the wrath of right hon. and hon. Members, I have no intention of reading this correspondence between the Association and the Treasury which has lasted ten years. Right hon. and hon. Members will be delighted to hear that the pattern has been the same for ten years. There has been very little change. In every letter successive Chancellors of the Exchequer have expressed great sympathy for the manufacturers of gymnasium equipment but have unfortunately not seen their way clear to reduce or abolish the Purchase Tax. This is quite in keeping with tradition. One cannot expect tradition to change in ten years.
    The Purchase Tax of 25 per cent. on gymnasium equipment comes under Group 20—toys—and there are extraordinary anomalies. The manufacturers tell me in this correspondence that 95 per cent. of the equipment they manufacture is sold to agencies of the State—education, the Forces and institutes of further education. Parallel bars, vaulting horses, ets., are all paid for by grant from the Treasury. The Purchase Tax of 25 per cent. goes back to the Treasury. All over the country clerks are working out the Purchase Tax at the wholesale stage in order to tell the Treasury the amount of Purchase Tax it must collect on the product. This is nonsense. If 95 per cent. of the product is bought by the State, the State obviously gains no revenue from the Purchase Tax. It pays it.
    Under Group 20, swings, slides and roundabouts are excluded if they are not mechanically operated. Parallel bars, vaulting horses, vaulting boxes and vaulting saddles used in gymnasiums are taxed at 25 per cent. Swings and roundabouts hand manipulated are not taxed. This is absurd. These are exemptions from the tax. I could hardly believe this when it was pointed out to me. This shows how a Member of Parliament should follow in almost his every waking hour what is going on in Departments of State. The anomalies and stupidities perpetrated by bureaucracy would shock the people.
    1200
    Hon. Members will be interested to learn that—
    "Boats and other vessels large enough to carry human beings, and accessories for such boats and vessels"
    are exempt. A small bracket to fasten the side or the saddle on to a vaulting box is chargeable at 25 per cent. A factory makes brackets for catamarans and small boats. Brackets are made in the same process. If the brackets go on boats, they are exempt. Brackets for fastening sides and tops to vaulting boxes are taxed at 25 per cent.
    This is nonsense. When this was pointed out to me in the Gymnasium Equipment Engineering Company in my constituency, I wondered whether I was in a madhouse. It reminded me of Bernard Shaw's essay, "The Political Madhouse in America and Nearer Home", written before the war.
    7.30 p.m.
    Gliders large enough to carry human beings are exempt, while high parallel bars and adjustable parallel bars used for exercising one's muscles and ingenuity are taxed at the 25 per cent. rate. If one can afford to buy a glider and be towed by an aeroplane—and get the exercise of manipulating the craft in the air—one does not pay Purchase Tax. If one buys a set of parallel bars to exercise one's muscles and ingenuity one pays at the 25 per cent. rate.
    For the Government to permit such an anomaly to continue is making the whole taxation system look ridiculous in the eyes of the community. Having listened for most of the afternoon to the debate, I have come to the conclusion that the sooner Purchase Tax is abolished the better. It might be worth while our going over to a turnover or other form of taxation, for the present system is absurd.
    Each year when we discuss the Finance Bill we discover further anomalies in our Purchase Tax arrangements. As each year passes the system becomes more and more crazy. I hope that the proposed new Clauses will be accepted so that we can progressively get rid of Purchase Tax altogether. Every day millions of people are buying goods which are subject to Purchase Tax—soft drinks, boots and shoes and the rest—and the present system does not take into account

    1201
    the incomes of those least able to afford to pay the tax.
    Mr. John Wells: I support the plea of my hon. Friend the Member for King's Lynn (Mr. Bullard) regarding blackcurrant juice. I had a most unsatisfactory Answer from the Economic Secretary last Thursday on this very point, when my hon. Friend used the phrase:
    "It is good to see that sales are recovering somewhat…".—[OFFICIAL REPORT, 23rd May, 1963; Vol. 678, c. 622.]
    The sales of blackcurrant and other juices may be recovering somewhat, but that is only due to the massive advertising campaign which has been undertaken by the natural fruit juice companies, but the harm done to this industry and the fruit growing community is indeed great.
    My hon. Friend the Member for King's Lynn put forward some cogent arguments, and while I have no doubt that we shall not receive a long reply on this point from the Chief Secretary tonight, I hope that my right hon. Friend will remember that the signatories to the proposed new Clause, entitled "Purchase Tax: exemption for blackcurrant syrup", represent almost every horticultural constituency in the country. This is a nation-wide problem, and I am glad that the hon. Member for Dunbartonshire, East (Mr. Bence) has echoed this both in his remarks about the fruit juice industry today and at Question Time last week. I hope that the Government will reconsider this matter in the near future.
    Mr. Oram: One after another of my hon. Friends have built up a devastating case in favour of the new Clauses. If it were not for the fact that we are used to exhibitions of stone-walling from the Dispatch Box, I would hope that when the Chief Secretary replies he would be able to make the shortest reply of all time and simply say "I agree" or "I submit", whichever he chooses.
    My hon. Friends and I welcomed certain features in the Budget as soon as it was introduced. One glaring omission from it was the lack of any concessions in the present Purchase Tax arrangements. It seems, therefore, that the virtues of the previous year's Budget are only virtues in that they reverse the trend of the previous year's Budget. The new Clauses we are discussing give the Government an opportunity to reverse two of the major
    1202
    errors committed by the Chancellor's predecessor. I refer, first, to the doubling of the Purchase Tax on furniture and clothing, and, secondly, to the introduction of Purchase Tax at the 15 per cent. rate on a wide range of confectionery and soft drinks.
    My hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) rightly based his case largely on the effects of the increased rate on the cost of living. My hon. Friend gave instances from the cost-of-living index to show how the prices of clothing, furniture and many other items have taken an upward leap as a direct result of the Government's Purchase Tax moves last year. While my hon. Friend gave specific instances, I wish to concentrate on the breadth of the application of Purchase Tax on clothing and furniture.
    Considering the weights in the cost-of-living index which apply to clothing and furniture, one finds that more than 100 points are applicable to these items from the range of 1,000 points in the weighting system. So the doubling of the tax was applied on one tenth of consumer expenditure. It was a flagrant act, deliberately designed to increase the cost of living at a time when everyone—Government, manufacturers, distributors, and so on—should have been concerned to do everything possible to reduce it.
    Reference has been made to the possible intention of the Government regarding an alternative or alteration to the Purchase Tax structure. We are entitled to know more than we have been told about the Government's strategic intentions in this direction. I say "strategic" intentions because we have discussed the "tactical" side of this matter. Are the comments of the Chancellor's predecessor about the intention to take further steps to reform the whole structure of Purchase Tax still applicable? The hon. Member for Kidderminster (Sir G. Nabarro), in his usual self-confident way, claimed credit for having set the Government on what he regards as the right road in this matter. I agree with him that last year there was more than one hint to the effect that the Government intended to introduce one or other of the Continental systems, no doubt with a view to our entering the Common Market. That situation has changed. Have the Government changed

    1203
    their attitude in this matter? Do they now intend to bring about what seemed to be their intention last year; that is, one rate of indirect taxation, or are we to continue with the system we have and its accompanying series of Purchase Tax rates?
    I am strongly opposed to what the hon. Member for Kidderminster called the important principle of one rate of Purchase Tax. The hon. Member said that he could not distinguish between luxuries and necessities and that, therefore, all consumer expenditure should be subjected to the one rate. Last year, like many of my hon. Friends, I was most uneasy about the extension of Purchase Tax to food and drink, commodities that had up to then been recognised by both sides as being inappropriate for indirect taxation. That was a step in the wrong direction and indicated the Government's intentions to spread the Purchase Tax net much more widely than hitherto. We ought to be told whether the Government intend to go further in that direction or to accept the policies suggested in the new Clauses.
    The idea of one rate Purchase Tax, of not attempting to differentiate between necessary and less necessary goods, is all very well if, at the same time, we are moving to a situation in which incomes are more nearly equal. If there is equality of incomes we can have a one-rate Purchase Tax, but if, as is the case, the gap between rich and poor is widened, there is every reason to ensure that the poorer families do not pay increased amounts of Purchase Tax.
    Constituency points have been made on all sides in this debate. Hon. Members from the textile areas, such as my hon. Friends the Members for Burnley (Mr. D. Jones) and Westhoughton (Mr. J. T. Price); those concerned with the manufacture of biscuits, as was my hon. Friend the Member for Birmingham, Ladywood (Mr. V. Yates), others concerned with the difficulties facing the footwear trade, and with unemployment in the furniture trade, have made their cases, and I want to speak of one special case that has been already mentioned.
    The soft drinks industry illustrates the unfortunate effect that last year's taxation
    1204
    has had on the development of an industry. Soft drink production has gone down, as it has in other countries where this commodity has been taxed. I believe that production went down by nearly 30 per cent. in the third quarter of last year, and by about 15 per cent. in the fourth quarter. I hope that the Chief Secretary will not blame the weather for that because, if he casts his mind back, he will know that last year was as bad as the year before it—and this year looks like being the same. The right hon. Gentleman may not have the figure, but I should like to know whether the expectations of revenue from this tax and similar taxes have been fulfilled, or whether the slump in production has falsified the Chancellor's hopes.
    By accepting these new Clauses the right hon. Gentleman the Chief Secretary has the opportunity to do three important things. First, he can make a very considerable contribution to reducing the cost of living—and, by reducing the tax on clothing and furniture in particular, he can give aid to many people who are in great need of it. Secondly, he can stimulate the economy in areas of special unemployment-the furniture industry and others have been mentioned—and the Government should be very much concerned with that aspect. Thirdly, he can make a considerable contribution to greater social justice in the tax structure. For those three reasons, I hope that the right hon. Gentleman will give a reasonable and very favourable reply.
    7.45 p.m.
    Mr. Boyd-Carpenter: When I last took part in a Purchase Tax debate in relation to the Finance Bill, as Financial Secretary, we had the procedure, which some hon. Members will recall only too well, of what was colloquially called the "Dutch auction." That was an experience that those of us who have been through it would never wish to repeat. I must say that this debate today indicates how very much better is the Committee's present method of dealing with this very complicated subject.
    We are debating new Clauses relating to the main rates of Purchase Tax, and the individual points affecting different commodities come into our discussion,

    1205
    not as being themselves the subject matter of Amendment but as being, I understand, Sir Robert, in a Ruling given by one of your predecessors, illustrative of the arguments in favour of the new Clauses. That has the advantage that one can listen, as I have listened to this debate, and my right hon. Friend and I and our associates can subsequently read in HANSARD what hon. Members have said, and give it, as we certainly shall, the fullest consideration, without prejudice to handling the debate itself as being on the main rates.
    I can probably best serve the Committee, without unduly prolonging our proceedings, and we have a good deal of further business, by first replying-and I hope that the Committee will excuse brevity; it generally does—to some, but not all of the individual points raised, but subject to the general assurance I have already given that what has been said will be very carefully considered by my right hon. Friend during the course of the year.
    The right hon. Member for Orkney and Shetland (Mr. Grimond) asked—and here I must tread warily, because I might lack his adroitness in treading the outer perimeter of the rules of order-about the added—value tax, and the Richardson inquiry. I cannot tell the right hon. Gentleman when that inquiry is likely to be completed. My right hon. Friend the Chancellor said in his Budget speech that it would be carried out urgently. As I am sure the right hon. Gentleman knows, this is an immensely complex subject, and I cannot yet foresee when we shall receive the report. I will come at another point to the right hon. Gentleman's question about the way in which my right hon. Friend's general measures are working out.
    The hon. Member for Erith and Crayford (Mr. Dodds) most persuasively said that he thought that his remarks would gain force by their brevity. I noted what he said about footwear, and particularly about footwear suitable for young children. He will be aware that there is already an exemption in respect of footwear suitable for young children.
    My hon. Friends the Members for Worcester (Mr. Walker) and King's Lynn (Mr. Bullard), and one or two other hon. Members, touched on the application of the tax to blackcurrant
    1206
    juice, or cordials, beverages, etc., made from it. We shall certainly watch the development of this industry, and hon. Members are quite right when they say that for one reason or another there has been some falling off in demand for the juice.
    I cannot say very much more, for another reason. Two of the manufacturers have challenged the Purchase Tax classification and have claimed that this should not be treated as a beverage but as having medicinal properties. This is a highly complicated issue which they are discussing at the moment with the Customs. I should ill serve the Committee if I should seek to take it into the quite hideous complexities of that subject, but I will certainly note the general tone of the speeches.
    Mr. Hilton: Will the right hon. Gentleman also bear in mind the valuable point made by the hon. Member for Kidderminster (Sir G. Nabarro) that this tax was put on blackcurrant juice by mistake or by accident?
    Mr. Boyd-Carpenter: I do not think that I need assure the hon. Member that I always pay special attention to everything that my hon. Friend the Member for Kidderminster (Sir G. Nabarro) says.
    Mr. Dodds: The right hon. Gentleman did not take up the paint I made about children's footwear when I stressed that some 14-year-old children take adult-size shoes. Can the right hon. Gentleman say whether these would be exempt from Purchase Tax?
    Mr. Boyd-Carpenter: I thought that I dealt with that point by expressly saying that the exemption related to young children. It is fair to say that in his speech the hon. Member, although no doubt he knew it, did not indicate that this exemption existed.
    The hon. Member for Birmingham, Ladywood (Mr. V. Yates) raised the next question about chocolate biscuits about which, if I may say so, he appeared to be extremely excited. This is a quite complicated problem which my hon. Friend the Economic Secretary has already discussed with representatives of the trade. The problem, briefly, is that there is a kind of chocolate biscuit sold in sweet shops which is very close to chocolate bars, with a different filling. There is

    1207
    also a type of chocolate biscuit which one buys at grocery shops and which to all intents and purposes is a biscuit. The difficulty, as so often with this tax, is to get the definition right. If we can find a definition with which the trade agrees and which we think workable, I think that we shall be able to make some progress, but I do not dispute that the hon. Member for Ladywood has made a point.
    Then we had what one of his hon. Friends described as the musical interlude by the hon. Member for Rotherham (Mr. O'Malley) who made, as I agree with the hon. Member for Westhoughton (Mr. J. T. Price), a most agreeable speech and who recalled to us affectionate memories of his predecessor as Member for Rotherham for many years. The hon. Member was not quite right in his reference to the practice of other countries. I understand that musical instruments are charged under a general turnover tax in Germany and Italy and under the T.V.A. system in France. The hon. Member also referred by way of contrast to the exemption given to pianos. This was given some years ago because of the then desperate condition of the manufacturing industry.
    The hon. Lady the Member for Stoke-on-Trent, North (Mrs. Slater) referred to the reduction some months ago of the tax on motor cars, and I was very glad to hear that she had benefited from it. The hon. Lady said that she would have far preferred the changes to have been made in respect of other articles chargeable with Purchase Tax which she felt were borne by old people, but it is pertinent to remember in this connection that the tax on motor cars, before my right hon. Friend reduced it, was 45 per cent. as opposed to 10 per cent. on the articles with which the hon. Lady was concerned. It should be remembered also that in connection with the tax on motor cars there is the question of employment in a very large and important industry. The hon. Member for Birmingham, Northfield (Mr. Chapman) represents a great many workers in that industry. I am sure that it was extremely important in the interest of both employment and the economy to give that relief.
    I come now to one or two of the general problems, or the major issues.
    1208
    My hon. Friend the Member for Kidderminster made a valid point when he drew attention to the fact that the hon. Member for Cardiff, South-East (Mr. Callaghan), who moved the new Clause, at no stage in the course of his agreeable speech referred to the cost. I thought that the rebuke which my hon. Friend, in his inimitable manner, applied to the hon. Member was fair, because when we are dealing with new Clauses, which are not trifling but substantial in their financial effect, the Committee is entitled to have from a Shadow Chancellor of the Exchequer some indication of the cost of the remission.
    My hon. Friend the Member for Kidderminster, in his calculation of the cost, got the figures very nearly right but I had better give the cost to the Committee now. The new Clause giving exemption to goods hitherto chargeable at 10 per cent. would cost £170 million. The new Clause to reduce Purchase Tax from 25 per cent. to 20 per cent. would cost £60 million, and the new Clause to reduce the 15 per cent. rate to 5 per cent. would cost £36 million, making a total cost of £266 million. This is a major factor, and whatever arguments may be adduced, however entertainingly, about the anomalies and irrelevancies of the tax, the Committee cannot responsibly adopt proposals for major changes of this sort and, indeed, the abolition of the 10 per cent. tax, without facing the fact that this would make a major change in the whole pattern of the Budget.
    The hon. Member for Cardiff, South-East may say that that is right, because he thinks that my right hon. Friend ought to have gone further in releases of purchasing power. I come here to what the right hon. Member for Orkney and Shetland said about this. We argue that my right hon. Friends judgment about the amount of additional purchasing power required is proving to have been fully justified. The economy, in our view, is developing well. It is noteworthy in this connection, first, that the big infusion of purchasing power from the bulk of the increase in National Insurance benefits and retirement and widow's pension begins to operate only this week and that the large infusion in respect of Income Tax concessions does not begin to operate until the beginning of July. Given these various factors, we are fully satisfied with the

    1209
    way the economy is responding to my right hon. Friend's proposals.
    Mr. Douglas Jay: Is the right hon. Gentleman aware that there is also a First Secretary in this Government, and that the First Secretary has recently expressed the opinion that further expansionist measures would probably be necessary? How are we to know which of these two Ministers is right?
    Mr. Boyd-Carpenter: I do not know whether the right hon. Gentleman was in the House when the First Secretary answered a Question on this very point last Thursday and he pointed out that he had said nothing of the sort that the right hon. Gentleman alleges. If the right hon. Gentleman had thought that my right hon. Friend had said it, he could have been present and could have asked a supplementary question, but I do not think that he did.
    This proposal, involving a forgoing of revenue of this sort, would have doubled the release of purchasing power proposed in the Budget. Therefore, in putting this forward, the hon. Member for Cardiff, South-East must either say that he would be virtually doubling the release of purchasing power or that these proposals for reduction in Purchase Tax ought to be substituted for the other main steps taken in reducing Income Tax. Which is the view of the Opposition?
    8.0 p.m.
    Mr. Callaghan: I am a little influenced in my approach to this matter by the fact that exactly the same arguments were advanced from the Front Bench last year when I moved to incorporate concessions amounting to £100 million and was told that this would be grossly inflationary, but, six months later, the changes were made. So I really dismiss that argument because we do not know what the Government will say next. As to the rest, I have moved only the new Clause to abolish the 10 per cent. rate. That would make a difference of £170 million. If the right hon. Gentleman wants to know what off-setting I should do, I can tell him of one thing straight away, the Stamp Duty, a present to the Stock Exchange of £25 million, with no benefit whatever.
    Mr. Boyd-Carpenter: Without going into the merits of the Stamp Duty—I think
    1210
    that I should get into trouble if I did—I can only say that £25 million even from the hon. Gentleman is a very poor off-set for £170 million. The fact that the hon. Gentleman has avoided answering my question about whether he would substitute this for the Income Tax concessions will enable all hon. Members to form their own view.
    Taking the debate generally, the hon. Member for Cardiff, South-East and several hon. Members seriously exaggerated the effects of the Purchase Tax on the cost of living. The hon. Member for Cardiff, South-East, went into this at some length. He said that the Purchase Tax was putting up the cost of living, making substantial increases. I pass over, because it has already been dealt with, the fact that his own Government did not regard reductions in the Purchase Tax as a means of dealing with the cost of living, even though, when they left office, their lowest rate was 33⅓ per cent., which is higher than the highest rate maintained this year, 25 per cent. As a pure matter of fact, the Purchase Tax does not have any very substantial effect on the cost of living.
    The effect of the first new Clause, the one to abolish the 10 per cent. rate, would be to take 0·75—three-quarters of a point—off the Index of Retail Prices, at a cost of £170 million. To abolish the Purchase Tax as a whole, going even further than hon. Members opposite, would make only a reduction of 1·8 in the index. I think that that puts the matter in proportion. It is not my purpose to argue that it has no effect that would obviously be nonsense—but it is right that the Committee should have the figures so that it can put in proportion the hon. Gentleman's views, expressed at considerable length, about the effect that a reduction of Purchase Tax would have in making a serious impact on the cost of living.
    Mr. G. R. Mitchison: My hon. Friend referred also to the effect on employment. May we hear what the Government have to say about that? In Kettering, we are very conscious of the boot and shoe trade.
    Mr. Boyd-Carpenter: I am obliged to the hon. and learned Gentleman. That brings me to what I had intended to be my next point. The first point in relation to employment is that the Purchase Tax

    1211
    at the relatively moderate rates now imposed is, quite obviously, a much less serious adverse factor on employment than it was at the time of which, no doubt, the hon. and learned Gentleman is thinking, when the rates were a great deal higher. It is one of the advantages of the flattening of the rates of Purchase Tax to the three we have at present, 25 per cent., 15 per cent., and 10 per cent., that one avoids the distortions of the economy and, therefore, the effects on employment which high rates of Purchase Tax have, with extremely difficult marginal cases in which, perhaps, a question of definition may make an enormous difference, depending on whether an article attracts a high or more moderate rate of tax.
    Mr. Mitchison: I am sorry to correct the right hon. Gentleman, but there was no Purchase Tax on boots and shoes. The rate was so flat that it did not exist until the First Secretary of State put it on after the 1955 election.
    Mr. Boyd-Carpenter: I am sorry to correct the hon. and learned Gentleman. He asked a question about employment generally.
    Mr. Mitchison: No.
    Mr. Boyd-Carpenter: He added, perhaps superfluously—we all know that he is a very good constituency Member—a reference to the boot and shoe trade, but he put it as a general question and I am answering it as a general question.
    This brings me to the question of the shape of the Purchase Tax, to which several hon. Members have referred. The three rates which we have now, all moderate and without a very great disparity between them, form a tax which, in our view, it a better and more efficient tax and one more conducive to the vigour of the economy than a Purchase Tax with a large number of rates and a wide spread between them, partly for the reason I have given already to the hon. and learned Member for Kettering (Mr. Mitchison).
    I know that there is a clash, almost a doctrinal clash, between hon. and right hon. Gentlemen opposite and ourselves on this subject. I have no wish to stir up that clash, but it is a fact that they tend to believe in a wide spread of rates with a very high rate of tax on what they regard as luxuries. Those who advocate
    1212
    this must remember two things. First, the effect on the economy and employment. Nothing is a luxury to the people who earn their living making it. I say that in reply, partly, to the hon. Member who earlier interjected a reference to Rolls-Royce. Second, it is, in these days, increasingly difficult to define objectively what is a luxury.
    Mr. D. Jones: We do not find that difficulty.
    Mr. Boyd-Carpenter: It used to be said that a motor car was a luxury. I do not know whether this is argued now that a motor car is a necessary tool of trade of the commercial traveller, the journalist, the country doctor and so on. A cynic once said that a luxury was something one happens not to like oneself. In fact, it is a very difficult problem and it is not one for the handling of which, I feel, taxation is a particularly useful and effective instrument.
    Our view is that the present shape of the Purchase Tax is an enormous improvement on what we have had hitherto. I should be quite wrong if I were to respond to the temptation to speculate about the future. It is my purpose to commend to the Committee the tax as it now stands and to point out that, although there are individual points of difficulty—there always are individual points of difficulty in this tax, as I from my previous term at the Treasury, know and as other hon. Members know—it is a tax which produces a revenue of £545 million in a full year. We have this tax. We think it is in better shape than before. I am quite sure that it would be wrong to make the radical changes proposed in the new Clauses. To do so would seriously damage the whole pattern of my right hon. Friend's Budget, as I have explained. No argument has been produced to show that to do so would help the economy. In my view, it would hinder it. While we shall, of course, study with the greatest care, as we always have done, the points at which the shoe may be pinching, the points at which there may be a real case for improving the tax, I put it to the Committee that it would be wrong to make the sweeping changes which the new Clauses would make and I ask the Committee to reject them.
    Mr. Neil McBride:
    The right hon. Gentleman spoke about

    1213
    the Chancellor's measures to promote the vigour of the economy. Has he considered that what he is saying is at variance with the article in the centre page of today's Financial Times, particularly the first paragraph? If he has studied that article, will the right hon. Gentleman give his view of the last sentence of that paragraph?
    Mr. Boyd-Carpenter: Owing to my attendance on the Committee in this
    debate, I have not had the intellectual pleasure, which I usually enjoy at an earlier hour of the day, of reading that admirable paper. So far as it differs from what I have said, I think that it must be wrong.
    Question put, That the Clause be read a Second time:—
    The Committee divided: Ayes 175, Noes 230.

    Division No. 126.]

    AYES

    [8.9 p.m.

    Ainsley, William

    Hannan, William

    Oram, A. E.

    Albu, Austen

    Harper, Joseph

    Oswald, Thomas

    Allaun, Frank (Salford, E.)

    Hart, Mrs. Judith

    Padley, W. E.

    Allen, Scholefield (Crewe)

    Henderson, Rt. Hn. Arthur(RwlyRegis)

    Pannell, Charles (Leeds, W.)

    Awbery, Stan (Bristol, Central)

    Herbison, Miss Margaret

    Pargiter, G. A.

    Bacon, Miss Alice

    Hill, J. (Midlothian)

    Parkin, B. T.

    Baird, John

    Hilton, A. V.

    Paton, John

    Beaney, Alan

    Holman, Percy

    Pavitt, Laurence

    Bence, Cyril

    Houghton, Douglas

    Pearson, Arthur (Pontypridd)

    Bennett, J. (Glasgow, Bridgeton)

    Howell, Charles A. (Perry Barr)

    Pentland, Norman

    Benson, Sir George

    Howell, Denis (Small Heath)

    Popplewell, Ernest

    Blyton, William

    Hoy, James H.

    Prentice, R. E.

    Boardman, H.

    Hughes, Cledwyn (Anglesey)

    Price, J. T. (Westhoughton)

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

    Hughes, Hector (Aberdeen, N.)

    Probert, Arthur

    Bowles, Frank

    Hunter, A. E.

    Pursey, Cmdr. Harry

    Braddock, Mrs. E. M.

    Hynd, H. (Accrington)

    Randall, Harry

    Bradley, Tom

    Hynd, John (Attercliffe)

    Rankin, John

    Bray, Dr. Jeremy

    Irvine, A. J. (Edge Hill)

    Redhead, E. C.

    Broughton, Dr. A. D. D.

    Irving, Sydney (Dartford)

    Reynolds, G. W.

    Butler, Herbert (Hackney, C.)

    Janner, Sir Barnett

    Rhodes, H.

    Butler, Mrs. Joyce (Wood Green)

    Jay, Rt. Hon. Douglas

    Roberts, Albert (Normanton)

    Callaghan, James

    Jeger, George

    Robertson, John (Paisley)

    Carmichael, Neil

    Jenkins, Roy (Stechford)

    Rogers, G. H. R. (Kensington, N.)

    Chapman, Donald

    Jones, Dan (Burnley)

    Ross, William

    Collick, Percy

    Jones, Elwyn (West Ham, S.)

    Short, Edward

    Corbet, Mrs. Freda

    Jones, J. Idwal (Wrexham)

    Silverman, Julius (Acton)

    Craddock, George (Bradford, S.)

    Jones, T. W. (Merioneth)

    Silvennan, Sydney (Nelson)

    Cronin, John

    Kelley, Richard

    Skeffington, Arthur

    Crosland, Anthony

    Kenyon, Clifford

    Slater, Mrs. Harriet (Stoke, N.)

    Cullen, Mrs. Alice

    Key, Rt. Hon. C. W.

    Slater, Joseph (Sedgefield)

    Dalyell, Tam

    Lawson, George

    Small, William

    Darling, George

    Ledger, Ron

    Smith, Ellis (Stoke, S.)

    Davies, G. Elfed (Rhondda, E.)

    Lee, Frederick (Newton)

    Snow, Julian

    Davies, Harold (Leek)

    Lee, Miss Jennie (Cannock)

    Soskice, Rt. Hon. Sir Frank

    Davies, Ifor (Gower)

    Lever, L. M, (Ardwick)

    Spriggs, Leslie

    Deer, George

    Lewis, Arthur (West Ham, N.)

    Stewart, Michael (Fulham)

    Delargy, Hugh

    Mabon, Dr. J. Dickson

    Stones, William

    Dempsey, James

    McBride, N.

    Strachey, Rt. Hon. John

    Diamond, John

    McCann, John

    Swingler, Stephen

    Dodds, Norman

    MacDermot, Niall

    Taverne, D.

    Duffy, A. E. P.

    McInnes, James

    Thomas, Iorwerth (Rhondda, W.)

    Edwards, Rt. Hon. Ness (Caerphilly)

    McKay, John (Wallsend)

    Thompson, Dr. Alan (Dunfermilne)

    Edwards, Robert (Bilston)

    McLeavy, Frank

    Thornton, Ernest

    Fernyhough, E.

    MacPherson, Malcolm (Stirling)

    Tomney, Frank

    Finch, Harold

    Mahon, Simon

    Wainwright, Edwin

    Fitch, Alan

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

    Warbey, William

    Fletcher, Eric

    Mapp, Charles

    Watkins, Tudor

    Foot, Dingle (Ipswich)

    Mason, Roy

    Wilkins, W. A.

    Foot, Michael (Ebbw Vale)

    Mayhew, Christopher

    Williams, D. J. (Neath)

    Forman, J. C.

    Mendelson, J. J.

    Williams, Ll. (Abertiltery)

    Fraser, Thomas (Hamilton)

    Millan, Bruce

    Williams, W. R. (Openshaw)

    Galpern, Sir Myer

    Milne, Edward

    Williams, W. T. (Warrington)

    George, LadyMeganLloyd(Crmrthn)

    Mitchison, G. R.

    Willis, E. G. (Edinburgh, E.)

    Ginsburg, David

    Monslow, Walter

    Winterbottom, R. E.

    Gourlay, Harry

    Morris, John

    Woof, Robert

    Griffiths, David (Rother Valley)

    Moyle, Arthur

    Yates, Victor (Ladywood)

    Griffiths, W. (Exchange)

    Neal, Harold

    Zilliacus, K.

    Hale, Leslie (Oldham, W)

    Oliver, G. H.

    Hamilton, William (West Fife)

    O'Malley, B. K.

    TELLERS FOR THE AYES:

    Mr. Whitlock and Mr. Grey.

    NOES

    Agnew, Sir Peter

    Ashton, Sir Hubert

    Balniel, Lord

    Allason, James

    Atkins, Humphrey

    Barber, Anthony

    Arbuthnot, John

    Awdry, Daniel (Chippenham)

    Barlow, Sir John

    Barter, John

    Harrison, Brian (Maldon)

    Pannell, Norman (Kirkdale)

    Batsford, Brian

    Harrison, Col. Sir Harwood (Eye)

    Pearson, Frank (Clitheroe)

    Baxter, Sir Beverley (Southgate)

    Harvey, John (Walthamstow, E.)

    Peel, John

    Beamlah, Col. Sir Tufton

    Harris Anderson, Miss

    Pickthorn, Sir Kenneth

    Bell, Ronald

    Hastings, Stephen

    Pilkington, Sir Richard

    Berkeley, Humphry

    Heald, Rt. Hon. Sir Lionel

    Pitt, Dame Edith

    Bidgood, John C.

    Henderson, John (Cathcart)

    Pott, Percivall

    Biflen, John

    Hendry, Forbes

    Price, David (Eastleigh)

    Bishop, F. P.

    Hiley, Joseph

    Profumo, Rt. Hon. John

    Bossom, Hon. Olive

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

    Proudfoot, Wilfred

    Bourne-Arton, A.

    Hirst, Geoffrey

    Quenneil, Miss J. M.

    Box, Donald

    Hobson, Sir John

    Rawlinson, Sir Peter

    Boyd-Carpenter, Rt. Hon. John

    Hocking, Philip N.

    Redmayne, Rt. Hon. Martin

    Braine, Bernard

    Holland, Philip

    Rees, Hugh

    Brewis, John

    Hollingworth, John

    Rees-Davies, W. R.

    Bromley Davenport, Lt.-Col. Sir Walter

    Hopkins, Alan

    Renton, Rt. Hon. David

    Brooke, Rt. Hon. Henry

    Hornsby-Smith, Rt. Hon. Dame P.

    Ridley, Hon. Nicholas

    Brooman-White, R.

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

    Roberts, Sir Peter (Heeley)

    Brown, Alan (Tottenham)

    Howard, John (Southampton, Test)

    Robinson, Rt. Hn. Sir R. (B'pool, S.)

    Buck, Antony

    Hughes Hallett, Vice-Admiral John

    Roots, William

    Bullard, Denys

    Hughes-Young, Michael

    Ropner, Col. Sir Leonard

    Bullus, Wing Commander Eric

    Hurd, Sir Anthony

    Russell, Ronald

    Burden, F. A.

    Hutchison, Michael Clark

    St. Clair, M.

    Butcher, Sir Herbert

    Iremonger, T. L.

    Scott-Hopkins, James

    Campbell, Gordon (Moray & Nairn)

    Irvine, Bryant Godman (Rye)

    Sharples, Richard

    Carr, Robert (Mitcham)

    James, David

    Shaw, M.

    Cary, Sir Robert

    Jenkins, Robert (Dulwich)

    Skeet, T. H. H.

    Chataway, Christopher

    Johnson, Or. Donald (Carlisle)

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

    Chichester-Clark, R.

    Jones, Arthur (Northants, S.)

    Smithers, Peter

    Clark, Henry (Antrim, N.)

    Kerby, Capt. Henry

    Smyth, Rt. Hon. Brig. Sir John

    Clark, William (Nottingham, S.)

    Kerr, Sir Hamilton

    Spearman, Sir Alexander

    Cooke, Robert

    Kershaw, Anthony

    Stanley, Hon. Richard

    Cooper, A. E.

    Kimball, Marcus

    Stodart, J. A.

    Cooper-Key, Sir Neill

    Lagden, Godfrey

    Stoddart-Scott, Col. Sir Malcolm

    Cordesux, Lt.-Col. J. K.

    Langford-Holt, Sir John

    Studholme, Sir Henry

    Cotfield, F. V.

    Leather, Sir Edwin

    Summers, Sir Spencer

    Coulson, Michael

    Leavey, J. A.

    Talbot, John E.

    Courtney, Cdr. Anthony

    Leburn, Gilmour

    Tapsell, Peter

    Crawley, Aidan

    Legge-Bourke, Sir Harry

    Taylor, Sir Charles (Eastbourne)

    Critchley, Julian

    Lewis, Kenneth (Rutland)

    Taylor, Edwin (Bolton, E.)

    Curran, Charles

    Lilley, F. J. P.

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

    Currie, G. B. H.

    Linstead, Sir Hugh

    Teeling, Sir William

    d'Avigdor-Goldsmid, Sir Henry

    Litchfield, Capt. John

    Temple, John M.

    de Ferranti, Basil

    Loveys, Walter H.

    Thatcher, Mrs. Margaret

    Donaldson, Cmdr. C. E. M.

    Lucas-Tooth, Sir Hugh

    Thompson, Sir Richard (Croydon, S.)

    Drayson, G. B.

    McLaren, Martin

    Thornton-Kemsley, Sir Colin

    du Cann, Edward

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

    Tiley, Arthur (Bradford, W.)

    Eden, Sir John

    McMaster, Stanley R.

    Touche, Rt. Hon. Sir Gordon

    Elliot, Capt. Walter (Carshalton)

    Macpherson, Rt. Hn. Niall(Dumfries)

    Turner, Colin

    Eillot, R.W. (Newc'tle-upon-Tyne, N.)

    Maddan, Martin

    Turton, Rt. Hon. R. H.

    Emmet, Hon. Mrs. Evelyn

    Maitland, Sir John

    Tweedsmuir, Lady

    Farey-Jones, F. W.

    Markham, Major Sir Frank

    van Straubenzee, W. R.

    Farr, John

    Marshall, Douglas

    Vane, W. M. F.

    Fell, Anthony

    Marten, Nell

    Vaughan-Morgan, Rt. Hon. Sir John

    Finlay, Graeme

    Mathew, Robert (Honiton)

    Vickers, Miss Joan

    Fletcher-Cooke, Charles

    Matthews, Gordon (Meriden)

    Vosper, Rt. Hon. Dennis

    Forrest, George

    Maudling, Rt. Hon. Reginald

    Walder, David

    Fraser, Ian (Plymouth, Button)

    Mawby, Ray

    Walker, Peter

    Freeth, Denzil

    Maxwell-Hyslop, R. J.

    Walker-Smith, Rt. Hon. Sir Derek

    Gammans, Lady

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

    Wall, Patrick

    Gardner, Edward

    Mills, Stratton

    Ward, Dame Irene

    Gibson-Watt, David

    Miscampbell, Norman

    Webster, David

    Gilmour, Ian (Norfolk, Central)

    Montgomery, Fergus

    Wells, John (Maidstone)

    Gilmour, Sir John (East Fife)

    Morgan, William

    Whitelaw, William

    Glyn, Dr. Alan (Clapham)

    Nabarro, Sir Gerald

    Williams, Dudley (Exeter)

    Glyn, Sir Richard (Dorset, N.)

    Neave, Airey

    Williams, Paul (Sunderland, S.)

    Goodhew, Victor

    Wilson, Geoffrey (Truro)

    Gower, Raymond

    Nicholls, Sir Harmar

    Wise, A. R.

    Grant-Ferris, R.

    Nicholson, Sir Godfrey

    Wolrige-Gordon, Patrick

    Gresham Cooke, .

    Oakshott, Sir Hendrie

    Woodhouse, C. M.

    Grosvenor, Lt. -Col. R. G.

    Orr, Capt. L. P. S.

    Woodnutt, Mark

    Gurden, Harold

    Osborn, John (Hallam)

    Woollam, John

    Hamilton, Michael (Wellingborough)

    Osborne, Sir Cyril (Louth)

    Harris, Frederic (Croydon, N.W.)

    Page, Graham (Crosby)

    TELLERS FOR THE NOES:

    Harris, Reader (Heston)

    Page, John (Harrow, West)

    Mr. Pym and Mr. MacArthur.

    New Clause.—(RELIEF FROM DUTY ON HEAVY OILS USED AS FUEL FOR CERTAIN HACKNEY CARRIAGES.)
    (1) Subject to the provisions of this section, section 3 of the Finance Act 1961 (relief from duty on heavy oils used by horticultural producers) shall apply in relation to heavy oils
    1216
    used by the applicant as mentioned in the next following subsection as that section applies in relation to heavy oils used by the applicant as mentioned in subsection (2) of that section.

    (2) The owner or hirer under any contract of a hackney carriage having seating capacity for twenty or more persons shall be entitled to

    1217
    repayment under the foregoing subsection in respect of oils used by him as fuel for that hackney carriage.

    (3) For the purposes of this section subsection (5) of the said section 3 (which provides for the furnishing of information to the Commissioners of Customs and Excise) shall have effect as if references to the production of horticultural produce by the applicant were references to the transport business of the applicant and as if the word "plant" includes vehicles.

    (4) In this section "hackney carriage" has the same meaning as in the Vehicles (Excise) Act 1949; and in relation to the phrase "fuel for that hackney carriage" section 7(1) of the Finance Act 1959 (which, as amended by section 9(2) of the Finance Act 1960, states the circumstances in which heavy oils are to be treated as used as fuel for a vehicle) shall apply for the purposes of this section as it applies for the purposes stated in that subsection (1).—[Mr. Mitchison.]

    Brought up, and read the First time.
    Mr. Mitchison: I beg to move, That the Clause be read a Second time.
    The Temporary Chairman (Sir Samuel Storey): The following new Clauses are also selected for discussion: "Reduction of duty on heavy oils", "Fuel oils, gas oils and kerosene: rebate", "Heavy oils: rebate" and "Abolition of duty in heavy oils". The first of these can, if desired, be taken to a Division.
    Mr. Mitchison: The new Clause which I am moving is a good deal narrower in scope than some of the other Clauses which will be discussed with it. As far as I can make out, no such thing as an omnibus or bus is mentioned in any statute. It is camouflaged as a hackney carriage. The Amendment refers to derv for buses, but derv does not exist in the Statute Book either, nor, curiously enough, does diesel oil.
    The intention and effect of the Clause is to allow buses operating anywhere to get their derv free of Customs duty. They would get it, it is intended, by a rebate in the same way that the Finance Act, 1961, allowed relief from duty in the form of a rebate on heavy oils used by horticultural producers. Without going into the matter in detail, Section 3 of the 1961 Act provided machinery for the purpose and, no doubt, it has been operated since then.
    Until 1961, we used to bring this or a similar proposal forward and were told that it was administratively impossible. Now that the Government have managed
    1218
    to do it for horticultural producers, there should be no insuperable objection to doing the same thing for buses. It is in that spirit that we seek by the new Clause to apply the horticultural producers machinery to the case of buses. I hope that this will not be another instance of an agricultural tractor getting a rebate only when at sea; I do not think that it is. I always doubted the truth of that accusation. What matters is the substantial point which we are trying to raise, and that is whether the 2s. 9d. per gallon duty on buses should be continued.
    The curious position about these heavy oils is that there are rebates, but they do not apply to what in some books is called road fuel—that is, fuel for a mechanically-propelled vehicle on the road. There are exceptions to the rule which I need not go into. This part of the Customs and Excise legislation and corresponding machinery is fairly complicated. The exceptions are curious and devious, and the processes of administration are much the same. The substantial point is simply the one about derv for buses.
    This matter came up in Committee on the 1959 Finance Bill, and the then Chancellor, now Lord Amory, recognised the existence of a problem. He pointed out what he called difficulties of principle, but a fair conclusion from what he said is that it was on difficulties of administration that he finally rejected a proposal from the Government side for derv for buses, but only outside built-up areas. That would make matters a great deal more complicated, and I appreciate the difficulties which that proposal involved.
    On 15th June, 1959, the then Mr. Amory said:
    "For the reasons I have given, realising all too clearly the problem which exists, particularly in the rural areas—whose case my hon. Friends have argued with such moderation this evening"—
    we can, of course, expect their support tonight—
    "I must say that I cannot see a solution by way of either of the proposals put forward."
    The proposals were the rural bus one from the benches opposite and a more general one from this side of the Committee.
    "Although I share the anxieties expressed by hon. Members and agree that we must

    1219
    somehow find a solution to the problem, I must advise the Committee not to accept the new Clause."—[OFFICIAL REPORT, 15th June, 1959; Vol. 607, c. 171.]
    That was in 1959. It was at about the same time that the Jack Committee was set up to consider this problem of rural transport. It was
    "to review present trends in rural bus services and in particular to enquire into the adequacy of those services; to consider possible methods of ensuring adequate services in future; and to make recommendations."
    As was said at the time, that Committee was set up only after prolonged pressure. Having been appointed in September, 1959, it made a fairly prompt Report. Ever since then, hon. Members on both sides have pressed the Government to say what they propose to do about it.
    Having set up a Committee to investigate the question, the Government have now considered the Report of their own Committee, I suppose, insufficient or unsatisfactory—although they will never say so—and are conducting an inquiry of their own into the whole question. The Ministry of Transport is having what one might call a high old time investigating what happens in buses all over the country. It is a busy Ministry, particularly nowadays. Buses have come to assume an importance that they did not have even in 1959.
    Let us see what conclusions the Jack Committee reached. The Committee examined the question of removing the fuel tax as a possible solution and finally rejected it. I want, none the less, to refer to one or two things that were said, and particularly to two dissenting Reports that were given on this point and which are printed at the end of the full Report, and especially to one from Mr. H. R. Nicholas, who was one of the members of the Committee and is well known to all of us on this side, at least, and, I imagine, to most hon. Members opposite.
    The solution that the Committee finally reached was that a subsidy would be required. It indicated in paragraph 123 of its Report that that subsidy might entail an initial cost of about £1 million a year, with the prospect of an annual increase over the next few years. I certainly would not regard that as an understatement of what was required. Perhaps that is the reason why the
    1220
    Government have done nothing about it for so long.
    8.30 p.m.
    When the Committee was considering the fuel tax, it asked for some evidence from groups of bus undertakings. One was called the Public Transport Association, another was Tillings and another was Scottish Omnibuses. These three groups stated their losses on unremunerative rural mileage and then stated the costs of the fuel tax, and the conclusion which the Committee drew—I think it must be correct on the figures—was that the cost of the removal of the fuel tax would be more than the actual loss on unremunerative rural mileage. That was one of the reasons—I think the substantial reason—for its rejecting that solution. It then considered various other forms of doing the same thing, with which I will not trouble the Committee, because the Report has been published.
    But Mr. Nicholas, in his dissenting Report, came to a different conclusion. In paragraph 14 on page 54, he said:
    "In my view there is a strong case for an immediate and complete fuel tax remission generally for the industry for many reasons. One is that it would enable operators of stage services to continue the system of cross-subsidisation…"
    I need not go on with that paragraph. It went into the matter in a little more detail.
    Cross-subsidisation means, in plain English, the use of a remunerative service to carry an unremunerative one. I live in a rather remote part of Scotland where what would be by itself the unremunerative provision of our electricity supply by the North of Scotland Hydro-electric Board is done because its system of providing electricity has other more remunerative parts and the two things are taken together. That is done in many industries, particularly public ones, but also in others. Cross-subsidisation is, therefore, a very important point when we are considering the position of rural services, and it has a considerable bearing on present circumstances.
    Before dealing with that subject, I would add a word or two more from Mr. Nicholas's Report:
    "The eventual sum involved in a subsidy would inevitably be much greater than that envisaged in Chapter 10 of the main Report."

    1221
    That is the part that I read out just now.
    "If the principle of a subsidy is sound there appears to be no reason why it should be restrictive in its application to unremunerative rural services only."
    That was his criticism of the Committee's conclusions.
    Finally, he said—this is what appealed to me—that, in effect, it really would be ridiculous to subsidise a service of this character at one end and tax it at the other. His phrase was:
    "a 'from one pocket to the other' transaction."
    I agree with that. Therefore, looking at the Jack Committee Report, which found a very great many advantages in this type of arrangement, I still prefer Mr. Nicholas's Report, and I think the time has come for the Government to consider whether this should not be done. That is the intention of the Clause.
    I say that I think the time has come for a certain reason. Rural bus services have not been improving. Within my knowledge they have been getting rather worse, if anything. There is a constant tendency on the part of a commercial bus company to give up cross-subsidisation unless it is driven to it by the licensing authorities and to drop unremunerative services. The company is out to make a profit, and it is not particularly concerned with the social consequences of what is done. Therefore, it naturally drops unremunerative services, one by one, quietly. That has been happening. Whether I am right or wrong about that, it is clear that there is considerable pressure to that end.
    What is happening at the moment is that the Beeching Report and the views of the Minister of Transport about it will involve a further burden on our bus services—additional services and such wild ventures as the removal of a seat or two in order to accommodate a perambulator. This was one of the devices we had to consider in a debate the other day. Seriously, perambulators or no perambulators, our bus services will be very hard put to it if they are to meet the social needs consequent on any attempt to implement the Beeching Report.
    I am not going into the matter in detail, but it is obvious that if one says that a great many of the railways do not
    1222
    pay and, therefore, shuts them down and relies on bus services to meet the gap one has caused, one will not get very much out of the bus services that do not pay. The effect of this tax is to increase the bus services that do not pay. If one could remove it, one would reduce the number of unremunerative services and thus brighten the whole picture. This is not just a question of balancing one service against another. It is getting the undertakings as a whole to perform their social obligations—obligations consequent, after all, on Government actions.
    It may be said, "Your Clause does not say anything about all this". I think that is a fair criticism, but there are limits to what one can do in the Finance Bill. It seems to me that the time has come for the Government to accept, in principle if they like, that they cannot go on getting this additional duty on derv for buses without damaging, or increasing the damage already done, to the bus services in the country.
    In talking of rural bus services, I do not mean to exclude other bus services, but I do see the particular importance of those in rural areas, whether they be local or long distance. It is, indeed, impractical to try to limit the effect to one category or another. If we try to do it by using a built-up area as a criterion, as hon. Members opposite suggest, one may get the ridiculous position of bus services running alternately through built-up and rural areas. We will have to go the whole hog.
    I can see no real objection to this at all. I cannot see that the administrative difficulties, although I would be quite prepared to agree that they exist, are insuperable in view of what has been done since Mr. Amory, as he then was, made the observation I referred to. What was a critical problem in 1959 has not only continued to be one but is a great deal worse, and at the moment it threatens to be even more serious and of even wider social effects than it was in those days. It really is an important matter, as Lord Amory recognised even at that time.
    I am not here to argue the case for a further reduction of duties on fuel generally. That is not the purpose of my Clause. The case will no doubt be argued by those hon. Gentlemen who have put

    1223
    down new Clauses accordingly and which are being discussed with this one. It is an entirely different matter. It is different for one outstanding reason—that the moment one considers a fuel tax simply as a matter of fuel, whether one is considering this, that or the other type of heavy oil, one inevitably has to consider other fuels and obviously among these is coal.
    The days when motor cars or motor buses were driven by steam generated by coal are past, and in practice derv accounts for 90 per cent. of the fuel used by buses. That is why only one derv has a substantial case today. When one comes to reducing taxation on other fuel, one is on a different and very much broader question.
    The best estimate I can make is that something like a loss of £30 million a year would be involved to the National Coal Board, allowing for diminution of gross revenue and some savings of costs, if the new Clasues proposing to reduce the fuel tax as a whole were accepted by this Committee. I say no more about that than that, given conditions in the north of England, Scotland and elsewhere, and given the state of the coal industry at the moment, it would be madness to attract the social dislocation that would be involved by the more sweeping proposals in the other Clauses we are considering with mine. This is not the moment, with mines closing all over the country, and with grave unemployment in and near the coalfields, to do anything of the sort.
    But that does not arise on the Clause that I am moving, and on this Clause I say with confidence that the case that has existed for many years, that has been recognised on both sides of the Committee, that was recognised by the Chancellor of the Exchequer in 1959, has not only continued but has grown, and now it must be met if anything is to be done to implement the Beeching proposals or any part of them.
    Mr. T. H. H. Skeet: Sir Samuel, you have been good enough to call for discussion of the two new Clauses in my name, one dealing with rebate of duty on fuel oils, gas oils and kerosene, and the other with lubricants, and the right hon. Member for Kettering
    1224
    (Mr. Mitchison) has indicated that the coal industry requires a certain degree of protection. I think that we on this side of the Committee, as well as hon. and right hon. Gentlemen opposite, will appreciate that the arguments in favour of the coal industry have been put before the Committee on many former occasions.
    Mr. Neville Chamberlain said this:
    "I have received very strong representations from the coal industry, supported by the gas and electricity supply industries, and by the railway companies that in the interests of British coal and allied industries, I should review what they regard as an anomalous position".—[OFFICIAL REPORT, 25th April, 1933; Vol. 277, c. 52.]
    Starting from that, a duty of 1d. per gallon was placed on heavy oils. Rather curiously, with the passage of time, there have been repercussions, and when we come to another Chancellor of the Exchequer, Mr. Hugh Dalton, he stated
    "These arrangements will…I hope…result in conversions from coal to oil to the maximum extent possible."—[OFFICIAL REPORT, 1st August, 1946 Vol. 426, c. 238.]
    He removed the ld. per gallon from heavy oils and gas oils. Industry was persuaded by the Chancellor of the Exchequer at that time to go over to oil. Now it has been told by subsequent Chancellors of the Exchequer that it is to be penalised for doing so.
    My right hon. and learned Friend the Member for Wirral (Mr. Selwyn Lloyd) on 17th April, 1961 said:
    "…I consider that for revenue reasons heavy oils should now bear some duty. I propose, therefore, to reinstate the duty, at the rate of 2d. a gallon on heavy oils at present free of duty…".—[OFFICIAL REPORT, 17th April, 1961; Vol. 638, c. 819–9.]
    I think that is perfectly consistent with what my right hon. Friend the Minister of Power at the opening of the B.P. terminal at Angle Bay, as reported in The Times on 21st April, 1961, said:
    "Some have suggested that it is naive to suppose its purpose was to raise revenue and not to give protection to coal. I emphatically deny this…because I am convinced that coal is in no need of such protection."
    There seems to be some Ministerial confusion about it. On the one hand, we have the recognition from the Chancellor that industry should convert from coal to oil because of the difficulties experienced at the time.
    In a fairly recent Budget it was indicated and confirmed by the Minister of

    1225
    Power that the coal industry was in no need of protection. That is not the end of the story, because in my right hon. Friend the Chancellor's recent Budget he said:
    "I have to decide whether the quick reductions in the costs of certain industries which would result from the removal of the duty would outweigh both the immediate damage to the coal industry and the risk of disrupting and even preventing the long-term recovery of the full competitive position of the industry…I have, therefore, decided that the time is not ripe to reduce the duty"—[OFFICIAL REPORT, 3rd April, 1963; Vol. 675, c. 486,]
    8.45 p.m.
    I find it difficult to reconcile this with the statement by the Chancellor of the Exchequer when he was Paymaster-General. During the fuel and power debate in this House on 4th May, 1959, he said:
    "I should have thought that a duty designed for the protection of coal would probably also be contrary to our international obligations."—[OFFICIAL REPORT, 4th May, 1959; Vol. 605, c. 55.]
    My right hon. Friend said in the first place that he wanted it for the protection of the coal industry; a previous Chancellor of the Exchequer, my right hon. and learned Friend the Member for Wirrall said that it was not necessary but he wanted it for revenue purposes; and my right hon. Friend the Chancellor of the Exchequer said in 1959 that it was probably contrary to our inter-national obligations.
    On this basis hon. Members may wonder how an industry can plan ahead if it finds that its fuel policy is changed almost overnight, that distortions are introduced from different angles, and that we are pursuing a policy in this country which has already been rejected in Western Europe. I should have thought that in 1960 there would have been a turning point when the Report of the Robinson Committee was published, which indicated that what Europe required was
    "a plentiful supply of low cost energy with freedom of choice to the consumer…
    These views received broad acceptance by the Government, and my right hon. Friend the Chancellor of the Exchequer said:
    "Our aim must be a cheap and abundant supply of fuel. Our policy is to obtain it by proper freedom of choice for the user and competition between suppliers…"—
    1226
    [OFFICIAL REPORT, 4th May, 1959; Vol. 605, c. 45.]
    This would seem economic sense, but what do we find in this Budget? We find that my right hon. Friend is refusing to allow proper freedom of choice or competition between suppliers, and my right hon. Friend's views were supported by the Ridley Committee when it said:
    "…the right policy…is to leave the pattern of fuel use to be determined by the consumers own choice between competing services."
    The position is that while Europe is going over to a liberal fuel policy, Her Majesty's Government are moving further and further towards protection, and while European industry is having its costs thrust down to compete effectively abroad, our fuel prices are being chained more and more to high cost coal with the result that we have imbalance.
    Mr. Chapman: It is not high cost coal.
    Mr. Skeet: It is compared with the cost of coal in Europe and some of the coal exported from Virginia in the United States to Europe. That is why at one stage the Minister of Power would not allow the steel industry of Wales to import Virginia coal.
    Having paid lip-service to what is known as a liberal fuel policy, what has happened here? Industry has had considerable increments added to its fuel bill. For example, the steel industry has had between £6½ million and £7 million added to its fuel bill. The engineering industry, on which we depend for exports, has had £2¼ million added to its bill. Food processing has had £22½ million added. These figures are significant if one tots them up. The textile industry, which is going through a difficult phase, has had about £2 million added to its bill, and a number of other industries, like the ceramics and pottery industries, have had £1 million added. I could enumerate a number of other industries which have suffered this severe affliction.
    It is extraordinary that when a clear line of policy has been laid down in Western Europe, where it appears that they are on the right lines trying to get their costs down, we should either be adding to or keeping these high costs which are an embarrassment to industry, at a time indeed when rates are rising substantially through re-rating, and when

    1227
    the prices of electricity and gas have risen considerably.
    I wonder whether the Committee would care to consider some of the technical advantages to be derived from the use of oil? Not only is it cleaner to use and store, but on a calorific basis there is less sulphur content than there is in solid fuel. Therefore, I think that one of the factors which my right hon. Friend should take into account is that if he is trying to clean the air of Britain this is one way in which to do it. If, on the other hand, he is going along with the present policy—
    Mr. R. E. Winterbottom rose—
    Mr. Skeet: If the hon. Member will please wait until I have finished my sentence—of shoring up the markets in the hope that by assisting one part of the economy he will vastly strengthen the other, he will find that this policy will not act in the way he wants.
    Mr. Winterbottom: Just to get the record straight, I wish to point out to the hon. Member for Willesden, East (Mr. Skeet) that his statement about electricity is the best understatement I have come across for some time. Taking the area which I represent, the increase budgeted profits for electricity for the next five years range to something like a f14 million increase on a former budget of £18 million. The estimated profit is about 360 per cent. In other words, electricity is helping to price some industries—particularly those connected with the steel industry—out of the market.
    Mr. Skeet: The hon. Member should bear in mind that if the suggestion which I put forward of halving the duty, or the suggestion regarding the removal of the tax, is adopted, the electricity industry will benefit. Its tax bill each year from this levy is about £13 million. It is a factor, therefore, from which the electricity industry would benefit. That is, of course, the total bill for fuel oil duty.
    If we consider the relative tax position in Europe and compare the situation in the countries of the Six and the United Kingdom we find that in Western Germany the tax is 2·8d. per imperial
    1228
    gallon. We can say, therefore, that Western Germany is top of the league. We come second with a figure of 2d. There are a few other countries like Belgium, 1·8d.; Italy, 1·7d. and the Netherlands, 1·1d., with France at the bottom with a figure of (Ad. Therefore, from the angle of the tax on fuel oil we are virtually right at the top of the league for the European cup. We have not got into the Common Market. But we have to compete with the Common Market countries and taxwise we are well and truly up against it.
    Mr. Denis Howell: And it is the fourth division.
    Mr. Skeet: It may be the fourth division.
    For what are we considering this special privilege? For an industry which accounts for at least 70 per cent. of the total energy requirements of the United Kingdom against the oil industry which accounts for only 29 per cent. The total hydro-carbon tax works out at about £590 million. The fuel oil tax works out at something like £60 million. Who foots the bill? Industry, to the extent of 86 per cent.
    I wish to point out to the Committee that this would total less than 1 per cent. of the total tax receipts of the Government. Yet in some industries it has an impact on increased fuel costs of about 25 per cent. Surely this makes economic nonsense. One quotation which I have here from industry relates to Associated Portland Cement:
    "This time last year I foretold the damaging effect that the hydro-carbon oil duty would have on our export trade. Events have, unfortunately, borne this out as our exports fell by one third equivalent to some 300,000 tons. We had no alternative but to withdraw from many of our old traditional markets because the oil duty turned a profit, already only marginal, into a loss."
    How long can we expect these things to continue?
    The duty of about £4 million on kerosene is a little hard on two sections of the economy. In the United Kingdom there are about 13 million oil heaters. People who have them have to pay this tax. Would it not be right to assist those on lower incomes to utilise those devices by reducing this duty? Kerosene is also used for vapourising and there are about 150,000 tractors in the United

    1229
    Kingdom. Are we to say that the duty should not be removed to their advantage?
    Perhaps the Chancellor may address his mind also to the important aspect of lubricants. This tax is exceedingly high, and I think that my right hon. Friend could well afford to release approximately £3 million in this respect. Where is the competition with the coal industry in lubricants? The coal industry itself uses lubricants and has a tax bill on this account. If, on the other hand, the tax is for revenue purposes and not for the protection of the coal industry, then it should be recognised that industry has not been doing quite so well in recent years and the amount of lubricants which has been consumed has fallen quite significantly. Therefore, an advantage should be conceded.
    Where we have a fuel which enters into the cost of production it should not be taxed. Where industry in Europe has access to cheap fuels such as natural gas, an abundant supply of liquid fuel and also a large quantity of American coal, we should do something to secure the position of British industry. After all, it is British industry which is largely responsible for the exports of this country.
    It may be a happy circumstance if we could export a little coal, but that is purely marginal. Are we to say that industry must carry the heavy burden because the coal industry cannot keep its own house in order? [HON. MEMBERS: "Nonsense."] I sympathise with anyone who has to face being rendered redundant, but this is a charge which should be put on the nation as a whole and not on a particular section of industry. I think that many hon. Members will agree with that sentiment.
    I have asked, quite modestly, that this tax should be halved. Some of my hon. Friends have suggested that it should be deleted entirely this year. The Government should consider on what ground they continue the tax. A couple of years ago it was said to be for revenue purposes. This year it appears to be for the protection of the coal industry. It seems that they are rather confused. It is up to the Chancellor to clarify these matters.
    Mr. Donald Wade: It is generally recognised that the closing down of bus services, particularly
    1230
    in rural areas, is a serious matter and one has to take into account the social consequences. On these grounds, there is a case for relief from the duty on heavy oils so far as it affects bus services, but I do not think one can limit this question to derv for buses. As the hon. Member for Willesden, East (Mr. Skeet) has pointed out, this fuel tax has very serious implications for industry.
    You, Sir Samuel, have been good enough to indicate that in this debate we can discuss the Liberal new Clause—"Reduction of Duty on Heavy Oils". The object of that Clause is to increase the rebate, or in other words to cancel the increase of 2d. a gallon which was imposed in 1961. Like the hon. Member for Willesden, East, I am rather puzzled by the change of attitude which has been adopted by way of justification for the tax. From what the right hon. and learned Member for the Wirral (Mr. Selwyn Lloyd) pointed out when he was Chancellor in 1961, it is quite clear that the tax was for revenue purposes. He said:
    "…I consider that for revenue reasons heavy oils should now bear some duty."—[OFFICIAL REPORT, 17th April, 1961; Vol. 638, c. 818–19.]
    9.0 p.m.
    The ground has obviously been changed, and the Government's view is now very different. The Chancellor's observation has already been quoted, and I need not quote him again at length. But, in his Budget speech on 3rd April, he said:
    "Against this background I considered whether do reduce the duty on fuel oil. I have been pressed to remove this duty to lower industrial costs. I cannot consider this solely from a revenue point of view…"—[OFFICIAL REPORT, 3rd April, 1963; Vol. 674, c. 485.]
    He gave his reasons far not removing this burden and referred to the problems of the Coal Board. One cannot ignore that aspect. I fully appreciate the Coal Board's problems, and I will refer to them in a few minutes, but we must consider industry as a whole, and it cannot be denied that the duty on heavy oil has been passed on to the consumer probably in all relevant products. This affects both home industry and the export trade, and a wide range of industries. The public utilities are prominent among them.

    1231
    Electricity generation alone absorbed 5,700,000 tons of gas, diesel and fuel oil last year. A further 2,800,000 tons was absorbed in the iron and steel industry, while miscellaneous engineering industries together accounted for well over 1,900,000 tons. I could give other examples of important consumers. Reference has been made to cement, and there is also the fishing industry.
    Among those who have turned increasingly to oil fuels over recent years are those employing central heating. Last year more than 2,600,000 tons of gas, diesel and fuel oil, as well as considerable quantities of burning oil, were utilised in central heating installations, and the users of the heavier oils included schools, medical and welfare establishments.
    But it is among the industrial users of oil that the effect of the new duty has been most far-reaching. I hope that the Chancellor is aware that much plant is designed to operate on fuel oil because it offers certain natural advantages by comparison with solid fuel. For example, it has a higher calorific value, ease of handling, convenience of storage and cleanliness in use. The relatively low price of fuel oil, in particular, has been an important factor to firms whose competitive ability depends largely on keeping down their manufacturing costs. That is the essence of the case. We must consider the vital importance of the competitive element in manufacturing costs, because this is essential if we are to compete overseas, particularly against some Western European countries.
    The Chancellor recognised this, but he came to the wrong conclusion. The industries which are heavy users of fuel oil include cement, steel and parts of the chemical industry. In effect they are being penalised, and the result has been a blow at the export competitiveness of a significant sector of British industry.
    I will give an illustration in connection with cement, which has already been referred to. Exports of cement have been particularly adversely affected. The tax of 2d. a gallon increased cement-making costs by 8s. per ton, or about 12½per cent., at oil-fired works, which is the case in all the major United Kingdom export-
    1232
    ing works. I have some figures here which bear this out.
    The effect on the exports of British cement is clearly brought out by the following figures from the Trade and Navigation Accounts, which I have here. I shall not give a great many details. I will give a summary. In 1960 the value of the exports was £7,115,306. In 1961 —hon. Members should remember that the fuel tax which I am discussing was increased in April, 1961—the figure fell to £5,300,908. In 1962 it fell to £3,124,526. I do not think it can be denied that in industries such as this the fuel tax has had a serious effect on our exports.
    Mr. Mitchison: Is not the fall to which the hon. Gentleman refers at any rate connected with the increasing practice of that particular outfit to manufacture more cement abroad?
    Mr. Wade: Yes, but I do not think one can get away from the fact, both from the quotations we have had from the hon. Member for Willesden, East (Mr. Skeet) and those which I have given, that this tax must have had an adverse effect on the competitiveness of the cement industry.
    I will give one last quotation. It is from an article in the Guardian of 15th March, 1963, which sums the matter up in this way:
    "Probably no single step could do more to reassure the world that Britain is really intent on achieving faster economic growth than a clear and unequivocal positive answer to the question: 'Does Britain want cheap fuel?' "
    The Government have come down on what I regard as the wrong side, namely, they prefer to keep fuel prices in this country artificially high.
    As I said at the beginning of my brief speech, I am aware of the problems of the coal industry. I believe that Lord Robens is doing a good job. I do not want him to be handicapped in his task. However, if the choice has to be made, I would prefer some form of subsidising temporarily to help the coal industry to carry out its reorganisation rather than impose this very serious burden on the remainder of industry.
    Mr. Frank McLeavy: Will the hon. Gentleman tell the Commitee the amount of tax per gallon for industrial use?
    Mr. Wade: If I might ask the hon. Gentleman a question, does he mean over the whole country?
    Mr. McLeavy: Yes.
    Mr. Wade: The amount I propose as a reduction is 2d. per gallon.
    Mr. McLeavy: I do not think the hon. Gentleman has understood me. He is arguing that the fuel oil tax imposes an extremely heavy burden on industry. Will he tell us for our guidance precisely what the tax is per gallon for industrial use?
    Mr. Wade: I think it is 2·2d. I would have to check that.
    I think that the Chancellor of the Exchequer made a fair point when he said that he has to take into account the problems of the coal industry, but, if the choice has to be made, it would be better for industry as a whole to face this squarely and provide some kind of subsidy over a period of years rather than continue this fuel tax which, I repeat, is a serious impostion on industry. It is for that reason that I advocate this reduction in duty.
    Sir Hugh Linstead: In this short debate on the proposed new Clause two points have been adduced which must have been in my right hon. Friend's mind when he made his Budget announcement. The first is the revenue aspect of the duty—which amounts to about £55 million a year—and the second is the impact on the coal industry; and however much one desires to see the abolition of the duty, one must recognise that at the very time when the coal industry is turning the corner—is getting its head above water, to mix metaphors—is probably not the most fruitful time at which to encourage the further development of the use of a competitive fuel.
    While these two points must have been in my right hon. Friend's mind, there is a third point which is of importance to him and to industry as a whole—the value of a reduction of fuel oil tax as a general incentive to industry, in reducing both the costs of production and of distribution. Although I appreciate why this year my right hon. Friend does not propose to make a change, I hope that the possibility of using a reduction of this tax as a means of stimulating industry—as a type of regulator to be used at this parti-
    1234
    cular period of time as an incentive—will not be overlooked by my right hon. Friend in his calculations for next year's budget.
    Mr. Skeet: My hon. Friend referred to the coal industry being in the process of "turning the corner". Realising that it has been doing that for the last thirty years, is he suggesting that the Chancellor should take the sort of action he is describing next year or the year after that? When does he consider that this tax should be remitted?
    Sir H. Linstead: I was hoping that it would be next year, but it is important that industry should not be left any longer than is absolutely necessary in a state of uncertainty.
    Mr. Skeet: Hear, hear.
    Sir H. LinsteadIndustry can work subject to almost any conditions provided that it can be reasonably certain of what those conditions will be. It cannot work satisfactorily on the basis of uncertainty. The sooner we get a clear statement from my right hon. Friend on his intentions the clearer the road will be for industry.
    Of the representations that have come my way, some of the most interesting have come from the glass industry. I have no financial interest in this industry, but it would seem that it is very representative of a fuel-using type of industry; and a few figures representing the effects of the oil tax on it are worth considering by my right hon. Friend and worth having on the record. There can be no doubt that, for the glass industry, oil is far and away the most efficient fuel it can use. It is also extremely valuable from the clean air point of view, particularly with the increasing number of smokeless zones. Both the Government and the nation fully support the clean air policy, but some sections of industry may be considerably prejudiced if they are not permitted to use coal and yet are discouraged from using oil by the present tax.
    It is important when my right hon. Friend considers the effects of the tax on the coal industry for him to remember that a large number of the most efficient industries and firms have already changed over to oil. He is not protecting the coal industry by maintaining the tax on

    1235
    fuel oil because no one will change back from fuel oil to coal firing.
    It is interesting to note that, although the glass industry carries 2½ per cent. of the £55 million tax, it employs only one-third of I per cent. of our total labour force, and has only half of I per cent. of our total industrial turnover. It is, therefore, bearing a very much higher proportion of the cost of the tax than are some of our other industries, and can put forward many very strong commercial and economic arguments why this burden on it should be lightened. It is one of a number of highly-modernised industries that are battling to compete with foreign imports and at the same time increase exports. It has succeeded in effecting a very substantial reduction in the ratio of imports to exports. Its exports now stand as £22½8 million, and are still rising.
    9.15 p.m.
    West German oil prices—and the West Germans are substantial competitors of our own glass industry—are 28 per cent. below our prices; Belgium, 21 per cent.; Holland, 25 per cent.; Sweden, 40 per cent., and Italy 7 per cent. Somehow or other, our own industry has to keep up its rate of increase of exports in the face of competing oil prices like that. I believe that we must put the efficiency of our industries, and their ability to succeed in a highly competitive export market, very much higher than my right hon. Friend has seemed to be prepared to do—at any rate, in relation to this tax.
    Most of our industry is very responsive to Treasury policy, and I believe that this tax represents an extremely valuable regulator of industrial policy. If my right hon. Friend really wants a reduction in costs at home and expansion in a highly competitive world, he has in this tax a very valuable instrument. I hope that he will be able to tell us tonight that he is satisfied that the coal industry no longer requires the kind of support he indicated in his Budget speech he thinks it still needs, that in his next Budget—let us assume that he will be Chancellor next year—he will find it possible to use the remission of this tax as an encouragement both to productivity and to more economical distribution.
    Mr. McLeavy: If the Chancellor had unlimited money to dispose of in this
    1236
    Budget, it would have been well had he undertaken a general review of the whole question of the taxation of fuel oil as used in industry and in public transport. One outstanding thing about this tax is its serious effect on the transport industry. While, in happier financial circumstances, I would be anxious to support hon. Members who have spoken of the need for relieving industry, I am not satisfied that the incidence of fuel oil taxation on industry generally is at present such a serious hindrance as some hon. Members have stated.
    I want, in the main, to confine myself to the tax as it affects road passenger transport vehicles. I have spoken in the House for many years on this subject. I was one of a delegation from both sides who had an interview with the noble Lord, Lord Amory, about fuel oil taxation as it affected passenger transport. I am quite satisfied that Lord Amory accepted the very strong case which we put forward for immediate relief, but he found some difficulty, possibly because of Treasury opposition, in being able to help us. He appeared on television and said that he was sorry that in that Budget he was unable to give some relief to the passenger transport service. In view of what Lord Amory said, it was rather astonishing that when the right hon. and learned Member for Wirral (Mr. Selwyn Lloyd) brought in his regulator and put a 10 per cent. surcharge on a certain group of articles petrol tax was included and, in consequence, went up from 2s. 6d. to 2s. 9d. a gallon.
    The right hon. and learned Gentleman then made out a case that, while the passenger transport industry was not entirely satisfied about the increased charge, nevertheless it accepted his implied statement that this increase of 3d. per gallon was merely temporary and would disappear when the 10 per cent. surcharge was removed. To our astonishment, when he removed the surcharge on the other commodities in this group he excluded the fuel oil and consolidated the 3d. into what is now known as the fuel oil tax of 2s. 9d.
    It was astonishing that when the matter was raised with the Chancellor, the then Financial Secretary to the Treasury, in defending the retention of the extra 3d. on fuel oil, said that the

    1237
    Treasury could not afford to lose the revenue. The transport industry and other sections of industry which were affected by the 3d. increase regarded this action by the then Chancellor of the Exchequer as nothing short of sharp practice. They said so, and they were very resentful that having accepted a temporary increase because of the economic conditions which the Chancellor described to Parliament the right hon. and learned Gentleman then, took the opportunity of consolidating it in fuel oil taxation itself. It was a disgraceful thing to do, which did not reflect credit on the right hon. and learned Gentleman.
    There is no other section of industry which has a stronger case for the abolition of the tax than the road passenger transport service. The undertakings have to provide a public service, in the early morning, during the day and in the evening, whether it pays or not, and they have to set against the unremunerative routes the more profitable routes which they run.
    I remember very well that the Traffic Commissioners, who have a good deal of influence and control over road passenger transport, were extremely anxious to press municipal and private bus undertakers to provide unremunerative services in the countryside and elsewhere, setting them off against the more profitable routes in the towns. It is to the credit of bus undertakers generally that they tried to meet the wishes of the Traffic Commissioners throughout the country in providing these services.
    The situation is now much changed. The bus undertakings, municipal or privately owned, are not now able to carry the amount of unremunerative services which they were carrying some years ago. It is simply the reduced volume of traffic which has caused the difficulty. My hon. and learned Friend the Member for Kettering (Mr. Mitchison) referred to the Jack Committee. Let us be clear about the Jack Committee. It was set up to consider one section of the passenger transport industry, the rural bus services. Hon. Members on both sides who take a close interest in our bus services know how shamefully the Government have, for many years, neglected the rural bus services. Time and time again, we on this side of the Committee
    1238
    and hon. Member opposite representing rural constituencies have raised the matter with the Minister. Promises have been made. We have been put off from month to month, until, today, nothing is being done effectively for the countryside although its services are dwindling day by day.
    The Chancellor must, therefore, consider the passenger transport industry as a very special case. We cannot compare our bus services with an ordinary commercial service such as road haulage. The road haulier is in an infinitely better position. He is able to decide whether he will take a load from A to Z, and he decides whether it is profitable for him to carry it over that particular distance. It is done on the basis of profitability. But the bus undertakings have to run a schedule of services and have to provide a service for the community at times when the number of passengers does not warrant running bus services at all. The traffic commissioners have been most emphatic in pressing the bus undertakings to provide the maximum number of services.
    9.30 p.m.
    The bus undertakings feel that the Government have not been fair to the industry. They have not accepted the case put before them and have not realised the serious situation of the industry. It is very difficult to get staff for the bus services because wages and conditions of employment commensurate with those in other industries are not provided. That is why, apart from the heavy burden of the fuel oil tax, many services are having to be curtailed. This is a very serious matter. The Chancellor of the Exchequer should make up his mind about the municipal transport undertakings.
    When this matter was raised on a previous occasion, all sorts of arguments were put forward as to why it was not possible to give relief to the bus undertakings. I have no hesitation in saying that unless special relief is given, and given quickly, the bus services in the rural areas and townships will be serious handicapped by financial difficulties. The Minister of Transport proposes to cut train services and to close unremunerative stations and to rely on substituting bus services. How on earth will he get the staff to do that when the bus undertakings cannot get it?

    1239
    Unless the Government are prepared to recognise the financial difficulties of the industry and to give it a fair deal, it will not be able to provide the service which the nation requires.
    I urge the Chancellor of the Exchequer to consider the financial difficulties which are arising mainly because of the heavy fuel oil tax. If the tax were abolished in respect of the road passenger transport industry, it would enable it to restore many of the services in the rural areas and to provide a better service not only in the rural areas but elsewhere.
    No industry has served the nation so well and no industry has been dealt with so shamefully by the Government over the past few years as the road passenger transport industry. As one who has spent a lifetime in the passenger transport service, I apply for common sense and justice. My hon. and learned Friend the Member for Kettering, knowing the financial limitations of the Chancellor of the Exchequer, has made a reasoned case why there should be special treatment for the transport industry. Failure to give justice to the industry will strike a blow at one of the most public-spirited industries that this country has.
    Mr. John E. Talbot: As sometimes happens in dealing with the Finance Bill, we are discussing two rather different matters at the same time. We are discussing the proposal of the hon. and learned Member for Kettering (Mr. Mitchison) related solely to passenger transport, but we are discussing also other new Clauses, in particular those of my hon. Friend the Member for Willesden, East (Mr. Skeet), which seek in varying degrees to give wider relief from this tax.
    I am concerned on a constituency basis in both respects. I live in the country and am dependent sometimes on a country bus service. It is getting worse and worse and I have continual complaints from constituents that they do not have the services that they had. I am concerned that this process will continue and I believe that this tax is a major part of such a process. What is the good of applying the Beeching principle to the railways when perhaps, we will have to do the same thing to road transport, whose costs have been inflated by this unnecessary tax? To that extent, I support the hon. and learned Member for Kettering and I hope
    1240
    that my right hon. Friend the Chancellor of the Exchequer will have something to say which might make that support waver.
    On the second issue, I, too, like my hon. Friend the Member for Putney (Sir H. Linstead), am concerned in the glass trade. I am very interested in it. I have no money in it, but many of my constituents work in it and I speak from personal experience of seeing the working of the glass trade in Brierley Hill. The manufacture of cut glass is a craft industry and is dependent in great degree on the skill of the individual. Mass production methods are not easy to apply. This industry is feeling the impact of the tax with peculiar vigour. I am told that something like 10 per cent. of its costs is accounted for by fuel, which is a high proportion.
    I will not go over the figures again, but I believe and am fully satisfied that it would be not only in the interests of the glass trade in particular, but of industry in general, for something to be done at an early date to relieve the burden of this tax, which seems to have universal unpopularity on all sides of the Committee and does far more damage in relation to the income that it yields than anything else on the Statute Book.
    Mr. Edwin Wainwright: I did not intend to intervene in this debate until the hon. Member for Willesden, East (Mr. Skeet) made such an attack on the Coal Board. I am sorry that the hon. Member is not in his place.
    Sir G. Nabarro: I am.
    Mr. Wainwright: Once more, the hon. Member for Kidderminster (Sir G. Nabarro) interjects in his complacent manner. He does not even stand up to make his comments.
    Statements have been made by the hon. Member for Willesden, East that on every occasion when hon. Members opposite want to denigrate the Coal Board because it is a nationalised industry, they attempt to do so.
    Sir G. Nabarro: Certainly not.
    Mr. Wainwright: I fully remember when coal was in short supply and it had to be imported from the United States of America at £2 or £3 a ton more than the cost of our own coal. Private

    1241
    industry did not have to pay that difference in the price, but was allowed to have coal supplied to it at home prices, resulting in the fact that the Coal Board had to pay about £70 million to help private enterprise to have cheap fuel.
    I cannot remember reading in the OFFICIAL REPORT of that time that any hon. Members opposite who were then in the House said that private industry should pay the difference in price between home coal and imported coal. They were content that private industry should have the benefit, and for the sake of the nation at that time. Also, there was not a great deal of criticism from the N.U.M. on the issue. We wanted our production rates to rise. If the tax on fuel oil imposes a burden on private industry, hon. Members opposite ought to realise that a heavy burden was placed on the coal mining industry when coal had to be imported. There were other factors which the National Coal Board had to stand which private enterprise never stood and never would be responsible for in the days when it ruined the industry. We have no proof that private enterprise could run the industry as it is being run today.
    It seems that at present we are reaching saturation point in taking fuel oil from crude oil. The proportion is about fifty-fifty. The process of refining crude oil to obtain the petrol that we require means that fuel oil is being left. Not many years ago it was left in abundance, but even today it is sold mostly at a lower price than crude oil. Consequently, it looks as if the oil industry is to a certain extent subsidising fuel oil.
    Are we certain that this type of fuel can be guaranteed to this country in the years to come? Would it be wise to run down the coal mining industry to such an extent that 50 per cent. of our power needs would have to be imported? Regardless of my connection with the coal mining industry, I believe it would be a great mistake for us to do so. If we did that, I feel sure that in years to come we should be criticised for such action by whatever Government there was at the time. Who can vouch that oil will be allowed into our country at the present price? Who will vouch that the price of oil will not jump
    1242
    tremendously in the near future? Does not the oil come from an area which is very unstable politically? Could not any action taken in those countries gravely affect our fuel oil supplies?
    If we were dependent upon oil to the extent that some hon. Gentlemen opposite would like us to be, there would be a cry of "spilt milk" from them. They would want to blame someone else for the action they had taken. I am certain that to take such action would be a grave injustice to our nation and to the people who work in it. I do not believe that hon. Members opposite are bothered about the social consequences of a rundown of the coal mining industry.
    Sir G. Nabarro: Drivel.
    9.45 p.m.
    Mr. Wainwright: It may be that if the hon. Gentleman were to say what was in his mind I could describe it as drivel. He likes to interject from a position from which he is not entitled to interject. If he cares to stand up and say what he wants to say, I will be glad to give way.
    Sir G. Nabarro: I do not think that it would be appropriate, in the middle of this Committee stage, for me to make a dissertation upon the Tory Party's policy for coal. The hon. Member represents, I understand, the Dearne Valley, in Yorkshire. I shall be addressing the summer school of the National Union of Mineworkers at Bingley, Yorkshire, in July, and I invite him to listen to my discourse on that occasion, which will be entitled, "A Tory M.P. looks at the future of coal". That is the proper answer now to the hon. Member.
    Mr. Wainwright: I occasionally waste my time in listening to the hon. Gentleman in this place and I do not propose to go to a summer school in order to listen to him in the summer. Despite his bombast, if he is fair and just, honest and sincere, he will find a responsive audience but I must warn him that after he has spoken they will be convinced that what he has said was drivel. I want now to return to the subject of oil.
    Sir G. Nabarro: Hear, hear.
    Mr. Wainwright: I could spend quite a few minutes relating what has been accomplished in the coal industry since

    1243
    the National Coal Board took over. I could describe to the Committee the price paid by the miners in deaths, injuries and a great many other things to the old private owners. But I shall not dwell on these things tonight. I want instead to warn the Committee about the area where most of our oil comes from and about what kind of oil it will be in years to come.
    Our present oil supplies come mainly from the Middle East. It is heavy, crude oil. There are limited supplies of it in the Middle East—more limited than the supplies of coal in this country. And remember that one can stop oil from flowing and then quickly start up production again, but that if one stops a pit it takes a long time to put it back into production.
    Another important factor is that the oil from the Sahara, a new source, is lighter oil than that found elsewhere in the Middle East. The result is that there will be less percentage for fuel oils after refining. Therefore, fuel oil could easily be in short supply. If it is in short supply, prices will rise.
    The more we depend upon oil, the greater could be the adverse effec on our industry. I hope that the Government do not take notice of what many of their supporters have been saying on this issue. Let the Chancellor accept the Clause moved by my hon. and learned Friend the Member for Kettering (Mr. Mitchison). I hope that the Government will appreciate that we have been putting our views in all sincerity, because we believe that the nation would be put in a dangerous position if it had to depend too much on a source of power from such a dangerous area as the Middle East.
    Mr. Geoffrey Wilson: I do not want to enter into the coal-oil war between by hon. Friend the Member for Kidderminster (Sir G. Nabarro) and the hon. Member for Dearne Valley (Mr. Wainwright). I agree with the hon. Member for Bradford, East (Mr. McLeavy), who indicated that he thought that the most important of the Clauses before us was the one dealing with derv, which is very much heavier taxed. The hon. and learned Member for Kettering (Mr. Mitchison) referred to the Jack Committee and pointed out that it referred to this problem, and in one
    1244
    section of its Report observed that the bus industry for many years—this Report was written in 1961—had been complaining of the excessively high tax on the bus industry, which, of course, has since been increased.
    Both the hon. Member for Bradford, East and the hon. and learned Member for Kettering referred to the Jack Committee, and the hon. and learned Member for Kettering pointed out that although the Committee turned down the sugggestion that a reduction in fuel tax would be a particular help to the rural bus industry, the minority report of Mr. Nicholas did so. There was also another minority report by Mr. James of the same Committee which sets out the reasons more clearly. But neither hon. Members referred to the fact that the Jack Committee's principal reasons for turning down the reduction of the fuel tax as a means of helping rural buses was that it would be too sweeping and would apply to the whole of the bus industry and not only to the rural buses. If we are to try to help the rural buses by taxation I would much prefer to revert to the new Clause which we, on this side of the House, attempted to put in in 1959 to which the hon. and learned Member for Kettering referred. That was to make an exception for derv outside the built-up areas on the ground that a similar sort of exception had been made for motor fishing vessels. But that Clause is not before the Committee and we cannot discuss it.
    In so far as a rejection of this Clause would cause a rural bus service to be adversely affected by the Beeching Report, I think that both the hon. Members who have spoken and some hon. Members on this side of the Committee also have not observed that that really does not arise because Clause 4 of the Transport Act, 1962, preserves for the Railways Board the agreements arising under the Railway Road Transport Acts, 1928, under which the Railways Board could call upon a bus company to run an alternative service to a closed railway service and could if the bus service refused to undertake it on the ground of expense give it a subsidy for doing so. Thus the fact that the bus company might find such a service rather expensive and one which upset its cross-subsidisation arrangements would not

    1245
    really arise, and I do not think that that was a good point.
    The suggestion was made on this side of the Committee that my right hon. Friend should give some indication that the fuel tax on derv would be looked at in due course. We appreciate what he said in his Budget statement about this matter, and I thought that I detected then a slight glimmer of hope that he would be able to do it. I do not know whether a general reduction on fuel tax would he possible at the present time. I should have thought that that might be doubtful, and I do not know whether that would be the full solution of the problem that has been mentioned.
    The Chancellor of the Exchequer (Mr. Reginald Maudling): The debate has really fallen into two different sections. Because we are discussing the broad question of hydrocarbon oil duties, I think that it is right to start by pointing out that, as my hon. Friend the Member for Willesden, East (Mr. Skeet) said, these duties raise nearly £600 million a year in revenue. They are extremely important duties from the point of view of the Exchequer, and one must safeguard their integrity with some care.
    The points made in the course of the discussion fall under two heads: those raised by the hon. and learned Member for Kettering (Mr. Mitchison) in opening the discussion and the hon. Member for Bradford, East (Mr. McLeavy) and others about bus services and the duty on the fuel that they consume, and those raised by my hon. Friend the Member for Willesden, East, the hon. Member for Huddersfield, West (Mr. Wade), my hon. Friend the Member for Putney (Sir H. Linstead) and others on the duty on heavy oil used in industry. Finally, I think that two of my hon. Friends, the Member for Brierley Hill (Mr. Talbot) and the Member for Truro (Mr. G. Wilson) mentioned both subjects in the course of their speeches.
    Perhaps I might start by discussing the point about the heavy fuel oil used in industry. The actual amount of duty collected as a result of this tax is in the neighbourhood of £60 million, and to abolish it would, I think, involve too large a sum to be contemplated. The alternative, as some hon. Members have suggested, would be to halve this duty, at a cost of £30 million. This was a
    1246
    possibility which I considered with care. In fact, at the beginning of my study of the Budget proposals this was one which I might describe as one of the most vigorous runners. It seemed a good possibility.
    Strong reasons for reducing this tax have been adduced by many hon. Members in this debate, although I think possibly the arguments have occasionally been a little overdone. The hon. Member for Huddersfield, West, for example, referred to the change in the export position of the cement industry, and I agree that there has been a big change. He said that the new duty would cost about 8s. a ton, but I am told that in the last two years the export price of cement has risen not by 8s., but by 48s., a ton, so it may be that the cost of the fuel oil duty is not necessarily a major factor in this matter.
    The fuel oil duty is a serious one for certain industries. Glass was referred to by my hon. Friend the Member for Brierley Hill and by my hon. Friend the Member for Putney. The iron and steel industries, to which reference has been made, are also substantial users of fuel oil. Cement is another example, as are certain chemicals. There is a wide range of industries which consume heavy oil in substantial quantities and whose costs are affected by the tax. Clearly, there would be considerable advantage in reducing the tax or halving it this year, and I felt that on revenue grounds this was a possibility.
    As has been said, when this duty was imposed it was made quite clear by my predecessor that it was imposed as a source of additional revenue. Therefore, my first reaction in looking at it this year when there was an opportunity to make tax deductions, was that here was an opportunity, on revenue grounds, to reduce the duty. I would not have abolished it, because £60 million is too much, but there was a case on revenue grounds for reducing the duty by half, at a cost of £30 million.
    I then had to consider the effect on the coal industry, and I think that we must be realistic about this. We depend on the coal industry—end will do so for many years to come—for a preponderant part of our industrial energy, and therefore the progress of the coal industry is important to industry as a whole, and

    1247
    possibly more important to industry as a whole than anything else. I felt that it was important to look at the stage actually reached in the progress of the coal industry.
    In the last year or so it has been making substantial progress. Productivity has been rising. I think that the figure that Lord Robens quotes is 8 per cent. per year. He is hoping to get a big increase in exports this year. The streamlining of the industry and the reduction in the labour force has been taking place with remarkable smoothness, and it would be a great pity to disturb that.
    10.0 p.m.
    Finally, I was encouraged by what Lord Robens had been saying about beginning the long trek of bringing down coal prices. It would be an immense value to industry if a start could be made to bring down coal prices. I have been explaining to the Committee as clearly as I can the sequence of the arguments which I followed. Against that background, I had to look at the effect of cutting the fuel duty this year. It would have had a considerable effect on the coal industry and its financial position at a time when it is at last struggling out of the red into the black. It would be a great pity if there were a setback to the industry extending to £20 million or £30 million competitively. I attach the greatest importance to all the nationalised industries showing a proper return on their capital. I believe that the coal industry is in sight of doing so, and the effect of driving it back into the red—the effect on the morale of the industry, which I consider of the greatest importance, and on those engaged in the industry—would have been very serious. In the long run it would have been worse for fuel costs as a whole than a reduction in the fuel oil duty.
    It has been suggested that the alternative would be to subsidise the industry. I think that this would be quite wrong, and I should not like to start on that process. If the nationalised industry can go on, as at the moment, earning a profit in competition on the present basis of protection, they should be encouraged to do so.
    I therefore came to the conclusion that this year was not the time to make a reduction in the duty.
    1248>
    Because this year is not the time it does not mean that I regard this as by any means a permanent and proper level of protection. It is not. It is one which I wish to reduce as soon as possible. My sole concern is the course of the coal industry, and the progress achieved, and the possibility of a setback to the morale and progress of the industry at this critical stage.
    Mr. Skeet: The Chancellor has indicated that he is against giving a subsidy. But does not he appreciate that industry is being made to give a subsidy to the coal industry, and is not that rather an unfair burden?
    Mr. Maudling: I do not think so. One could say that of any tariff which is imposed. My hon. Friend the Member for Willesden, East will find that most countries which have indigenous fuel resources protect them to a certain degree. As I say, this was an extremely hard decision to reach, and one which I reached with the greatest reluctance. There are obvious advantages to be gained from cutting the duty. But, after long consideration, and balancing the arguments, I decided against making any change this year—I emphasise "this year". No one would be happier than I should be if on a future occasion, and as soon as possible, I were able to make a reduction.
    Mr. Eric Lubbock: The Chancellor has talked about "this year" several times with great emphasis. To what extent would existing users of coal-fired equipment have changed to oil firing had he made this reduction in this year's Budget? The right hon. Gentleman must have made some estimate of the effect on the relative positions of the industry.
    Mr. Maudling: It is hard to say. The loss to the coal industry might have been something like £20 million in a full year. That is about the best estimate I can make.
    Sir Derek Walker-Smith: In order to get the picture clear, will my right hon. Friend say whether the position is this? Two years ago the then Treasury Minister made expressly clear that this was purely a

    1249
    revenue duty and disclaimed any protectionist intent. My right hon. Friend has now used the word "tariff", which is, of course, a word appropriate only to a protective duty and not to a revenue duty. Are we now to understand that it is retained for its protectionist and not for its revenue aspect, and it is by that that it will be judged in future?
    Mr. Maudling: I think absolutely and clearly I should answer "Yes" to that. It was imposed as a revenue duty. From purely revenue considerations I would have felt justified this year in making the reduction, but I had to take into account the effect on the coal industry and I am looking at the effect on this industry at this moment.
    Sir G. Nabarro: I claim an interest in this matter only because I was the only Tory to vote with my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) against this tax originally. What has caused this change of attitude at the Treasury? Surely there should be some continuity of policy at the Treasury? My right hon. and learned Friend the Member for Wirral (Mr. Selwyn Lloyd), when he was Chancellor, proclaimed over and over again when I attacked the imposition of this duty and voted against it on 16th May, 1961—with a Liberal as a Teller to help me—"This is not in any circumstances a protective measure for coal." Now my right hon. Friend says that it is a protective measure for coal. I want some assurance that between this year and next he is not going to turn another somersault.
    Mr. Bence: He will not be there.
    Sir G. Nabarro: He will be there all right. There is only one other possibility—that I shall be there in his place. I am trying to get from my right hon. Friend an assurance that we are to have some continuity in fuel policy and that he is not going to turn another somersault.
    Mr. Maudling: The prospect of my hon. Friend the Member for Kidderminster (Sir G. Nabarro) standing at this Box as Chancellor of the Exchequer and carrying out all the proposals he has
    1250
    made in the last few years almost makes me wish to give way to him.
    I have done my best. One must look at this sort of matter in the light of the purely practical consideration of what the effect in this year will be of making a reduction of this kind, which I readily accept would be extremely valuable, and I thought that on balance this year was not the time to do it.
    Turning to the point about the duty on fuel used in buses, the cost of that proposal in a full year would be about £31 million, but it would go much wider than that. It would be very difficult to draw the line at that particular point. This is always the trouble with this type of problem, that we have two forms of fuel used, petrol and diesel. It is very difficult to maintain the duty on one and not on the other. In the past the main problem was to preserve the position of petrol duty. Secondly, if one started to do something for road passenger transport it would be very difficult indeed to prevent it spreading to other forms of transport. Road haulage and other forms of transport could make a good case for it. The hon. Member for Huddersfield, West, pointed out how difficult it would be to limit this merely to derv for buses.
    Mention was made of the effect of the Beeching Report on the bus situation. My hon. Friend the Member for Truro made an apposite point on that and disposed of a great deal of the argument. I do not think that the closure of a number of railway lines which at present compete with bus companies should make it harder for those bus companies to continue their services. If one of two competing services is closed down, that puts the other service in a better position.
    In general, with the hydrocarbon oil duty, as with so many other things laid before the Committee, clearly a reduction would be welcome and any Chancellor welcomes anything that everyone welcomes; but I could not accept a new Clause of this kind, which would cost £31 million in a full year. I am convinced that if the proposal were accepted it would lead to even further concessions and to a reduction in heavy oil duties as a whole. Therefore, I must recommend the Committee to reject these proposals.
    The Committee divided: Ayes 161, Noes 205.

    Division No. 127.]

    AYES

    [10.10 p.m.

    Alnsley, William

    Grimond, Rt. Hon. J.

    Oswald, Thomas

    Allaun, Frank (Salford E.)

    Hale, Leslie (Oldham, W.)

    Padley, W. E.

    Awbery, Stan (Bristol, Central)

    Hamilton, William (West Fife)

    Pannell, Charles (Leeds, W.)

    Bacon, Miss Alice

    Hannan, William

    Parkin, B. T.

    Heaney, Alan

    Harper, Joseph

    Pearson, Arthur (Pontypridd)

    Bence, Cyril

    Hart, Mrs. Judith

    Pentland, Norman

    Bennett, J. (Glasgow, Bridgeton)

    Henderson,Rt. Hn. Arthur (RwlyRegle)

    Popplewelf, Ernest

    Benson, Sir George

    Herbison, Miss Margaret

    Price, J. T. (Westhoughton)

    Blyton, William

    Hill, J. (Midlothian)

    Probert, Arthur

    Boardman, H.

    Hilton, A. V.

    Pursey, Cmdr. Harry

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

    Holman, Percy

    Redhead, E. C.

    Bowen, Roderic (Cardigan)

    Houghton, Douglas

    Reynolds, C. W.

    Bowles, Frank

    Howell, Denis (Small Heath)

    Rhodes, H.

    Braddock, Mrs. E. M.

    Hoy, James H.

    Roberts, Albert (Normanton)

    Bradley, Tom

    Hughes, Cledwyn (Anglesey)

    Robertson, John (Paisley)

    Bray, Dr. Jeremy

    Hunter, A. E.

    Rogers, G. H. R. (Kensington, N.)

    Broughton, Dr. A. D. D.

    Hynd, John (Attercfife)

    Ross, William

    Butler, Herbert (Hackney, C.)

    Irvine, A. J. (Edge Hill)

    Short, Edward

    Butler, Mrs. Joyce (Wood Green)

    Irving, Sydney (Dartford)

    Silverman, Julius (Aston)

    Callaghan, James

    Janner, Sir Barnett

    Carmichael, Neil

    Jay, Rt. Hon. Douglas

    Silverman, Sydney (Nelson)

    Collick, Percy

    Jeger, George

    Skeffington, Arthur

    Corbet, Mrs. Freda

    Jenkins, Roy (Stechford)

    Slater, Mrs. Harriet (Stoke, N.)

    Craddock George (Bradford, S.)

    Jones, Dan (Burnley)

    Slater, Joseph (Sedgefield)

    Cronin, John

    Jones, Elwyn (West Ham, S.)

    Small, William

    Crosland, Anthony

    Jones, J. Idwal (Wrexham)

    Smith, Ellis (Stoke, S.)

    Cullen, Mrs. Alice

    Jones, T. W. (Merioneth)

    Soskice, Rt. Hon. Sir Frank

    Dalyell, Tam

    Kelley, Richard

    Spriggs, Leslie

    Davies, G. Vied (Rhondda, E.)

    Kenyon, Clifford

    Stewart, Michael (Fulham)

    Davies, Harold (Leek)

    Lawson, George

    Stones, William

    Davies, Ifor (Gower)

    Ledger, Ron

    Strachey, Rt. Hon. John

    Deer, George

    Lee, Frederick (Newton)

    Swingler, Stephen

    Delargy, Hugh

    Lee, Miss Jennie (Cannock)

    Taverns, D.

    Dempsey, James

    Lever, L. M. (Ardwick)

    Thomas, George (Cardiff, W.)

    Diamond, John

    Lewis, Arthur (West Ham, N.)

    Thomas, Iorwerth (Rhondda, W.)

    Dodds, Norman

    Lubbock, Eric

    Thompson, Dr. Alan (Dunfermline)

    Duffy, A. E. P.

    Mabon, Dr. J. Dickson

    Thornton, Ernest

    Edwards, Rt. Hon. Ness (Caerphilly)

    McBride, N.

    Tomney, Frank

    Edwards, Robert (Billston)

    MacDermot, Niall

    Wainwright, Edwin

    Edwards, Walter (Stepney)

    McInnes, James

    Warbey, William

    Fernyhough, E.

    McKay, John (Wallsend)

    Watkins, Tudor

    Finch, Harold

    Mackie, John (Enfield, East)

    Whitlock, William

    Fitch, Alan

    MacPherson, Malcolm (Stirling)

    Wigg, George

    Fletcher, Eric

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

    Wilkins, W. A.

    Foot, Dingle (Ipswich)

    Mapp, Charles

    Williams, LI. (Abertillery)

    Foot, Michael (Ebbw Vale)

    Mason, Roy

    Williams, W. R. (Openshaw)

    Forman, J. C.

    Mayhew, Christopher

    Willis, E. G. (Edinburgh, E.)

    Mendelson, J. J.

    Fraser, Thomas (Hamilton)

    Millan, Bruce

    Winterbottom, R. E.

    Galpern, Sir Myer

    Milne, Edward

    Woof, Robert

    George, Lady MeganLloyd (Crmrthn)

    Mitchison G. R.

    Yates, Victor (Ladywood)

    Ginsburg, David

    Morris, John

    Zilliacue, K.

    Gourlay, Harry

    Grey, Charles

    Oliver, G. H.

    TELLERS FOR THE AYES.

    Griffiths, David (Rother Valley)

    O'Malley, B. K.

    Mr. Charles A. Howell and

    Griffiths, W. (Exchange)

    Oram, A. E.

    Mr. McCann.

    NOES

    Agnew, Sir Peter

    Brooke, Rt. Hon. Henry

    Crawley, Aldan

    Allason, James

    Brooman-White, R.

    Critchley, Jullian

    Arbuthnot, John

    Brown, Alan (Tottenham)

    Currie, G. B. H.

    Ashton, Sir Hubert

    Buck, Antony

    d'Avlgdor-Goldsmid, Sir Henry

    Atkins, Humphrey

    Bullard, Denys

    de Ferranti, Basil

    Awdry, Daniel (Chippenham)

    Butcher, Sir Herbert

    Donaldson, Cmdr. C. E. M.

    Barber, Anthony

    Campbell, Gordon (Moray & Nairn)

    Drayson, G. B.

    Barlow, Sir John

    Carr, Compton (Barons Court)

    du Cann, Edward

    Barter, John

    Carr, Robert (Mitcham)

    Eden, Sir John

    Batsford, Brian

    Cary, Sir Robert

    Elliot, Capt. Walter (Carahalton)

    Bennett, Dr. Reginald (Goa & Fhm)

    Chataway, Christopher

    Elliott, R. W,(Newc'tle-upon-Tyne, N.)

    Berkeley, Humphry

    Chichester-Clark, R.

    Emmet, Hon. Mrs. Evelyn

    Bidgood, John C.

    Clark, Henry (Antrim, N.)

    Farr, John

    Biffen, John

    Clark, William (Nottingham, S.)

    Fell, Anthony

    Birch, Rt. Hon. Nigel

    Cooke, Robert

    Finlay, Graeme

    Bishop, F. P.

    Cooper-Key, Sir Neill

    Fletcher-Cooke, Charles

    Bossom, Hon. Clive

    Cordeaux, Lt.-Col. J. K.

    Freeth, Denzil

    Bourne-Aston, A.

    Corfield, F. V.

    Galbraith, Hon. T. G. D.

    Box, Donald

    Coulson, Michael

    Gammons, Lady

    Brewis, John

    Courtney, Cdr. Anthony

    Gibson-Watt, David

    Gilmour, Ian (Norfolk, Central)

    Litchfield, Capt. John

    Roots, William

    Gilmour, Sir John (East Fife)

    Loveys, Walter H.

    Ropner, Col. Sir Leonard

    Glyn, Dr. Alan (Clapham)

    Lucas-Tooth, Sir Hugh

    Russell, Ronald

    Glyn, Sir Richard (Dorset, N.)

    MacArthur, Ian

    Scott-Hopkins, James

    Goodhew, Victor

    McLaren, Martin

    Sharples, Richard

    Gower, Raymond

    Maclean, SirFitzroy(Bute & N. Ayre)

    Shaw, M.

    Grant-Ferris, R.

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

    Shepherd, William

    Gresham Cooke, R.

    McMaster, Stanley R.

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

    Grosvenor, Lt.-Col. R. G.

    Macphereon, Rt. Hn. Niall(Dumfries)

    Smithers, Peter

    Gurden, Harold

    Maddan, Martin

    Smyth, Rt. Hon. Brig. Sir John

    Hamilton, Michael (Wellingborough)

    Markham, Major Sir Frank

    Spearman, Sir Alexander

    Harris, Frederic (Croydon, N.W.)

    Marten, Neil

    Stodart, J. A.

    Harrison, Col. Sir Harwood (Eye)

    Matthews, Gordon (Meriden)

    Stoddart-Scott, Col. Sir Malcolm

    Harvey, Sir Arthur Vere (Macclesf'd)

    Maudling, Rt. Hon. Reginald

    Studholme, Sir Henry

    Harvey, John (Walthamstow, E.)

    Mawby, Ray

    Summers, Sir Spencer

    Harvie Anderson, Miss

    Maxwell-Hyslop, R. J.

    Talbot, John E.

    Hastings, Stephen

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

    Topsell, Peter

    Heald, Rt. Hon. Sir Lionel

    Mills, Stratton

    Taylor, Edwin (Bolton, E.)

    Henderson, John (Cathcart)

    Miscampbell, Norman

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

    Hendry, Forbes

    Montgomery, Fergus

    Teeling, Sir William

    Hiley, Joseph

    Morgan, William

    Temple, John M.

    Hill, Mrs. Eveline (Wythenehawe)

    Nabarro, Sir Gerald

    Thatcher, Mrs. Margaret

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

    Heave, Airey

    Thompson, Sir Richard (Croydon, S.)

    Hirst, Geoffrey

    Nicholls, Sir Harmar

    Thornton-Kemsley, Sir Colin

    Hobson, Sir John

    Orr, Capt. L. P. S.

    Tiley, Arthur (Bradford, W.)

    Hocking, Philip N.

    Osborn, John (Hallam)

    Touche, Rt. Hon. Sir Gordon

    Holland, Philip

    Osborne, Sir Cyril (Louth)

    Turner, Colin

    Hollingworth, John

    Page, Graham (Crosby)

    Turton, At. Hon. R. H.

    Hopkins, Alan

    Page, John (Harrow, West)

    Tweedsmuir, Lady

    Hornsby-Smith, Rt, Hon. Dame P.

    Pannell, Norman (Kirkdale)

    van Straubenzee, W. R.

    Howard, John (Southampton, Test)

    Partridge, E.

    Vaughan-Morgan, At. Hon. Sir John

    Hughes-Young, Michael

    Pearson, Frank (Clitheroe)

    Vickers, Miss Joan

    Hutchison, Michael Clark

    Peel, John

    Vesper, Rt. Hon. Dennis

    Iremonger, T. L.

    Pickthorn, Sir Kenneth

    Waider, David

    Irvine, Bryant Godman (Rye)

    Pilkington, Sir Richard

    Walker, Peter

    James, David

    Pitt, Dame Edith

    Walker-Smith, Rt. Hon. Sir Derek

    Jenkins, Robert (Dulwich)

    Pott, Percivall

    Wall, Patrick

    Johnson, Dr. Donald (Carlisle)

    Price, David (Eastleigh)

    Ward, Dame Irene

    Johnson Smith, Geoffrey

    Prior-Palmer, Brig. Sir Otho

    Webster, David

    Jones, Arthur (Northants, S.

    Wells, John (Maidstone)

    Profumo, Rt. Hon. John

    Whitelaw, William

    Kahorry, Sir Donald

    Proudfoot, Wilfred

    Williams, Dudley (Exeter)

    Kerr, Sir Hamilton

    Quennell, Miss J. M.

    Williams, Paul (Sunderland, S.)

    Kershaw, Anthony

    Rawlineon, Sir Peter

    Wilson, Geoffrey (Truro)

    Langford-Holt, Sir John

    Redmayne, Rt. Hon. Martin

    Wise, A. R.

    Leavey, J. A.

    Rees, Hugh

    Wolrige-Gordon, Patrick

    Legge-Bourke, Sir Harry

    Renton, Rt. Hon, David

    Woollam, John

    Lewis, Kenneth (Rutland)

    Ridley, Hon. Nicholas

    Lilley, F. J. P.

    Roberts, Sir Peter (Heeley)

    TELLERS FOR THE NOES;

    Linstead, Sir Hugh

    Robinson, Rt. Hn. Sir. (B'pool, S.)

    Mr. Ian Fraser and Mr. Pym.

    New Clause.—(INCOME TAX: ALLOWANCES ON COMMERCIAL BUILDINGS IN DEVELOPMENT DISTRICTS.)
    (1) Chapter I of Part X of the Income Tax Act 1952 (which relates to capital allowances for industrial buildings and structures) shall apply to capital expenditure incurred after the passing of this Act on the construction of a commercial building in a development district as it applies to the construction of an industrial building.

    (2) In this section a "commercial building" means a building constructed and to be occupied as a retail shop, showroom, hotel or office or for any purpose ancillary to the purposes of a retail shop, showroom, hotel or office; and section 38 (5) of this Act shall apply for the purposes of this section as it applies for the purposes of that section.-[Mr. Houghton.]

    Brought up, and read the First time.
    Mr. Douglas Houghton: I beg to move, That the Clause be read a Second time.
    While the Government are considering whether or not they should resign, following the result of the last Division, I hope that the Committee will note subsection (1) of the proposed new Clause, which states:
    (1) Chapter 1 of Part X of the Income Tax Act 1952 (which relates to capital allowances for industrial buildings and structures) shall apply to capital expenditure incurred after the passing of this Act on the construction of a commercial building in a development district as it applies to the construction of an industrial building.
    Subsection (2) defines a "commercial building".
    The new Clause does not raise the wider issue of whether the capital allowances for industrial buildings shall apply to commercial buildings generally. It deals solely with capital expenditure on new buildings and new constructions after the passing of the Bill—and only in local employment areas.
    As the Committee knows, the Tucker Committee of 1951 recommended that the capital allowances granted to industrial buildings should be extended to commercial buildings generally. Hon. Members will recall that on pages 67 and 68 of the Tucker Report there were set out that Committee's arguments in favour of that recommendation. That recommendation was further considered by the Radcliffe Commission four years
    1256
    later, and in paragraphs 379 onwards of that Commission's Report is confirmed the recommendation made by the Tucker Committee. The Radcliffe Commission was also of the opinion that the capital allowances granted to industrial buildings should also apply to commercial buildings.
    Nothing has been done about the recommendation of the Tucker Committee, as approved by the Radcliffe Commission. In the new Clause we are not proposing the wider application of the recommendation of these two important and authoritative bodies. We feel, however, that since special steps are being taken to encourage new industries to go to the local employment areas, it would add to the encouragement if we were to extend to commercial buildings the allowances given for new industrial buildings.
    In the development areas, as they used to be called—"local employment districts" as they are now called—one of the important factors has bean the diversity of industry; the widening of the scope of employment for different types of people. Hon. Members will remember why it was that the Ministry of Pensions and National Insurance went to Newcastle and why an important branch of the Inland Revenue went to Cardiff. It was because there was a need for the diversity of local employment, which was then dangerously and heavily concentrated on particular industries—mostly heavy industries.
    The transfer to Newcastle and Cardiff of substantial branches of public administration offered employment to many thousands of people for whom work in heavy industries was scarcely suitable. I am thinking of women and girls, disabled persons and others with a bent for office, clerical or commercial work, as distinct from industrial skills. Part of the policy of the Government now is to encourage development and administration to move from the south-east, especially London, to elsewhere. The Government are setting an example in that respect by transferring substantial branches of the public administration, in one case to Durham and in another to Chesterfield.
    Some commercial undertakings that have their offices out of the centre of London, but not very far away from London, should be encouraged to move

    1257
    quite a distance from this area and, if possible, induced to go to the local employment districts, where commercial expansion could well take place alongside industrial expansion. At the present time, the capital allowances—both initial allowance and annual depreciation—granted to industrial buildings are withheld from commercial buildings—shops, and offices of all kinds. The only non-industrial building that qualifies for an industrial building capital allowance is, apparently, a sports pavilion run by a firm as part of its welfare services for its employees. I do not, of course, quarrel with that, but it rather looks as though the administrative block of an industrial concern would be excluded from the allowances for an industrial building.
    The representations that have been made to the Chancellor by various bodies have pressed upon him the need to extend the industrial buildings allowance to commercial buildings generally—which, I must make clear, once again, we are not proposing to do. This new Clause is very narrowly drawn, and has a specific purpose. I hope that I have satisfied the Financial Secretary that to have commercial development alongside industrial development would be a healthy combination in the areas that we now wish to help. There is no reason why industrial concerns and commercial undertakings should not send their administrative branches into these areas.
    At the present time, as the Committee knows, if a shopkeeper, for example, puts in a new shop front, he cannot get any capital allowance on that expenditure; only when he replaces the shop front can he get any set-off against his taxable profits—and only then if he can show that what he has done is a replacement and not an improvement. These are considerable handicaps to the development of commercial enterprise—and I do not think only of office development in this connection, but of the distributive trades as well.
    We think ours is a very reasonable proposal and one which, when linked with what the Chancellor is proposing to do for the local employment areas, would provide a mare comprehensive remedy than the remedies contained in the Bill. I stress that the capital allowances for industrial buildings are very different from
    1258
    the capital allowances for industrial plant and machinery. They are very much more modest. It seems that, as a general proposition, commercial buildings should qualify for some measure of depreciation, and this is argued at some length in both of the Reports to which I have drawn attention. In the narrow way in which we have drawn this proposal, it would apply to local employment areas only.
    The hour is late, and I do not wish to develop the matter more fully because other hon. Members may wish to speak. Above all, we shall be interested to have the reply of the Financial Secretary. Here there seems to be an opportunity to improve the Chancellor's proposals, and to add these additional inducements to the remedies far local distress and stagnation which it is one of the immediate objects of the Finance Bill to provide.
    10.30 p.m.
    The Financial Secretary to the Treasury (Mr. Anthony Barber): As the hon. Member for Sowerby (Mr. Houghton) pointed out, the purpose of the Clause is to extend the scope of the capital allowances provisions in the chapter of the 1952 Act referred to in the new Clause. The consequence would be to grant investment allowances of 15 per cent. of the cost, initial allowances of 5 per cent., and annual allowances of 4 per cent. for capital expenditure on commercial buildings incurred after the passing of the Bill where the buildings are erected in development districts. Commercial buildings would mean retail shops, showrooms, hotels and offices, and premises kept for ancillary purposes, and so on.
    I would remind the Committee from the outset that capital allowances were limited in 1945 to industrial buildings, that is buildings in use for the purposes of traders in certain defined classes. These are productive, manufacturing and processing industries and certain other types of major undertakings. Commercial buildings were excluded from the relief as a matter of deliberate policy, because the intention was to encourage the expansion and modernisation of the premises of productive industry.
    The hon. Member for Sowerby made the scope of the new Clause quite clear. He pointed out that he was not here

    1259
    concerned with a general extension of capital allowances for all commercial buildings. I frankly admit that I agree with him that any form of discriminatory taxation in favour of areas of high and persistent unemployment, such as the development districts and Northern Ireland, has a certain superficial attraction, but I hope that the Committee will agree with me that the more one examines this proposal the less attractive it becomes. I think that it is now accepted by virtually the whole Committee that in order to tackle the problem of the development districts discriminatory taxation is justified. Indeed, my right hon. Friend's proposals, to which the hon. Member for Sowerby referred, for free depreciation in these districts has been almost universally applauded.
    Several hon. Members opposite have contended that what my right hon. Friend proposes in the Bill for these districts is somewhat analogous to their proposals in previous years, but what matters most is not the apportionment of credit but the achievement of results. It will be obvious to anyone that when my right hon. Friend was working out his proposals for giving some measure of tax advantage to the development districts he considered at that time not only the allowances in respect of plant and machinery but also allowances for industrial buildings and the position of commercial buildings. For reasons with which the Committee is now very familiar, because we have gone over the ground several times in the past few weeks, my right hon. Friend came down in favour of free depreciation limited to plant and machinery, a proposal, I remind the Committee, which in a few years' time will cost about £45 million a year.
    The first point to bear in mind about the proposal in the new Clause is that it would create a quite remarkable distinction between commercial buildings in development districts and commercial buildings elsewhere. As I understand, the hon. Member for Sowerby was saying that this was just what the Opposition wanted, because this would provide the incentive for people to set up offices and shops and make extensions in the areas and consequently improve the tone of the areas
    1260
    and provide employment. But, in all seriousness, I ask the Committee to bear this in mind. Although my right hon. Friend has made a general improvement in the capital allowances for industrial buildings as distinct from commercial buildings, with which the new Clause deals, the Bill does not include any differentiation at all between capital allowances for industrial buildings in development districts and industrial buildings elsewhere.
    One of the principal reasons, of course, is that the Board of Trade already provides capital grants to cover these cases. But, this being so, the capital allowances for industrial buildings being the same both within development districts and outside—a principle which is not challenged by the new Clause—one must ask whether it would really be right to make such a remarkable distinction as is proposed here for commercial buildings. The result would be that a shop and office building in a development district would not merely qualify for annual allowances of 4 per cent., as has been requested by several hon. Members seeking these allowances for commercial buildings generally, but also in the development districts would qualify for 5 per cent. initial allowance and 15 per cent. investment allowance. That means allowances amounting in all to 24 per cent, of the cost of the commercial building in the first year. But similar buildings outside a development district would qualify for no relief at all—not a penny.
    It is one thing to argue that shops and offices generally should receive annual allowances at the same rate as, say, industrial buildings or even that they should all be eligible for initial allowance and investment allowance, but to make available all three allowances for a block of shops and offices within a development district as distinct from a similar building just outside, which would qualify for nothing at all, seems to me to be going too far.
    Mr. Houghton: The hon. Gentleman is making very heavy weather of maintaining the principle of universality for these reliefs or of avoiding a distinction between the development districts and other districts; but he must bear in mind that his right hon. Friend has already breached the principle when

    1261
    providing for free depreciation within the development districts and for no such thing outside.
    Mr. Barber: I thought that I had made clear at the outset that my right hon. Friend had accepted that, in his view, in order to deal with the problem in the development districts and Northern Ireland, there must be some degree of tax discrimination. I said that this had been generally welcomed by the Committee and outside also. But, obviously, one can carry this to the most extraordinary lengths. There must be some lengths beyond which one would not wish to go. All I was pointing out was that it seems very odd to say that that there should be be this quite remarkable discrimination—the allowance in respect of shops and offices of annual allowance, investment allowance and initial allowance, but no allowances at all outside, there being no such discrimination proposed for industrial buildings which, after all, are of more importance in the development districts, I suggest, than commercial buildings.
    I should have understood the hon. Gentleman's proposal better if it were suggested that there should also be some preferential tax treatment for industrial buildings as well, but this is not suggested.
    The hon. Gentleman spoke of the importance of commercial development in these districts. I agree that this is a matter of great importance. As my right hon. Friend said in a previous debate, on the Budget or since, it is important in the development districts not only to improve productive capacity but also to try to improve the general tone of the area. But the Committee will bear in mind that the 25 per cent. capital grant which is administered by the Board of Trade is available in proper cases for the construction of commercial buildings as well as industrial buildings in a development district, assuming always, of course, that the project is of a type worthy of assisttance when judged by the criterion of providing employment. This was one of the main objectives which the hon. Member mentioned in talking of the Government Departments which had been moved to development districts.
    The Committee will, I hope, take the view that my right hon. Friend was right to concentrate what tax relief is
    1262
    available for the purpose of providing incentive to modernise productive industry, both by doubling the annual allowances for industrial buildings throughout the whole country and by the new scheme of free depreciation for plant and machinery within the development districts, to which the hon. Member referred.
    The cost of the new Clause, I am told, would be about £24 million in a full year. If that amount of additional taxation relief were to be made available to development districts and to Northern Ireland, I should have thought that there were other candidates rather than shops, offices, showrooms and the like which should have priority, quite apart from the extraordinary disparity of treatment, which is important, which would result as between industrial and commercial buildings.
    Having pointed out all these facts briefly and followed, I hope, the good example of the hon. Member for Sowerby in keeping my observations brief, I must tell the Committee that I regret that I cannot advise hon. Members to accept the new Clause.
    Dr. J. Dickson Mabon: The Financial Secretary has advanced two arguments, quite apart from his lengthy introduction, which amounted to no argument at all. To take them in the reverse order, the hon. Gentleman's second argument was the question of priority, that the new Clause would cost about £25 million and that this money could be spent in better ways. That is, possibly, an attractive argument, but the fact is that the Government are not spending this or any particular £25 million in this or in any other way.
    We already have indications from the Government about what they intend to spend for the Local Employment Act and other Measures which have been discussed. For example, the money for the Local Employment Act has fallen from £45 million in the last year to about £25 million in the present year. We are told that there are various reasons for that, including the fact that no big developments are taking place this year comparable with those which last year's Estimates covered.
    We have also had the provision by the Chancellor in connection with Clause 38 of the Bill which is directly and

    1263
    deliberately aimed at helping the development districts. Therefore, the argument that the £25 million which the Clause would cost could be spent in a better way is a false one, because the Government are not proposing to spend £25 million in another way apart from the Clause.
    The hon. Gentleman's first argument concerned differentiation. Its basis was that there is no differentiation for buildings under Clause 38 because this is dealt with, I presume, through B.O.T.A.C. and the Local Employment Act in grants for buildings. If I am wrong, I should like to know. I tried to interrupt the hon. Gentleman to get this clear.
    Mr. Barber: I am sorry if I did not give way. I did not intend to be discourteous, but I was developing an argument. The point is that the extraordinary distinction which would arise would be between the treatment of allowances for commercial buildings within and without a development district as contrasted with the present tax treatment—in other words, the provision of capital allowances—in respect of industrial buildings where there is no distinction as between a building within a development district and one outside. It was not a B.O.T.A.C. point.
    Dr. Mabon: Nevertheless, when one considers how these things are operated through B.O.T.A.C. in relation to giving assistance in development districts, I do not see why this is not considered a particularly good point, even in discrimination.
    The Financial Secretary argued, for example, that if there was a good case for a certain project of a commercial nature attracting jobs to an area, it would get proper treatment through the B.O.T.A.C. organisation and, ultimately, the sanction of the Treasury. I cannot think of any large-scale commercial project which has been approved by the Government under the Local Employment Act. I am open to correction, and perhaps the information might be given to me, but most of the job-providing projects which have been approved by the Government in the last three years have, I think, all been of an industrial character. I cannot think of a substantial commercial development which has been approved.
    1264
    10.45 p.m.
    Since the Financial Secretary has underlined this, the point that I am making is that this is the very kind of thing that has to be brought into the development districts. Quite apart from the prestige value of many of the projects—someone has used the phrase that it raises the tone of the district, which is true—it attracts into the district industry, and also offers to the people employment of an entirely different kind. For instance. they may be able to go to work with clean clothes and come home again clean, which is rather different from what happens in the development districts where the occupations have of necessity involved a great deal of dirt and uncleanness. This raises the tone of the district and offers job opportunities to many youngsters which they would not otherwise get. Therefore, it is important to attract this sort of thing into the development districts.
    If this is the wrong way to do it, why do not the Government suggest some other way in which commercial projects of this kind can come to the areas? There is also the point that by the very nature of industry as distinct from commercial establishments there are advantages in giving free depreciation for plant and machinery. The plant and machinery of commercial enterprises bear little comparison with the plant and machinery involved in industrial enterprises. One of the main incentives in attracting commerce ought to be the provision of relief for the construction of the building itself. If the Financial Secretary can tell me that these commercial projects have been encouraged to the full through B.O.T.A.C. I shall rest content.
    But I am dissatisfied from the point of view that my constituency now tops the United Kingdom unemployment poll. We feel that not enough is done to bring down the high unemployment levels in the areas which are affected not only when there is stagnation and restriction in the economy but also when there is expansion. We still have chronic unemployment, and we think that more ought to be done by the Government.
    Last year the Government resisted what is, in effect, Clause 38 with all kinds of arguments which seemed strong at the time, but they have retreated from them now. We have had two rather feeble

    1265
    arguments to resist it tonight. Are we to take it that if we have to vote on this Clause tonight, next year the Chancellor might look at another argument and then introduce the Clause and be greeted with cries of "Brilliant" by his supporters-who will probably vote against the Clause tonight?
    I urge the Chancellor to give further consideration to the Clause. These things are important in development districts. The commercial side of development has been neglected, and I plead with the Government to think about it again.
    Mr. Graham PageWhen one has a Royal Commission Report on one's side, it is usual in Finance Bill debates to quote it. The hon. Member for Sowerby (Mr. Houghton) made the best of it. When one cannot find a quotation in any Royal Commission Report, one forgets all about it. But there are two Reports in support of the Clause—the Tucker and Radcliffe Reports—and the Clause is very modest when compared with the recommendations of both Reports.
    The Clause applies only to commercial buildings within development districts and seeks to extend to commercial buildings the benefits which industrial buildings receive. Some parts of development districts are quite inappropriate for industrial development. There are the older residential areas of development districts which are admirable for office development but quite inappropriate for industrial development. I have some such areas in my own constituency on Merseyside. The Government are doing something to help there.
    Inquiries are being made for sites for Government offices within that older residential area in my constituency. But I am not sure this is quite fair. If the Government are to do commercial development there, it may prevent private enterprise from doing it, when private enterprise might do it if it had even slight encouragement. Industrial firms are having encouragement for their developments there.
    When there is an industrial development in a development district, it can be successful only if commercial development follows, particularly retail shops and the type of distributive service which industrial development requires. Again I turn to Merseyside as an example. Ford's
    1266
    development at Halewood has necessitated any number of commercial developments to go along with it, particularly retail shops.
    What happens when there is no allowance for building new shops is that old shops are patched up. This is not a wise policy. If retail shops were having the benefit of an allowance, particularly in development districts, so that commercial development could accompany industrial development, we would have a better type of development, certainly in shopping areas. After all. it is in development districts that urban renewal is so very essential.
    It is just this type of town-again I speak of Liverpool and Merseyside—where urban development is so necessary and where we do need to encourage the commercial enterprises as well as the industrial. My hon. Friend said that the policy when capital allowances were introduced for industrial development was to encourage the expansion and modernisation of productive industry. But can one really make a distinction, particularly for a development district, between productive and distributive industry? I do not think that such a distinction is real.
    The policy now, at least within the development districts, should be to expand and modernise both productive and distributive industries and give all encouragement to it, I think it right that at present there should be discrimination between areas and that this encouragement could be applied only to development districts, because I do not believe we can be successful with industrial development in these districts unless we also encourage commercial development as well. This Clause may go too far in the allowances which it seeks to give, but that could be rectified at a later stage. Something on these lines should be seriously considered by my right hon. Friend.
    Mr. Ernest Fernyhough: I reinforce the plea by the hon. Member for Crosby (Mr. Graham Page). I cannot believe that the Financial Secretary, before he made his speech, had consulted the Lord President of the Council. Lord Hailsham is the overseer, as it were, of the North-East and after his "Cook's tour" of the area he concluded that it required a face-lift. He did not confine

    1267
    that to industrial buildings. He said that because it was an old industrial centre the whole of the social furniture needed renewing, and that included the whole of the commercial furniture. A Clause of this kind would make that a possibility.
    We who represent the North-East are often told that the reason we cannot attract new industries to the area is not because the businessman will not come there, but that his wife finds the shops so dowdy and nothing like so attractive as those in Oxford Street and Bond Street. At the cost of £24 million, accepting the figures given by the Economic Secretary, this is an opportunity which the Government could grasp. They could kill two birds with one stone-not only attract new industries but make it much easier for the wives of businessmen, so far reluctant to go to Liverpool, to Scotland or the North-East, to go there because the social furniture, the commercial buildings and the shops could become equivalent with those in other parts of the country.
    I do not want to detain the Committee because I understand that some hon. Members want to catch trains. I hope that the Economic Secretary will consult with the Lord President of the Council and ask him if he does not think that this new Clause would be a good thing for the North-East. If in private conversations with the Economic Secretary, the Lord President is to live up to the public utterances he has made in the North-East, there is no doubt that the Economic Secretary would have to consider and grant this modest concession.
    Mr. Barber: I can answer the hon. Member for Jarrow (Mr. Fernyhough) straight away. Of course, anyone who has in mind the interests of the development districts and of Northern Ireland—I mention that because we are not only concerned with development districts in England and Wales and Scotland—would be attracted by any action we in this Committee might take to improve the general position in those districts and in Northern Ireland. The only point I tried to make in answer to the hon. Member for Greenock (Dr. Dickson Mabon) in saying that one should consider how best one might spend the money available was how best to provide whatever taxation
    1268
    relief is available for those districts, and I do not think it follows that this is the best way to do it. I should have thought it very doubtful whether this was the most sensible way. There is an argument for saying that one can use to greater advantage taxation relief of £24 million by providing a differential in the industrial buildings allowance or even in providing greater incentive to industry to move to these areas.
    My hon. Friend the Member for Crosby (Mr. Graham Page) was beginning to touch on somewhat wider ground. He thought that we should extend the allowance for industrial buildings to commercial buildings generally, which would be a very expensive affair. I am not sure that I go with him the whole way in suggesting that the Tucker Committee and the Royal Commission would have approved of this new Clause because it is of more limited application. From my reading of the Tucker Report and the Royal Commission's Report, I should doubt very much whether they would approve of the discrimination as proposed in this new Clause. The Tucker Committee said:
    "A tax which refuses to give an allowance for the depreciation of all business premises is not limiting itself to a tax on income, but is encroaching on capital."
    The Committee was saying that on business principles a deduction ought to be allowed in computing profits for the loss in value of business premises through normal depreciation. While that argument can be adduced in favour of some sort of annual allowance, there is very little case for the investment allowance and initial allowance suggested in this new Clause.
    I have been over the grounds why my right hon. Friend could not accept the new Clause and I do not want f0 go over them again. I hope that the Committee will forgive me for not speaking a t greater length on the new Clause.
    11.0 p.m.
    Mr. John Diamond: I am sure that the Committee will forgive the Financial Secretary and that it will forgive me if I speak briefly, because I am conscious of the fact that a number of my hon. Friends are anxious to demonstrate their views about the lack of understanding by the Government of the needs of development districts. It was true that

    1269
    in 1951 and in 1955, when these two Reports were made, the development areas had not established themselves as solid areas of unemployment such as we have seen in Northern Ireland. It is true that in 1951 we had not had a Conservative Government for very long. We were, therefore, at the start of a period during which the Northern Ireland unemployment figures have averaged between 6 per cent. and 8 per cent. year after year.
    But now we have reached a situation in which it is impossible to demonstrate that we must give preference to industry in those areas to the exclusion of commercial buildings. The commercial buildings also provide employment, and it is not possible for us to say that those areas do not need the benefit which would come from the Clause.
    The Financial Secretary's reply to the arguments of my hon. Friends was totally inadequate. He has given no attention whatever to the need for giving a new and fresh look at the needs of
    development districts. He has tried to put us off with arguments about the comparison between industrial buildings and commercial buildings. If we start with industrial buildings which have considerable advantages outside development districts, we need not give them comparatively increased advantages within development districts. When we are dealing with commercial buildings which have no tax advantages outside development districts, they will have comparatively larger advantages if we give them anything at all within development districts. The hon. Member's argument would lead to our giving nothing at all to help commercial buildings being installed in development districts, and we wish to register our very strong protest against that attitude.
    Question put, That the Clause be read a Second time:—
    The Committee divided: Ayes, 118, Noes 175.

    Division No. 128.]

    AYES

    [11.3 p.m.

    Alnsley, William

    Griffiths, David (Rather Valley)

    Oram, A. E.

    Allaun, Frank (Salford, E.)

    Grimond, Rt. Hon. J.

    Oswald, Thomas

    Awbery, Stan (Bristol, Central)

    Hannan, William

    Pentland, Norman

    Beaney, Alan

    Harper, Joseph

    Popplewell, Ernest

    Bennett, J. (Glasgow, Bridgeton)

    Hart, Mrs. Judith

    Price, J. T. (Weethoughton)

    Benson, Sir George

    Herbison, Miss Margaret

    Probert, Arthur

    Blyton, William

    Hill, J. (Midlothian)

    Redhead, E. C.

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

    Hilton, A. V.

    Reynolds, G. W.

    Braddock, Mrs. E. M.

    Holman, Percy

    Roberts, Albert (Normanton)

    Bradley, Tom

    Houghton, Douglas

    Robertson, John (Paisley)

    Bray, Dr. Jeremy

    Howell, Denis (Small Heath)

    Rogers, G. H. R. (Kensington, N.)

    Broughton, Dr. A. D. D.

    Hoy, James H.

    Ross, William

    Brown, Rt. Hon. George (Belper)

    Hughes, Cledwyn (Anglesey)

    Short, Edward

    Butler, Mrs. Joyce (Wood Green)

    Hunter, A. E.

    Slater, Mrs. Harriet (Stoke, N.)

    Callaghan, James

    Hynd, John (Attercllffe)

    Slater, Joseph (Sedgefield)

    Corbet, Mrs. Freda

    Irvine, A. J. (Edge Hill)

    Small, William

    Craddock, George (Bradford, S.)

    Irving, Sydney (Dartford)

    Soskice, Rt. Hon. Sir Frank

    Cronin, John

    Janner, Sir Barnett

    Spriggs, Leslie

    Crosland, Anthony

    Jay, Rt. Hon. Douglas

    Stewart, Michael (Fulham)

    Cullen, Mrs. Alice

    Jenkins, Roy (Stechford)

    Stones, William

    Dalyell, Tam

    Jones, Dan (Burnley)

    Swingler, Stephen

    Davies, G. Elfed (Rhondda, E.)

    Jones, Elwyn (West Ham, S.)

    Taverne, D.

    Davies, Ifor (Gower)

    Jones, J. Idwal (Wrexham)

    Thomas, George (Cardiff, W.

    Delargy, Hugh

    Jonee, T. W. (Merioneth)

    Thomas, Iorwerth (Rhondda, W.)

    Dempsey, James

    Kelley, Richard

    Thompson, Dr. Alan (Dunfermline)

    Diamond, John

    Lawson, George

    Thornton, Ernest

    Dodds, Norman

    Lever, L. M. (Ardwick)

    Tomney, Frank

    Duffy, A. E. P.

    Lewis, Arthur (West Ham, N.)

    Wainwright, Edwin

    Mabon, Dr. J. Dickson

    Watkins, Tudor

    Edwards, Robert (Boston)

    McBride, N.

    Whitlock, William

    Fernyhough, E.

    MacDermot, Niall

    wigg, George

    Finch, Harold

    McInnes, James

    Wilkins, W. A.

    Fitch, Alan

    Mackie, John (Enfield, East)

    Wililame, Ll. (Abertillery)

    Foot, Dingle (Ipswich)

    MacPherson, Malcolm (Stirling)

    Willis, E. G. (Edinburgh, E.)

    Forman, J. C.

    Mason, Roy

    Winterbottom, R. E.

    Fraser, Thomas (Hamilton)

    Mayhew, Christopher

    Woof, Robert

    Galpern, Sir Myer

    Millan, Bruce

    Yates, Victor (Ladywood)

    George, Lady MeganLloyd (Crmrthn)

    Milne, Edward

    Ginsburg, David

    Mitchison, G. R.

    TELLERS FOR THE AYES:

    Gourlay, Harry

    Morris, John

    Mr. Charles A. Howell and

    Grey, Charles

    O'Malley, B. K.

    Mr. McCann.

    NOES

    Agnew, Sir Peter

    Ashton, Sir Hubert

    Barber, Anthony

    Allason, James

    Atkins, Humphrey

    Barter, John

    Arbuthnot, John

    Awdry, Daniel (Ghippenham)

    Batsford, Brian

    Bennett, F. M (Torquay)

    Hastings, Stephen

    Pym, Francis

    Bennett, Dr. Reginald (Gos & Finn)

    Heald, Rt. Hon. Sir Lionel

    Quennell, Miss J. M.

    Berkeley, Humphry

    Hendry, Forbes

    Rawlinson, Sir Peter

    Biffen, John

    Hiley, Joseph

    Redmayne, Rt. Hon. Martin

    Biggs-Davison, John

    Hill, Mrs. Eveline (Wythenshawe)

    Rees, Hugh

    Bishop, F. P.

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

    Rees-Davies, W. R.

    Bourne-Arlon, A.

    Hirst, Geoffrey

    Renton, Rt. Hon. David

    Box, Donald

    Hobson, Sir John

    Ridley, Hon. Nicholas

    Boyle, Rt. Hon. Sir Edward

    Hocking, Philip N.

    Ridsdale, Julian

    Brewis, John

    Holland, Phillip

    Roberts, Sir Peter (Heeley)

    Brootnan-White, R.

    Hollingworth, John

    Robinson, Rt. Hn. Sir R. (B'pool, S.)

    Brown, Alan (Tottenham)

    Hopkins, Alan

    Roots, William

    Buck, Antony

    Hornsby-Smith, Rt. Hon. Dame P.

    Ropner, Col. Sir Leonard

    Bullard, Denys

    Howard, John (Southampton, Test)

    Russell, Ronald

    Campbell, Gordon (Moray & Nairn)

    Hughes-Young, Michael

    St. Clair, M.

    Carr, Compton (Barons Court)

    Hutchison, Michael Clark

    Scott-Hopkins, James

    Carr, Robert (Mitcham)

    Iremonger, T. L.

    Sharpies, Richard

    Chataway, Christopher

    Irvine, Bryant Godman (Rye)

    Shaw, M.

    Chichester-Clark, R.

    James, David

    Shepherd, William

    Clark, Henry (Antrim, N.)

    Johnson Smith, Geoffrey

    Skeet, T H. H.

    Clark, William (Nottingham, S.)

    Jones, Arthur (Northants, S.)

    Smith, Dudley (Br'nthd & Chiswick)

    Clarke, Brig. Terence(Portsmth, W.)

    Kaberry, Sir Donald

    Smithers, Peter

    Cooke, Robert

    Kerr, Sir Hamilton

    Stanley, Hon. Richard

    Corfield, F. V.

    Kershaw, Anthony

    Stodart, J. A.

    Coulson, Michael

    Langford-Holt, Sir John

    Stoddart-Scott, Col. Sir Malcolm

    Courtney, Cdr. Anthony

    Leavey, J. A.

    Studholme, Sir Henry

    Crawley, Aldan

    Legge-Bourke, Sir Harry

    Summers, Sir Spencer

    Currie, G. B. H.

    Lewis, Kenneth (Rutland)

    Tapsell, Peter

    d'Avigdor-Goldimld, Sir Henry

    Lilley, F. J. P.

    Teeling, Sir William

    de Ferranti, Basil

    Litchfield, Capt. John

    Temple, John M.

    Donaldson, Cmdr. C. E. M.

    Loveys, Walter H.

    Thompson, Sir Richard (Croydon, S.)

    Drayson, G. B.

    Lucas-Tooth, Sir Hugh

    Tiley, Arthur (Bradford, W.)

    du Cann, Edward

    MacArthur, Ian

    Touche, Rt. Hon. Sir Gordon

    Elliot, Capt. Welter (Carshalton)

    McLaren, Martin

    Turner, Colin

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

    Turton, Rt. Hon. R. H.

    Emery, Peter

    Maddan, Martin

    van Straubenzee, W. R.

    Farr, John

    Markham, Major Sir Frank

    Vaughan-Morgan, Rt. Hon. Sir John

    Finlay, Graeme

    Marten, Neil

    Vickers, Miss Joan

    Fletcher-Cooke, Charles

    Matthews, Gordon (Meriden)

    Vesper, Rt. Hon. Dennis

    Galbraith, Hon. T. G. D.

    Maudling, Rt. Hon. Reginald

    Walder, David

    Gammons, Lady

    Mawby, Ray

    Walker, Peter

    Gibson-Watt, David

    Maxwell-Hyslop, R. J.

    Walker-Smith, Rt. Hon. Sir Derek

    Gilmour, Ian (Norfolk, Central)

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

    Wall, Patrick

    Gilmour, Sir John (East Fife)

    Mills, Stratton

    Ward, Dame Irene

    Glyn, Dr. Alan (Clapham)

    Miscampbell, Norman

    Webster, David

    Glyn, Sir Richard (Dorset, N.)

    Montgomery, Fergus

    Wells, John (Maidstone)

    Goodhew, Victor

    Morgan, William

    Whitelaw, William

    Gower, Raymond

    Nabarro, Sir Gerald

    Williams, Dudley (Exeter)

    Grant-Ferris, R.

    Osborn, John (Hallam)

    Williams, Paul (Sunderland, S.)

    Gresham-Cooke, R.

    Partridge, E.

    Wilson, Geoffrey (Truro)

    Grosvenor, Lt.-Col. R. G.

    Pearson, Frank (Clitheroe)

    Wise, A. R.

    Gurden, Harold

    Pilkington, Sir Richard

    Wolrige-Gordon, Patrick

    Hamilton, Michael (Wellingborough)

    Pitt, Dame Edith

    Woollam, John

    Harris, Reader (Heaton)

    Pott, Percivall

    Harrison, Col. Sir Harwood (Eye)

    Price, David (Eastleigh)

    TELLERS FOR THE NOES:

    Harvey, John (Walthamstow, E.)

    Profumo, Rt. Hon. John

    Mr. Peel and Mr. Ian Fraser.

    Harvie Anderson, Miss

    Proudfoot, Wilfred

    To report Progress and ask leave to sit again.—[Mr. Maudling.]
    Committee report Progress; to sit again Tomorrow.

  LINCOLNSHIRE RIVER BOARD (GRANT)
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Hughes-Young.]
  11.12 p.m.
  Mr. Dick Taverne: I wish to raise the matter of the refusal of the Ministry of Agriculture, Fisheries and Food to grant aid to the Lincolnshire River Board of £12,918 for work on the
  1272
  Witham Improvement Scheme. This is a serious matter to the River Board and I will begin by explaining to the House the background to this matter.
  This is part of a large scheme, the total of which involves the expenditure of more than £1 million. The part of the scheme with which the debate is concerned is that for improvements to the Sincil Dyke, involving the expenditure of about £½ million. Before the work could start on this scheme there was a considerable delay and the River Board had to wait for the transfer of responsibilities from the British Waterways; but at the first opportunity, in late 1961, tenders for this scheme were invited by the Board. Tenders were

  1273
  received in March, 1962, and the successful tender, after the necessary inquiry as to costs, was sent to the Ministry's regional engineer on 12th April, 1962.
  On 25th May, one-and-a-half months later, the regional engineer wrote to the River Board asking for certain information and raised certain queries about costs. Promptly, on 29th May, an answer was received from the River Board giving him all the information he required—and, of course, he had had time to consider the figures for about one-and-a-half months. Then nothing happened. The Board became disturbed about the delay. The clerk spoke to officials of the Ministry on several occasions, and pointed out that the matter was extremely urgent because he feared that if there were continued delays prices might go up, since a fixed price had been tendered. The clerk was told by the officials of the Ministry that, irrespective of the size of the contract-which was, as I have said, for about £½ million—the Board would have to wait its turn.
  In the middle of July the Board became so disturbed at the delay that a special delegation went to the Ministry. The Board was told, as the clerk had been told, in a letter which followed that visit to the Ministry, that it was hoped to deal with the matter soon. Not until 7th August, nearly four months after the successful tender had been transmitted to the Ministry, was approval finally granted.
  By that time, what the Board feared would happen had, in fact, happened. The contractor told the Board, "I could not take advantage of the fixed prices which were offered to me when the tender was submitted. I have now to do the work in two winters and one summer instead of being able to do it in two summers and one winter. Winter work necessarily involves further costs, because of delays caused by the weather, uncertainties, and so on, and I am afraid that I cannot stick to the contract price." In effect, the contractor said, "I want £15,000 more for the work than I estimated."
  The matter was gone into in great detail, negotiations ensued, and finally, after negotiations, the Board agreed that a fair and suitable price for the extra work occasioned by the Ministry's delay was a further sum of £12,918, which is
  1274
  the amount for which grant aid was subsequently refused. This was felt, after elaborate inquiries, to be the cheapest possible way of getting this extremely important scheme carried through.
  As soon as possible, on 27th August, the full facts were passed to the regional engineer, who was told, as was the Ministry, how extremely urgent the matter was. The contractor also added that he would be able to stick to this further additional price only if the new work was started on 17th September. It was on 6th September—11 days before the work was due to start—at the last possible date, that the Board told the contractor, "Yes, you may carry on with the contract. We accept this offer."
  When the Ministry heard of this, it at once tried to get the Board to order the contractor from the site, or to prevent him from getting on to it, but it was too late—the contract had been concluded, and the Board had no option because, had there been further delay, the costs would have risen once again, the progress of the work, which is extremely important and urgent, would have been prejudiced, the ratepayers would have been asked to contribute more and, because grant aid for a larger sum would have been involved, the taxpayer would have been prejudiced.
  The Ministry told the Board, "You have broken our regulations. You had not been granted approval before entering into the contract—therefore, no grant aid." Not unnaturally, the Board was somewhat incensed at this, and the explanations from the Ministry have been two. First of all, the explanations given for the delay have been that there was originally a discrepancy between the figure of nearly £½ million put forward in the early part of last year and the original figure of some £300,000 which had been mentioned in 1959. The Ministry said, quite rightly, that a big sum was involved, hence the delay.
  To that, there are two answers. The first is that the old figure of nearly £300,000—which was, as it turned out, quite an erroneous one—had been before the Ministry for a long time and, at its request, a report had been made by consulting engineers, a long time before the later figure was put forward, which made it quite clear that the other figure was too low and could not be

  1275
  supported. Further, as the Ministry itself admitted, and pointed out in a letter of May, 1962, costs had gone up.
  The second answer to the Ministry's explanation is: does it really take the Ministry of Agriculture four months to reconcile a discrepancy in the figures? If this was a big contract, as it was, did not that fact make it all the more urgent to see that it was dealt with quickly so that no further increase in costs was involved? Did it, and should it, take the Ministry four months to consider the tender which was put forward? If that is the normal practice of the Department, it is high time that the Department was seriously examined with a view to overhaul. The Ministry knew that the matter was urgent, but it replied that the Board must wait its turn. If this means that everyone who puts forward a tender to the Ministry has to wait a period of four months, this is a very disturbing state of affairs. In my view, there was no excuse whatever for such a long delay.
  The second explanation given by the Ministry, not of the delay but of the refusal, has been that, according to the Ministry, the Lincolnshire River Board has a bad record and had been warned on 12 previous occasions of breaches of the regulations. That was the Minister's answer to a Question which I put to him. There are two answers to that explanation.
  First, I hope that the Minister will carefully consider these cases of warnings about breaches of regulations. I have examined 12 incidents which have been reported to me by the River Board on which this may have been based. Only one of them was a case where work on a scheme was started before approval was given. This was work to the extent of some £500, an occasion in 1957. Two of the 12 are admittedly breaches of the regulations by the Board for which the Board can offer no excuse and in which it was at fault. They were in 1953 and 1957.
  Of the other nine cases, three were only minor and very technical, three were cases in which the circumstances changed owing to conditions which were quite unforeseeable by and beyond the control of the Board and where the Board's explanation was accepted by the
  1276
  Ministry and in which grant aid was duly given. The other three were cases in which there were variations by the Board which resulted in considerable saving.
  The Board's record is not bad and perhaps the Minister can tell me whether there have not been minor breaches by other river boards of the same kind, because I suspect that minor breaches of this kind and variations of this kind are cases in which not only the Lincolnshire River Board is at fault.
  The second answer is much more important. Even if there were technical breaches of the regulations by the Board in the past, does that justify delay by the Ministry? Does that mean that the Ministry can delay as long as it wishes? Does it justify delay to such an extent that an extra burden is imposed on the ratepayers and the taxpayers—for it is not only people in Lincolnshire who have to be considered, but all the taxpayers who contribute to grant aid?
  The Ministry is under a duty to assist the river boards and under a duty to keep down costs and under a duty to act to prevent contracts from being delayed and prices rising as a result of delay. There is no question whatever but that the extra cost which was incurred on this occasion, this sum of nearly £13,000, was due to delay. This was a scheme which had to be pressed on, a scheme of great importance to my constituents and not only to people in Lincoln but to farmers and people in Lincolnshire generally, and it was a matter in which, as I have said, the Board had no choice.
  Does the Ministry say that if there have been breaches in the past, one has to disregard the extra costs involved irrespective of the delay and abide by the strict letter of the regulations, even if the cost goes up by £10,000, £20,000 or £30,000? Was the Ministry to have no regard to the postponement of the scheme involved? Was the Board simply to wait its turn, as it was told, and, when it became impatient, to be told that it had a bad record? Whatever the record of the Board may have been, and it does not admit that it has anything in the sense of a bad record—there are a few technical breaches and only two serious breaches—its case was still entitled to be treated on its merits on this occasion.

  1277
  Even if there were previous breaches, the Ministry was still at fault.
  This was an important scheme to prevent flooding, from which many of my constituents have suffered badly. The sum which now has to be met by the Board, and, therefore, by the ratepayers, is not a negligible sum. The total which they will have to meet on which otherwise aid would have been granted is a sum which is more than the total collected, for instance, annually from income from angling fees.
  I regard this as a sorry story which throws a bad light on the operations of the Ministry. I would much rather defend the civil servants than attack them, as a body which is working for the community as a whole. I have often explained to my constituents the inevitable delays which must result in correspondence with the Ministry. One cannot expect a very large Department to answer all queries overnight.
  I should like to be able to point to the Civil Service and to show it to be quite as effective as, and in many cases even more effective than, private firms. But it is this kind of delay and technical interpretation of the rules which sometimes gives a bad name to the operations of the Civil Service, which leads to the exasperation of the public and leads to talk of bureaucratic red tape which we cannot afford in a case like this.
  I realise, of course, that the Minister must always defend the work of his Department, but I hope that when he has finished defending it he will give this case a more than routine examination and will ask some very searching questions of his Department. I hope and trust that if he does so he will realise where the fault lies and will then review the decision he has taken which has placed this extra burden on the rate-payers of the Board, and I hope that in future the Civil Service will proceed without unnecessary delay.
  11.27 p.m.
  The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. James Scott-Hopkins): I am grateful that the hon. Member for Lincoln (Mr. Taverne) has presented his case in such a clear manner. I regret one or two of the final remarks he made concerning the Civil Service. I would point out that the decisions taken in this case stem from
  1278
  our decisions alone. The civil servants have been carrying out the instructions given to them to the best of their ability and, in my view, have done so extremely well. Perhaps the hon. Gentleman has not been briefed as well as he might have been by the River Board as to the events concerning this case.
  It might be to advantage if I talked for a moment about the conditions of grant. Here we have gone to a lot of trouble to ensure that river boards are fully aware of the conditions that must be observed before expenditure on drainage works is eligible for grant-aid, and the importance of care in estimating costs. The hon. Gentleman made a fair point about this.
  We issue a Memorandum of Grant Conditions, several copies of which were sent to all boards the last time it was revised in 1955. Very often boards are reminded in correspondence of the need to observe these conditions. The two conditions that are particularly applicable to the case we are discussing tonight are those dealing with the variation of works already approved and the acceptance of contracts.
  With the permission of the House I will very quickly give two quotations from this memorandum. The first quotation is under the heading "Variation of Works as Approved" and the important sentences here are as follows:
  "All works must be carried out in accordance with the description and drawings as approved for the purpose of grant-aid. Any variation of the scheme must be submitted through the Regional Engineer for the Ministry's prior approval."
  A little later in the same paragraph is the sentence:
  "If any variation is made without prior approval, the Ministry reserves the right to withhold or reduce the grant and to require the board to refund any advances of grant which may have been made."
  My second quotation is from a later paragraph dealing with contract tenders, and in this case I think it is sufficient if I read just one sentence, namely:
  "In no circumstances should a tender be accepted without the Ministry's prior approval."
  Perhaps I may make one further observation before turning to the Lincolnshire River Board and this particular case. Our procedure for approving proposals for drainage improvements usually entails

  1279
  our considering a first estimate of the cost of the works in relation to the objects they are intended to secure. This is the estimate which the hon. Gentleman was mentioning in this case. We have to consider whether a scheme is worth while. In doing this, we obviously are very dependent on the closeness of the estimate that a board can produce.
  If a board makes a serious mistake and underestimates the cost of some works which, at that estimated cost, are clearly justified by the benefits they produce, we may later find ourselves in the position of having approved, at least in principle, a scheme costing much more than the first estimate and at this new price not necessarily justified by the benefits which will accrue from that increased expenditure. We take what steps we can to verify the estimates that are sent to us, but in the last resort we cannot duplicate all that a board does and must accept its findings at their face value.
  The hon. Member made a point about cases over which the Lincolnshire River Board had had trouble in the past with my Ministry. I do not want to single out this Board for an unfair shale: of criticism. I would agree with the hon. Member when he mentions that there are other boards which also have had difficulties in the past, but it is fair to say that the Lincolnshire River Board has had more warnings than any other board over the difficulties and the mistakes which I have just mentioned.
  I have taken the trouble to go through the past five years' record of the Board—not back to 1953 as the hon. Member did—and I have identified 12 instances of warning letters to the Board, urging it to estimate more carefully and closely, or warning it against varying approved works without prior approval. To be fair, however, none of the instances I have seen related to the acceptance of a tender without prior approval. If the hon. Member wishes, I will give him later a complete list of cases where the Board has transgressed the regulations and has spent more than it ought to have done.
  I will give the hon. Member two instances now which are not minor infringements, as he said. They are quite important, particularly in relation to the sum involved. In 1959, works on the
  1280
  Tetney Sluice resulted in excess expenditure of £3,211, over and above the approved sum of £6,000. We warned the Board in the strongest terms of the need to estimate more closely and get prior approval to variations. The Board had committed both offences in this case. Nevertheless, we grant-aided the excess. In 1961 the Ministry refused grant on £192—a small sum, but the principle is the same. It was spent on work not approved in advance.
  Mr. Taverne: Is it not a fact that the sum of about £3,000 in the case of the Tetney Sluice was expenditure which the Ministry admitted was caused by additional works which were variations as a result inevitably of weather conditions and the collapse of the old doors? Was not this accepted later as an explanation by the Ministry?
  Mr. Scott-Hopkins: I said that we accepted it, and indeed paid grant on this excess expenditure, but I must make the point again that the Board did not consult us before it spent this money and that there was no excuse for that. When the Board explained the reasons to us we grant-aided that scheme.
  As recently as May, 1962, we had to consider unauthorised works on the Upper Bain Improvement Scheme. Here the Board had been given approval to £50,000 but did extra work costing over £18,000 without our prior approval. All these cases are instances—and there are 12 ranging from small to big—where the principle has been breached and the Board has not kept the conditions of grant.
  As to the present scheme and the events leading up to it, what I have to say does not entirely agree with what the hon. Member said. The whole scheme, of which the work under discussion is only a part, is the improvement of the River Witham and its tributaries in the City of Lincoln and a large area of agricultural land nearby. Sincil Dyke, to which the hon. Gentleman referred, is one of the two channels carrying the Witham through the City of Lincoln.
  When this scheme was put to the Ministry for approval for grant-aid, in 1959—the hon. Gentleman gave the date correctly—it was estimated that the whole cost would be over £1 million, of

  1281
  which the Board estimated that £308,000 would he for the improvement of the Sincil Dyke part of it. In March, 1962, the Board obtained tenders, having left its estimate unrevised, for the work on Sincil Dyke, and on 12th April, 1962, it asked the Ministry to approve acceptance of a particular tender. It was then found that the tender price was £497,805. It had risen by £189,805. I have stressed the importance of close estimating in these matters, but there was a difference of over £189,000 between the estimate and the tender price. This is an important point because river board schemes of this kind attract grant of about 80 per cent., which means that approximately £800,000 of taxpayer's money is involved in this case.
  Here we had an estimate that was exceeded at tender by almost two-thirds, an enormous amount. Not unnaturally, at this point the Ministry asked the Board for an explanation of the increase. We were extremely anxious about the vast difference between the two figures. At the end of May, 1962, the Board replied to the effect that there was no explanation of the difference, as the original estimate was obviously wrong. Almost as an afterthought. the Board then said that the total estimate for the Sincil Dyke part of the work should be increased still further to £548,867.
  It is hardly to be wondered that at that stage the Ministry found it essential to examine the new estimate very closely and to re-examine the whole worth-whiteness of the scheme, since the original estimate of £300,000 had gone to something over £500,000, a quite enormous increase. In June, 1962, the Board told the Ministry that it was worried about delay in approving the tender and it warned us then that the price might rise if work did not begin shortly.
  In July, the Ministry received a deputation which came to press on us the need to take an urgent decision. At this meeting, once again, we had a further surprise from the Board, which disclosed that the estimate could be reduced now—quite suddenly, out of the blue—by £48,000 because this was for work for a private company which would pay that sum to the Board for what was done. This was further evidence that the Board really had some difficulty in getting anything like accuracy in its estimating, and doubt was thrown on the estimate for the
  1282
  whole scheme. Later in July, the Board again warned us that the contractors might not be able to keep to their price.
  On 7th August, the Ministry told the Board by telephone that it could accept the tender, and we confirmed this on 10th August. On 27th August, the Board said that the contractors wanted either to delay beginning the scheme until March, 1963, thereby, presumably, increasing the cost, or to increase their tender by £13,000 because—this was a point made by the hon. Gentleman—delay in accepting it had meant that they would have to work through two winters and one summer instead of two summers and one winter.
  We understood that a decision on this would have to be taken by 16th September or otherwise the contractor would withdraw his tender altogether. While we were still considering this further increase—an additional increase on the £300,000 which had already gone up and up-we learned on 12th September by telephone that the Board had already accepted the tender. We discovered later that the Board had accepted the tender on 7th September, knowing that the Ministry was still considering the request to increase the tender price by £13,000, a matter for which the Board had sought approval only the week before.
  The hon. Gentleman can hardly maintain that the Ministry has in this case been dilatory in trying to meet the Board's constantly varying estimates and tenders. He has said that delay costs money. The reason for the delay has been the inaccuracies of the Lincolnshire River Board, its constantly varying estimates, going up and up, suddenly dropping by £48,000, and then going up again and that right at the last moment. Then there was this final broach. It was a contravention of the conditions of grant and placed the Ministry in a difficult position. I say frankly to the hon. Member that this was a case that we could not judge in isolation. Therefore, after the most careful consideration, we felt that we had no choice but to take the action which we did.
  As the hon. Member knows, because I have written to him, since we took the decision I have looked hard, long and earnestly at the matter to see the rights and wrongs of the case. I have gone a long way back into the matter in response

  1283
  to appeals by the hon. Member and by the River Board. I feel bound to conclude, however, that the decision not to grant-aid the final excess of £13,000 on the Sincil Dyke section of the scheme must stand.
  I point out to the hon. Member that this £13,000 is likely to be less than about
  1284
  1 per cent. of the total cost of the River Witham Improvement Scheme. I regret that the decision has had to be taken in this way, but I cannot find any justification for changing the decision which I have given.
  Question put and agreed to.
  Adjourned accordingly at nineteen minutes to Twelve o'clock.

SCIENCE
  Atomic Energy (Reactor Systems)
  Atomic Energy (Reactor Systems)
  D.S.I.R. Economics Committee(Industrial Studies)
  D.S.I.R. Economics Committee(Industrial Studies)
  Radioactive Waste
  Radioactive Waste
  Office Staff
  Office Staff
  Mechanical Engineering
  Mechanical Engineering
  Winfrith Heath (Heavy Water Reactor)
  Winfrith Heath (Heavy Water Reactor)
  Advanced Gas-cooled Reactor
  Advanced Gas-cooled Reactor
  National Research Institutes
  National Research Institutes
  National Economic Development Council
  National Economic Development Council
LOCAL GOVERNMENT
  Rating Inquiry (Committee)
  Rating Inquiry (Committee)
  Rate Increases
  Rate Increases
  Spoil Heaps
  Spoil Heaps
  Private Street Works
  Private Street Works
  Town Centres (Development Schemes)
  Town Centres (Development Schemes)
HOUSING
  Rent Act
  Rent Act
  Moderate Income Groups
  Moderate Income Groups
  White Paper
  White Paper
  Leasehold Properties, Wales
  Leasehold Properties, Wales
  Transferred Miners
  Transferred Miners
  House Purchase
  House Purchase
NATIONAL FINANCE
  Output per Head (Comparative Figures)
  Output per Head (Comparative Figures)
  Associated Television Limited
  Associated Television Limited
  Purchase Tax
  Purchase Tax
  Pension Schemes (Tax Reliefs)
  Pension Schemes (Tax Reliefs)
  University Salaries (Clinical Staff)
  University Salaries (Clinical Staff)
TRADE AND COMMERCE
  South Africa
  South Africa
  Aycliffe Industrial Estate (Factory)
  Aycliffe Industrial Estate (Factory)
  North-East
  North-East
  Ammanford and Garnant
  Ammanford and Garnant
  Under-developed Countries
  Under-developed Countries
SOUTH AFRICA
  Dependent Territory Africans
  Dependent Territory Africans
BRITISH GUIANA
  Situation
  Situation
KENYA
  Land Resettlement Scheme and Economic Development
  Land Resettlement Scheme and Economic Development
  Land Board
  Land Board
BRITISH HONDURAS
  Hospital Beds (Mental Patients)
  Hospital Beds (Mental Patients)
  Mental Hospital, Belize
  Mental Hospital, Belize
  Psychiatric Treatment
  Psychiatric Treatment
PUBLIC BUILDING AND WORKS
  Telephone Exchange, West Hartlepool
  Telephone Exchange, West Hartlepool
  Outer Circle, Regent's Park (Vehicle Parking)
  Outer Circle, Regent's Park (Vehicle Parking)
TELEPHONE SERVICE
  Rochester and Chatham
  Rochester and Chatham
  Kent
  Kent
  Herne Bay Exchange
  Herne Bay Exchange
POST OFFICE
  Air Mail (London-Scotland)
  Air Mail (London-Scotland)
  Dollis Hill Research Station
  Dollis Hill Research Station
  Electricity Boards (Accounts)
  Electricity Boards (Accounts)
AGRICULTURE, FISHERIES AND FOOD
  Royal Commission on Common Land (Report)
  Royal Commission on Common Land (Report)
SHIPPLNG
  Sugar Imports (Cuba)
  Sugar Imports (Cuba)
ROADS
  Traffic, Stonebridge
  Traffic, Stonebridge
  Accidents, Croydon
  Accidents, Croydon
  Treforest Industrial Estate
  Treforest Industrial Estate
EMPLOYMENT
  School Leavers, Gateshead
  School Leavers, Gateshead
  Buckhaven and Methil
  Buckhaven and Methil
  Portsmouth
  Portsmouth
  Tees-side
  Tees-side
  N.A.T.O. (INFORMATION)
  N.A.T.O. (INFORMATION)
  NORTH-EAST
  NORTH-EAST
  COUNCIL FOR WALES AND MONMOUTHSHIRE
  COUNCIL FOR WALES AND MONMOUTHSHIRE
EDUCATION
  Teachers (Pay)
  Teachers (Pay)
MINISTRY OF HEALTH
  Doctors' Lists
  Doctors' Lists
HOME DEPARTMENT
  Betting Levy
  Betting Levy
  Legal Aid (Report)
  Legal Aid (Report)
  SOMALI REPUBLIC (PENSION PAYMENTS)
  SOMALI REPUBLIC (PENSION PAYMENTS)
  N.A.T.O. COUNCIL
  N.A.T.O. COUNCIL
SCOTLAND
  Teachers
  Teachers
  Probation Service
  Probation Service
  Educational Institute of Scotland (Circular)
  Educational Institute of Scotland (Circular)
TECHNICAL CO-OPERATION
  English Language
  English Language
  British Honduras (Medical Staff)
  British Honduras (Medical Staff)

Preamble
The House met at two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Birmingham

CONSTITUTION OF NORTHERN RHODESIA
2.4 p.m.
THE EARL OF LISTOWEL: My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government when they will hold a conference to revise the Constitution of Northern Rhodesia.]
THE LORD CHANCELLOR (LORD DILHORNE): My Lords, it is too soon to say when further discussions or a conference with regard to a Constitution for Northern Rhodesia will take place. The Conference which it is proposed to convene next month in Africa, under the chairmanship of my right honourable friend the First Secretary, will be considering the problem of the dissolution of the Federation and associated problems. My right honourable friend feels that progress should be made on these problems, and then we can carry further discussions on the Northern Rhodesia Constitution.
THE EARL OF LISTOWEL: My Lords, may I ask the noble and learned Lord whether the Government are aware that, according to a statement he made only yesterday when passing through London, the Premier of Northern Rhodesia, Mr. Kaunda, is expecting a new Constitution in the late autumn? Is the noble and learned Lord not also aware that a serious situation may arise in Northern Rhodesia if the delay in holding a constitutional conference is so considerable that there is no reasonable prospect of another Constitution before the end of the year?
THE LORD CHANCELLOR: My Lords, the Northern Rhodesian Ministers who visited London in March made it
710
clear that they wanted an early constitutional conference. My right honourable friend the First Secretary accepted the need for further discussion about the Constitution, but, for the reasons which I have given, made no commitment about when this might be.

MALTA
2.6 p.m.
THE EARL OF LISTOWEL: My Lords, I beg leave to ask the Second Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will hold a conference to discuss further constitutional advance in Malta.]
THE MINISTER OF STATE, COMMONWEALTH RELATIONS OFFICE (THE DUKE OF DEVONSHIRE): My Lords, as my right honourable friend announced after his talks with the Maltese Prime Minister last December, an independence conference will be held as soon as the necessary preparatory steps have been taken. Noble Lords will be aware that my right honourable friend is planning to visit Malta for a few days during the Whitsun Recess, and I have no doubt that he will discuss with the Maltese Prime Minister questions concerning the convening of the conference.
THE EARL OF LISTOWEL: My Lords, I am very glad indeed to hear from the noble Duke that the Secretary of State is going to Malta over Whitsun and will discuss this matter of a constitutional conference. May I ask him these two questions? First of all, will the Maltese Opposition Party, the Labour Party, as well as the Government Party, be invited to attend this conference on a new Constitution for Malta? Secondly, do the Government agree, in view of our policy in Africa, that economic viability should no longer be regarded as a condition of independence for Malta?
THE DUKE OF DEVONSHIRE: My Lords, as regards the first part of the noble Earl's question, I think this is a matter for discussion between the Prime Minister of Malta and my right honourable friend. The terms of this conference have yet to be decided, the agenda has

711
yet to be composed, and the composition of the delegation and who will be represented in it are matters for discussion and no doubt will be discussed in the next week or so. As regards the second question, whether economic viability should be a condition of independence, this seems to go rather wider than the terms of the printed Question. Without wishing to evade the issue, I think I can say that it poses a different question from that set down by the noble Earl.
THE EARL OF LISTOWEL: May I ask this further supplementary question? I hope that the noble Duke will remind the Secretary of State that when we had the Round Table Conference on a Constitution for Malta after the war, both Parties, the Labour Party as well as the Party of Mr. Borg Olivier, were represented at the Conference. Surely this is to be taken as a precedent. It would be most unfair not to invite the Labour Party in Malta to attend this conference. May I say that I entirely sympathise with the noble Duke's dilemma over the second question that I put?
THE DUKE OF DEVONSHIRE: My Lords, I am most grateful for the kind treatment I have received from the noble Earl. As regards the first point, I would certainly agree that at every constitutional conference all reflections of political opinion ought to be represented. But I think it would not be proper far me to make a statement at this stage on who exactly will be represented at this conference, when discussions are to be held in the immediate future.

DIMENSIONAL CO-ORDINATION IN THE BUILDING INDUSTRY
LORD BOSSOM: 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 what steps are being taken to introduce dimensional co-ordination in the building industry, and to promote prefabricated methods of construction.]
THE MINISTER OF STATE, HOME OFFICE (EARL JELLICOE): My Lords, my right honourable friend the Minister
712
of Public Building and Works published in February a first statement on dimensional co-ordination for the industrialised building by public authorities of houses, schools, hospitals and offices; and it will be followed by others. We hope that these statements will stimulate progress in the adoption of dimensional co-ordination both as regards industrialised building and traditional building.
My right honourable friend's Directorate General of Research and Development is also promoting the widest possible application of existing techniques of industrialised building, and is fostering the growth of new systems which should be applicable to a wide range of buildings. In all its work the Directorate General is co-operating closely with the construction industries and the associated professions.
LORD BOSSOM: My Lords, may I thank my noble friend for that Answer. But may I inquire whether he is aware that if these principles were taken up consistently and persistently they could make a reduction in our entire national building bill in the neighbourhood of 5 per cent. or more? Other countries are now using them, and I should like to ask my noble friend to see that every possible effort is made that England gets the benefit of the science that is being practised elsewhere.
EARL JELLICOE: I entirely agree with my noble friend that there are great gains to be won in this field. I think that my right honourable friend the Minister of Housing and Local Government is shortly to publish a White Paper on the housing situation, and that will include, I think, a pithy and pregnant paragraph to this effect. I would also agree that we should keep fully abreast of the best modern techniques in this matter; and as my noble friend is doubtless aware, the building industry has recently taken steps in one form or another to intoduce into this country certain of the best foreign practices in this general field. But, that said, I would claim on behalf of the industry that in this whole field of industrialised building, especially the lighter industrialised building, which affects schools, for example, we have been in the vanguard of progress.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, may I ask whether it is not fairly apparent that the White Paper has been through a long period of pregnancy—a good many years?
LORD WILLIAM S OF BARNBURGH: Probably by reason of artificial insemination.
EARL JELLICOE: I think there has been a considerable process of gestation, but it will doubtless be all the better for that.
LORD LATHAM: My Lords, could the noble Earl say whether the Minister of Works is aware of dimensional coordination?
EARL JELLICOE: My Lords, I was in fact answering on behalf of my right honourable friend the Minister of Public Building and Works. I can assure the noble Lord that he is entirely aware of the problems and of the progress which can be won in this field.
LORD CONESFORD: My Lords, does "dimensional co-ordination" mean "standard sizes"?
LORD HAWKE: My Lords, will my noble friend seek out and read the speech of the chairman of the largest brick-makers in the country, delivered at their annual general meeting, from which it appears that brick-makers, at all events, think that the sizes which we are standardising may not be correct?
EARL JELLICOE: My Lords, I am aware of the speech to which my noble friend has drawn your Lordships' attention. I think there is, in fact, a slight difference of opinion in this matter; but some experts believe that there will be no difficulty whatsoever in fitting the British brick, whether it is the Welsh and English brick, or the Northern British and Scottish brick, to the proposed system.
LORD CONESFORD: My Lords, may I have an answer to my Question?
EARL JELLICOE: My Lords, I think that the answer is probably "Yes"; but, quite frankly, I do not know.
BARONESS HORSHBRUGH: My Lords, might I ask, then, if the Minister does not quite know, whether this title has been given to the White Paper in order
714
that the public cannot know what is going on and, therefore, take an interest and express their opinions?
LORD HAWKE: My Lords, I thank my noble friend for his reply to my supplementary question, but will he bear in mind that the chairman whose speech we are dealing with is chairman of an organisation which produces a very large proportion of bricks in this country? That being so, surely it would seem more economic that the other standards should come to him, rather than that he should go to the others.
EARL JELLICOE: My Lords, I am not aware that there is any real reason why that should be so, but it is certainly very important that the brick-making industry as a whole should bend their minds to the question of how best to integrate their efforts with what progress is being made in this field.
LORD BOSSOM: My Lords, while further thanking my noble friend for the consideration he has given to this very important subject, is he aware that a model building built entirely of coordinated and prefabricated units was built on the Thames Embankment? Is he further aware that it was built with ordinary bricks and then fitted in with everything else? Is he further aware that the co-ordination should apply not only to special types of building, but to all types of building, as is being done in other countries?
EARL JELLICOE: My Lords, I am not aware of all the matters my noble friend has brought to my attention, but I am aware of most of them.

NATO AND MIXED FORCES
THE EARL OF SANDWICH: My Lords, I beg 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 make a statement of policy on the United States' proposal for the creation within NATO of a mixed force of surface ships carrying Polaris missiles.]
THE FIRST LORD OF THE ADMIRALTY (LORD CARRINGTON): My Lords, Her Majesty's Government have

715
given a general welcome to the concept of a mixed-manned force. We have entered into no commitment to participate in it, although we are naturally in close touch with discussions on the subject.
THE EARL OF SANDWICH: My Lords, may I ask my noble friend for an assurance that the Nassau Agreement will be unaffected by any decision to give effect to the United States proposals; that is to say, that Britain will retain the independent nuclear deterrent of eight Polaris submarines and will contribute additionally to the multilateral force if in the end we have to contribute to it at all.
LORD CARRINGTON: Yes, my Lords, I can give that assurance. Any multilateral mixed-manned force would be in addition to our own deterrent.
VISCOUNT MONTGOMERY OF ALAMEIN: My Lords, may I ask the First Lord some questions on this matter? Does he not understand that the whole question of multilateral mixed-manned forces is utter and complete poppycock? I should like to ask some further questions. I spent ten years in the Western Defence Organisation; indeed, I began it in the days of Western Union. In those days our object was so to organise ourselves that we could fight effectively if attacked. Does the First Lord understand this? How can a ship fight effectively if a third of the crew is Portuguese, a third Belgian, and a third Danish? The thing just is not "on". You might as well man a ship with a party of politicians. We have three Parties in this House. In fact, we have four Parties, one Communist—he can be the comrade captain. The thing simply is not "on". I read in the newspapers—
SEVERAL NOBLE LORDS: Order!
VISCOUNT MONTGOMERY OF ALAMEIN: If I may ask another question, I read in the paper that an Admiral is coming over from the United States to discuss this question. Will the First Lord inform the Admiral that the whole thing is first-class military nonsense?
LORD CARRINGTON: My Lords, with regard to my noble and gallant friend's second question, it has been decided at the request of the United
716
States that Admiral Ricketts, accompanied by a small naval team, will come over here next week, on June 4, to discuss the military aspects of this question. Of course, these talks in no way commit us to this project. With regard to the first supplementary of my noble and gallant friend, I should have thought that those were just the sort of things which would be discussed at these meetings, and I must confess that I should be very hard put to it to decide which I would rather do, serve in a multilateral mixed-manned ship, or on a ship manned by Members of your Lordships' House!
EARL ALEXANDER OF HILLSBOROUGH: My Lords, would it not be wise at once for the Government to decide at any rate one thing, that there is no real purpose in having merchant ships manned for missiles? It is an exceedingly dangerous thing to rely upon in any way. Would the First Lord not perhaps give us his own naval view as to what would happen with regard to a mixed-manning of actual nuclear submarines?
LORD CARRINGTON: The Royal Navy has been having conversations in Washington with the United States Navy on the project, and these talks which are going to take place next week are a continuation. I think it would be very much better not to say anything till we have finished these talks.
EARL ALEXANDER OF HILLSBOROUGH: It will not be very long, I expect, before the Leader of the House will be agreeing to a day for a debate on Defence. I think that on this particular matter the Admiralty ought to be ready with the exact answers.
SEVERAL NOBLE LORDS: Hear, hear!
LORD AIREDALE: My Lords, if the gallant Admiral is arriving on June 4, will he be given an opportunity to visit the battlefield of Waterloo?

BUSINESS OF THE HOUSE
2.15 p.m.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, may I ask the Leader of the House if he would be obliging enough, at rather short notice, to tell us what he considers is the position with regard to the Business to-day in

717
respect of the London Government Bill? We are seemingly in a very difficult position. We have a long way over 100 Amendments on the Paper and I understand that more are being added to it to-day. Some of these additional Amendments come from Government sources, and in so far as they are concessions we welcome them, but here we are at the beginning of only the last day but one for the discussion of this Bill before the Recess. Some of our people are being over-pressed. I think we ought to have some idea from the noble Viscount the Leader of the Government Party, so that we may know exactly how far he intends to go.
THE LORD CHANCELLOR (LORD DILHORNE): My Lords, may I perhaps answer this question, as I am in charge of the Bill for the Government? I also was anxious about the progress made on this Bill last night, and I made such inquiries as I cot ld in regard to the position because I could foresee that perhaps it would be right to sit fairly late last night. But such inquiries as I was able to make led me to think that there would be no real difficulty in concluding the Committee stage of this Bill in the allotted time. In regard to the noble Earl's question as to how far we should press to-day, I should say we ought to reach the end of Part VIII and Schedules 14 and 15. In the light of the information I was able to obtain, I myself see no real reason why we should not do so.
EARL ALEXANDER OF HILLSBOROUGH: I think that is going a great deal too far. There is a limit to the extent to which the Government in this House of unpaid Members should be forcing an issue of this unmandated character at this pace. It really is not good enough. I do not think in the end that it will enhance the general objectives of the Government if we are forced in this direction.
LORD MORRISON OF LAMBETH: My Lords, I wish to support my noble friend the Leader of the Opposition. We have left to consider over 100 Amendments to the Bill, and probably more to come. It must be remembered that this is an enormous Bill. In fact, it would have been possible to embody its contents in a number of Bills. A number of the clauses are, by their very nature, bound to produce something in the nature of
718
Second Reading speeches and Second Reading debates, because they themselves could have been the subject of separate Bills. There was the debate on children with which we dealt yesterday, and various other matters under the Bill are bound to lead to lengthy debates. Now there are over 100 Amendments left, and the Lord Chancellor who claims to be in charge of the Bill says that we ought to be able to manage with only two Parliamentary sitting days. I think it is really preposterous to imagine that that can be done. It seems to be merely a case of the Government setting themselves the objective of getting the Committee stage finished by Whitsun. It is not essential that the Committee stage should be finished by Whitsun.
EARL ST. ALDWYN: Yes, it is.
LORD MORRISON OF LAMBETH: It is not. You have still until the end of July, and possibly into the next Session. Many a Bill has been finished in part of October, so that is not essential. I think it is utterly unreasonable, and it must be realised that noble Lords on both sides of the House are not accustomed to this kind of late sitting, which is the Government's form of guillotine. I submit to the House that it is not good Parliamentary business; it is not going to get the best out of the House. I hope, therefore, that the Lord Chancellor, or the Leader of the House, who possibly has more real responsibility in the matter—it is for him to judge—would think about the matter again.
THE LORD CHANCELLOR: My Lords, I thought about the matter a great deal last night, because I realised that the actual number of Amendments left on the Marshalled List was considerable.
For that reason I was inclined to the view that we ought to have sat later last night. But I made such inquiries as I could, and I received assurances which led me to suppose that there would be no real difficulty in completing the Marshalled List by Thursday night. When I am asked how far we should proceed to-day, I adhere to the view that we should reach the end of Part VIII and Schedules 14 and 15. I am not going to comment upon the course of proceedings yesterday, except to say this, as I said last night: that I do not think we made all the progress yesterday that we might conceivably have made.
LORD SILKIN: I do not know whether the noble and learned Lord realises that there are a number of noble Lords who, after a certain time of the night, just cannot get home. Is that not an important factor that we ought to take into account? Are we to condemn people, who are doing their duty here, sitting from 2 o'clock onwards, not only to spend hours and hours in this place, but to be unable to get a night's rest? I think that there is a limit to the endurance that can be expected of noble Lords. I think that the noble and learned Lord ought to take into account what it is reasonable to expect. After all, this Bill has been guillotined, and noble Lords on this side attach great importance to this Bill. We want to examine it thoroughly. Although the noble and learned Lord may think that it could have been discussed in a shorter time, that, after all, is a matter of opinion only. Noble Lords are entitled to express their views about it and, if you are to say that a noble Lord should not stand up and say what he thinks, that is equivalent to a guillotine. I hope the Government will have second thoughts about pressing this matter too hard.

DURHAM COUNTY COUNCIL BILL [H.L.]
Read 3a, and passed, and sent to the Commons.
LUCAS ESTATE BILL [H.L.]
Read 3a, and passed, and sent to the Commons.

LONDON GOVERNMENT BILL
2.25 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.—(The Lord Chancellor.)
EARL ALEXANDER OF HILLSBOROUGH: My Lords, we were dealing with business just now upon this very Bill. I was quite astonished that my noble friend Lord Silkin, who has put in so much work on this Bill and on nearly all the other technical Bills which your Lordships have had, did not
720
have the courtesy of an answer. Now the noble and learned Lord is moving to go into Committee without our having been satisfied at all with the kind of answers we have had from the Woolsack this afternoon. I protest most strongly against this treatment. I take it that it is still possible for the Government to answer the points which have been made by my noble friend Lord Silkin.
THE LORD CHANCELLOR: My Lords, if I may say so in reply to the noble Earl, I am sorry he should be so indignant about that, but I had already answered the question put by the noble Lord, Lord Silkin. I do not want to go into what happened yesterday, or indeed on earlier days, but I can assure the noble Lord that I made the fullest possible inquiries and received information which led me to suppose that there was no need whatsoever for us to sit later last night. That was why, at the time I did, I moved, "That the House do now resume." And to be faced to-day by a protest, on the ground that there is too much work for to-day and Thursday, I must confess somewhat astonishes me, in the light of the information that I was given last night.
LORD WILLIAMS OF BARNBURGH: My Lords, are we to understand then from the Lord Chancellor, when he thinks that Tuesday and Thursday will be, sufficient to deal with over 100 Amendments, that he expects and suggests, by implication, that members of the Opposition should either not talk at all or, if they do any talking, should be very brief? And if they do not either cease talking or speak very briefly, then the penalty he intends to impose is to compel them to sit throughout the night or at least as long as the Lord Chancellor thinks they ought to?
THE LORD PRESIDENT OF THE COUNCIL AND MINISTER FOR SCIENCE (VISCOUNT HAILSHAM): My Lords, I think I must say that nobody can compel this House to sit. It is for the House itself to decide.
EARL ALEXANDER OF HILLSBOROUGH: That sounds a little better. Surely, also we are part of the House, and we usually have the courtesty of considering what are the limits to which the House can go on a particular matter. I must say that, with an Opposition in a small

721
minority, if there is a change of Government and it goes the other way round we shall have to learn our lesson from this, and see that we take steps at least to be equal in power to this unelected great majority opposite, who blindly follow a Government which impress their will upon us. We must consider the whole future of the Chamber.
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD MERTHYR in the Chair.]
Clause 52 [Licensing of theatres, public entertainments, etc.]:
LORD MORRISON OF LAMBETH LORD MORRISON OF LAMBETH moved, after subsection (3), to insert:
"( ) If at any time it appears to the Greater London Council that any club at which music and dancing or any other form of entertainment is carried on is not being conducted as a bona fide club which is restricted to the use of permanent members and their guests, or that it is being conducted as a place of public resort, then that Council may make a declaration accordingly, and thereupon the provisions of Schedule 12 to this Act, except paragraphs 4 to 6 thereof, shall apply to that club."
The noble Lord said: We have just had an inevitably lively period, which I think was justified, so far as this side of the House was concerned. But I hope that the Committee can bring itself to the state of mind of considering, in relation to this Amendment, a real and important problem which exists in London, particularly in the district of Soho—because this is not a Party matter at all. It is a moral question, largely, and a question which affects the welfare of our city and of our country, and the opinion of the country in the eyes of foreigners, people from the Commonwealth and others from abroad. I refer to the problems related to the occurrence of certain bodies in the Soho district which are in the nature of so-called private clubs, which really are not always to the credit of London, the capital city of our country.
I understand that these places are not subject to public supervision if they do not sell intoxicating liquors, or if they are private clubs. Therefore, it is said—and it is true—they are outside effective control. This Amendment may or may not be perfect in drafting, but it is the idea that I want to put to the Committee and it is the idea upon which
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I should like the Committee to vote. If there is imperfection in the drafting, that can easily be put right by the Home Office and the Government draftsman and brought forward later. The Amendment begins:
"If at any time it appears to the Greater London Council…"
That brings in an element of elasticity in timing and gives the Council control as to when they thought it was time something was done about it. Then the Amendment says if it appears
"that any club at which music and dancing or any other form of entertainment is carried on is not being conducted as a bona fide club which is restricted to the use of permanent members and their guests, or that it is being conducted as a place of public resort, then that Council may make a declaration"
which would bring the provisions of the Schedule into effect. I myself am not quite sure about the drafting, on the point that sometimes these clubs are not run ostensibly as places of entertainment. There are forms of entertainment that can take place there which would not be looked upon with favour by the law. We feel, therefore, for the good name of London and of Britain, that something ought to be done about it. Indeed, there are a number of Continental people, and some of our own countrymen, who now say that this part of London is the most disreputable place to be found in Europe. I do not know whether or not that is true, but it is being commonly said.
I do not bring up this matter because I am anything in the nature of a strict Puritan. I should not like England to be run on the strictest puritanical lines; but I think that this part of London has gone over the limit. I say that as one who has an attachment to Soho, not only because I work there but because I always have felt that way. It has many nationalitites there, with people of all colours; it has all sorts of restaurants, most of which—in fact, nearly all of which—are well conducted and well run; and it is a very interesting part of London. It is partly because I like Soho that, with my noble friend Lord Shepherd, I have tabled this Amendment.
The kind of things that are going on are striptease exhibitions. Not only are there exhibitions of striptease, but there are large posters outside at least one place, showing a woman near enough

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naked, for the purposes of attracting in passers-by. I think they are nominally made members of the club when they pay, and consequently the place is without public control or public supervision. There is at least one cinema—and here I declare an interest as President of the British Board of Film Censors—where the films shown have either been condemned by the censors or amended, but where they appear in their raw state. I have never been to it. I have never been to a striptease show, either. I do not see any reason to go, especially to the cinema, because I see all the films, such as I censor, in their raw state, anyway, and most of the so-called naughty ones I find thoroughly boring. But they are exhibited without any censorship control over them at all. I am told that the gentleman who runs one of these places is not a bad chap at all, and that the shows might be worse; but surely it is unfair to the ordinary licensed cinema that it should be subject to competition under conditions in which the other cinema is free to show what it likes, whereas the ordinary cinema is subject to some degree of public control.
Then there are institutions known, I am told, as "clip joints", where women have a custom of standing outside attracting visitors inside for the purpose of taking light refreshments and being entertained in some way or another. In some of these places alcohol is not sold: in some, it is a question of gin and orange, with perhaps a little touch of alcohol, for which they may pay 10s. 6d. a time. Of course, the existence of these places opens up the possibility of their use for improper purposes; and, in any case, if foreigners, Commonwealth citizens or people from Britain, including the provinces, come here and innocently drift into one of these places, they may find themselves badly shocked and it is not for the good name of London or of the country that that should be so. There are also some very small clubs, conducted in backrooms, which, because they are private clubs, are not subject to public supervision. I think that this is wrong and bad.
I assure the Committee that there is a lot of feeling about this question among Londoners, provincials, Commonwealth people, foreign people and
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so on. What I would ask the Committee to do is either to approve this Amendment in principle, subject to redrafting by Government experts, or to say that we should have an undertaking that a suitable provision will be brought in at Report stage. But I think it is important, when this new form of local government is being set up, that powers should exist whereby these things can be dealt with. If I may anticipate a possible argument, that it could be dealt with by the London borough concerned—namely, the City of Westminster—I would say that I think that would be unsatisfactory, for this very simple and more or less obvious reason. If the City of Westminster were to descend upon these people, there is nothing to stop them from moving into Chelsea or Kensington; and then it would be necessary to legislate all over again. So I think it is more appropriate that this matter should be dealt with by the Greater London Council, which, under the Bill, is also the authority responsible for issuing licences for cinemas, public music, dancing and so on.
There is one other point I ought to mention. It could be argued that this job would be better done by the police than by the Greater London Council, which is a local authority. I have a great respect for the police, as indeed we showed yesterday, all of us on both sides; but I think the police would be a bit nervous about dodging into these places, even if they had the power. I dare say the case of Lady Chatterley's Lover may have made the police a little apprehensive about starting prosecutions. They have become somewhat nervous, in case they get themselves into controversial bother or are defeated in the courts, which naturally they do not like. So I do not think that the police would welcome it, and I think that, owing to this apprehension on the part of the police, we might not get so effective an administration as is desired. As music halls, many theatres and cinemas are already under the control of local government, it is appropriate, I think, that this service should also be under the control of local authority—namely, the Greater London Council.
As I have said, this is not a Party political question: it is a moral question. It is one of those things in which the noble Viscount the Leader of the House

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often exhibits a worthy interest, even during our economic debates. And he is right to bring tie moral factor forward: this is a moral question. But it is also a question affecting the good name of London, possibly in a small way our tourist business, and the good name of our country. I very much hope that the Amendment, or at any rate its principle, will commend itself to the sympathy of the Committee. I beg to move.
Amendment moved—
Page 70, line 32, at end insert the said subsection.—(Lord Morrison of Lambeth.)
2.40 p.m.
LORD SHEPHERD: I rise briefly to support my noble friend because I have one or two points should like to put to the noble Earl, Lord Jellicoe. At the moment I am not particularly interested in the morals of the people who will go to these strip-tease clubs; I am concerned about the effect of that type of club on the local area. One can see the general standard going down very much, not only in London, but in places like Hamburg or Paris, where there is a very serious effect, not only upon the reputation of the city in the minds of passers-by or visitors, but also upon the men, women and children who must live in the same streets as this type of business.
I would put this point to the noble and learned Lord who sits on the Wool sack, because here, I think, we are involved in a problem of law. As I understand it, a club can be set up to-day so long as it has bona-fide permanent membership. The only licence it requires is that for the sale of alcohol. I think it is true, from what emerged when we were debating in your Lordships' House the licensing of clubs, that the feeling in Parliament and outside is that a member of a club should be entitled to some privilege; we should not wish a policeman or an inspector to come regularly into the premises to see what is going on. As a member of a sports club myself, I can, in some ways, well understand this. But these strip-tease clubs are clubs only in name. I do not believe that a case could be made that they have a permanent membership. If we could obtain a definition of what is a permanent member of a club, or how it becomes a club through permanent membership, we could then
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make a great stride in dealing with these so-called clubs that exist in London.
I think it is quite clear, from information I have had from the authorities, that the majority of the people who go to these so-called clubs are not the local residents; they are, in the main, visitors from overseas to London and, I am afraid, also those business men of London who have to entertain clients. These people, obviously, do not come within the classification of permanent members. Therefore, if we could find some way of defining the permanent member of a club we should be making a great step forward. As I understand it, during 1962 the London County Council took proceedings on the conduct of clubs. I think it was 34 in 1962 and 49 in 1963.
EARL JELLICOE: It is 51 in 1963.
LORD SHEPHERD: I will accept 51; it is a higher figure. No doubt there could have been more prosecutions if there was not so much difficulty in obtaining the information; and my noble friend, Lord Morrison of Lambeth, spoke just now of the problem of the police in this connection. The police are reluctant to do the under-cover type of investigation in which they would be involved. It does not give the police a good reputation when a sergeant, a constable or another rank has to come into court and give evidence that he has been to this or that club; that he has gone in as an ordinary member, has broken the normal laws of becoming a member of the club. He has to say that he has spent large sums of public money in entertainment and in buying drinks for himself and for lady friends. This does not give the police a good reputation.
Again, I would suggest that if we could deal with this definition of permanent membership then we would make it possible for the police to go into clubs that clearly do not come within the definition of permanent-membership clubs. The point I would put to the noble Earl, Lord Jellicoe, is that at present the London County Council can take proceedings in regard to the conduct of clubs only on the question of a licence; that a licence should have been obtained for the type of entertainment that is being provided. The fine is a mere £100. The Bill will raise this to £200. I would have thought that the maximum fine for this type of

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conduct should be a deterrent fine; it should be a great deal higher—if in the judgment of the magistrate (or perhaps a higher court) the circumstances were such as to deserve it, the court should be able to impose a much higher fine than that proposed within this Bill. Obviously, the magistrate or judge could use his discretion, but in the past—and certainly last year—I think in well over 90 per cent. of the cases the maximum fine was imposed; but clearly it was not a deterrent.
Therefore, I would suggest to the noble Earl that he should consider the raising of the maximum fine in the Schedule to a figure which would be a deterrent one. I come back to the first point I made. I am not concerned with the morals of people who go to these clubs; that is their own affair. What I am concerned about, and I am sure the Committee would also be concerned about, is the effect upon the people who live in the vicinity of these clubs. If this is a free world, a free society, we should see that the people who live in these streets are free of this vice and menace.
EARL JELLICOE: I would certainly agree with both noble Lords that this is a real problem and a completely non-Party problem. I think we should all wish that London, as the capital city, should set and maintain a certain standard. We all have its good name very much at heart. In these matters we all have personal standards; nevertheless, I should have thought that certain types of nude entertainment and certain types of "strip joint" clubs fall below our own personal standards. That said, I would briefly outline the problem as I see it. There are two problems here. In the first place there is the genuine club, the bona fide club, which complies with all normal club requirements, but yet, perhaps, on occasions lends itself to or pursues indecent or lewd entertainment. I think it is fair to say that there was, in the last two or three years, something of a rash of that type of thing in London. But here the Common Law bites. For example, it is an offence against the common law to keep a disorderly house. Although there is no statutory control directly over entertainments provided in genuine clubs, there are these other means of taking action against such clubs where undesirable or objectionable entertainments are laid on.
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In the past few years a number of successful prosecutions have been launched against such clubs. There was a club called "The Keyhole Club" which laid on such entertainment. It was prosecuted and the proprietor was fined £2,600. To pay his fine, he laid on even lewder entertainment, and as a result he is now in prison. From such inquiries as I have made, I understand that the police are of the opinion that they have this type of problem under control as a result of the successful prosecutions which have been made in the last year or so.
The second problem is the club which is not a bona fide club, which pretends to be a club but is not, and which produces what is really public entertainment of one sort or another. We have in mind the problem with which the noble Lord was mainly concerned—the sleazier type of Soho "joint". As I understand it, noble Lords opposite feel that there is a loophole here in the Bill and accordingly the Amendment provides that if it appears to the Greater London Council that any club in which this sort of thing is being carried on is not conducted as a bona fide club, or that it is being conducted as a place of public resort, the Council should then be able to make a declaration to that effect and deal with the club concerned under the provisions of the new Schedule 12. I would suggest, however, that the Amendment adds nothing to the powers already included in the existing Schedule 12.
If a place which provides entertainment admits members of the general public, notwithstanding that it calls itself, or professes to be, a club, it is then being used for purposes of public entertainment, and automatically paragraph 1 of Schedule 12 will bite and the club will be liable to prosecution for not having obtained a licence for public entertainment. Whether or not the public is admitted is a matter of easily ascertainable fact, and the noble Lord, Lord Shepherd, himself produced statistics which showed that it is reasonably easy to ascertain this: the 34 successful prosecutions initiated by the L.C.C. in 1962, and the 51 successful prosecutions in 1963 up to now—and we are only halfway through the year. Therefore, it would appear that in practice not only are prosecutions being successfully launched and maintained in this area but

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also, whatever the intention behind the noble Lord's Amendment, it would not increase our powers, because it would not enable us to do anything more than we are at present able to do.
In answer to the specific suggestion made by the noble Lord, Lord Shepherd, for a possible increase in the range of penalties, I would say straight away that this is an interesting suggestion, but I would remind your Lordships that already penalties under the Bill have been raised once. In another place, the Government accepted an Amendment to raise the maximum penalty in this field from £100 to £200. I would also remind your Lordships that, so far as monetary penalties are concerned, the normal maximum in magistrates' courts is £100, though we have departed from it in this instance. As I am advised, if one wishes to "up" the fines one proceeds by the hybrid method of taking a prosecution to a more senior court. It is, I think, for consideration whether we should wish to introduce this second tier, where prosecutions would be launched for what at least on the face of it, would be only technical offences against administrative provisions.
That is the problem here. But having outlined the problem; having said that I do not think the noble Lord's Amendment would help us, because it does not reinforce our powers having touched on the question of penalties, I would add that I, at least, have an open mind on this subject, and I should very much like a chance, subject to what my noble and learned friend the Lord Chancellor may have to say, of reconsidering this particular problem in the light of what the noble Lords, Lord Morrison of Lambeth and Lord Shepherd, have said.
BARONESS WOOTTON OF ABINGER: I am very glad to hear the noble Earl say that he might contemplate some increase in the penalties, because this is a practical problem. I myself have heard a great many cases of clubs of this kind. The noble Earl has referred to the number of successful prosecutions, but I think that he would need to have in mind that successful prosecutions are often successive successful prosecutions against the same defendant. In my petty sessions we have sometimes beer obliged virtually to hold special courts in order to hear cases repeatedly against the same defendant. It is quite obvious that at the moment the
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law is farcical, that it is constantly defied and that the penalties are not a deterrent.
LORD SHEPHERD: May I put one point to the noble Earl, Lord Jellicoe? The L.C.C., as licensing authority, will not license a strip-tease performance. Therefore, these strip-tease shows are being held in premises under the guise of clubs. I think that the noble Earl's Office will give him the information that the members of these so-called clubs are not permanent club members, as we understand club membership. They are passers-by who merely use a loophole in the law to pass themselves off as members of a club. Therefore, I would say that my Amendment goes a stage further in the matter. If it became known that any club carrying on strip-tease or indecent performances was clearly a club to which the public resort—and the noble Earl must know that there are many in the Soho district which have advertising material outside, not only pictures but neon lights, to entice the public—and so would come within the province of Schedule 12, then the Greater London Council could refuse a licence and close down the club. That is my understanding of it.
THE LORD CHANCELLOR: The noble Lord has referred to so-called clubs. As my noble friend pointed out, here we have really two problems to consider. First, there is what is called in the Amendment a bona fide club, which is rather an odd description for this kind of club. That means a genuine club, and where there is a genuine club the Amendment does not touch the position, even though there may be indecent performances inside the club. That is a police matter and can be dealt with under the ordinary law. The Amendment does not touch what I call the genuine club.
So far as the so-called club is concerned, where members of the public can easily resort to it, although it is called a club, it is a question of fact. It is pretty easily established that it is a place of public entertainment, although it may be called a club. That depends on the evidence and, as the record shows, there have been a large number of prosecutions for running this sort of so-called club, when in fact it has been a place of public entertainment to which members of the public resort. I doubt whether the law is unsatisfactory in that regard,

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having regard to what has happened in the last two years. However, whether the law is adequate or not, this Amendment does not alter the law in relation to the so-called club, because the powers to deal with what the noble Lord calls the so-called club exist already and are not enlarged by this Amendment. Schedule 12 will bite in relation to this class of premises.
LORD MORRISON OF LAMBETH: Can the noble and learned Lord say whether Schedule 12 changes the existing law?
THE LORD CHANCELLOR: I do not want to be drawn too far into that at the present time, for the simple reason that we are not discussing Schedule 12. We are discussing the noble Lord's Amendment. We are not discussing penalties, because they are not touched on in this Amendment.
I appreciate what the noble Baroness said about being troubled with the same person being brought before the courts more than once, and I will certainly give consideration, with my noble friend, to the question of penalties, which, as I say, does not arise on the Amendment. There are arguments that can be advanced (I will not go into them) in favour of not making this kind of offence triable at quarter sessions or assizes and not, therefore, giving the accused persons the right of election to go for trial. That ordinarily places a limit upon the amount of the fine imposed. I do not think it would be useful to discuss that aspect further at this juncture.
I appreciated the way in which the noble Lord, Lord Morrison of Lambeth, moved this Amendment. I should like to ask him if he would be good enough to withdraw it, on the understanding that, while I cannot enter into any commitment with regard to it, I realise it is the general feeling of the Committee that the law here should be made as positive as it can be. I should like another opportunity of considering whether any improvement can be made which would meet with your Lordships' wishes. But this Amendment will not—and I think the noble Lord, Lord Morrison of Lambeth, realises it—secure the object he desires. I would ask him to withdraw now, and I can say
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that I will certainly consult with my noble friends to see whether we can tidy up this small section of the law in some degree.
3.2 p.m.
EARL ALEXANDER OF HILLSBOROUGH: I am obliged. May I say "Thank you" to the noble Earl who spoke in response to the submissions of my noble friends Lord Morrison of Lambeth and Lord Shepherd. I fully appreciate what has been said about those cases which can be on the ordinary basis of police action, fines and the like. But it has occurred to me, from the submission of my noble friend Lord Morrison of Lambeth to the Committee in respect of this Amendment, that he has something wider in view, and I began to see a little glimmer through the Lord Chancellor's speech that he probably apprehends what my noble friend is after. Here is a Bill dealing with the local government of Greater London; here is something which in a moral sense does not bring a good name to London, and here, if this Bill becomes a Statute, is probably the greatest authority as a whole for the London of the future.
What is really needed in a case like this? We do not want to interfere with the law of the land; we want to interfere with the sort of thing that is done on the side from the ordinary law, by people adopting every possible method to try to escape the penalty under the law, and at the same time constituting a real menace. I see the noble and gallant Viscount, Lord Montgomery of Alamein, here. It is the sort of thing that we do not want our young men in all spheres, and especially in the Services, to suffer. When they come up for an earned night of entertainment, we do not want them to be taken into the wrong kind of place like this. What we want is to have powers in in the new authority to be set up under this Bill, not to take action in this court, that court or the other court, but by some process of licensing to close these clubs altogether.
What I want to know from the Lord Chancellor, before my noble friend Lord Morrison of Lambeth replies to his offer, is this: how far will his inquiries go, and what sort of results will he see? If my noble friend withdraws the Amendment, will the Lord Chancellor look far enough and wide enough to see that we

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really have a chance, under the legislation finally to be passed, of stopping this particular menace altogether. That is what we want to do, and if the noble and learned Lord can give us some reassurance like that, I am sure my noble friend will respond.
THE LORD CHANCELLOR: I should be very bold to give an assurance that we should be able to pass legislation which would prevent any offence of this kind from being committed in the future. After all, one has tried to stop people from being fraudulent by passing laws, but it does not always work. I would say, in answer to the noble Earl, that what I should be concerned about are three aspects. The first is detection and prosecution—and detection is a matter for the police. Whether a place is a club "so called" depends really on the evidence available. As to that, I should like to make inquiries from the police to see whether they experience any difficulty in establishing that a place which is a so-called club is really a club. The second aspect I should wish to consider is the proper range of fines.
Thirdly—and the noble Earl touched on this—I want to see whether in some way one can prohibit the same individual from starting the same thing up again. That, I think, is a matter of great difficulty, because the so-called club is started up without a licence, when it should require one. I do not see at the moment a way in which somebody can be stopped from starting up a so-called club in breach of the law. However, I should like to look at that. I appreciate that the feeling of the Committee is to try to put real teeth into these provisions, to make sure that, if we cannot secure complete prevention, at least the penalties are sufficient to be an adequate deterrent. I cannot go further than that at the moment, as I am sure the noble Earl will agree, but I certainly want to look at the problem as a whole.
THE DUKE OF ATHOLL: Would my noble and learned friend also look at the so-called clubs which work rather the opposite way? Outside they promise you untold pleasures and vice inside, and when you get in all you do is to pay three guineas for two orange juices and half an hour's conversation with an unattractive and ill-educated female.
THE LORD CHANCELLOR: No, I cannot undertake that task. I think the man who pays his money for that and is disappointed in consequence has incurred his own fine.
LORD MORRISON OF LAMBETH: On that I am pleased to agree with the Lord Chancellor. Nevertheless it shows that there is money to be made out of this business. There are a few points that I should like to mention on the Amendment. I think the Lord Chancellor was a little unkind, if I may say so—not spitefully, but he was not forthcoming enough—because I admitted at the begininng that probably the Amendment was not perfectly drafted. That is a clean "let out" for me, and it should not be taken advantage of, because this is a difficult thing to frame. Therefore I cannot be blamed if the Amendment is badly drafted, because I am not good at doing things like this. I was a Minister for a long time, and I had these things done for me. So long as I told the draftsman clearly what I wanted, then it was done.
The noble Earl, Lord Jellicoe—or it may have been the Lord Chancellor; it was one of the two speakers from the Government Front Bench—said that the police are broadly satisfied that it is under reasonable control. But I do not think they can be, for the very reasons that the Lord Chancellor has kindly given about the number of places in which authority can be evaded and walked round, and about people being difficult to catch. But if the police are broadly satisfied, then that rather confirms my belief, not that there is anything wicked about the police in this matter, but that they do not want to be unduly troubled with it. It is admittedly a troublesome matter, and the police are always worried about their relations with the public.
The noble and learned Lord the Lord Chancellor said that there is nothing new in the Amendment and the existing law covers it. That is another way of saying, as I think he will agree, that the existing law must be inadequate to deal with the problem, because of these "jolly old strip-tease clubs" (if they are jolly; and I doubt it) in Soho. They go on and on-and so do other clubs, and the police do not seem able to close them or get ad of them. Therefore, there must be

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something unsatisfactory with the existing law and a need to change it. In any case, let the Government get to work on redrafting my Amendment, or producing an entirely new one which will be adequate from their point of view. But there must be something wrong with the existing law, whether it be the law affecting the police or that concerning the London County Council, because these things are going on.
I should prefer the responsibility to be given to the Greater London Council, through what I imagine they will call the Public Control Committee—because by the rejection of our Amendment on the merging of the police forces we have lost the chance of giving them a watch committee. They will deal with a number of things. The procedure is very fair. I do not think I ever sat on the Public Control Committee, but I have seen it in action. I have been to their public hearings. A charge is brought against a licensee by the chief officer or the solicitor of the Council, and it is heard by the Committee. The accused licensee is then competent to appear, either in person, by counsel or by solicitor, and I have seen very important counsel appearing at those hearings of the Public Control Committee.
THE LORD CHANCELLOR: The noble Lord is dealing with a case of a licensee who is abusing his licence?
LORD MORRISON OF LAMBETH: Yes.
THE LORD CHANCELLOR: The problem here is the man who had no licence at all.
LORD MORRISON OF LAMBETH: I am saying that such people ought to have a licence—that is the whole point. They ought not to be allowed to function without a licence from the Greater London Council. They can be heard by counsel (and I have seen Curtis-Bennett the elder, and the younger, I think, appear before that Committee; so the licensees have plenty of chances of defence, which is right, if they have the money to pay) or by solicitor or by themselves. At the end of the hearing the Committee give their decision. It may be a warning; it may be a temporary suspension of the licence, or even a total abolition of the licence. That goes for
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the premises as well as the man. That is an adequate and fair judicial procedure, and I feel it is better than a court procedure because this is a matter in which morals and public policy—in the best sense of the term—arise. Law ought to come into the matter, but other things are needed as well. Therefore, I believe that the best remedy is through the Public Control Committee which can revoke the licence of the premises altogether—and these clubs should not be able to open without a licence.
As I have said, this is a moral question. I do not want to rub it in about the Bishops too much, but this is eminently a matter upon which I feel the Bishops could have been helpful to us. Having said that, I leave it. I tried to draw in the noble Viscount, Lord Hailsham, who I know is keen on moral aspects, even in economic debates. But he has left us, so we are left with the Lord Chancellor. He has done his best about the morals of the matter, but he has done more about law.
LORD HAWKE: It would be easier for Bishops to attend at specific times if it were possible to stick more closely to the proposed timetable.
LORD MORRISON OF LAMBETH: We can elaborate a timetable if that is what you want, but it will go well beyond Whitsun. Why try to be controversial, which is just the thing I am trying not to be? The Lord Chancellor said that they will give real consideration, not only to the police aspect, but to the possibility of using the local government Public Control Committee. I know that he cannot commit himself. He admits that there is a real problem, and has undertaken, without commitment, that they will give it real consideration, to see whether something can be done and to put it on the Order Paper for the Report stage. That is right. We also, of course, are free to nut something on the Order Paper for the Report stage.
I hope that the Government will take this matter seriously. I am sure that any Government, with all the legal knowledge they have, with all the skill that the Parliamentary draftsmen have—for which they never get enough credit in the public mind; they are pretty wonderful—if they wished to have something done about this could get it done. They have the technical means and, moreover,

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they have the Law Officers of the Crown and the Lord Chancellor. I am never sure whether the Lord Chancellor is a Law Officer of the Crown, or something superior. I think they could do something, and in view of the undertaking—not a binding undertaking—I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 52 agreed to.
Clause 53 agreed to.
Clause 54 [Food drugs, markets and animals]:
3.17 p.m.
LORD SHEPHERD LORD SHEPHERD moved, in subsection (1), to leave out "council of a London borough" and to insert "Greater London Council". The noble Lord said: On behalf of my noble friend, I beg to move this Amendment, and also those up to No. 207. I would say that we regard Amendment No. 206 as the main Amendment. Clause 54 lays down the provision that a London borough shall be the authority with regard to the Food and Drugs Act, 1955, the Slaughterhouses Act, 1958, the Slaughter of Animals Act of the same year, and, for some peculiar reason, that the Common Council of the City of London should be the authority in regard to the importation of animals under the Diseases of Animals Act, 1950.
The purpose of my Amendment and that of my noble friends is to see that the authority for these closely connected and important duties should lie with the Greater London Council. The Molony Committee, which no doubt the noble Earl will remember, recommended that the administration of food and drugs, together with the Merchandise Marks Act, should be tied or co-ordinated with weights and measures, and that these functions should reside with the largest unit of local government. I think it is right that the Molony Committee considered that type of authority to be that of a county status and not of a borough. We believe that the weights and measures and the food and drugs legislation, upon which consumer protection is largely based, depends upon enforcement. In our view—and I think this view is shared outside this Chamber by those connected with consumer protection—enforcement
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is best done by a large authority able to use its inspectors and to switch them from one area to another so that, above all else, shopkeepers and the like are not aware of who is an inspector and, therefore, have to be more careful with the way they conduct their business. There is the other tremendous advantage that you will be able to obtain a uniformity of standard.
I would ask the noble Earl whether he can conceive, under the provisions of this Bill, in the question of weights and measures or other matters, how 32 boroughs, each with its own inspector—because that is what the position will be—and, of course, its own local authority, will be able to produce a uniform standard right through the area. It may well be—and we deployed this argument in the weights and measures debate—that one borough would insist on a particular standard, and another borough would be quite satisfied with another. Obviously this may well put shopkeepers at some advantage or disadvantage. I should have thought that the Government would accept the special need for uniformity in this matter. In fact, they themselves accepted this—I think the noble Lord, Lord Hastings, will remember—in the Offices, Shops and Railway Premises Bill, when they inserted a clause to set up a central administration of inspectorate to ensure that local authorities throughout the country would maintain the right standards in relation to the offices and shops.
So far as I can see, if the Government proceed with their idea of having 32 different authorities dealing with consumer protection—that is, weights and measures and food and drugs—they have no organisation here to see that there is uniformity in its enforcement and also its standards. I do not know whether the noble Lord, Lord Hastings, can give us any idea how the Government propose to obtain that uniformity. I am sure that it is their wish that it should be so, but there is nothing within this Bill, as I see it. I ask the noble Lord why is it that the Common Council of the City of London is the authority in regard to the disease of animals in respect of the importation of animals? Is it because the City of London is the borough health authority for London?

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But then, surely, meat is imported through other ports than London. Meat comes to Southampton. It does not necessarily come into Smithfield, but it could well be distributed within the Greater London area. Is the noble Lord then going to suggest that the City of London's inspectors will be travelling and inspecting the importation of meat in places like Caterham or Epsom? I cannot believe that is so.
Therefore, we come back to the point that I was endeavouring to make at the beginning: that we should ensure in regard to consumer protection that there should be one strong authority. We have had that in the past in the London County Council, although I agree that it has been subdivided down, into, I think, ten divisions. This has given a degree of flexibility, yet it has given central control and this degree of uniformity. But the Bill as we have it in front of us will not give us that uniformity.
I would ask the noble Lord how he anticipates that the boroughs themselves will be able to provide veterinary officers for dealing with the disease of animals? At the present moment the Middlesex County Council and the London County Council have their own veterinary officers who are in close contact with the farming industry, as it is necessary. But under this Bill the local borough becomes the authority. Are we therefore to expect that each borough will employ a veterinary officer?—because that is what would appear necessary if an authority were to do its duty under this provision. I believe that there is a shortage of veterinary officers willing to perform this duty, but, at the present time, because of the central authority, the task has been able to be spread over a wide area. But if you concentrate it into watertight responsibility in the boroughs, you will find there will be some boroughs with a veterinary officer and some without. In the interests of all, and because in the question of the control of disease one cannot afford to have some areas uncovered by veterinary officers, and because to ensure that a whole area is free one has to be satisfied that a proper service is provided, I do not believe that the service can be performed
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on this narrow, borough basis. I beg to move.
Amendment moved—
Page 72, line 13, leave out ("council of a London borough") and insert ("Greater London Council").—(Lord Shepherd.)
3.25 p.m.
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (LORD HASTINGS): This series of Amendments which the noble Lord, Lord Shepherd, has introduced, bring into the picture several different Departments—the Board of Trade, Agriculture, Health and the Home Office—but it was thought perhaps that I should try to embrace all these subjects in an opening speech to give the Government's general view as to how these matters should be dealt with as between the Greater London Council and the London boroughs. In fact, I think we shall find as we go on, that there are more Amendments to which the noble Lord has not specifically referred which relate to the same subject, and we shall find ourselves dealing with two aspects of the same matter under Clauses 54 and 60. In this Clause 54, the Government are dealing specifically with food and animals, two subjects which are at times dealt with jointly by the two Ministers responsible. In Clause 60, we shall be dealing with other enactments, one or two of which the noble Lord is wishing to import into Clause 54, such as the Pharmacy and Poisons Act. In both clauses, however, the Government are proposing to give these powers and functions to the London boroughs. Noble Lords opposite wish to turn Clause 54 into a Greater London Council clause in respect of the matters which they have mentioned, and to take out of Clause 54 certain things which are now in it, and put them into Clause 60, which would then deal with the powers of the London boroughs. I think that that is the general picture.
As a result of that somewhat confusing interchange between the two clauses, we find that we have no disagreement about Parts III and IV of the Food and Drugs Act, and no disagreement about the Slaughter of Animals Act and the Slaughterhouses Act, both of 1958. What we do disagree about are the Food and

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Drugs Act, 1955, except for Parts III and IV, the Pharmacy and Poisons Act, 1933; weights and measures enactments and the Diseases of Animals Act, 1950; and, later on, my noble friend Lord St. Oswald will deal separately with the Performing Animals (Regulations) Act, 1925, the Amendment concerning which is going to be moved by the noble Lord, Lord Walston.
May I deal with these four Acts, and just give your Lordships a picture of the present situation? Because we must know what that is if noble Lords opposite wish to transfer these powers to the Greater London Council. Under the Food and Drugs Act the functions of a food and drug authority, of course, consist of the enforcement of provisions relating to the composition, labelling and description of food and of milk, including the duty to appoint a public analyst. The Act lays the duties of a food and drugs authority on county boroughs—this is the present situation—metropolitan an boroughs (I draw your Lordships' attention to this) the City of London as well as non-county boroughs and urban districts with a population of 40,000 or more, unless the Minister gives special directions; and, if a special direction is given by the Minister of Health, then even boroughs and urban districts with a population of only between 20,000 and 40,000 may be given these powers.
In respect of other county districts, the only food and drugs authority is the county council. Middlesex, of course, is in a special position and it exercises all the powers in the County of Middlesex in respect of food and drugs, but that is because there were so many boroughs and urban districts of over 40,000 in Middlesex that if all were given powers to which they were in fact entitled the county would not have been left with enough to do and they would not have been able, because of the location of the remaining districts aid their size, to perform their job efficiently. That is the only reason Middlesex County Council had powers throughout their whole territory.
There are at present no fewer than 64 food and drugs authorities wholly or partly within the Greater London area, including the metropolitan boroughs and the Common Council of the City, as I have said. They have been, in spite of that, extremely effective. In this case we shall of course be reducing the number
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of authorities. There will only be 32, or 33 if the City is included. One of the specific recommendations by the Royal Commission on London Government was that these functions should be given to the new London boroughs, and that the Greater London Council should not inherit the concurrent permissive powers to institute proceedings which the London County Council have at present. I am informed that these concurrent powers to institute proceedings have hardly ever been used by the London County Council. I think that is so. So there the situation will be, from the point of view of noble Lords opposite, considerably improved by what the Government are proposing to do.
May I turn now to the weights and measures enactments? Surely we must discuss on the Weights and Measures Bill, which of course is in process of going through your Lordships' House, what authorities shall exercise functions in this respect. When and if the Weights and Measures Bill itself becomes law, it will, of course, be the basic instrument governing the designation of weights and measures authorities throughout the country. The present weights and measures authorities under existing weights and measures enactments are county and county borough councils, and the Common Council of the City of London. The Bill provides that outside the London area counties and county boroughs, non-county boroughs and urban districts with a population of only 60,000 or over shall be weights and measures authorities. It is the intention of the Board of Trade, if this London Government Bill goes through Parliament, to make the London boroughs weights and measures authorities, since there seems to be no reason, if there are to be urban districts and county boroughs, and even non-county boroughs, with a population of only 60,000 enjoying these functions, why the London boroughs also should not do so. This again was a recommendation of the Royal Commission, and one with which we agree. I will just add here that orders made by the Board of Trade designating these authorities in the Greater London area will be subject to annulment by Parliament, so that Parliament will have the final decision.
In respect of the Pharmacy and Poisons Act, the local authorities responsible in this field in the Greater London

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area are the Common Council of the City and, again, the metropolitan boroughs in the County of London; and elsewhere they are the county councils and county borough councils. It seems that the decision to give responsibility for functions under this Act to the London boroughs is based on the principle of ensuring that they do most of the detailed day-to-day work, and also on the present responsibility of the metropolitan boroughs under the Act.
I come, finally, to the Diseases of Animals Act. The noble Lord made particular play with the figure of 32 or 33 authorities that will be dealing with these functions under the Bill. There are, in fact, at the moment 20 different author-ties in the Greater London area, so I admit there will be an increase, but not a very substantial increase. There are 20 different authorities. They are the counties and county boroughs in the area, the Common Council of the City and, curiously enough, 10 boroughs with populations over 10,000 and dating as far back as 1881. I have the list of the 10, but, unless requested, I do not think I need bore your Lordships with the names.
Despite this apparent fragmentation of the Greater London area in respect of the Diseases of Animals Act, we find that enforcement, which the noble Lord particularly mentioned in his speech, is satisfactorily carried out both by the county boroughs and by the boroughs which have these powers, and we do not think it necessary, or even reasonable, to pass this work to the Greater London Council. The City of London has a special responsibility, as the noble Lord pointed out, for dealing with imported animals within the L.C.C. area, and those functions are linked with its powers as port health authority. Under Clause 41 of the Bill these are to be continued.
From that résumé of the present position I think your Lordships will see that the food and drugs authorities are normally the boroughs, with the special exception of Middlesex, as I said. In weights and measures matters, responsibilities are given to counties and county boroughs. Local authorities responsible under the Pharmacy and Poisons Act are, inside London, the metropolitan boroughs, and elsewhere the counties and county boroughs. In broad terms, the
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authorities under the Diseases of Animals Act, as well as the Performing Animals Act, which perhaps I should not mention yet—I am anticipating—are counties and county boroughs. In every case we see that at present the county borough is the appropriate authority and that in two cases the metropolitan boroughs also have these powers.
That being so, I do not see how it can be argued that county boroughs and metropolitan boroughs do not do their jobs efficiently, or that there is any real argument on the ground of pure efficiency for changing what is virtually the present system. Therefore, we have come to the conclusion that it is the new London boroughs, as it is the county boroughs elsewhere, who should have these powers. There seem to us to be no special circumstances in the new organisation which could justify giving these functions to the Greater London Council. That is the general view of the Government in respect of these matters. If there should be any detailed points on some of these subjects which are the concern of another Department, I think one of my noble friends will probably answer it.
LORD WALSTON: I happily admit that the noble Lord has on this occasion made out a much stronger case in defence of the proposals than has been the case on some other matters. For all that, I am not by any means 100 per cent. convinced by what he has said. As I understand his argument, one of the major points is that since, in the past, this system has worked well with county boroughs and similar authorities elsewhere, there is no reason why it should not work well in this case as proposed. But I would point out, in the first place, that simply because something has worked adequately up to the present time, that is no reason why we should say we cannot make it work better somewhere else. After all, the Government themselves have taken that attitude about the L.C.C., which has worked adequately up to now, but they believe they have an idea which will make the system work very much better. So that argument I do not find very convincing.
Even if I did, there would be a second objection—namely, that many of these county boroughs need not necessarily be the ideal size, from the point of view

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of population, but because of geographical reasons they are the most satisfactory compromise between size and area. It would manifestly be foolish to give the officials responsible for carrying out some of these regulations such a wide geographical area that they simply cannot satisfactorily travel around. Therefore, it may well be arguable that it is right to restrict the population they would cover because of the area. That, in the case of London, does not follow at all because the area that has to be covered is not so great; it is here primarily a question of population density. But for all that, I see that there may be some argument for decentralising various functions—some of the food and drugs administration and fairly routine types of inspection.
But that does not deal with more important and more specialised problems which arise from time to time. There is, for instance, the occurrence of (shall we say?) something like anthrax, which takes place rarely but from time to time in certain areas of this country and—I am speaking without figures—I suspect to a greater extent in London than in most other parts of the country, with the possible exception of somewhere like Liverpool. Anthrax is not the sort of thing which you would expect an inspector in the normal course of his duties to come across more than once or twice in a lifetime in an ordinary area where it is not prevalent. Therefore, it is far better for him to have somebody who has far more specialised knowledge in the recognition and diagnosis of that particular disease, which can be achieved only by putting the administration of this particular regulation under the control of the Greater London Council rather than under the control of individual boroughs.
A similar argument might well apply to foot-and-mouth disease, which veterinary officers in country districts unfortunately come across rather too often, but which in the London area is a rare disease and which does not present itself frequently to the inspecting officers. In matters of that kind, it seems to me that placing the control and the implementation of the general orders emanating from the Ministries of Agriculture or Health, or whatever it may be, under central control would have far more efficacious results.
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I think it is worth looking overseas, to something which has recently happened which has some bearing on this—namely, the Zermatt typhoid epidemic. I have no doubt whatsoever that the health authorities in Zermatt were extremely com petent and efficient, but for all that, they were unable to contain this disease and it attained serious dimensions. It was only, I am informed, after the central authorities had come into the picture that this matter really came under control. I do not want to draw too close an analogy between Zermatt and the Swiss Government and the Greater London Council and the borough administrations, but I think we can learn from that that there are various diseases which may be extremely serious and which do not often happen but where an authority which has a wider experience is going to be much more effective in getting quickly on to the cause of a disease and preventing its spread than would be the case if it were left, at least in the initial stages, to the local authority. For these reasons, I believe that my noble friend's Amendment has sufficient substance to warrant supporting it, not so much in the interests of the fairly routine stuff which happens from day to day, but because of the more exotic and rarer types of occurrence which do not happen often but, if they do happen, may attain serious proportions.
LORD SHEPHERD: I listened to the noble Lord, Lord Hastings, with great care, and I am most grateful to my noble friend Lord Walston for coming to my support. I recognise the position that now exists in Greater London in regard to the dispersal of some of these powers. I hope I made it clear that what I wished to see was that, if the various provisions of the Food and Drugs Act and matters relating to diseases of animals and weights and measures, which are all part of consumer protection and consumer health, were brought under and administered by one authority over a wide area, they should be given flexibility and greater uniformity than at present exists. I am not in any way criticising some of the local authorities. Some are better than others; some could do a little more. But I still believe—and this is the burden of our case, not only on this Bill but on other legislation that has been before

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your Lordships' House—that where you are dealing with consumer protection there is more to be gained by a strong enforcing body than by having a large number of independent small boroughs, acting not always in a sense of uniformity or even of purpose. Therefore, I feel
3.57 p.m.
LORD LINDGREN LORD LINDGREN moved, in subsection (3), after "1950" to insert:
"and the Performing Animals (Regulation) Act 1925".
The noble Lord said: I desire to move Amendment 208 on behalf of my noble friend, and for the convenience of the Committee, and no doubt of the Minister dealing with it, we can take with it Amendments Nos. 209 to 211. Much of what could have been said on this group of Amendments has already been said on the previous Amendments, because, strangely enough, the regulations
that in the circumstances I must press this Amendment.
3.47 p.m.
On Question, Whether the said Amendment (No. 202) shall be agreed to?
Their Lordships divided: Contents, 26; Not-Contents, 72.

CONTENTS

Addison, V.

Latham, L.

Silkin, L.

Alexander of Hillsborough, E.

Lawson, L.

Summerskill, B.

Attlee, E.

Lindgren, L.

Walston, L.

Burden, L. [Teller.]

Listowel, E.

Williams, L.

Chorley, L.

Longford, E.

Williams of Barnburgh, L.

Crook, L.

Lucan, E. [Teller.]

Williamson, L.

Faringdon, L.

Morrison of Lambeth, L.

Wise, L.

Francis-Williams, L.

Shackleton, L.

Wootton of Abinger, B.

Henderson, L.

Shepherd, L.

NOT-CONTENTS

Ailwyn, L.

Fraser of North Cape, L.

Margesson, V.

Alexander of Tunis, E.

Freyberg, L.

Massereene and Ferrard, V.

Atholl, D.

Gage, V.

Merrivale, L.

Auckland, L.

Goschen, V. [Teller.]

Mersey, V.

Beauchamp, E.

Grenfell, L.

Milverton, L.

Bessborough, E.

Hailsham, V. (L. President.)

Monk Bretton, L.

Blackford, L.

Hanworth, V.

Monsell, V.

Boston, L.

Harris, L.

Montgomery of Alamein, V.

Carrington, L.

Hastings, L.

Moyne, L.

Cawley, L.

Hawke, L.

Newton, L.

Chesham, L.

Henley, L.

Ogmore, L.

Cholmondeley, M.

Hereford, V.

Powis, E.

Conesford, L.

Horsbrugh, B.

Rea, L.

Cottesloe, L.

Howard of Glossop, L.

St. Aldwyn, E. [Teller.]

Crathorne, L.

Howe, E.

St. Oswald, L.

Cromartie, E.

Jellicoe, E.

Sandys, L.

Derwent, L.

Jessel, L.

Saye and Sele, L.

Devonshire, D.

Limerick, E.

Sinha, L.

Dilhorne, L. (L. Chancellor.)

Lloyd, L.

Sculbury, V.

Dundonald, E.

Long, V.

Swinton, E.

Ebbisham, L.

Lothian, M.

Templemore, L.

Effingham, E.

Luke, L.

Twining, L.

Ferrers, E.

Mabane, L.

Wolverton, L.

Forster of Harraby, L.

MacAndrew, L.

Yarborough, E.

Resolved in the negative, and Amendment disagreed to accordingly.

with regard to performing animals are tied up with those dealing with diseases of animals. Here again it is a question of which is the more sensible administrative arrangement to cover the group of regulations in regard to performing animals. Under the Bill this function goes to the boroughs, and this group of Amendments suggests that it should go to the Greater London Council.
There is considerable feeling among a large section of the public in regard to the training and performance of animals involved in circuses and all the rest of it. I do not share many of the fears which many people express, but I am certain that the question of inspection, regulation and control of those registered

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for training, the conditions under which performances are held, and the whole arrangements in regard to the welfare of animals have a certain comforting effect upon a range of the public who, while not violently opposed, have some general mental reservations as to whether it is natural for wild animals, and even domestic animals, to be put through some of the marvellous tricks which we see in the circuses and in various music-hall performances.
In London, where are seen some of the finest animal performances in the world, and where great masses of people watch individual performances, it is desirable that there should be one organisation to control the whole area. This is an important matter not only in regard to the welfare of the animals themselves—and it is their concern first of all—but in regard to the effect this might have on others, as well as the general question of public confidence in the regulations which have been passed by Parliament for the general protection of animals and their welfare.
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (LORD ST. OSWALD): The purpose behind these Amendments is very similar, as I think the noble Lord, Lord Lindgren, implied, to that behind other Amendments raised on this clause. I am sure that your Lordships will not wish me to weary the Committee any further in going over the same ground covered so lucidly by my noble friend. The effect of these Amendments would be to put the enforcement of the Diseases of Animals Act, 1950, and the Performing Animals Regulation Act, 1925, into the hands of the Greater London Council instead of the London boroughs. This was made very clear by the noble Lord. This work in connection with these two Acts has been performed perfectly efficiently in the past by the county councils, the county boroughs, the Common Council of the City and the ten non-county boroughs which are diseases-of-animals authorities. We consider it would be unnecessary, and indeed unreasonable, to take from the boroughs a task which they have been carrying out adequately and capably up to now.
The noble Lord did not in fact touch on this matter, but the City of London
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have a special responsibility for dealing with imported animals within the London County Council area. These functions are linked with their functions as port health authority for the Port of London which under Clause 41 of the Bill are to be continued. This arrangement has been satisfactory in regard to imported animals in the London County Council area, and we consider it desirable to continue it and to extend the area of the City's responsibility for imported animals throughout the area of Greater London. This would probably be approved of by the noble Lord.
So far as the purposes of the Performing Animals Regulations Act are concerned, the local authorities within the Greater London area are similar to those under the Diseases of Animals Act, 1950, with the exception of the ten boroughs. The administration of the Performing Animals Regulations Act occasions very much less work, but in fact requires staff with similar knowledge and experience to those for the administration of the Diseases of Animals Act. It has therefore been the practice for local authorities to use staff employed on diseases of animals work, for the occasional needs arising under the Performing Animals Act. I say "occasional", and I have figures for the number of times they have been required. I hope that the noble Lord, Lord Lindgren, with his usual reasonableness, will understand why I am not able to recommend the Committee to accept these Amendments.
LORD MORRISON OF LAMBETH: I gather that the noble Lord, in the course of his observations, has said that in other parts of the country county boroughs, even county districts—
LORD ST. OSWALD: I am sorry, but I did not mention other parts of the country. I was referring to the Greater London area.
LORD MORRISON OF LAMBETH: County boroughs would have done it there, of course. It is very natural that they should, because a county and a borough combined are a county borough, and to whom else can you give it? Nobody else, because nobody else has local authority jurisdiction. That is quite true, and the noble Lord is right. But did the metropolitan boroughs and county

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districts have that power? If they did, where did they get it from?
LORD ST. OSWALD: In point of fact, all my remarks referred to the authorities within what is to be the Greater London area.
LORD MORRISON OF LAMBETH: Does the noble Lord mean that the authorities for this purpose of seeing that the performing animals were looked after reasonably well and not ill-treated included metropolitan boroughs, urban districts and rural districts, as well as county boroughs?
LORD ST. OSWALD: Yes.
LORD MORRISON OF LAMBETH: Is the noble Lord sure?
LORD ST. OSWALD: Yes, that is quite so. I am sorry I was not following the noble Lord. I was trying to follow the noble Lord as closely as possible. I wanted to be certain I gave him the right answer. That is so.
LORD MORRISON OF LAMBETH: I must say I am surprised to find that county districts, urban districts, rural districts and metropolitan boroughs did this job. If they did, then it is an argument to be taken into consideration. I hope the noble Lord is 100 per cent. right about it; not that I am in any way assuming he would mislead the House. I just wondered whether he would like to check up. But if he is sure of it, all right. But if it is a Ministry of Housing and Local Government brief I should ask them again, or preferably some other Department like the Home Office, which is more reliable.
LORD ST. OSWALD: Perhaps I ought to repeat what I said, which was that the authorities are the same for both; that is, for the Performing Animals Regulations Act as for the other. The authorities which I listed, and I read them out in order to be absolutely certain, were the county councils, the county boroughs, the Common Council of the City, and the ten non-county boroughs which are diseases of animals authorities.
LORD MORRISON OF LAMBETH: What about the County of London? Who is the authority there?
LORD ST. OSWALD: The L.C.C. Is the noble Lord referring to the L.C.C.?
LORD MORRISON OF LAMBETH: That makes a difference. Because what happens in the County of London may well be different from what happens outside, though I do not want to perpetuate these differences. We ourselves have drifted into a number of Amendments, where we apply an Amendment to the inner London boroughs and not to the outer London boroughs. Sometimes you have to do it, but I do not like this distinction between inner London and outer London boroughs. In this case, the history of the law makes it understandable, for traditional reasons, though it is not really sensible, that outside London, where they are not used to county government of our type in London, they gave it to the county boroughs and the county districts, which includes non-county boroughs, urban disstricts and rural districts. I accept that from the noble Lord.
A man listening to this debate and coming from the North of England, provincial England, for example, might well think that in his county the county borough would do it, and I agree that they would. There is nobody else to do it there because they are the local authority. They are the supreme state, almost, in the hierarchy of local government authorities. But London is different. First of all, London is a built-up county and I will guarantee that 99·5 per cent. of Londoners, if they are standing in a metropolitan borough outside their own, will not know where they are. I am right—at any rate, I am 99·5 per cent. right. I am not sure about the ·5 per cent. They may be on one side of a road and be in one borough, and on the other side they may be in another borough. We used to get "chivvied" in Brixton, when I did open-air speaking in Brockwell Park, about local patriotism, which the boroughs have more than the counties, or so the Conservatives said. I got up on the platform in Brockwell Park, by which time I had a good following there, and said, "Come on, you respectable Brixtonians and Norwood people. What is the name of the Mayor of Lambeth?" Not one hand went up. That is the sad thing about London: that you have not the degree of civic patriotism that you have in the North.

753
But if the London County Council were doing this job, that is a prima facie case why the Greater London Council should do it in succession to the London County Council. In fact, I am increasingly thinking that the best name we can give to this authority is still "the London County Council". If the County Council is doing it, it is natural that the Greater London Council should succeed in the function. The London County Council had considerable powers beyond those of an ordinary county council—in some cases less powers than an ordinary county council—but these additional powers, given to it by Conservative Governments, in some ways meant that the London County Council was nearer to a county borough than to provincial county councils. I hope, therefore, that there is a case for this Amendment and that it will be understood. It is very difficult to understand it, in view of the complexities of local government over Greater London as a whole, but here is a natural case for the Greater London Council to do this job.
Let me give one example. Blackheath is an historic open space under the County Council. That is where King John, or a King whose name I have forgotten, met two peasant revolt leaders. He asked them to come and see him on Blackheath and said he would do a deal with them. He got them there and they were promptly arrested. That is the way we get dealt with, sometimes, when we do a deal about business. Every year Blackheath has a big circus or fair, and they have to get the permission of the County Council to hold it. That is simple; they just go to County Hall. But in the new Bill there will be two boroughs meeting in le middle of Blackheath. If the Bill goes through as it is, there will be Greenwich and Woolwich amalgamated on the one side, and Lewisham and Deptford amalgamated on the other. Can le noble Lord tell me quickly, on the spur of the moment—never mind about reading his brief—which borough they will go to? Or is this another case where they have to go to both? Or must we have a joint committee cluttering up the earth with indirectly elected authorities with no popular support whatever?
LORD ST. OSWALD: I am sure the noble Lord will want me to ignore his beautiful rhetorical question. He asked
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me a specific question about the present position of the L.C.C. as regards animal health. The L.C.C. at the moment employ two inspectors. It seems to us quite reasonable that these inspectors will afterwards find employment in two of the boroughs, the enlarged boroughs, which will come into being. That is in answer to a specific question which the noble Lord put to me.
LORD MORRISON OF LAMBETH: I am much obliged to the noble Lord. I can see what the noble Lord is going to do. The L.C.C. having two inspectors—I must say I should have thought one would do, but they may be right—I suppose one will cover Blackheath for Greenwich and Woolwich and the other will cover it for Lewisham and Deptford. What are they going to do with the others, the other circuses and what-not? Are you going to appoint a lot more? This is really a waste of manpower, because if two are going to do it, there will have to be joint appointments by thirteen metropolitan boroughs plus the City, because the City do not run circuses—except their own. Therefore, I submit that this is an uneconomic arrangement. The Minister ought to be surcharged. If the District Auditor was functioning, the Minister would be surcharged for this proposition, for compelling local authorities to spend more money than they ought to spend.
This is an easy service when run by the big authority. These men can "nip" about by motor car, even by helicopter if necessary. I do not recommend it by helicopter, because it is costly, but they can "nip" about. Therefore, it is better done in this way. I beg the noble Lord not to be a slave to those briefs, which may come from the Ministry of Agriculture but which are inspired by the incompetence of the Ministry of Housing and Local Government. Do not take any notice of them. Stand on your own feet. If you think we are right, say, "I am converted. The noble Lord, Lord Morrison of Lambeth, and others have persuaded me they are right, and I agree." That is all you have to do.
LORD LINDGREN: I think it is really most unsatisfactory. First of all, look at what we have been saying throughout the whole of the proceedings on this

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Bill. In some instances we have put the argument that it is the destruction of the London County Council that is taking place. There has not been an argument on any service that it did not function, and function well. Now the Government turn round, so far as other things are concerned, and say, "Because things have been going well, we will leave them as they are." This really is foolish, so far as this group of Amendments is concerned. This is not the sort of entertainment I go to very often, but, in company with youngsters, it makes a delightful evening to go to Olympia during the season. These circuses are not being held in every borough: they are being held at various times in various places.
When we have had a competent body such as the London County Council, which has created a confidence and whose inspectors have been doing this
work over the years, it is far better to give the power to the body to whom they are going, the Greater London Council—and they would have to go to the Greater London Council—than to give it through the boroughs. The noble Lord has not told us yet whether or not the other boroughs are going to have an inspector each. If not, the job cannot be put on to the sanitary inspector and made a spare-time job for him, because then it would not be done properly. Therefore, it is far better that this work should be centralised under the Greater London Council. In view of the unsatisfactory nature of the reply, I invite my colleagues to press this Amendment to a Division.
4.14 p.m.
On Question, Whether the said Amendment (No. 208) shall be agreed to?
Their Lordships divided: Contents, 25; Not-Contents, 73.

CONTENTS

Addison, V.

Henderson, L.

Shepherd, L.

Alexander of Hillsborough, E.

Latham, L.

Silkin, L.

Attlee, E.

Lawson, L.

Summerskill, B.

Burden, L. [Teller.]

Lindgren, L.

Williams, L.

Champion, L.

Longford, E.

Williams of Barnburgh, L.

Chorley, L.

Lucan, E. [Teller.]

Williamson, L.

Crook, L.

Morrison of Lambeth, L.

Wise, L.

Faringdon, L.

Shackleton, L.

Wootton of Abinger, B.

Fraser of North Cape, L.

NOT-CONTENTS

Ailwyn, L.

Ferrers, E.

Merrivale, L.

Alexander of Tunis, E.

Forster of Harraby, L.

Mersey, V.

Atholl, D.

Freyberg, L.

Meston, L.

Auckland, L.

Gage, V.

Milverton, L.

Beauchamp, E.

Goschen, V. [Teller.]

Monk Bretton, L.

Bessborough, E.

Grenfell, L.

Monsell, V.

Blackford, L.

Hailsham, V. (L. President.)

Moyne, L.

Bossom, L.

Hanworth, V.

Newton, L.

Boston, L.

Harris, L.

Powis, E.

Carrington, L.

Hastings, L.

Robertson of Oakridge, L

Cawley, L.

Hawke, L.

St. Aldwyn, E. [Teller.]

Chesham, L.

Hereford, V.

St. Oswald, L.

Cholmondeley, M.

Horsbrugh, B.

Salter, L.

Colyton, L.

Howard of Glossop, L.

Sandys, L.

Conesford, L.

Howe, E.

Sandwich, E.

Cottesloe, L.

Jellicoe, E.

Saye and Sele, L.

Crathorne, L.

Jessel, L.

Sinclair of Cleeve, L.

Crornartie, E.

Limerick, E.

Sinha, L.

Derwent, L.

Lloyd, L.

Soulbury, V.

Devonshire, D.

Long, V.

Swinton, E.

Dilhorne, L. (L. Chancellor.)

Lothian, M.

Templemore, L.

Dundonald, E.

Luke, L.

Twining, L.

Ebbisham, L.

Mabane, L.

Wolverton, L.

Eccles, L.

Margesson, V.

Yarborough, E.

Effingham, E.

Massereene and Ferrard, V.

Resolved in the negative, and Amendment disagreed to accordingly.

Clause 54 agreed to.
Clauses 55 and 56 agreed to.
Clause 57 [Provision of entertainments, concert halls, museums, etc.]:
LORD SHEPHERD: I beg to move this Amendment and will speak also to Amendment No. 217. This is a technical Amendment and perhaps it may not result in a division if we have a proper explanation from the Minister. Clause 57(2)(a) refers to the Horniman Museum. The purpose of Amendment 217 is to include provision for refreshments at Horniman Park. The purpose of this Amendment is to include in Clause 57 a reference to other statutory provisions governing the control and management of the Park and Museum. The view of the London County Council, who have taken a special interest in this matter, is that since certain parts of the Horniman Museum and Park are covered by the clause, it would be right for all the premises to be covered by an Amendment to this clause. I beg to move.
Amendment moved—
Page 74, line 29, after ("of") insert ("and the Third Schedule to" ).—(Lord Shepherd.)
LORD HASTINGS: I hope I can put the noble Lord's mind at rest in respect of Amendment 214. This would bring in reference to the Third Schedule to the London County Council (General Powers) Act, 1901. The Third Schedule to that Act recites the e conveyance of the Horniman Museum, but as this conveyance is confirmed by Section 46 of that Act, which is specified in the clause as it stands, it is not necessary to refer to the Schedule specifically. To make it quite sure that the reference to Section 46 embraces the Schedule too—and the Government draftsman had a look at this point and came to the conclusion that it did—the Government are going to move Amendments 215A and 216A to substitute the expression "by virtue of" certain enactments instead of "under" enactments. That has the effect of extending the precise legal meaning so that it will quite definitely mean Section 46 does include the Third Schedule to the 1901 Act. Therefore Amendment 214 would not be necessary.
In respect of Amendment 217, which the noble Lord has taken with this one, he referred to its purpose which was to make sure that the Greater London Council have the power to provide refreshments. We feel that is going rather
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beyond the scope of this section which is only dealing with the transfer of property, and also it is anticipating the review of local Acts under later clauses. If it is necessary to preserve the powers referred to in the Amendment, this will be done by order under Clause 81 of the Bill. This is merely arising under a point about refreshments. I would remind the Committee that I believe there are about 200 local Acts which have to be reviewed and revised at this moment. It would seem invidious to put this little one in at this point; it will be dealt with under Clause 81. In respect of Amendment 214, it is, as I have said, not necessary for the reasons I have given.
LORD SHEPHERD: I take it from the noble Lord's reply that the Greater London Council will be able to take over the L.C.C.'s authority and see that refreshment services are provided.
LORD HASTINGS: I think it has to be done specifically under Clause 81. But, in respect of the other part, the question of confirming the interests of the Greater London Council in the Horniman Museum is looked after under Section 46.
LORD SHEPHERD: In the circumstances, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
4.30 p.m.
LORD SHEPHERD LORD SHEPHERD moved, in subsection (2)(d), to leave out "section 4" and to substitute "sections 4, 5 and 6". The noble Lord said: On behalf of my noble friend Lord Morrison of Lambeth. I beg to move this Amendment. In Sections 5 and 6 of the L.C.C. (General Powers) Act, 1947, there are certain subsidiary powers and savings in connection with the exercise of the power in Section 4 of the Act to provide the Council with halls, et cetera. We consider that these powers should be transferred to the Greater London Council, in Clause 57(2)(d), and not left to be dealt with by Ministerial orders under the Bill. I presume that it is the Government's intention to use Ministerial orders in this matter. If I may, I would also refer to Amendment No. 216. The Council can exercise the power under Sections 5 and 6 at a future date should they consider it desirable, and they are not limited

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merely to taking over the property already provided under the power.
It might be argued against this Amendment that it is unnecessary, having regard to the application to the Greater London Council by Clause 57(1) of Section 132 of the Local Government Act, 1948. However, Sections 4, 5 and 6 are wider than Section 132, in so far as they enable the Greater London Council to do three things: first, to provide reading rooms and pavilions; secondly, with Ministerial consent, to adapt existing premises or erect buildings on land not appropriated for entertainment purposes—in other words, there would be a degree of flexibility; and thirdly, to provide, maintain, equip and furnish shops and offices as part of the buildings provided, adapted or erected for entertainment purposes. What we have in mind is something similar to the Festival Hall, where it would be of advantage, not only to the local authority but also to the community, that shops like tobacconists', confectioners' and florists' should be permitted to operate on the premises. This Amendment was put down in another place, but unfortunately, because of the guillotine, was not moved or considered. I think that it is reasonable.
Amendment moved—
Page 74, line 36, for ("section 4") substitute ("sections 4, 5 and 6").—(Lord Shepherd.)
LORD HASTINGS: This section is concerned only with the transfer of property, and no property is held under Sections 5 and 6 of the 1947 Act, to which the noble Lord referred. He is right in surmising that these sections will be studied with other local Act provisions to see whether they need to be retained or adapted by order under Clauses 81 and 84. Section 5 of the L.C.C. (General Powers) Act is already covered by the general powers to provide entertainment in Section 132 of the Local Government Act. 1948, which comes under Clause 57(1). So Section 5 appears to be looked after in that respect. I may point out that subsection (2) was only put in the Bill to allay possible misapprehensions about the future of certain major properties, such as are listed here, otherwise they would have all been dealt with under Clause 81.
It would appear that, if we accepted Amendment No. 216, this would give the
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Greater London Council powers which, apart from the fact that they are outside the scope of this subsection, are unnecessary because of the provision of Section 132 of the Local Government Act, 1948, or may even conflict with them in certain respects. And we feel that this would be anticipating the review of local Acts under Clause 84. I hope that the noble Lord may be satisfied with that explanation and feel that nothing dreadful is going to happen if this clause stands as it is at the moment.
LORD SHEPHERD: I do feel that something dreadful is going to happen when this Bill goes through, but not perhaps under this particular clause. I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
LORD HASTINGS: I have already referred to this Amendment in connection with Amendment No. 214. It is purely drafting. The words "by virtue of" give a better legal interpretation and effect a slight extension of the provision made in the final seven lines of the clause. In particular, they give the assurance that the noble Lord, Lord Shepherd, required on Amendment No. 214. I beg to move.
Amendment moved—
Page 74, line 44, leave out ("under") and insert ("by virtue of").—(Lord Hastings.)
On Question, Amendment agreed to.
LORD HASTINGS: This Amendment is also drafting, and is similar to the last one. I beg to move.
Amendment moved—
Page 75, line 2, leave out ("under") and insert ("by virtue of").—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 57, as amended, agreed to.
Clause 58, [Parks and open spaces]:
LORD SILKIN LORD SILKIN moved, in subsection (1)(b), to leave out "Greater London as a whole" and to insert:
"an area larger than the London borough of boroughs in which any such further park or open space is, or is proposed to be, wholly or partly situated".
The noble Lord said: I beg to move the Amendment standing in the name of my noble friend Lord Latham and other noble friends. The purpose of this Amendment is to modify the conditions under which the Greater London Council can acquire land for open spaces in the Greater London area. At the moment,

761
the test under Clause 51(1)(b) is that it is to be for the benefit of the Greater London area as a whole. That, of course, is quite intelligible, but there will be cases where it would be desirable to acquire land for open spaces where it cannot be strictly said that it would be for the benefit of Greater London as a whole, but it might be for the benefit of several boroughs. In that case, the Greater London Council would not come within the ambit of this subsection.
The purpose of the Amendment is to widen slightly the scope under which the Greater London Council can acquire land for open spaces. As the noble Lord will see, this is not to be entirely within the discretion of the Council, because any such acquisition will have to be approved by the Minister. So the Minister will have to certify that the proposed acquisition, under our Amendment, is not for the benefit of Greater London as a whole but for the benefit of part of Greater London larger than a borough. This seems to me a perfectly innocuous Amendment, and I hope that the noble Lord will see his way to accept it.
Amendment moved—
Page 75, line 24, leave out ("Greater London as a whole") and insert the said words.—(Lord Silkin.)
LORD HASTINGS: I see what is worrying the noble Lord about this, but I hope that after he has heard what I have to say, he may think that his Amendment is not necessary. "Greater London as a whole ", the phrase which gives the noble Lord cause for anxiety, is not the same thing, we claim, as saying every part of Greater London. One can quite easily have an existing open space which can be said to serve Greater London as a whole but which is certainly a long way from some parts of the area. One can think of Richmond Park, for example, which is not very near to north-east London but is certainly for the benefit of Greater London as a whole. I might point out, also, that the Amendment made in another place which introduced sub-paragraph (i) into this clause will help, because this will allow the appropriation for open-space purposes of land already held by the Greater London Council for other purposes, subject, of course, to the Minister's approval. In this way, land acquired under planning powers for major redevelopment
762
can continue to be held by the Council if that is thought right. On the other hand, it is the Government's intention to restrict the Greater London Council's power to provide new open spaces. The Royal Commission recommended that parks and open spaces should be the responsibility of the new boroughs, and apart from the exceptions provided for, the Government agree that this is the right thing. Dealing with existing open spaces is rather a different matter from deciding what should be done in the future.
It might be pointed out that the existing pattern is somewhat illogical, the L.C.C. holding some very minor open spaces and the boroughs some large ones which could possibly be said to be for the benefit of Greater London. It did not seem to us right to stem the existing pattern of open spaces, but when we come to the future we feel that the new boroughs should be well able to provide all the open space necessary and practicable within their areas. What I think is particularly in the noble Lord's mind is their inability to acquire an open space which might straddle boundaries or something of that nature, either because they felt they could not afford it or they could not agree with the neighbouring council, however unlikely that may be, and this would be a possibility. But in that case, if it was an important new open space, then the Minister could approve, and in these circumstances I think would probably approve of its acquisition by the Greater London Council. So I do not think that under the present drafting of the clause there is anything to make it more difficult for new open spaces to be acquired, either by the London boroughs or by the Greater London Council, if the necessity should arise.
LORD SILKIN: I think we can cut this discussion short. If I understand the noble Lord correctly, he and I are in complete agreement as to the purpose of this Amendment; and, as I understand him further, he agrees with its purpose—namely, that there will be (he says, however remote) some open spaces which might cut across boundaries where it would be difficult to get agreement, and in such a case, with the approval of the Minister, he thinks it right that the Greater London Council should acquire.

763
He then goes on to say that the words in the Bill are sufficient for that purpose, while I say they are not. I do not think that anyone reading those words objectively could possibly come to the conclusion that they would meet this case. Therefore I suggest to the noble Lord that he goes away and looks at the words again, and removes any ambiguity, so that we are both in agreement that the actual words in the Bill cover what we both have in mind. If the noble Lord will do that, I am perfectly willing to withdraw the Amendment.
LORD HASTINGS: I think that is a reasonable suggestion, and I am glad to adopt it.
LORD SILKIN: I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD HASTINGS: This is a purely drafting Amendment, but it will have some significance when we refer to a later Amendment of noble Lords opposite, because it replaces the phrase, "land so held by for use as" by the more correct one, "land so vested in and used as", and therefore pinpoints the matter of ownership. I beg to move.
Amendment moved—
Page 75, line 29, leave out from beginning to ("as") and insert ("vested in the London or Middlesex county council and used").—(Lord Hastings.)
LORD CHAMPION: Could the noble Lord tell me to which Amendment he is now referring, which comes later on in the Marshalled List? There are more than one.
LORD HASTINGS: It is Amendment No. 219, which refers to the question of property rights.
On Question, Amendment agreed to.
LORD HASTINGS: The Middlesex County Council own land in districts which, although now part of the borough of the county, are not being included in any London borough. These are the urban districts of Staines, Sunbury-on-Thames and Potters Bar. This Amendment makes it possible for land now held by the county council in those districts to be transferred eventually, if it should be so decided, to the urban district councils or to the councils of the
764
counties in which those districts will ultimately find themselves. As at present drafted, the clause leaves them out, and there would be no possibility of such a transfer. I beg to move.
Amendment moved—
Page 76, line 18, at end insert ("and, in relation to any land outside Greater London, as including a reference to the council of any county or county district in whose area any of the land is situated").—(Lord Hastings.)
THE EARL OF LUCAN: We should like to know a little more about this Amendment and its effect, because it may apply to other county councils than just the Middlesex County Council. I am told that some of Hainault Forest falls out side the Greater London boundary, and if that is so, it would affect the London County Council, who own this large tract in the East, and partly in the county of Essex. Hainault Forest is 1,100 acres in extent, and of that 400 acres fall in Essex, in the Chigwell Urban District Council area and the Epping and Ongar rural district. Is this a case where the land might be alloted to the district councils and not to the Greater London Council? Can the noble Lord tell us more about this?
LORD HASTINGS: This clause is limited to the simple transfer of property ownership from the two councils which are going to disappear—namely, the London County Council and the Middlesex County Council. Ownership of open spaces is not interfered with in respect of Essex, Kent or Surrey. When we come on to the Green Belt, I think there is a point to be clarified a little. They own land, I believe, inside the Greater London area, and the L.C.C. and Middlesex own it outside. There is not going to be any transfer of that sort of thing. It is simply because these two councils are disappearing, and Middlesex is, so to speak, the odd man out, and it might be a useful thing to transfer those properties which were part of Middlesex in that way. That is the only point.
LORD MORRISON OF LAMBETH: I want to be clear on this point. The case of Hainault, which was quoted by my noble friend Lord Lucan, is partly in the Greater London area and partly out. Are we to take it from the noble Lord that, even if that be so, it will be treated as a unit and will therefore pass to the Greater London Council? There is the

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other case of Epping Forest, which belongs to the Corporation of London. But I do not think that question arises under the Bill, because the Government are preserving all the rights of the City. If that is so, I am glad to hear it.
On Question, Amendment agreed to.
4.51 p.m.
THE EARL OF LUCAN THE EARL OF LUCAN moved, after subsection (2) to insert:
"(3) For the purposes of subsection (2) of this section—

(a) land in respect of which a contribution of not less than 50 per cent. of the purchase price has been made by the Middlesex County Council towards its acquisition by another body for use as a park or open space shall be deemed to have been held for that purpose by the Middlesex County Council immediately before 1st April 1965;

(b) land held for use as a park or open space includes land used for agricultural purposes within the meaning of the Town and Country Planning Act 1962 other than land held by the Middlesex County Council as smallholdings authority."

The noble Earl said: This Amendment deals with the case of the Middlesex County Council. Your Lordships will remember that subsection (2) of Clause 58 brings any land which is on April 1, 1965, vested in the London or Middlesex County Council under the provisions of subsection (2), which says that it shall on that date vest in the Greater London Council; but not later than 1970, or such later date before 1975 as the Minister may direct, the Greater London Council shall make a scheme, or make proposals in a scheme, which will be submitted to the Minister. I must say that that subsection seems to me to give astonishing powers to the Minister. It seems hardly worth while for the local authorities to make a scheme, if, after it has been submitted to the Minister, he may give effect to the scheme without modification, or with such modifications as he thinks fit, or may make such other provision for the retention by the Greater London Council, or the transfer to one, or to two or more jointly, of any of that land as appears to the Minister appropriate. In other words, it gives the Minister complete discretion to dispose of this land as he thinks best.
The Greater London Council is under an obligation to submit a scheme five years after the Act comes into force. But in the case of Middlesex there has
766
been for many years a movement to implement the Green Belt (London and Home Counties) Act, 1938, and the County Council and several of the boroughs and district councils in the county acquired land for open space or, in pursuance of the Green Belt policy, to keep it as agricultural land for the benefit of the population of London. In cases where a district council wanted to acquire land and the County Council thought that it would confer benefits on the county as a whole, the county contributed towards the cost, and this Amendment is proposing that where a contribution has been made of not less than 50 per cent. of the purchase price, that land should vest in the Greater London Council and not in the urban district to whom it belongs now. Your Lordships will see that in paragraph (b) of the Amendment
"land held for use as a park or open space includes land used for agricultural purposes…"
which, as I said before, was acquired in pursuance of the Green Belt policy for London.
The main argument for this Amendment, of course, is the argument which I think the noble Lord said he agreed with in the last Amendment: that parks and open spaces which conduce to the benefit, to the amenity, of the inhabitants of London as a whole should vest initially in the Greater London Council, who would then submit a scheme to the Minister. That is one argument. The other is the argument which my noble friend Lord Silkin brought up on Amendment No. 218, that a number of small authorities, each having only a small acreage of park, garden or open space, cannot afford the skilled staff needed to give proper attention and care to public parks and open spaces. They need landscape architects, and in the country they need estate agents. All this technical staff could easily be maintained by a large authority such as the Greater London Council, who would have a large department which could offer good pay, good prospects of promotion, and an interesting and worthwhile job, whereas the smaller units would be unable to do so. Therefore, they would not be able to give proper attention to the parks which vest in them. I hope that in this case the noble

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Lord will agree that this is an entirely reasonable Amendment. I beg to move.
Amendment moved—
Page 76, line 18, at end insert the said subsection.—(The Earl of Lucan.)
LORD CHAMPION: I am not quite sure that I wholly support my noble friend, if I understand the Amendment aright, although my name appears on the Order Paper as supporting the Amendment. My difficulty arises from the fact this this will affect urban district councils who will in future be outside the Greater London area. I have received a letter, and I hope your Lordships will not mind if I read a couple of paragraphs from it. The letter says:
"My Council have…a property of 100 acres with two lakes known as 'The Aquadrome' and acquired by my Council in 1961 with the aid of Green Belt contributions from Hertfordshire, London and Middlesex. The London and Middlesex contributions together do amount to exactly 50 per cent. of the cost of acquisition. The property is open to the public on payment of an entrance fee for boating, bathing, fishing and other forms of recreation; but it is right in the centre of the town and local control of it is of vital importance. The effect of the Amendment (if extended to include London as logic would require) would be that my Council would be compulsorily deprived of its freehold in this property against its will and without any consultation and the Greater London Council would acquire a property outside its boundaries at half of what it cost to acquire and without any compensation being made to my Council for their share of the expenditure."
This seems to me to be a matter which ought to be considered in connection with the Amendment moved by my noble friend.
LORD MORRISON OF LAMBETH: I am not unsympathetic in principle to the point my noble friend has raised, but what I do not follow is the argument about vesting—that means, I presume, the ownership of the property. If this land about which my noble friend Lord Champion is speaking is already part of the Green Belt, then presumably it was vested in one of the Green Belt authorities. Therefore, it is conceivable—I do not say it can be done—that the urban district council's case might be met if the vesting remained where it is but the day-to-day management of the open space remained with the urban district, if that is where it is at the present time. I do not know whether my noble friend has
768
thought about this point. I am only guessing and trying to feel my way.
LORD CHAMPION: My noble friend, Lord Morrison of Lambeth, asks whether I have thought about this point. Frankly, I have left it to the Clerk of the Council, who is a lawyer, and I guessed that he would know all about it. Therefore I have not made serious inquiries. I have put his point of view, and I am hoping that the noble Lord, Lord Hastings, will be able to clear up any doubts in my mind and in that of my noble friend.
LORD HASTINGS: This Amendment would transfer to the Greater London Council land not now vested in the Middlesex County Council but which has been, or is to be, between now and the coming in of the Bill when these the new boroughs are set up in a year's time, acquired by other bodies for use as an open space by agreement with the Middlesex County Council. As the noble Lord said, it has been quite a usual practice of the County Council to make contributions amounting to as much as 50 per cent. towards acquisition by the district councils for land which could be described as "regional" open space, or, at any rate, carries with it some benefit which could be said to extend beyond the limited enjoyment of that particular district council; and where such land has been, or is being, acquired by the district councils, it is intended to deal with it in due course by order under Clause 81. The normal method in this particular case would be to transfer it to the successor boroughs, because, as the noble Lord, Lord Champion, has pointed out, they own it and have also contributed towards it.
On the other hand, it could be transferred under Clause 81 to the Greater London Council, and I take it that these matters would be the subject of discussion and agreement. However, it seems that to throw this land arbitrarily and compulsorily, as the letter received by the noble Lord, Lord Champion, pointed out (and there is nothing permissive about this) into the scheme under the clause we are discussing would complicate things, and perhaps do so unnecessarily, because under this clause, as a point of administration, the Greater London Council has to make up its mind between now and 1970, and a little longer if

769
extended, and produce a scheme for submission to the Minister, trying to make up its mind which open spaces it thinks it ought to keep for itself and which perhaps might go to the borough councils.
Therefore, if this land were to be put into the scheme, it would be taken away from a district council, given to the Greater London Council and possibly returned later to the district council. So, administratively, I do not think it would be a very good thing. There is also a very strong point on the question of ethics. Even if the Middlesex County Council had paid more than half the purchase price, after all, they knew what they were doing; they did it with their eyes open and vested that land in another body, in the district council, and it seems rather difficult to justify taking it away now from such a council. I do not think we can contemplate doing that.
The noble Earl, Lord Lucan, refers to some agricultural land, and it is true that the Middlesex County Council own, so I am informed, about 8,500 acres of farm land, mainly in the Green Belt area. But I would point out that most of this land will be transferred to the Greater London Council under the Government's new Green Belt clause, which we are coming to presently. Only a little would fall outside that clause, arid we feel that could be much more expeditiously dealt with by orders under Clause 81. So I hope the noble Lord will feel, one way or another, that it would hardly be necessary or wise to press this Amendment.
THE EARL OF LUCAN: I thank the noble Lord for his reply. I must say it is nice to see the Government beginning to have doubts about the policy of compulsion. If the noble Lord jibs at compulsorily transferring a few little bits of open space from the Middlesex County Council to a district council, he seems to have no qualms about compulsorily abolishing the entire Middlesex County Council and the London County Council. Nobody had a choice and no one was asked whether they would like to be abolished. So the Government are straining at a gnat. It seems to me that perhaps the Government are relenting and softening, and we may yet, before the end of this Bill, get more concessions. We hope so. In the meanwhile, as this Amendment seems to have, I will not say stirred up a hornet's nest, but disclosed
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certain disagreements in the County of Middlesex, I do not propose to press it, and I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
5.8 p.m.
THE EARL OF LUCAN THE EARL OF LUCAN moved to leave out subsection (3). The noble Earl said: In this Amendment we propose to delete subsection (3) of Clause 58. It is partly an exploratory Amendment, because I should genuinely like enlightenment on what is the purpose of this subsection. It was introduced in another place at a late stage in the Bill, I think the Report stage, by the Minister in not more than a dozen lines of Hansard, with no explanation at all of what the purpose of it is. The effect of it is that half the expenditure of the Greater London Council on parks and open spaces is to be treated as expenditure for special London purposes, and it is charged only on the inner London boroughs.
It is very difficult to see the logic of this. Financially, it is not a very serious matter. I believe that it amounts to something like a penny rate on the inner London boroughs, but, in any case, why should they have to pay other than on a pro rata basis for the whole of the Greater London area parks and open spaces? Financially, it is going to come a little hard on the inner London boroughs. They are being hit in several ways. They are being made to shoulder half the total cost of the London parks, are going, presumably, to take their share of the cost of the remainder of the Greater London parks with the outer London boroughs, and will also have to take their share of the cost of any Middlesex or other council's parks which come into Greater London. So it seems to be weighted unnecessarily against inner London. It has such a small financial effect that it would seem, administratively speaking, hardly to be worth while doing. I should like, therefore, to move the Amendment and hear what the Government's reasons are for putting this subsection in. I beg to move.
Amendment moved—
Page 76, line 19, leave out subsection (3).—(The Earl of Lucan.)
LORD HASTINGS: The purpose of this subsection, as the noble Earl has

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said, is simply to secure that one half of the cost of maintaining the parks and open spaces taken over by the Greater London Council from the London County Council is borne by inner London authorities only, leaving the other half to be borne by Greater London as a whole. The reason for this is that the outer London boroughs, constituted from parts of Essex, Kent, Surrey and so on, pay for their own local parks, and we do not think that in these initial stages, until the general plan is made, from 1970 onwards, they should pay also for the local parks of inner London. The county districts and the metropolitan boroughs of Essex, Kent and Surrey at present provide practically all parks and open spaces in their areas, and they have local rates for that purpose which range from 6d. to as much as 1s. 8d.; and the outer London boroughs, of course, will inherit these responsibilities. Therefore, we feel that to treat one-half of the cost of parks and open spaces formerly held by the L.C.C. as attributable to parks serving local needs, as against the needs of Greater London, and charge that upon inner London is admittedly, perhaps, arbitrary but quite reasonable in the circumstances. That is why we have put in this subsection. I hope that noble Lords will feel that that is a reasonable explanation and will be satisfied.
THE EARL OF LUCAN: I should have thought that if the object of this whole Bill is to set up a Greater London Council and to treat Greater London as one for many purposes, it is unwise to draw a distinction straight away on the lines of the old county boundaries—because that is what is happening: you are merely perpetuating the division. The inner London boroughs are being differentiated against as compared with the rest. Surely the Greater London Council is precisely the means by which a fair allotment of the expenditure could be assessed.
LORD HASTINGS: The noble Earl realises, of course, that this will be only a temporary situation. When the general schemes are made, from 1970 onwards, most of these parks which are in the inner boroughs area, and which are now owned not by the boroughs but by the
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L.C.C., will probably be transferred to the boroughs, in which case they will have to pay for them. Meanwhile, all the local parks owned are owned by outer boroughs, who bear quite a substantial rate for their maintenance.
THE EARL OF LUCAN: Until the Minister has his field day with the schemes, when all the schemes come up to him and he blue-pencils them, this will fall fairly hardly on some inner London councils. But I do not propose to press this matter, and I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 58, as amended, agreed to.
5.14 p.m.
LORD HASTINGS LORD HASTINGS moved, after Clause 58 to insert the following new clause:
The Green Belt
".—(1) Where, in the case of any Green Belt land within the meaning of the Green Belt (London and Home Counties) Act 1938, immediately before 1st April 1965 that land was vested in the London or Middlesex county council or any functions, rights or liabilities were exercisable with respect to that land by either of those councils, then on that date that land shall vest in, or, as the case may be those functions, rights and liabilities shall become functions, rights and liabilities of, the Greater London Council.
(2) In the said Act of 1938—

(a) in section 2(1), in the definition of 'the area', for the words from 'London' onwards there shall be substituted the words 'and Surrey, and Greater London';

(b) the expression 'local authority' shall include the Greater London Council;

(c) the expression 'contributing local authority' in relation to any land in relation to which, if this Act had not been passed, any existing council to whom section 3(1)(b) of this Act applies would have been such an authority, shall, if that existing council is the London or Middlesex county council, include the Greater London Council, or in any other case, include the London borough council whose area includes the whole or any part of the area of that existing council;

(d) in sections 5, 6, 12, 15 and 32, the expression 'the county council' in relation to any land in Greater London shall mean the Greater London Council;

(e) in section 17(7) for the words 'county or borough or district or parish' there shall be substituted the word 'area'."

The noble Lord said: This is the Amendment about the Green Belt to which I have already referred. It has two purposes. The first subsection transfers to the Greater London Council all

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the functions, rights and liabilities of the London and Middlesex County Councils under the Green Belt Act. I think I am right in saying that it covers the same ground as the Amendment in the name of noble Lords opposite which immediately follows this one. The Government Amendment is, for technical reasons, somewhat more extensive. In subsection (2) it adapts the Act to the new situation which would be created by the passing of this Bill. I do not think I need say any more about it unless noble Lords wish to ask any questions. I beg to move.
Amendment moved—
After Clause 58, insert the said new clause.—(Lord Hastings.)
LORD MORRISON OF LAMBETH: This is a case where we can with both lungs say "Thank you" to Her Majesty's Government, and we are indeed grateful that this Amendment should have been brought forward by the noble Lord, Lord Hastings. I think it will improve the situation very much. I was right in this Green Belt business. We held a conference of counties and county boroughs, and we fixed up this arrangement whereby the L.C.C. would contribute substantially and the management would be undertaken by the county or county borough. So control was transferred: it has worked very happily, and would have been a pity if the control of the scheme had been broken up. We are very much obliged to the Government in this connection.
There is one thing that worries me, and I hope it is permissible for me to mention it at this stage. I refer to the efforts that are being made by speculative builders. It might be—I do not know—that individual local authorities might encroach on the Green Belt with building operations: what is called "nibbling" at the Green Belt. Of course the word "nibble" sounds a small affair, like a mouse or a rat at the greatest; but once it begins, you do not know where it is going to stop. And there are now before the Government proposals for various "nibbles" at the Green Belt which, though in themselves unobjectionable, would be profoundly dangerous as precedents. I communicated with the noble Lord, Lord Hastings, at the Ministry of Housing and Local Government about this problem, and he has been kind
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enough to send me a reply. This rather gives an indication that the Minister will try to uphold the Green Belt as a whole, but that, in view of the need for land for housing, he would concede on very limited cases the right to build. I think that is a fair summary of the letter.
Lord Hastings mentioned in his letter to me that Enfield, in the Lea valley, was a case in point. In that area there are some nurseries with which it happens I am familiar, though my noble friend Lord Stonham knows more about them than I do. I went there before the First World War, when I was a circulation man on the first official Labour newspaper, which unhappily died in that war—another grievance I have against that war. I was sent on an editorial experiment to report on these nurseries at Enfield. Even then they did not look particularly glorious or a tidy lot of structures. It is suggested that that would be a permissible place to let the Green Belt go. I am not sure about it, but I gather from Lord Stonham that they are to build some sort of structures. But Enfield is the kind of place which can do with all the open space and fresh air it can get, especially as it is represented in Parliament by Mr. Iain Macleod.
Once this nibbling at the Green Belt begins we do not know where it will stop. It is all very well to say "We will not go far", but there will be all sorts of specious pleas to build on this bit of land or that bit of land, because of the problem of shortage of housing accommodation—which may get worse in view of the obstinate refusal of the Government to allow the Greater London Council to be a concurrent housing authority with the boroughs. They may make it worse. We shall watch it and blame the Government for it. Therefore, they will say. "We must have it for housing". But, once you start that, you are committing the very crime against society that has been committed ever since the country abandoned the excellent policy of Queen Elizabeth I, who wanted a Green Belt around the Cities of London and Westminster. She passed it. She was an absolute Monarch. But the anarchist Tories of her day "busted it up" and it went. It was left to a Labour County Council to resume what that great Monarch, absolute as she was, did many centuries ago.

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This encroachment may go on. There are plenty of speculative builders knocking about; they have a lot of influence with the Conservative Party, and especially with the present Minister of Housing and Local Government, Sir Keith Joseph, who is a reactionary and not a progressive. A few local authorities might have it. But if the Green Belt tends to get filled up, not wholly but partly, then what you are going to do is to increase the urban spread of built-up London that ought never to have happened, and would not have happened if Her Late Majesty Queen Elizabeth I had not been defeated in her efforts to try to preserve a Green Belt round the Cities of London and Westminster. If you let building go on in the Green Belt, then you will have to make another Green Belt further out. Who knows, we may possibly have a future reactionary Minister of Housing and Local Government, and he may come along and say, "We have got to nibble at this"; and finally, the only Green Belt will be the North Sea and the English Channel. That is the history. That is how Greater London has evolved.
I love London, but I am not proud of this enormous urban sprawl. It ought never to have happened. Therefore, I hope that the Government in moving this clause, which we agree with, thank them for and congratulate them on, will listen to the address I have delivered to them this afternoon in the hope that they will regard Green Belt land as substantially sacrosanct and will not allow this nibbling to proceed, because otherwise we are on a slippery slope. We are not going to divide on the clause, because we like it. I cannot even divide on the speech I have made to protest to the Government. But I am sure that the Parliamentary Secretary, who has been courteous at all times, even when we have been a bit rough, will convey what I have said to his right honourable friend with my compliments, together with the other observations I have made about him, in the hope that he will be careful to preserve what was a great development, a great thing for London, and which nobody ought to upset.
LORD HASTINGS: I am most grateful to the noble Lord for welcoming this
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Amendment and agreeing to it, although he has done so by castigating me for something I have not yet done. But I will convey his remarks to my right honourable friend, and I can assure him that we are as attached to the preservation of the Green Belt as he is.
LORD STONHAM: I should just like to say, in regard to the remark of the noble Lord, Lord Hastings, that my noble friend castigated the Government for something they have not yet done, that it is the case that the value of certain land in these areas has suddenly increased—a parcel of land has risen in value from £5,000 to £50,000. So if the Government have done nothing else, they have encouraged the owners of the land and speculators in the land who would like to buy it, to the belief that that land will be available for housing and industrial development. It would be a good thing, if the Government have no such intention of allowing that land to be so used, for them to say so at an early stage and clear up any doubt that might exist.
THE EARL OF LUCAN: May I say one word to the Government on the Green Belt? There is often a tendency to say that this land has no amenity value, that it has no scenic value and it does not matter if it is built on. That, I think, is a deplorable attitude. It defeats the main object of the Green Belt. And so also would the gradual extension outwards of the Green Belt by allowing only building from the inside, eating into the Green Belt. You then have to extend it. There are proposals for extending it considerably outside. That is admirable, but it is of less use to the citizens of London. It is defeating the object of the Green Belt Act.
There is one other factor facing the Green Belt which I think is becoming more and more acute—namely, the need for building materials, and particularly the need for gravel in the Thames Valley. I believe it is a fact that supplies of gravel are getting rather short, and that the need for gravel for building is becoming more and more acute. Many tempting acres of the Green Belt in the Thames Valley are being watched anxiously by firms interested in the building industry; but I hope that the Minister will not sanction the use of land for extractive purposes,

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the extraction of gravel. No matter what the gravel firms tell one about their skill in restoring the land and in making boating lakes instead, that is not Green Belt. Again, it is destroying the object of the Green Belt Act. I hope that the Government will keep that fully in mind.
On Question, Amendment agreed to.
Clause 59 [Functions with respect to public rights of way]:
5.27 p.m.
LORD HASTINGS LORD HASTINGS moved, after subsection (2), to insert:
"(3) The London borough council to whom any functions of any county council other than the Middlesex county council are transferred by virtue of subsection (1) of this section may agree with the county council for the performance of any of those functions by that county council on behalf of the borough council; and where by virtue of subsection (1) or (2) of this section the said sections 27 to 34 for the time being apply to any part of any London borough or the City, the borough council or Common Council, as the case may be, may agree with the Greater London Council for the functions of the borough council or Common Council under the said sections 27 to 34 to be discharged by the Greater London Council, and while such an agreement with the Greater London Council is in force—

(a) references in Part IV of the said Act of 1949 to the surveying authority shall be construed accordingly;

(b) section 28(1) of the said Act of 1949 shall have effect in relation to a survey carried out by the Greater London Council as if the reference therein to the councils of county districts and parishes were a reference to the borough council or Common Council, as the case may be.

(4) In section 23 of the said Act of 1949, the reference to the local planning authority shall be construed in relation to land in a London borough or the City as a reference to the borough council or, as the case may be, the Common Council.
(5) The provisions of Part V of the said Act of 1949 with respect to access agreements and access orders and section 90 of that Act shall not apply to the inner London boroughs or the City, and in relation to land in an outer London borough references in sections 64 to 82 and 90 of that Act to the local planning authority shall be construed as references to the borough council.
(6) In section 89 of the said Act of 1949 the expression "local planning authority", and in section 99 of that Act the expression "local authority", shall include the Greater London Council, a London borough council and the Common Council; and in section 102 of that Act—

(a) the expression "local planning authority" shall include the council of an outer London borough; and

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(b) the expression "local authority" shall include the Greater London Council."

The noble Lord said: This is an addition to the clause. Under subsection (3) a London borough council which has taken over survey functions from a county may have them performed by the county council under an agency agreement. This will provide for a county council to continue the survey, which is done in well-defined stages, to the most convenient stage for handing over. By this means we think there will be continuity of these surveys for bridle paths and public ways and so on. The proposed subsection also allows any London borough council to let the Greater London Council exercise their survey functions. Of course this refers to counties outside London, not merely the London County Council or the Greater London Council. It may prove convenient for an area overlapping more than one borough to be surveyed by the Greater London Council which could then make a comprehensive survey based on information from the London boroughs.
In regard to subsection (4), Section 23 of the 1949 Act makes it a duty of the Nature Conservancy to notify local planning authorities of areas of special scientific interest. Under other legislation local planning authorities are required to consult the Nature Conservancy about any development proposals affecting areas notified to them under Section 23. Therefore, the effect of this Amendment in this subsection is that the borough council, or the Common Council, who will be dealing with development applications, will receive notification from the Nature Conservancy. In subsection (5) the powers referred to enable local planning authorities to make agreements or orders, or to purchase land which falls within the definition of "open country" for the purposes of securing public access; also to make by-laws in relation to such land when the powers have been exercised. The powers are given only to the outer London boroughs because there is no "open country" in inner London.
Subsection (6) will give to the Greater London Council, the London borough councils and the Common Council the power now available to other local authorities under Section 99 of the 1949

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Act to defray or contribute to expenditure by any other local authority under the 1949 Act. It also enables the Greater London Council to agree with an outer London borough council to exercise the borough council's powers in relation to national parks, areas of outstanding natural beauty, and access to open country. There is also in this subsection a provision which I omitted to mention but which gives powers to the Greater London Council and the London borough councils, to plant trees, bushes, flowers and grass, and to treat derelict land. I hope that this Amendment will commend itself to your Lordships, both on the grounds of convenience and in the interests of amenity. I beg to move.
Amendment moved—
Page 77, line 13, at end insert the said subsections.—(Lord Hastings.)
THE EARL OF LUCAN: My noble friend would not want to raise any objection to this clause at the present stage. I think it needs a good deal of detailed examination. Some words of the Minister struck me as needing clarification. He said "no open land in the inner London area." Is he sure about that? Even assuming that the parks, Hampstead Heath and Wimbledon Common are not considered as open land, is he sure that there is no open land in the boroughs of Greenwich and Woolwich?
LORD HASTINGS: I think the difference here is that we are not actually dealing with open parks and spaces. The clause is headed, Functions with respect to public rights of way. It is a technical matter in relation to "open country" in that legislation. Such "open country" does not exist in inner London. That is all it relates to—access and rights of way.
On Question, Amendment agreed to.
Clause 59, as amended, agreed to.
Clause 60 [Miscellaneous local authority functions]:
LORD HASTINGS: This Amendment introduces a new Schedule on land drainage and flood prevention. It is as a result of an undertaking given during the Committee stage in another place that land drainage and flood prevention functions would be specifically dealt
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with in the Bill. They had not been so dealt with at that time, and the new clause which follows now does so. I think it will be more convenient if we treat this as a paving Amendment, and I will deal with the new Schedule when we come to it. I think that would be the best course. If, of course, the Schedule were not approved, this paving Amendment would drop out. I beg to move.
Amendment moved—
Page 77, line 27, at end insert—
("(1A) Schedule (Functions with respect to land drainage, flood prevention, etc.) to this Act shall have effect with respect to the discharge in Greater London and the adjoining areas of functions with respect to land drainage and flood prevention and other functions under the enactments therein mentioned.")—(Lord Hastings.)
LORD STONHAM: We do not at this stage propose to debate this matter or indeed to oppose the Amendment, but we are not at all sure about it and will have to consider it. Perhaps we may reserve the position because we may have to put down an Amendment to this clause at a later stage in the Bill.
On Question, Amendment agreed to.
5.35 p.m.
LORD STONHAM LORD STONHAM moved to leave out subsection (3) and insert:
"(3) Notwithstanding anything contained in any other enactment passed before or during the same session as this Act, the authority by whom there shall be exercised on and after 1st April 1965 any function conferred on local authorities by the enactments relating to weights and measures shall, as respects Greater London be the Greater London Council."
The noble Lord said: I am aware that there has been some discussion on an earlier Amendment moved by my noble friend Lord Shepherd on the question of the authority to administer weights and measures in the area of Greater London; but that was on an Amendment which dealt with a number of services, while this particular Amendment deals only with weights and measures. Its purpose is to ensure that, notwithstanding anything that may happen in the Weights and Measures Bill which is now before Parliament, the Greater London Authority shall be the local authority for the whole of Greater London, including the City, for the purposes of the enactments relating to the Weights and Measures Act.
As we understand it, according to the pronouncement of the Minister in another place, it is his intention, if the Weights and Measures Bill becomes law unamended in this respect, to create 32 weights and measures borough authorities in the area of Greater London. In the event of a transfer of the weights and measures functions to these boroughs, the task of the inspector on the road will be greatly hampered by the comparative smallness of the area in which he will have to operate. I am speaking of the geographical smallness of some of these boroughs—boroughs, for example, like Shoreditch and Finsbury when they are combined. It is the case that modern methods of trading make it inevitable that the head offices of many shops will be right outside the area in which the inspector will be en titled to operate, and he can operate only in the area of his authority.
THE MINISTER OF STATE, BOARD OF TRADE (LORD DERWENT): I am sorry to interrupt. Of course, the head office might well be in Birmingham, for example.
LORD STONHAM: That is quite so, but in the event of the head office being in Birmingham, they would in all probability have a regional office in London with whom he could deal. But they would not have offices dotted all over London in many of these places, and in many cases it would add to the difficulty—and it is no use avoiding this fact—of bringing an infringement to the notice of a person in authority in a particular firm. This, of course, is going to result in a considerable loss of efficiency. At present the position is that a weights and measures inspector can make enquiries and can follow them up throughout London without any loss of time at all. He can get information from a central records office and, through that office, from all other London inspectors covering the whole of the present area of the London County Council.
One may have an example of where a shortage of weight in, say, an imported article of food found in one shop can be reported at once to the Central Office, with the result that all inspectors are warned to look out for that particular infringement. Any such arrangement between boroughs will obviously be very cumbersome and very much slower if,
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indeed, such arrangements are made at all or acted upon. Also, the position of multiple firms with branches in a number of London boroughs may be made difficult if there is any difference in the interpretation of the law, or any variations in its enforcement between one borough and another.
I submit that that objection cannot be overcome. It cannot be denied that there will be differences of enforcement as between one borough and another, if you have 32 comparatively small weights and measures authorities. The weights and measures staff of the London County Council, as with so many different types of their work—for example, the petroleum inspectorate—are specialised, qualified people doing a highly specialised job. They have a wide variety of practical experience and are available for duty at any time in any part of the county. The chain of organisation of the staff through local offices, independent within certain limits, up to headquarters at County Hall ensures a uniformity of treatment over a wide area, which cannot be maintained over a group of 32 boroughs.
The extension under the new Act, which this Amendment proposes, of the present uniform system of administration to the area of Greater London has many advantages. Among them I would submit are, first, that it will avoid the provision of unnecessary extra sets of local working standards; expensive apparatus which is made by a limited number of specialist firms, precision instruments and the like. Secondly, it will enable the authority to secure the full and economic use of buildings and of specialist equipment such as weighbridges and other testing units. Thirdly, it will provide greater control over the activities of traders who move quickly from one place to another—over coal merchants and their employees, over firms engaged in the conveyance of sand and ballast. I point out that they will not be restricted in their activities and their movements to a certain borough. They will, quite properly, be going from one part of London to another, maybe passing through the areas of three, four or half-a-dozen local weights and measures authorities, if the Bill as it now stands becomes law.
The Amendment which I am proposing will also simplify the investigation of

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offences under the pre-packed food regulations. This is a matter of importance, because an inspector's statutory powers are confined to the boundary of the employing authority. They are going to be very considerably hampered if they come up against the boundary wall of the borough and can go no further to pursue a known infringement. As I have already said, many of these boroughs are comparatively small, so that an inspector's legitimate activities in protecting the public will be quite unnecessarily hampered, and as a result it will be much easier for fraud to take place.
Finally, if the Amendment is accepted it will avoid variations in the enforcement of weights and measures Acts, which should be regarded not only as a nationwide service but as one in which there can be the maximum degree of uniformity. If this Amendment is accepted it will avoid, first, a very great additional expense. It will avoid the near certainty that the inspectorate will be seriously depleted, at least in the initial stages, because it is useless to argue that some of these boroughs could manage a complete unit of inspectors if they only had their share, one thirty-second part, of the present total of trained inspectors available. We know that the number of inspectors coming forward, of about 25, is small and quite inadequate for the job. I submit, therefore, that if the Bill in this present form became law, and unless this Amendment were accepted, serious damage would be done to the weights and measures regulations, the new Weights and Measures Act would be less effective in the area of Greater London, and the consumers would have less protection than we all want to provide for them. I hope, therefore, that in those circumstances the Amendment will find favour with the Government. I beg to move.
Amendment moved—
Page 77, line 32, leave out subsection (3) and insert the said new subsection.—(Lord Stonham.)
LORD LATHAM: I should like to support my noble friend Lord Stonham, who made a very convincing speech in support of the Amendment on the Paper. I think it can be said that the proposal to distribute the functions of weights and measures over 33 units within Greater
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London is against all informed opinion. It is also against the course of commerce and distribution. In commerce there is a movement towards larger units, mergers and take-overs. Weights and measures are a part of commerce and should move in the same direction and follow the same trend. Indeed, the future of British industry depends upon its being modernised, as we are told by the Prime Minister, who has now become devoted to efficiency and invites us to go into the millennium in the 'seventies.
It cannot be efficient to break up the unified weights and measures system of the London County Council and to have 33 authorities in the intended Greater London. It means that there are 33 opportunities for different interpretations. There are 33 different opportunities for differences of opinion as regards enforcement. If there was a case for a unified service such as that of the London County Council in the past, certainly in the future, with the extension of the provisions for weights and measures contemplated under the Bill now before Parliament, the changes which have come over industry, the self-service, the supermarkets, the discount trading, the near revolution which has taken place as regards packaging, the task of those concerned with the enforcement of these provisions of the law with regard to weights and measures will be more complicated and more difficult, and will need to be concentrated rather than dispersed. As I have said, giving these functions to the boroughs is not modernisation, and it is not in any case likely to produce efficiency. It is fragmentation of the worst type.
Let us examine the consequences of the proposal. It will be costly, it will be inefficient, and there will be less protection for the consumer because of the inefficiency. And what will be the result in the terms of finding the necessary staffs? At the present time, there are 23 district inspectors of weights and measures in the County of London—that is to say, in that area which will henceforth be known as the inner London area. That 23 excludes the City. It is estimated that the proposed 12 new inner London boroughs would require at least 30 inspectors to cover the same area of ground—that is to say, 7 more than is the case at the present time. It is thought

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to be likely that the service in the inner London area, without taking into account the developments which will flow from the legislation now in process, cannot be operated, in these circumstances, with fewer than 50 to 60 inspectors. That is in respect of the inner London area alone: it does not take into account that portion of the Greater London area which is not within the inner area.
Then, if we look at the whole area, the 32 boroughs and the City of London, we find it estimated that each of the inner London boroughs will require 4½ to 5 inspectors. Therefore, to cover the 32 boroughs of Greater London, leaving aside the City in this case, would, on this basis, require 144 to 160 inspectors. They are not available. Recruitment even now is below the need; and the need, as regards Greater London, as I have indicated, is likely to be much expanded. They are not there, and, accordingly, the service will be undermanned; it will be not efficient and it will be unsatisfactory.
The circumstances being what they are, with a unitary system of weights and measures enforcement in the London County Council which could easily be expanded to cover and embrace the whole of the Greater London area, it is difficult to understand why the Government should proceed with their policy of splitting up, of demolishing, of dismantling almost everything which is of value within the local government set-up in Greater London. It is to be hoped that in this connection, at all events, seeing that, as I submit, the facts are all in favour of the Greater London Council being the authority for weights and measures, this Amendment may be accepted.
5.54 p.m.
LORD DERWENT: I intend to answer both noble Lords in comparatively general terms. They have really produced no new argument today, except possibly in some small detail, which we have not already argued on the Weights and Measures Bill, and which we shall doubtless re-argue on the next stage of that Bill. I hold that the proper place to discuss what authorities shall exercise functions under the Weights and Measures Bill, which is at present before the House (I do not mean to-day, of course) is during the discussion on that
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Bill. And it is clearly appropriate that the Weights and Measures Bill itself, if it becomes law, should be the basic instrument governing the designation of weights and measures authorities throughout the country. The present weights and measures authorities under existing weights and measures enactments are county and county borough councils and the Common Council of the City of London. So far as I know, these county boroughs—I know that my own neighbouring one does—work very efficiently.
Outside the London area the Weights and Measures Bill provides that the counties and county boroughs, and non-county boroughs and urban districts with populations of 60,000 or over, shall be weights and measures authorities. In the Greater London area, the new London boroughs proposed by the London Government Bill will have populations ranging from three to five times that number. Both noble Lords have said that these are much too small for a weights and measures authority. I might add that this idea that the London boroughs should be the weights and measures authorities was also the recommendation of the Royal Commission on London Government. In the Government's view, the decision on the weights and measures authorities should be taken in the context of the Weights and Measures Bill, if it is passed. Orders made by the Board of Trade under that Bill designating these authorities in the Greater London area will be subject to annulment by Parliament, and Parliament will thus have the final say. The only reason (and it is becoming a less important reason than it was, perhaps, a month or two ago) why subsection (3) of Clause 60 is in the Bill at all—I am referring to this Bill—
LORD LATHAM: And, if I may say so, being in this Bill we are not out of order in discussing it.
LORD DERWENT: Nor am I out of order in discussing the two Bills together. The only reason why Clause 60, subsection (3), is in this Bill is that in the very unlikely event of the Weights and Measures Bill not being passed, some authority has to be given to the Board of Trade or to somebody to appoint weights and measures authorities; otherwise, they would not exist at all. That is why this particular subsection is in the Bill. But

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I resist the Amendment on the arguments I put forward on the other Bill. These authorities are not too small. Far smaller authorities work extremely well now. This was the recommendation of the Royal Commission. We believe it to be the right decision, and I must therefore ask the Committee not to agree to the Amendment.
LORD STONHAM: I think that is a most unsatisfactory reply. The noble Lord, Lord Derwent, said, "I shall answer the two noble Lords opposite in general terms"—
LORD DERWENT: Comparatively general.
LORD STONHAM: —which meant that it gave him the opportunity of refraining from answering the arguments at all. He has made no attempt to refute the irrefutable fact that there will not be enough inspectors, and that if the authority is split up in this way it will cost a lot more money and will make for a much less efficient service. There is no real reason in equity for this at all. That is why the noble Lord answered in general terms.
Then the noble Lord said he holds that the proper occasion on which to discuss weights and measures authorities is on the Weights and Measures Bill. I should have thought that the proper time to discuss the functions of the Greater London Council was on the London Government Bill, and that is precisely what we are doing. Naturally, in advancing the argument that the weights and measures authority should be the Greater London Council we have to say why. That was why my noble friend and I advanced these arguments, which the noble Lord has made no attempt whatever to refute. He referred, quite properly, to the fact that in the Weights and Measures Bill as it now stands it has been decided by a majority in another place, and so far has not been altered in your Lordships' House, that a local authority or a district authority with a population of no more than 60,000 can be a weights and measures authority.
My personal view, as the noble Lord is well aware—and which I expressed when we discussed the Weights and Measures Bill—is that this is far
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too small. But he will agree with me that in many cases the authority with a population of 60,000 which becomes a weights and measures authority is likely to occupy a much larger area than one of the Greater London boroughs with a population of 250,000.
LORD DERWENT: I cannot agree on general terms. In certain cases the noble Lord is right; but in almost as many other cases I do not think that is true.
LORD STONHAM: Since we are at least half-agreeing with each other, the noble Lord will say that that is, at least, half an answer to the point I made. It is the justification, if there is one, for making a smaller local authority with only a 60,000 population a weights and measures authority.
I think this is one of many retrograde steps that the Government propose to take in this particular Bill. It is no consolation at all to be told: "If we find you are right, then, of course, after some years and after all the damage is done, we shall take steps to put the matter right." That is exactly what the Government did over the Covent Garden Market Bill. We told them over two years ago that the market would never be built at Covent Garden. But they went on to reverse a decision that was made, and now another Act of Parliament must come in; and the market will not be built there but in one of the other places, where we said it would be built. All this wasted money and time is due simply to the fact that the Government would not listen to a reasonable case that was made on both sides of your Lordships House. This instance is another example when—if we are all in this House in a few years time and this Bill has become law—we shall have to take all the steps to put the matter right. It will be one more example of public money wasted and a misuse of the services of skilled and gifted men. I am on record as saying these things; and the Record will stand, irrespective of the way the Government uses its majority.
On Question, Amendment negatived.
LORD HASTINGS: Loan societies certified under the Loan Societies Act, 1840, are required under that Act to deposit their rules, and any amendments to their rules, with the councils of the counties or county boroughs in which they are

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situated. At the present time the functions under the 1840 Act in respect of loan societies in the Greater London Area are exercised by a number of authorities which under the previsions of the Bill will be abolished. Therefore this Amendment provides that, as respects loan societies in the Greater London area, those functions shall be exercised by the Greater London Council. I beg to move.
Amendment moved—
Page 77, line 38, at end insert—
("( ) The confirmation and record of the rules of loan societies under the Loan Societies Act 1840 shall as respects any such society, formed in Greater London be functions of the Greater London Council; and accordingly in relation to that Act sections 3 and 78 of the Local Government Act 1888 shall have effect as if Greater London were a county and the Greater London Council were the council of that county.")—(Lord Hastings.)
LORD STONHAM: We regard this as a satisfactory Amendment and are glad to support it.
On Question, Amendment agreed to.
LORD STONHAM LORD STONHAM moved to add to the clause:
" Notwithstanding anything contained in any other enactment, the Greater London Council shall be—

(a) the licensing authority for the purposes of Part III of the London County Council (General Powers) Act 1921 (which provides for the licensing of employment agencies), and the said Pant III shall extend to the whole of Greater London and accordingly, so far as they relate to the said Part III—

(i) in section 4 of the said Act of 1921 the expression "the county" shall mean Greater London, and the expression "licensing authority" shall mean the Greater London Council;

(ii) in section 40 of the London County Council (General Powers) Act 1926, the expression "licensing authority shall mean the Greater London Council;

(b) a registration authority for the purposes of the Theatrical Employers Registration Acts 1925 and 1928, and accordingly in section 13 of the said Act of 1925 for the words "As respects the City of London, the common council" there shall be substituted the words "as respects Greater London, the Greater London Council";

(c) a licensing authority for the purposes of the Nurses Agencies Act 1957, and accordingly, in section 2(1) of the said Act of 1957 for the words "in relation to the City of London, the Common Council, in relation to the remainder of the administrative County of London, the London County Council" there shall be substituted the words "in relation to Greater London, the Greater London Council"."

The noble Lord said: I beg to move Amendment No. 232, which proposes that the Greater London Council should be the licensing authority for employment agencies and for the purposes of the Nursing Agencies Act, and also the registration authority for the purposes of the Theatrical Employment Registration Act.
The first function is one which is at present carried out by the London County Council; and it is thought appropriate to add the other two, in so far as the City of London is concerned, because they run together in this question of licensing of employment agencies, and we feel that it would be a convenient form of administration if, in future, the Greater London Council were responsible for the licensing of all these types of agencies. The object is to ensure that private employment agencies are properly and fairly conducted and to prevent undesirable persons from carrying on an employment agency business. Much of the administrative and inspection work involved is concerned with inquiry into suitability and character of applicants for licences, and into the activities of agencies whose conduct has given rise to complaint or suspicion. Inquiries include consultation with the police extending over the whole county of London, and some investigations necessitate inquiries beyond the county boundaries.
I think the whole case for this Amendment rests not only on its intrinsic merits, but on the present distribution of these agencies throughout London. There are at present 1,130 licensed employment agencies in the County of London. Of these, 440 are theatrical agencies. To supervise all these, six administrative staff and four inspectors are employed, and experience has shown that one inspector can adequately supervise about 280 agencies. The Committee will note that just ten people, four of whom are inspectors, are looking after all the work of 1,130 agencies. As the Bill now stands, without this Amendment, each borough would have to set up its own staff and be responsible for licensing its own agencies, for vetting applications, for approving them, and for looking after the delinquent, or badly behaved agencies.
The distribution of those 1,130 existing agencies is as follows. In one of the new London boroughs, Westminster, St. Marylebone and Paddington, there

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would be 716 agencies out of the total of 1,130—that is, 60 per cent. of all the agencies would be in one borough. In another borough, Holborn, St. Pancras and Hampstead, there are 144; in Chelsea and Kensington there are 91. Four boroughs would have between 20 and 40 agencies, and 5 boroughs fewer than 20. Only one of those boroughs would therefore require to employ full-time staff on employment agency work. As regards the other boroughs, the absence of full-time staff with experience and special knowledge of a large number of agencies would be a serious handicap in carrying out the objects of this legislation. I am sure that we are agreed that inspection and licencing is necessary to prevent innocent people who apply for posts from being exploited. It has been found so over a great many years.
The second argument against the division of the service which this Amendment seeks to avoid and which is proposed in the Bill arises where the question of refusing or revoking a licence arises; because the licensing authority must hold a quasi-judicial hearing and decide whether an agency is run by persons suitable to hold licences. It has happened that applicants who after investigation have been refused a licence in London have set up offices outside the county. If the London boroughs become licensing authorities, then it could happen that a person refused a licence in one borough because he was unsatisfactory or unsuitable, or who had his licence revoked because of malpractice, could set up office in a borough just over the border, and the border would not be far away. The evidence of his unsuitability to hold the licence at the time of his second application might not be available because of difficulty in gathering witnesses together again. Therefore, it is essential to the success of employment agency legislation that in the Greater London area there should be only one authority.
The licensing of employment agencies is carried on in the Greater London area outside the County, under local Acts, by the Middlesex, Surrey, Hertfordshire and Essex County Councils, by the West Ham and Croydon County Borough Councils and by Barking, Ilford, Leyton
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and Walthamstow Borough Councils, and domestic agencies, by the East Ham County Borough Council under the Public Health Act, 1907. I submit that any fragmentation of the administration of licensing of employment agencies can only lead to increased injury, increased cost and, what I think will be agreed is most dangerous, increased danger that unsuitable and unsatisfactory people would be able to get licences after they had had them revoked in another part of London. I am sure that this is undesirable and that the actual distribution of licences now in the boroughs of inner London proves this case beyond any shadow of doubt. I hope that the noble Earl will take that view. I beg to move.
Amendment moved—
Page 77, line 38, at end insert the said subsection.—(Lord Stonham.)
6.13 p.m.
EARL JELLICOE: We have discussed the allocation of public control functions already at some length and I do not wish to go over that ground again, but I would remind your Lordships that the public control functions in respect of employment agencies, nurses' agencies and theatrical employees are on the list of public control functions which the Royal Commission in general felt should go to the boroughs, subject of course to the Minister concerned deciding in each particular case that this was a sensible thing to do. In the three particular cases to which the noble Lord's Amendment is addressed, we have come to the conclusion that it is sensible to allocate this responsibility to the boroughs.
The noble Lord's speech was mostly concerned with employment agencies. I think that he would agree that for the most part these agencies deal with local matters. Most of them deal with the employment of clerical workers and fill more local vacancies than vacancies over the whole London area, and complaints which would be likely to cause an agency to be struck off would come for the most part from local people. Therefore, there are strong practical grounds for transferring this responsibility to the boroughs. As the noble Lord said, this function has been performed, and well performed, by the L.C.C., but if we are to make a change, I should have thought that there

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was a strong case for giving it to the more local unit, the borough, rather than to the larger unit, the Greater London Council.
So far as nurses' agencies are concerned, to which I do not think the noble Lord referred, I should have thought that there was a strong practical reason for transferring the responsibility to the boroughs. Under this Bill the borough will be the local health authority, and I would have thought that there was a lot to be said for the unit of local health authority to be the supervising authority for nurses' agencies. Therefore, it seems right on that ground alone to transfer this responsibility to the boroughs.
So far as theatrical employees are concerned, if we are going to give the responsibility of employment agencies to the boroughs, I think it is sensible to give the responsibility for the theatrical employees likewise to the boroughs. I am reinforced in this view by the fact that there has already been some considerable delegation of powers. The Essex County Council have delegated their supervisory duties over employment agencies to Barking, Leyton, Ilford and Walthamstow. I would have thought that that was a good sign that there was a good deal to be said for treating these on a local basis. I admit that there is apparent force in the noble Lord's argument that it is unwise to fragment the powers of control among the boroughs, since this would allow someone to apply for a licence who had already been refused or whose licence had been with, drawn in another borough. He could pop over to the next borough and apply for a licence. This is a problem which we have to deal with, in any event. We are not dealing with a static problem and existing authorities have found no difficulty in coping with it. So far as staffing is concerned, the idea here is that the existing L.C.C. specialist staff should go to the boroughs. I should have thought that the heaviest concentration of employment agencies would be in the boroughs which would need to acquire that specialist skill, and that there would be no real difficulty in other boroughs recruiting suitable staff.
To conclude my argument, the action which we have taken here follows the broad recommendation of the Royal
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Commission—though I know that this is no particular commendation to noble Lords opposite. The Ministers concerned have also considered the allocation of functions in this field and have come to the conclusion that it is right that these should go to the boroughs. In any event, your Lordships will remember that both yesterday and to-day the Committee decided that a large number of these public control functions should be given to the boroughs. In view of that, I would have thought that there was a lot to be said for grouping these public control functions in the boroughs rather than blurring the picture by having some with the Greater London Council and some with the boroughs. Surely this is so in the case of specialist functions, like petrol licensing, which we have dealt with at length, and I should have thought that it was also to the advantage of the citizen that he should know that, for the most part, it was to his local town hall that he should go for these licences rather than that he should not know whether to go to his local town hall or to the Greater London Council. For these reasons I cannot advise your Lordships to accept this Amendment.
LORD MORRISON OF LAMBETH: I wish there were some consistency about the Government. When it suits them they drop on the Royal Commission as if it were the Law of the Medes and Persians; but time after time they have rejected the Commission's proposals. They have altered the area recommended by the Royal Commission for Greater London; they have altered very materially the areas and populations of the new London boroughs; and in education, too, they have departed from the Royal Commission's recommendations. I forget the others, but there are a number of other departures. It really tries one's patience that noble Lords opposite quote the Royal Commission when it suits them, yet when we quote the Royal Commission, they say: "You have no right to quote the Royal Commission, because you do not agree with it." We are both on the same footing there; neither of us agree with the Royal Commission about something or other.
For my part, I have the gravest suspicions about the Royal Commission on grounds of politics and knowledge of London—but that is another matter.

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The noble Lord should drop this reliance on the Royal Commission. Any Government who appoint a Royal Commission or a departmental committee always reserve the right to disagree with the recommendations which come before them, and they have often done so. I wish that the noble Lord would drop it, because it is trying, and there is an element of—
LORD STONHAM: Uncertainty.
LORD MORRISON OF LAMBETH: —uncertainty, or even humbug about it, and it is not decisive one way or the other. I am sorry that I missed most of the speech of my noble friend Lord Stonham, but the speech I am dealing with is that of the Minister of State, Home Office, I find it difficult to believe that the Home Office, which I knew pretty well, would disagree with us on the matter. It may well be that they are allowing themselves to be pushed around by this pantomime Ministry of Housing and Local Government; which is a great pity. The Home Office used to have a mind of its own, and I wish it still had.
Just look at the situation. There are 1,100-odd employment agencies of one sort or another in the County of London. Over 700 of those are in the new London borough that will probably be called the City of Westminster. That means that about 60 per cent. of the total are in one London borough. The other London boroughs, some of whom will have employment agencies—some may have none, and others very few—will have to appoint a staff for this purpose. The existing staff in the London County Council is 10 altogether, 6 administrative and 4 inspectors, to cover the whole County of London. If you pass this Bill as it is, the number may be not only doubled, but quadrupled—and perhaps even more—because each London borough will have to have its own unit of staff. That really is wasteful.
It is said: "But the bulk of the theatrical employment agencies are in the City of Westminster." That may be so. So are the bulk of the West End theatres. I am not sure that it is healthy to have the body that superintends theatrical employment agencies living cheek by jowl
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with the theatres and owners of theatres, because I think there needs to be impartiality on the part of the body supervising the employment agencies. That may be difficult when the employers are cluttered under your nose. But if the Greater London Council were responsible a degree of impartiality would be shown. On the grounds of public economy and the fair development and administration of a service in which the London County Council have great experience and which I imagine in one way or another will be passed on to the Greater London Council, I think this is the appropriate authority for the purpose, and I therefore think my noble friend Lord Stonham is right and, with great respect, the Government are wrong.
The truth is that the Government are running a dogma right the way through so far as they can. I give the Government credit for having made one or two concessions on this point, about whether it should be borough or Greater London; and it is true that we have sometimes stood up for the boroughs. But they are running a dogma all the way, arising out of their hatred of the London County Council. They want to see the Greater London Council given as little power as they can give it, irrespective of the merits of the case, and that the boroughs should have the greatest possible power. What they would have liked to do would be to cut London up into a crowd of county boroughs, and then there would be no London. They hate London. Well, I still say there will always be an England, and there will always be a London. I think this Amendment is right, and I would commend it to the favourable consideration of the Committee as a whole.
6.26 p.m.
LORD ARCHIBALD: I should like to say a word or two about the argument in respect of the licensing of employment agencies. The noble Earl, Lord Jellicoe, argued that many of the employment agencies are supplying labour within the borough in which they have their offices. But I wonder whether he can give us any evidence as to what proportion of the employment handled through employment agencies is, in fact, local in character. My experience of a certain type of employment agency is

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that the employees for whom it provides employment do not live within the borough in which the agency is situated, and the employers to whom the labour is supplied are a long way out from the borough in which the agency is situated. I feel that in that case, if there is dissatisfaction with the agency, either from the employees' or the employers' side, the borough in which the agency is situated is not going to be greatly concerned about it.
I think it would he much more satisfactory from the point of view both of employees and employers if a body such as the Greater London Council were the licensing authority for employment agencies. I do ask the noble Earl if he can give us some justification for his statement that they are mainly local in their activity, because my experience is that many of them are far from local, and are, in fact, entirely unlocal in their activity and should not come under the local borough authority.
LORD STONHAM: My noble friend Lady Wootton of A binger said yesterday that the noble Earl, Lord Jellicoe, was as persuasive as he was unconvincing, which was another way of saying that he puts forward his arguments with such charm that they would almost persuade one. On this occasion he was neither persuasive nor convincing, and however gifted the advocate, as the noble and learned Lord the Lord Chancellor will agree, he cannot convince when he has a bad case. This is one of those occasions. As this is a Home Office matter, I would ask the noble Earl, if not now, between now and the next stage, to think about it again. As my noble friend Lord Archibald clearly pointed out, the noble Earl is quite wrong in saying that this agency business is a purely local function—he may have said "mainly local function", and I do not want to misquote him; but words to that effect. It is not. All the theatrical agencies will be virtually in one London borough, because that is theatreland. People come to these agencies from all over the United Kingdom. They are not local at all.
If you take the nurses' agencies (the noble Lord will be aware that here I know what I am speaking about), while they are in London, they are not local
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in the sense of being local to a particular borough. All the nurses of different nationalities would go to the Nurses' Co-operation, in Eccleston Street, or the one in Regent's Park. I should like to make it clear that I am not saying anything adverse to these agencies—they are first class. But they are not local. They are almost, in a sense, national, because if a hospital gets permission from the Minister of Health to engage what we call "co-operation nurses" to fill a temporary gap, or otherwise, the demand can come from any borough from any part of the country. So the agencies are not local. Therefore, the noble Lord is really quite wrong in what I thought was one of the main planks of his case for refusing this Amendment.
Again, he must think about the question of the staffs. There are only ten staff doing this job at present, and the existing staffs will go with the boroughs. It means that those ten people will all have to go to the Westminster-Marylebone borough. That is virtually the case. They have 60 per cent. of the agencies now, so they will need all those staff, and there will be no trained stall left with the other boroughs. Surely there is no justification for setting up an office in an area where there is so little demand for their services that at present there are 20, or fewer than 20, agencies. Surely the noble Earl is not going to advocate that as a sound proposition. That is what he is doing in turning this Amendment down. It is all very well to say there is a case for grouping these various functions or boroughs, but this function is another of the specialist functions. You will not get a social worker in some other sphere in the borough to take on this job as an extra. It is a specialist function which needs knowledge, and, surely, the Government, for what seem to me to be purely doctrinal reasons, are not going to turn down what honestly appears to me to be a cast iron case. If the noble Earl is not in a position to accept our Amendment now, whatever we do on this occasion I hope he will think about it in the meantime, because I feel sure we shall have to return to it.
6.32 p.m.
On Question, Whether the said Amendment (No. 232) shall be agreed to?

Their Lordships divided: Contents, 19; Not-Contents, 60.

CONTENTS

Alexander of Hillsborough, E.

Lawson, L.

Strabolgi, L.

Archibald, L.

Longford, E.

Summerskill, B.

Attlee, E.

Lucan, E. [Teller.]

Walston, L.

Burden, L. [Teller.]

Morrison of Lambeth, L.

Williams of Barnburgh, L.

Champion, L.

Shackleton, L.

Williamson, L.

Henderson, L.

Stonham, L.

Wise, L.

Latham, L.

NOT-CONTENTS

Ailsa, M.

Effingham, E.

Lothian, M.

Ailwyn, L.

Ellenborough, L.

Luke, L.

Atholl, D.

Falmouth, V.

Mabane, L.

Auckland, L.

Ferrers, E.

Margesson, V.

Beauchamp, E.

Gage, V.

Massereene and Ferrard, V.

Bessborough, E.

Goschen, V. [Teller.]

Melchett, L.

Blackford, L.

Grenfell, L.

Molson, L.

Boston, L.

Hailsham, V. (L. President.)

Napier and Ettrick, L.

Brentford, V.

Harcourt, V.

Newton, L.

Carrington, L.

Harris, L.

Rockley, L.

Chesham, L.

Hastings, L.

St. Aldwyn, E. [Teller.]

Cholmondeley, M.

Hawke, L.

St. Oswald, L.

Colgrain, L.

Hereford, V.

Salisbury, M.

Conesford, L.

Hertford, M.

Sandys, L.

Crathorne, L.

Horsbrugh, B.

Sinclair of Cleeve, L.

Cromartie, E.

Howard of Glossop, L.

Swinton, E.

Derwent, L.

Howe, E.

Templemore, L.

Devonshire, D.

Ilford, L.

Teynham, L.

Dilhorne, L. (L. Chancellor.)

Jellicoe, E.

Wolverton, L.

Dundonald, E.

Lambert, V.

Yarborough, E.

Resolved in the negative, and Amendment disagreed to accordingly.
Clause 60, as amended, agreed to.
6.40 p.m.
LORD MORRISON OF LAMBETH LORD MORRISON OF LAMBETH moved, after Clause 60 to insert the following new clause
Subsidiary functions of Greater London Council
Notwithstanding anything in section 4 or 84(1) of this Act, but without prejudice to the provisions of sections 80(2). 81(1) and (2) and 84(2), (3), (4) and (5) of this Act, in so far as any functions were exercisable by, or any rights or liabilities attached to, the London county council or the Middlesex county council immediately before 1st April, 1965, under the enactments specified in Part I or Part II of Schedule (Subsidiary functions of Greater London Council) of this Act, those functions, rights or liabilities shall, as from 1st April, 1965, become exercisable by, or attach to, the Greater London Council; and those enactments shall have effect with any necessary modifications including, in particular, the substitution therein for references (however expressed) to the London county council or the Middlesex county council of references to the Greater London Council, and any such functions as aforesaid shall be exercisable—

(a) under the enactments mentioned in Part I of the said Schedule, in relation to Greater London other than the outer London boroughs; and

(b) under the enactments mentioned in Part II of the said Schedule, in relation to Greater London.

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(c) in the definition of a "sanitary authority" in subsection (5), for the words "a sanitary authority for the purposes of the Act of 1936 other than the Common Council" there shall be substituted the words "the Council of a London borough within the meaning of the London Government Act 1963 or the Common Council of the City of London, as the case may be";

(3) Subsection (4) of section 18 of the London County Council (General Powers) Act 1958 shall cease to have effect."
The noble Lord said: I beg to move this Amendment, which has nothing to do with politics or policy, so far as I know, although it may turn out to have something to do with policy; but it is really a tidying-up Amendment. There are a number of Private Act and some Public Act powers which were exercised either by the Middlesex County Council or the London County Council, and, so far as we can see, the Bill is silent as to the intended effect on many of these powers. We have examined the powers concerned, and we think that those which are set out in the Government's new Schedule—at any rate, those we have in our possession—ought to go to the Greater London Council, which is not unnatural as they were formerly exercised by one of these two great County Councils. We want this Amendment because it will ensure that the powers are not lost to the Greater London Council simply because there

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may have been an oversight on the ministerial or departmental level to take action upon it.
I will give some samples of the legislation we have in mind. I do not necessarily want to read them all, because it is a pretty long list; but there are the Thames River (Prevention of Floods) Acts, 1879 to 1962 and Section 14 ("Warnings of high tides on the River Thames") of the London County Council (General Powers) Act, 1932, which I think followed on the great floodings which took place at Millbank and caused a great deal of public concern at the time. Then there is the London County Council (Subways) Act, 1893 and Section 27, charges in respect of subways of the Council under the General Powers Act, 1958.
There is the Thames River (Steamboat) Act, 1904; but here I ought to explain that this is not concerned with the actual running of the steamboats, because I made provision when I introduced the London Passenger Transport Act, 1933—which I introduced first of all and got Second Reading and through the Joint Select Committee—whereby that function would pass to the London Passenger Transport Board, because it was a passenger service, and I hoped the Board would be in a financial position to take it over because they might lose a little money. It was lost to the Council by the fact that it lost a farthing rate, and the Municipal Reformers, as they were called for some curious reason, decided they would not lose a farthing rate, even to save the steamboat service on the Thames, so they abolished it. Then there is legislation about London squares and enclosures and various other things. In the Second Schedule there are enactments relating to parks and open spaces and recreation grounds which were controlled and managed by the L.C.C. and the Middlesex County Council, and the Physical Training and Recreation Act, 1937, the London and Home Counties (Green Belt) Act, 1938, and so on.
I do not want to bore the House (I want to economise time) by reading the whole of the Schedule, but it may be that the noble Lord who is going to answer the debate will be able to show that there is some provision for some of these enactments in some part of the Bill. In so far as that is so, it may be that the Schedule
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we have in mind should be modified. But the principle is right: that all this legislation should not be allowed to lapse. We think, therefore, that this Amendment should be put into the Bill, so that powers which have been granted by Parliament in one form or another should be carried over to the care of the Greater London Council. I beg to move.
Amendment moved—
After Clause 60, insert the said new clause.—(Lord Morrison of Lambeth.)
LORD HASTINGS: I think the noble Lord who moved this Amendment said at the beginning that the purpose of it is to effect a general saving in favour of the Greater London Council of all the Acts referred to in the new Schedule, which is the subject of a later Amendment. Certainly I can agree with him straight away that Clause 84 does not contain a general saving of this kind in favour of the Greater London Council. Clause 84 says that the London boroughs should, in the absence of express provision in any order stand in the place of any county borough, metropolitan borough, or county district referred to in a Local Act in force in Greater London. While the London boroughs will take over all the functions which are exercised by county boroughs, metropolitan boroughs and county districts, and which are normally referred to in Local Acts, the Greater London Council will not be taking over all the county councils' functions. Many of the powers and functions given to the county councils in Local Acts applicable to Greater Landon will be going to the London boroughs. For this reason, a general transfer of Local Act powers from the county councils to the Greater London Council would be inappropriate—in fact, technically impossible.
Orders under Clauses 80 and 81 will make all the necessary adaptations to Local Acts after each have been examined in detail, transferring the functions either to the boroughs or to the Greater London Council as appropriate. There is just one thing I might point out, although I do not particularly make a point of it: I think I am right in saying that the proposed new clause and new Schedule make no reference to the Local Acts of Essex, Hertfordshire, Kent or Sussex, or to the functions of those county councils, and the same thing applies, of course, in

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their case. The Government have concluded, therefore, that it is not at this stage possible to attempt an omnibus transfer to the Greater London Council of functions which are exercised by county councils under other Acts.
So far as Public General Acts are concerned, the aim has been to give all the necessary powers to the Greater London Council by specific reference in the Bill, and there is provision in Clause 80 to make further adaptation of Public Acts to supplement the provision made in the Bill. Local Acts require detailed examination so far as county council functions are concerned, and these will be dealt with by order. This is, as the noble Lord said, not a political problem; it is a highly technical one, and I hope I have been able to make myself clear and that the noble Lord has been able to follow me.
LORD MORRISON OF LAMBETH: Broadly, I think I follow, but what the upshot of it all is going to be I do not know. Each of these provisions which we think ought to go to the Greater London Council may be arguable, and need detailed examination, and I am not too happy about this matter being settled by Ministerial order, because that really is getting rather in conflict with our Parliamentary traditions. It is going a little too far with delegated legislation when a Minister has a free choice, subject to Parliamentary ratification—which is usually fairly certain—of whether or not to confer local, statutory, powers on any local authority in the area which has a mind to it. I do not like it. The other county councils are of course involved, which I was not able to speak about because I have not enough knowledge. The Government will have to look at that. I wonder whether in due course the noble Lord could let me have a note, as briefly as possible, though it will not be easy, indicating what the Government are going to do about allocation in London, Middlesex and other county areas, so that we are in a better position to know whether to continue our efforts on the Report stage. I do not feel I want to be over-dogmatic at this moment on what is a technical question which needs legal examination to ascertain the tidiest means of settlement. If the noble Lord would let one of us have that information
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in due course, we can look at it again and see whether we need to take action on the Report stage.
LORD HASTINGS: This is a highly complicated matter and these things are certainly being examined by the Departments, but I do not think I could hold out any great hopes that we could provide much information before Report stage, because it is a lengthy business. But I will make inquiries.
LORD MORRISON OF LAMBETH: The noble Lord would not like this Bill to go out at the end of the day more imperfect than it is, so the Government must struggle to get this matter tidied up, if it needs it, and I think it does. If the noble Lord has to be ready for Report stage, we have to be ready for Report stage, too. Therefore, I should like him to try to do it so that we have all the information we can have, even if it is not complete. Will he do his best?
LORD HASTINGS: I am always glad to try my best, but these local Acts have to be considered in detail. The allocations will be ready, I hope, in April, 1964, but there is still some time to go before we reach that time. I will do my best.
On Question, Amendment negatived.
Schedule 12 [Licensing of Public Entertainments in Greater London on and after 1st April 1965]:
6.53 p.m.
EARL JELLICOE EARL JELLICOE moved, after paragraph 14, to insert:
"14A. In relation to a licence under the said Act of 1843 falling to be granted by the Council, paragraph 9 of this Schedule shall have effect as if for the reference to paragraph 1 or 4 of this Schedule there were substituted a reference to the said Act of 1843, and section 9 of that Act shall not apply".
The noble Earl said: We are in a rather technical field here. Amendment No. 233A, and 233B which is linked to it, deal with the licensing arrangements regarding safety for places of public entertainment in the Greater London area. They cover the same ground as the Opposition Amendments Nos. 282 and 283, and perhaps noble Lords opposite would allow me to touch on those Amendments in my remarks. In the country as a whole safety requirements in this field are dealt with in what are called the conditions of licence, but

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in the L.C.C. area there is a special power under the Metropolis Management Act, 1878, to make regulations which operate separately from the conditions of licence.
The object of Amendments Nos. 282 and 283, the Opposition Amendments, which bite on this part of the Bill, is to preserve this power under the Act of 1878, and to extend the special power to all of Greater London. We believe it is unnecessary to extend this power so far as music and dancing, or places where people listen to music and dance, are concerned. I would remind your Lordships, in case some of you are not completely abreast of this subject, that paragraph 9 of Schedule 12 gives the Greater London Council power to make regulations laying down the necessary conditions. Paragraph 9 makes it clear that these regulations should be read as if they were conditions of a licence. There is also provision for a right of appeal in paragraph 18 of this Schedule. What we propose by Amendment 233A is to extend the cover of paragraph 9 to include theatres. At the present time it does not bite on theatres. We think this is a defect, and we propose to remedy it by Amendment 233A.
I think that would also be the effect of the Opposition Amendments. We should not wish to go quite so far as noble Lords opposite, since they would preserve intact the relevant parts of the Act of 1878 and thus cover, for example, initial structural requirements in a theatre or place of entertainment. We feel this would be covered quite adequately from the administrative point of view by the negotiations which would inevitably take place between the Greater London Council and the architects of whoever was proposing to do the particular piece of development, and the necessary guidance could be given by the Greater London Council, who would presumably put out a manual of guidance covering architectural requirement; in this field. So far as statutory means of control are concerned, they will be safeguarded in the fact that the licence could not be issued unless the building was designed to meet the requirements of the G.L.C. We think it unnecessary therefore to preserve the relevant parts of the Act of 1878, and we also prefer our own approach to this highly technical problem, because under it we preserve or
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introduce a right of appeal, which we think is desirable. I beg to move.
Amendment moved.
Page 191, line 19, at end insert the said paragraph.—(Earl Jellicoe.)
LORD MORRISON OF LAMBETH: This Amendment does go a fair distance to meet points which the Opposition have raised in this House or in another place, and I am much obliged to the noble Earl for the sympathetic consideration which has been given to these admittedly rather technical points by Her Majesty's Government. In all the circumstances, therefore, I would thank the noble Earl and support the Amendment he has moved.
On Question, Amendment agreed to.
EARL JELLICOE: This Amendment is consequential. I beg to move.
Amendment moved—
Page 191, line 22, leave out from ("Act") to first ("or") in line 23.—(Earl Jellicoe.)
On Question, Amendment agreed to.
Schedule 12, as amended, agreed to.
Schedule 13 [Modifications as from 1st April 1965 of Enactments relating to Food, Drugs, Markets and Animals]:
LORD HASTINGS: This Amendment corrects a drafting error. Consequential upon Clause 54(1), which gives the duty of enforcing Section 31 of the Food and Drugs Act, 1955, to the London borough councils and to the Common Council, as drafted the paragraph inadvertently deprives the county councils of their duty of enforcement and also gives the duty to the authorities of the Inner and Middle Temples, which are local authorities for other purposes under the Food and Drugs Act. The wording of the Amendment puts these matters right and brings the Schedule back into line with Clause 54 giving the county councils their proper powers. I beg to move.
Amendment moved—
Page 193, leave out line 39 and insert ("Councils of counties, county boroughs and London boroughs and the Common Council of the City of London").—(Lord Hastings.)
On Question, Amendment agreed to.
Schedule 13, as amended, agreed to.
7.0 p.m.
LORD HASTINGS LORD HASTINGS moved, after Schedule 13, to insert the following new Schedule:

FUNCTIONS WITH RESPECT TO LAND DRAINAGE, FLOOD PREVENTION, ETC.
(1) Subject to the following provisions of this Schedule, the functions exercisable by the council of a county borough under the Land Drainage Act 1930 and the Land Drainage Act 1961 (hereafter in this Schedule respectively referred to as 'The Act of 1930' and 'the Act of 1961') shall be exercisable as respects a London borough by the council of the borough and as respects the City by the Common Council, and accordingly references in those Acts to a county borough and the council thereof shall, without prejudice to paragraphs 2 and 4 of this Schedule, be construed as including references respectively to a London borough and the council thereof and the City and the Common Council.
(2) Subject as aforesaid, the functions exercisable by the council of a county borough under or by virtue of Part V and section 51 of the Act of 1930 and sections 28 and 34 of the Act of 1961 shall also be exercisable as respects the metropolitan watercourses by the Greater London Council, and accordingly references in those provisions to a county borough and the council thereof shall, in their application to the metropolitan watercourses, be construed as including references respectively to Greater London and the Greater London Council.
(3) The functions exercisable under the Acts of 1930 and 1961 by the council of a London borough or county district or by the Common Council shall, so far as concerns the main metropolitan watercourses, including the banks thereof and drainage works in connection therewith, be exercisable solely by the Greater London Council; and without prejudice to the foregoing restriction, any provision of the Acts of 1930 and 1961 which precludes or restricts the exercise by a county borough council of any functions with respect to a main river shall apply to the exercise by the council of a London borough or county district or the Common Council, of any functions with respect to a main metropolitan watercourse.
(4) References to a county borough and the council thereof in sections 4(2), 6(4) and 54 of, and paragraph 1 of Part I of Schedule 2 to, the Act of 1930 and in section 17 of the Act of 1961 shall be construed as including references respectively to Greater London and the Greater London Council.
(5) Section 78 of the Land Drainage Act, 1930, shall cease to have effect, but sections 10, 17 to 19 and 50(1)(a) and (4) of that Act shall not apply in relation to the metropolitan watercourses.
(6) The foregoing provisions of this Schedule shall not be construed as applying to any river authority or river authority area a provision of the Act of 1930 which is excluded by paragraph 5 of Schedule 2 to the Water Resources Act, 1963.
(7) Subject to any provision made by an order under secion 81 or 84 of this Act—

(a) the functions of the council of any county or county borough under the local enactments relating to the metropolitan watercourses shall instead of being exercisable by that council be exercisable by the Greater London Council and references in any such enactment to any such council shall be construed accordingly; and

(b) the local enactments relating to so much of the tidal Thames as lies within the existing county of London shall apply to the whole of the tidal Thames (as described in the Table in paragraph 13(1) of this Schedule), and in those enactments references to, or which are to be taken as references to, the county of London shall be construed accordingly;

(c) no functions relating to land drainage, flood prevention and the like matters shall (subject to paragraph 14 of this Schedule) be exercisable with respect to the tidal Thames by any authority under any local statutory provisions other than the enactments mentioned in sub-paragraph (b) of this paragraph or by virtue only of section 83(3) of the Act of 1930.

(8) In section 9(5) of the River Boards Act, 1948 (so far as applicable by virtue of section 9(10) of that Act and section 128(5) of the Water Resources Act, 1963) the reference to local authorities shall be construed as including a reference to the Greater London Council, the London borough councils and the Common Council.
(9) In the Water Resources Act, 1963—

(a) the reference in section 16(3) to local authorities and the reference in section 127(3) to a local authority as defined in section 127(1) shall be construed as including references to the Greater London Council and the London borough councils;

(b) the references in sections 6(7), 7(3), 82, 105 and 116 to a county borough and the council thereof shall be construed as including references respectively to a London borough and the council thereof;

and the transitional, incidental, supplementary and consequential provisions which may be included in an order under section 10 or 120 of that Act shall include provision repealing or amending any of the provisions of this Schedule.
(10) The expenses incurred by the Greater London Council in the discharge of the functions conferred on them by virtue of this Schedule shall be chargeable on the London boroughs falling wholly or partly within the London excluded area and on the City and the Temples and where part only of a London borough falls within that area those expenses shall be chargeable only on that part of the borough.
(11) The expenses so incurred shall be expenses for special London purposes.
(12) Where any expenses incurred by the Greater London Council in the discharge of their said functions are by virtue of paragraph

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10 of this Schedule chargeable on part of a London borough—

(a) any expenses incurred by the council of that borough in the discharge by them of the like functions with respect to another part of the borough, and

(b) any payments made by that council for meeting precepts for defraying expenses incurred by some other body of persons in the discharge of the like functions with respect to another part of the borough,

shall be chargeable only on that other part of the borough.
13.—(1) Subject to the provisions of any order under the next following paragraph, in this Schedule—
"the metropolitan watercourses" means the watercourses described in column 1 of the following Table;
"the main metropolitan watercourses" means the tidal Thames and the watercourses named in paragraphs 2 to 4 of that Table (including the tributaries of the river Ravensbourne mentioned in the said paragraph 2);
"the tidal Thames "means the water courses described in paragraph 1 of that Table;
"local enactment" means, in relation to any watercourse, the enactments specified in regulation thereto in column 2 of that Table:

TABLE

1.

The river Thames from and including Teddington lock to the eastern limits of Greater London, including all its associated watercourses within the flow or reflow of its tides west of those limits, but not including so much of the river Thames or of those watercourses as lies within the Thames catchment area, the Les catchment area or the area of any river authority.

The Thames River (Prevention of Floods) Acts 1879 to 1961 and section 14 of the London County Council (General Powers) Act 1932.

2.

The river Ravensbourne and the tributaries thereof named in section 5 of the Act of 1961 specified in column 2, and their associated watercourses.

The River Ravensbourne, &c. (Improvement and Flood Prevention) Act 1961.

3.

The Beverley Brook, the river Graveney, the Pyl Brook and the river Wandle and their associated watercourses.

Part II of the Surrey County Council Act 1925, section 15 of the Surrey County Council Act 1931, Part II of the Surrey County Council Act 1936 and the London and Surrey (River Wandle and River Graveney) (Jurisdiction) Act 1960.

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4.

The river Brent, the river Crane and the Duke of Northumberland's river and their associated watercourses.

Part V of the Middle-sex County Council Act 1944.

(2) The Minister may, after consultation with the Greater London Council and the council of any London borough or county district appearing to him to be affected, by order provide that—

(a) the whole or any part of a watercourse other than the tidal Thames shall cease to be a metropolitan watercourse;

(b) the whole or any part of a metropolitan watercourse shall become or cease to be a main metropolitan watercourse.

(3) In this Schedule—
"associated watercourse" in relation to any river means a tributary or other watercourse the water from which ultimately flows into, or which is directly or indirectly connected with, that river;
"banks" has the same meaning as in the Land Drainage Act 1930;
"London excluded area" means so much of Greater London, and of any area adjoining Greater London, as does not lie within the Thames catchment area, the Lee catchment area or the area of any river authority;
"public sewer" has the same meaning as in the Public Health Act 1936;
"watercourse" includes all rivers, streams, ditches, drains, cuts, culverts, dykes, sluices, sewers and passages through which water flows, except public sewers;
and any reference in this Schedule to a particular river does not include a reference to so much of the river as is a public sewer, and any mention of a particular river shall not be construed as prejudicing the meaning of the expression "associated watercourse".
14. Nothing in this Schedule shall apply to any property held for the purposes of their undertaking by the Port of London Authority or affect any functions exercisable by that Authority."
The noble Lord said: This is the new Schedule referring to land drainage and flood prevention which I foreshadowed in the paving Amendment earlier this afternoon. When I was moving that Amendment I said that this was in response to an undertaking given during the Committee stage in another place. It was thought that this was such an important subject that, to deal with it in orders, which had been the original intention, would not be appropriate, and Members of another place requested that there should be much more detailed mention of this matter. In considering the provisions of land drainage in Greater London we have to remember that parts of Greater London are in the areas of the Thames Conservancy, the

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Lee Conservancy Catchment Board and the Essex and Kent River Boards. In their respective areas those authorities have general control over land drainage and exclusive powers to carry out works over the "main rivers" which are specified for this purpose on a map of "main rivers". Within those areas, however, the county boroughs, county councils and county district councils have their own powers under the Land and Drainage Acts to carry out works on watercourses other than main river to prevent or to mitigate flooding. In those parts of Greater London which are within those areas the London boroughs will be able to exercise the same powers which county boroughs have in this connection elsewhere throughout the country.
A substantial part of Greater London is not, however, in the area of any of these major drainage authorities. This area is known as the "excluded area", and it includes most of the administrative county of London, South Middlesex and much of Metropolitan Kent and Surrey. The excluded area also stretches outside Greater London into Staines and also in the Banstead and Caterham areas of Surrey. In this excluded area a number of the most important rivers have been made the subject of Local Acts. The Thames itself is, of course, in this category, and in addition there are the rivers which are specifically named in column 1 of the table which forms part of paragraph 13 of this Schedule. The Schedule describes these named rivers as "main metropolitan watercourses" and the effect of doing so is to place them in the same position as main rivers in river board areas elsewhere. The Greater London Council is thus given exclusive power to carry out drainage and flood prevention works on these rivers and the expenses of the Council in this connection are to be spread over the whole of Greater London in the excluded area.
The Schedule also refers to "metropolitan watercourses." I think I ought to draw your Lordships' attention to the difference between these. There are "main metropolitan watercourses", and these are merely "metropolitan watercourses." This may otherwise be rather
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confusing. These metropolitan watercourses, in addition to the main rivers mentioned in this category, include the associated watercourses, which are the tributaries of those rivers mentioned in Nos. 2, 3 and 4 of the table. The Greater London Council and the London boroughs will have concurrent drainage powers over these. For example, if we take the River Brent, which flows through Hendon, the Greater London Council will be the sole drainage authority for the River Brent itself, but so far as its tributaries are concerned, which would be metropolitan watercourses, works may be carried out either by the Greater London Council or by the London boroughs concerned.
There remain then the other streams and watercourses in the excluded area. These are the ones which are not tributaries of any of the named rivers in the table in paragraph 13. In connection with these, the London boroughs will be the sole drainage authorities. Paragraph 13(2) of the Schedule permits the Minister to alter the table by removing rivers either from the categories of metropolitan watercourse or main metropolitan watercourse. I am afraid that this is a long and involved Schedule and it may call for further study but I hope I have, in a brief space, been able to clarify what it is about and to make clear the sort of way in which this matter will operate. I beg to move.
Amendment moved—
After Schedule 13 insert the said new Schedule.—(Lord Hastings.)
LORD MORRISON OF LAMBETH: I confess that we are beaten by this long Amendment; we do not know what it means. But we do not think that it is necessarily any the worse for that. Therefore, we do not propose to be troublesome about it at this stage of the Bill. We must examine it in further detail and we may want to bring up something on the Report stage. This term "paving Amendment" is a new expression, I think, in Parliamentary language, so far as I remember. Well, I stand corrected. I accept that. I thought it was. I thought it was something from Perry Mason who, when he gets pulled up by the district attorney or by his Honour as being out of order, says, "I am laying the foundation, your Honour". I thought

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it meant that. If the noble and learned Lord the Lord Chancellor assures me that it is a common phrase. I accept that, because he knows all about it. In all the circumstances, we propose not to be difficult about this Amendment; but we shall have to try to understand it between now and the Report stage, and then do what we can, if anything, in regard to it.
On Question, Amendment agreed to.
Part VIII.
Clauses 61 to 65 agreed to.
Clause 66 [Financial provisions applicable to the Common Council]:
LORD HASTINGS: This Amendment removes the reference to "St. Botolph Without Aldgate Tithe Rate." As the Bill stands, expenses met by the rate in question are excepted from the provision made by the subsection. The rate is levied under the provisions of Acts of 1881, 1888 and 1910 to meet the cost of the extinguishment of the tithe formerly charged on the ecclesiastical parish of St. Botolph Without Aldgate, which is within the City. The rate is leviable until 1970, and it therefore seemed necessary to except the expenses covered by it from the clause. But we have heard since that the Common Council are satisfied that it will not be necessary to levy any further rate, and therefore the reference can be removed from the Bill. I beg to move.
Amendment moved—
Page 80, line 41, leave out from ("rate") to end of line 42.—(Lord Hastings.)
On Question, Amendment agreed to.
Clause 66, as amended, agreed to.
Clause 67 agreed to.
7.10 p.m.
LORD SHEPHERD: Before my noble friend moves the next Amendment, I wonder whether I might seek the assistance of the noble and learned Lord who is in charge of the Bill. I think he will agree that we have made very good progress at this stage. We are now about to deal with Clause 68, about which there is considerable concern because this matter is regarded as of considerable importance by all sections of the Committee. I think that in some ways it would be unfair to my noble
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friend Lord Champion to have to speak and then to find the debate being adjourned for Dinner.
Therefore, in view of the progress we have made, and in the interests of continuity of debate—because this is an important subject, not a Party issue—I wonder whether the Government would agree to adjourn at this stage, and then we could deal with Clause 68 in its entirety. May I say to the noble Lord in charge of the Bill that a number of these Amendments will in fact be moved together? They will not involve separate debates. I refer to Amendment 244A, 245, and 246A; and I believe that the noble Lord, Lord Auckland, would be agreeable to speaking to his own Amendment, No. 246B, together with the others, which would mean that Amendment 246, which is on a different subject, could be moved separately. I hope that the Government can help us in this matter.
THE LORD CHANCELLOR: I think it is true that we have made extremely good progress, and some of the pessimism shown at an earlier period of the day has proved to be unfounded. I would willingly accept the noble Lord's request, but I should point out that its acceptance cannot accelerate the cooking process. Therefore, I understand that Dinner will not be available, or I cannot guarantee its availability, immediately. I beg to move that the Committee do adjourn during pleasure until half-past eight.
Moved, That the Committee do now adjourn until half-past eight.—(The Lord Chancellor.)
LORD AIREDALE: On this Motion, perhaps I might inform the Committee that the result of the Division, Division No. 2, on Amendment 208, was announced as: Contents, 25; Not-Contents, 73. A careful check of the Not-Contents division sheet shows that 74 Members, and not 73, voted Not-Content.
On Question, Motion agreed to.
[The Sitting was suspended at thirteen minutes past seven o'clock and resumed at half-past eight o'clock.]
Clause 68 [Transitional assistance to certain counties]:
LORD CHAMPION LORD CHAMPION moved, in subsection (1), to omit
"which exceeds the estimated product of a rate of fivepence in the pound for the county for the year 1965–66."
The noble Lord said: Amendment No. 244A is a paving Amendment for No. 246A. I use the expression even if my noble friend Lord Morrison of Lambeth did not like it very much, because it seems to me to be a good way to describe something which paves the way for something which succeeds it. Clause 68 accepts the principle put forward by the Royal Commission that the severed counties would need financial aid. So what we have to discuss now is the extent of that financial aid and the extent to which the Government have, by this Bill, made provision for it. We have to consider whether or not these proposals in the Bill are just and fair to those counties.
What are the problems that those counties will have to meet? First, the new counties—that is, the severed counties—will have to carry the burden caused by the movement of Londoners outwards, a movement that has accelerated enormously since the end of the last war, which has caused these counties which are to be severed to provide services on a very large scale for those people who have moved out. In this connection it has to be remembered that many of these people who have moved out to these counties work in the Greater London area and by so doing contribute to the wealth of the Greater London area. It also must be mentioned in this connection that the effect of migration upon these counties, the counties of Essex, Kent and Surrey, has been felt for many years, and the whole of those counties have contributed to the initial building up of services in the metropolitan part of the counties. This part, in turn, could now have been expected Ito contribute to the cost of the services for those Londoners who are moving out into what are now described as the new counties. In this connection it might be argued that all this new development will create new rateable values. Of course it will. But the point that has to be stressed about the new rateable values is that before the benefit is felt by these counties there will be a
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considerable time lag. I think this is important. It is the experience of everyone who has ever been engaged in local government, that with new rateable value, following upon new building, et cetera, some time elapses before the benefit accrues to the local authority.
Secondly, in this connection there is the burden caused by the fact that the cost of central administration will be borne on narrow shoulders, the narrower shoulders of the new counties, as against the broad shoulders of the old counties. The counties will lose their most compact areas, and we all know that the rural parts of the county can involve the county in very much heavier cost than the compact area, in the matter of roads and services of that sort. The savings which accrue to old counties as a result of their size—the old counties as they were before—will no longer be achieved. For example, the fire service and other specialised services will have to be carried on what I have described as the narrower shoulders.
Also, large-scale purchasing economies will be reduced as a result of this contraction which is going to take place. Perhaps I can best illustrate this by taking the County of Essex. The population of the County of Essex rose by some 253,000 in the ten years 1951 to 1961. For comparison with other counties, I take two counties showing large increases in the same period: Lancashire, 163,000; Gloucestershire, 65,000. Ten other counties come in between the figures I have quoted. The population increase of the new County of Essex is more than the population of many of our counties in England. It is the equivalent to an increase of some 37 per cent. in the population of new Essex—that is, the part which will be left after this Bill has become an Act. Schools clinics, police and ambulance stations, et cetera, have had to be provided at large capital costs and high interest rates to provide for that tremendous influx of population. Two hundred new schools have been built since the end of the last war. And all this gives Essex a special claim to transitional assistance.
Essex has estimated—and here I am using some information which has been provided for me by someone knowledgeable in this connection—that the new county will incur a loss due to the Bill

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of about £1·5 million. The Government propose to provide transitional assistance to meet this loss, but require that the new county mast bear the first 5d. rate increase due to the loss, without any help of any kind. This means that the first £900,000 a year—the estimated product of a 5d. rate in the new County of Essex in 1965–66 must be borne by that county in one fell swoop in 1965. Thereafter, the remaining £600,000 of the loss will be assumed by the new county by eight equal annual instalments until the whole £1·5 million is borne by the new county. Yet, if the whole of the losses of the Home Counties were met by Greater London in the first year, it might cost less than a 1½d. rate in London, and this would be reduced each year. The whole scheme of local government in Greater London is designed to benefit the people of Greater London. The people of the new County of Essex can reap no benefit at all. Yet the Bill proposes that the people of Essex must bear a 5d. increase at once, increasing to about 8d. on 1965 figures. This will be directly due to the Bill—and Essex, naturally, feel that this is an imposition that they ought not to be expected to bear.
In another place the Government improved the financial provisions of the Bill by reducing the additional rate burden from the estimated product of a 6d. rate to a rate of 5d. in the pound. They also extended the transitional period from five to eight years. That was something of an advance, but I have seen the 1d. in the pound reduction described as a derisory reduction considering the burden which has to be borne by these counties as a result of this Bill. The proposal in the two Amendments hat I am moving would provide for reimbursement of the whole of the added burden in the year 1965–66, for reducing the assistance in subsequent years by a fixed amount in each year, and for the avoidance of unnecessary claims and ascertainment of added burden by a proviso that no payment shall be due under the clause it the added burden, ascertained by applying Schedule 15, is less than 2d. in the pound.
Under our proposals embodied in Amendment No. 246A, the severed counties could easily and quickly ascertain if the added burdens to be sustained were
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likely to support a claim; if not, then no further administrative time would be involved. Those counties qualified for assistance would receive the whole of their loss in the first year and a reduction in the financial aid by a specific figure would extend the period of aid for those counties where the loss is greatest. I have moved this Amendment very briefly, but I honestly think there is a case for improvement in these financial provisions. Some way must be found to make that improvement even if the proposals in my Amendment do not exactly meet it. I think that the case of Essex demonstrates the burden that is going to fall upon these new counties as a result of this Bill; and clearly the ratepayers of that section of Essex ought never to be expected to bear it.
Amendment moved—
Page 82, line 19, leave out from ("Act") to third ("the") in line 21.—(Lord Champion.)
LORD SHEPHERD: May I support my noble friend and, with the permission of the Committee, speak also to the following Amendment No. 245? My noble friend Lord Champion and I, with our colleagues, have been involved for many days in what is obviously a political fight. I have no regrets about it. However, I hope this evening that the non-political approach we are making from this side will be matched by the other side, because here we are not dealing with any Party matter. We are trying to find justice for these counties that will be gravely (and I hope the noble Lord, Lord Hastings, will bear this in mind) and permanently affected by the proposals of the Government. This is a Bill which the Government claim is for the improvement of local government in London. That is their case; but I do not now propose to deal with it. But, falling consequentially from the Government proposals, local county government in Surrey, Kent and in particular, as the noble Lord, Lord Champion, has said, in Essex, will be permanently affected.
A NOBLE LORD: And Hertfordshire.
LORD SHEPHERD: Yes, and Hertfordshire; but I think the Committee would agree with me that in Hertfordshire the effect is limited. I am sure that it would not be the Government's intention, whatever they may wish to do in London, in any way to destroy

819
or reduce the effectiveness of government in Surrey and the other counties; or in any way to reduce the type and quality of service these counties are providing.
My noble friend drew the Committee's attention to the Royal Commission Report. Perhaps, I may read it the relevant passage, because this part is the basis of Clause 68. It says:
"Nevertheless, the changes which we propose are of such magnitude and represent a surgical operation of such an unusual kind that special treatment seems to be justifiable. We therefore propose that there should be transitional arrangements whereby the Boroughs in the severed metropolitan parts of the Counties of Essex, Hertfordshire, Kent and Surrey should relieve the rate burden of their respective former counties for a limited period of time by means of a special precept payable through the Council for Greater London."
The Royal Commission recognised the consequences of the proposals on these counties. The Government have accepted that these counties should receive some compensation, but they have departed from the Royal Commission to this extent, that instead of putting the precept upon the areas being brought into Greater London, they have decided to make the whole of the Greater London area responsible for it. It is debatable whether that is right. It could be argued that the inner boroughs will be called upon to pay a rate to a county to which they have never been affiliated and that in the long run they themselves may not gain by the new Greater London Authority.
The Government's original intention was that there should be a 6d. rate decreasing over five or six years. The counties understood that the 6d. rate was to be on the old valuation. In that circumstance, they thought that their treatment was satisfactory. But they were completely shocked when they found that the 6d. rate was to be on the new valuation. This means that the figure at which compensation will be paid to the county councils would be the equivalent of 1s. 3d. on the old rate. That would be a heavy burden, which would come as a great shock to ratepayers. If they appreciated the magnitude of the imposition which was being placed upon them. But when expressed as a 5d. or 6d. rate, it does not sound so bad. After pressure in
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another place, the Government reduced the 6d. rate to 5d. and lengthened the period of payment for the county qualifying from five or six years to eight.
This evening I wish to speak of my own county, Surrey. I recognise that the county of which my noble friend Lord Champion was speaking, Essex, is in a much worse position than Surrey.
EARL ALEXANDER OF HILLSBOROUGH: I know that. I live there.
LORD SHEPHERD: I should like to put the position of Surrey in some detail, because I think that the Committee should be aware of it. I appreciate the position of the noble Lord, Lord Hastings, about making a policy decision on his own responsibility, but I should like him to give an undertaking tonight that he will again take up this matter with his senior Minister and perhaps open fresh negotiation with the counties concerned and the Minister. The area that will be left of the new Surrey—that is, the Surrey area without the London section—will represent 92·33 per cent. of its present area. Therefore, the Committee will appreciate that the area for the new county to administer will be very much the same as now exists. They will have the same length of roads, the same problem of providing social services and the transport problems that will arise from them. As to population, they will have to provide services for 60½ per cent., a tidy figure, spread over the urban district.
The serious consequence is with regard to the rateable value. The rateable value of new Surrey will be a mere 57·43 per cent. of the present rateable value, and this to cover and provide the services to an area practically equivalent to today's area. If we want to get away from percentages, perhaps the noble Lord will take these figures from me. The revenue which the Surrey County Council to-day receive is approximately £43,750,000. But they will have to provide and maintain the present standards of social service, education and the like on an income of approximately £25,750,000. I think the noble Lord will appreciate the task that will confront the Surrey County Council.
I do not think there is any dispute over my figures, because I understand that the noble Lord's Ministry has accepted them. As I understand it, leaving aside administrative costs, the severance of the county

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will result in an increased rate on the old valuation figures of 11d., or of 3¾d. on the new figure, which is what we are now interested in. This figure derives partly from lower rating resources of the new Surrey, and partly from the heavier burden of highways. For although the county is losing 42 per cent. of its rateable value, it is losing less than 8 per cent. of its area. As I say, I think the figures have been accepted by the noble Lord's Department. To this figure of 3¾d. we have to add the administrative costs—the extra burden that will fall on the authority in view of its present size, the distribution of its population and the type of facilities that will be required, which will not in any way permit the authority to reduce its administrative staff, its equipment and the like to compensate for this fall in population. According to my figure, on the new rate it will be 1¼d. Therefore, so far as Surrey is concerned, because of the area of higher rateable value being taken into the Greater London Area, a 5d. increase in the rate will have to be borne by the ratepayers of Surrey to compensate for the loss. That represents a figure of £925,000.
I wish to say one thing in regard to what the Surrey County Council are faced with in education. I have mentioned it before, and I think it is of considerable importance. It is in regard to the capital cost of education, and I refer to it because I believe it represents 80 per cent. of their expenditure to-day. During the years 1934 to 1939, 65 per cent. of their capital expenditure on education—that is, the provision of schools, playgrounds and the like—related to the area which is being absorbed into London, and a mere 35 per cent. was spent upon the rural district.
During the years 1959, 1960 and 1961, and obviously in the future, the ratio must be changed. The rural areas must be developed. The services which have been concentrated into the built-up areas must now be brought to if e rural areas. Their estimates were that 37 per cent. would be for the Metropolitan area and 63 per cent. for the rural areas. But because of this Bill, because of the Government's decision as to which areas shall go into Greater London, the mainly rural area of Surrey, which has provided the main capital, the main emphasis, for the
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development of this London area, will be denied the income and the resources that would naturally become available from the high rateable value of those areas that are going into Greater London.
I suggest that in justice, and for the sake of maintaining the standards of the rural districts of Surrey (and, of course, of Essex and other counties), these counties should be provided with (if I may use the word) "compensation" for the permanent loss they will sustain. This is not a loss from which they will quickly recover. The areas they are losing are the areas in which they themselves have played a part in developing. I know that these areas have developed by natural consequence because they were so close to London; but it is county responsibility, judgment and decision which has built up these amenities. I suggest that if, following a Government decision, these areas are now to be taken away and are to go into Greater London there should be some (I use the word again) "compensation"; because, as I say, it is a permanent loss to the counties.
There is much more that could be said in this matter. I do not know whether the noble Lord, Lord Hastings, can give us any idea how the figure of 5d. was set. In the case of Surrey, I think there may be suspicion that the figure was set at 5d. because they thought there would be no precept charge on the Greater London area. I think it is quite wrong that the County of Surrey—and, of course, the County of Essex—should bear this complete shock.
In closing, may I illustrate the effect of the Government decision on the rateable value per head? My understanding is that the rateable value per head in Surrey to-day, as a whole county, is £52 10s. For the new Surrey—the Surrey outside the Greater London area—the rateable value per head will drop to £49 17s. This is very interesting. The rateable value of London-Surrey, that is, the part that will be going to London, will rise to £56 13s., so that the areas which are going into London will make substantial gains. Perhaps that will not be shared by Greater London, but they themselves will have a higher rateable value per head. Whether the Government were right to say that the whole of the Greater London area should make

823
this contribution, I do not know. The Royal Commission said that it should come from the areas which are leaving the county, and to which the county themselves had contributed to their development. Whether it is the boroughs, whether it is the London area, or whether, as my noble friend Lord Latham will suggest, in view of the Government policy it is a question for the Government itself, with its financial national resources, who should make the contribution to the county, I beg the Government at least to recognise the position of these counties. They will be viable, but you cannot hold back progress. Once you start halting the growth of a service, it takes some time to recover. Plans have already been made and I hope that this Committee will see that these counties, whatever may be done, may be able to continue with their plans and develop their own districts.
LORD AUCKLAND: I wish very briefly to support everything which the noble Lord, Lord Shepherd, and the noble Lord, Lord Champion, have said. During the course of this Bill I have tried to estimate in my own judgment, purely on the merits of the case; and while there have been times when I have not agreed with noble Lords opposite, I think that the noble Lord, Lord Shepherd, has put this case with consummate fairness. The Surrey County Council is not an irresponsible body. It has gone into this matter with great care. I have myself had considerable communication with the Clerk of the Council. The people who live in Surrey, and especially those who live in the parts of Surrey which are not going into the Greater London Council, are largely people of fixed incomes. They are not people of great wealth, and already this year many have suffered considerable increases in rates; and once the rates go up they have a habit of coming down, if at all, very slowly. One has only to examine the figures to see the burdens with which these people are likely to be faced if those proposals go through. There is another point here, which is that Surrey is going to lose quite a large proportion of its industrial ratings; for example, Mitcham, which has a good deal of industry, will be lost. I know that it will be argued that Woking, Camberley and Weybridge, which were reprieved, will remain in the county.
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My noble friend Lord Ellenborough and I have another Amendment down which does not commit the Government as far as the one moved by the noble Lord, Lord Shepherd, but I feel that his Amendment is perfectly fair and I plead with my noble friend to give it at least very serious consideration, because people living in Surrey and those who do such fine work for the Surrey County Council have gone into this matter very carefully. I will say no more, because the case has already been put, to my mind, with cast-iron conviction; but I would plead with my noble friend to go into this matter very thoroughly.
9.4 p.m.
VISCOUNT GAGE: I hope the noble Lords who have spoken will forgive me if I raise a somewhat different point on this Amendment although it is connected with it. This is a Bill about London and the Amendments deal with London, but in the course of the arguments about these Amendments points have been raised on both sides which go a long way beyond London. I happen to know that there is a degree of apprehension in the associations of local governments about the formula which we are now discussing. In the first place, I think there is a good deal of sympathy for those truncated counties, for the reasons that have been put very clearly. This new valuation in itself has come as a great shock to retired people, as I know well. They have to face it, for reasons which no doubt can be stated as good mathematical reasons but which weigh very hardly on that particular class of person. What I am especially concerned about is to get some assurance from the Government with regard to the application of this formula to other parts of the country. This Bill obviously contemplates considerable enlargement of the areas and the powers of various authorities, but they are by no means the only proposals likely to be placed before Parliament with the same object if the recommendations of the Boundary Commission are of any importance in this matter.
I do not claim any expert knowledge on this highly technical question of financial adjustment. I know it has had a long and complicated history, and even if I were an expert it perhaps would not be a suitable occasion to go into

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it in detail on this London Bill. I am informed by experts that if this formula were to be applied elsewhere it might result in a number of serious anomalies and unfairnesses. The case we are discussing to-day is rather unusual, because we are contemplating the creation of an entirely new body, the Greater London Council, and the controversy, which is considerable, is nevertheless a fairly simple controversy. I am informed that it would not be at all simple if this formula were applied to amalgamation of other existing authorities. I would therefore make a strong plea to my noble friend Lord Hastings that we might be given an assurance that Clause 68, whatever happens to it in this House—and I personally hope some attention will be paid to the speeches already made—will not be treated as a precedent in any other case without opportunities being given for full consultation with the organisations of local government authorities.
EARL ALEXANDER OF HILLSBOROUGH: May I say a word and declare an interest? I am a ratepayer to some extent in Essex, and therefore I must confess my interest. We have already had an experience, as mentioned by the noble Viscount, Lord Gage; we have already had our first shock in 1963, and the rates are up tremendously this year. In my own case in the course of twelve months they will be up by nearly £40. Some of it may be adjusted, because we can appeal against the basic valuation up to August. Mine has been in an agent's hands for two or three months and we have heard nothing about it or about what is going on. When we come to the elect on Essex as a whole, which has been so admirably illustrated by detailed figures given by my noble friend Lord Champion, then we see that the result will be quite extraordinary. It must also be the case in Kent and Surrey that when these new delineations are carried through there will have to be many adjustments in the accommodation provided so far near the boundaries which are newly to be set, and the costs which are going to remain upon the county which is losing so much of its rateable value will be out of all proportion in the rate per pound as against the actual areas taken into Greater London. I do not need to repeat the figures given by my noble friend Lord
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Champion regarding the County of Essex, but I can say that I know there are rising commitments of very heavy substance.
Take education, for example, If you lose the rateable value of boroughs like Walthamstow and Ilford and other places which have already been largely provided for in regard to education by great capital expenditure within their boundaries, you leave on the fringe, outside a lot of these facilities, places where new capital expenditure will have to be undertaken. One cannot measure yet what the effect is going to be on Surrey, Kent and Essex. Take the great pressure now for advanced education beyond the secondary modern and grammar school stage into the university. In the case of Essex we have already the heavy burden upon us of finding university places for our scholars in Essex and so it has had to be decided that an entirely new university must be provided in Colchester. It is all passed, and I believe the preliminary expenditures are at this moment being undertaken.
Who is to bear the burden of that in the future, apart from the actual grants for university education from the Government? It is this tendency all the way round in these matters that makes us fear greatly for the financial stability of many of our remaining administrative county areas. I daresay the Government think that, sooner or later, the suffering public will bear it, but I do not think the Government can get away with that. They ought to listen to the pleas of both of my noble friends, Lord Champion and Lord Shepherd—and particularly in regard to the rates referred to, which could be relieved by a proper readjustment, and if not entirely by adjustment with the Greater London Area, then surely by direct aid from the Government themselves, to see that these rate burdens do not come down upon these mutilated areas in the counties I have mentioned. I have looked into this matter carefully from the point of view of the county where I live, Essex, and I most heartily support the Amendment.
9.13 p.m.
LORD ELLENBOROUGH: I, too, should like to give general support to these two Amendments, even though they appear to go somewhat further than the

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Amendment which is down in the names of my noble friend Lord Auckland and myself. I think there is no doubt at all that particularly the counties of Essex and Surrey are hard hit. Essex is left without any large town apart from Chelmsford and Colchester. In so far as Surrey is concerned, 42 per cent. of its rateable value goes, but it loses only 8 per cent. of its area; and it is obvious what effect that will have on administrative costs and also on the upkeep of the highways.
I find it rather difficult to see what is the use of Clause 68 in the Bill, because although it guarantees relief from anything over an estimated product of a 5d. rate in the £, as a result of the loss of the metropolitan area of these counties, at any rate Surrey has worked it out—I do not think the matter is in any dispute at all—that when all is said and done, and allowing for administrative costs and so on, it will, in fact, mean an additional burden of just about exactly 5d. What, then, is the use of the clause? It all seems to me really far too reminiscent of the Government's undertaking during the passage of the Rating and Valuation Act, 1961. I think it was then said by the Minister that an increase of at any rate over one-third of the householders' rates bill would be quite intolerable. And, of course, that Act allowed for percentage deductions of rateable values to be made in hard-hit areas. Then, later on, the Government came along and said that nowhere had they actually reached that one-third limit, and therefore nothing would be done. It was really a poor consolation for those people in areas which had been hit by 20 or 25 per cent. increases.
If I may say so, I find the Government's continued indifference to the plight of the ratepayer—not only in these four counties, but elsewhere for that matter—astonishing. At last, very belatedly and with great reluctance, they have grudgingly agreed to set up a Committee to look into certain limited aspects of rating. There seems to be little enthusiasm about it, and I do not think that is going to get the Government very far. Obviously, many ratepayers in these four counties—which are, after all, if not mainly, at any rate to a great extent, residential, as my noble friend
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Lord Auckland mentioned—are retired and elderly people living on fixed incomes. Many of them have already had a nasty shock through the positively savage increases in rates as a result of the revaluation which has just taken place. Now, if this Bill is unamended, they are going to be severely hit again next year or in 1965, and certainly so far as Surrey is concerned they have calculated that it will mean not less than a 10 per cent. increase in the rates.
I do not know whether the Government really think that ratepayers are going to be prepared indefinitely to put up with just anything. One would have thought they might have been taught some lesson from the recent local elections, which go some way to show that ratepayers are not prepared indefinitely to put up with this Government. I would warn the Government not to delude themselves into thinking that because of low polls at local elections people do not care what happens. They quite obviously do. I think the Government will find out in no uncertain manner at the next General Election that the electorate sees through the local government to the real culprits—who are the central authority who control the powers of local authorities.
As a result of Clause 68 the Government surely accept, at any rate in principle, the need for making transitional assistance to those counties, particularly Essex and Surrey, which are to be shorn of their metropolitan area. But by inserting this rate limit or bar of 5d. in the clause it seems that at the same time it will be of no effective use at all. I would therefore feel that these Amendments which have been moved by noble Lords opposite go a long way to meet the needs of the ratepayers in these counties, because, when all is said and done, there is going to be a very difficult transitional stage as a result of this reorganisation which is being imposed on the ratepayers of these counties—not asked for by the ratepayers in these counties, not necessarily in their interests, but it is in the interests of course of an important reorganisation of local government in the area of Greater London. I therefore would ask the noble Lord who is to reply for the Government to give these matters very serious consideration.
LORD BOSTON: I want to intervene for one moment to say that, although I do not live anywhere near London, in my own case about three years ago I was paying about £65 rates on my house; last year I paid £90; this year, thanks to the new rating, I have once more gone back to something under £70. So there are areas in which the rates are down.
9.20 p.m.
LORD HASTINGS: I approach this series of Amendments with a great deal of sympathy, but, naturally, with a great deal of caution as well. Here we are delving into a field of strong personal feelings, feelings based perhaps on a sense of injustice, and feelings aggravated by the knowledge that certain people's financial well-being may be affected. Therefore I have to make my argument as convincing as possible, and to treat the arguments from the other side—and not only from the opposite side, but from behind me as well—with complete seriousness and to try to meet them as best one can.
EARL ALEXANDER OF HILLSBOROUGH: With cash?
LORD HASTINGS: I agree at once, of course, that there is no question of not paying anything. As the noble Lord, Lord Champion, said, we are discussing whether the payments proposed to be made are just and fair. I would also agree with the noble Lord, Lord Shepherd, that this is not in any way a Party matter. We wish to do justice to all concerned, within certain limits and within certain principles, upon which we feel we must take a stand. This transitional assistance, which was recommended very strongly by the Royal Commission, in the words quoted by the noble Lord, Lord Shepherd, is to be considered, in the Government's view, as an exceptional case. It is not a principle that transitional assistance should always be given when we are dealing with local government reorganisation.
I should like to digress for a moment to speak about the principles of local government reorganisation. After all, as we know, the Boundary Commission is doing its work and there is going to be local government reorganisation throughout the length and breadth of the country. Therefore, I think it will be accepted by noble Lords opposite that the purpose of local government reorganisation is to
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improve local government as a whole. There can be no other reason for reorganising. I have deliberately linked the Greater London scheme to reorganisation in the country as a whole, because I am perfectly well aware that noble Lords opposite do not think that the reorganisation of London Government on the lines proposed by the Government is in the interests of local government.
LORD LATHAM: Can the noble Lord mention one case where the Commission's proposals have been agreed to?
LORD HASTINGS: Is the noble Lord referring to the Boundary Commission's proposals? They are very incomplete.
LORD LATHAM: Not the Royal Commission—the Boundary Commission dealing with the provinces.
LORD HASTINGS: We are not going into a detailed discussion of that aspect. But these reorganisations are going on, and in many cases people are agreeing to them. But they are very incomplete.
LORD LATHAM: Local authorities have objected in almost every case.
LORD HASTINGS: Inquiries are held and objections are fully considered. But I am saying that the purpose of this reorganisation is to improve local government. There can be no other purpose. When we consider it in that context, we have to realise that transitional assistance is not a principle at all. It can be considered only in exceptional instances.
Therefore I would assure the noble Viscount, Lord Gage, who brought up this particular aspect, that there is no intention of adopting Clause 68 as a pattern for other areas, with reorganisation of local government outside Greater London. The Royal Commission, as I have said, considered that there was a special case for some form of transitional assistance to the counties which, as a result of their proposals, would be losing population and rateable resources, and the Government agreed with this recommendation. However, their conclusion—that is to say, the Government's conclusion—was reached purely on the circumstances of the reorganisation of London government. I cannot say that a special case could never in any circumstances be made in any other area, but I can certainly say that Clause 68 is

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not regarded by the Government as a precedent, as regards either the principle or the formula which it contains.
That brings me to the words of the noble Lord, Lord Shepherd, who spoke about compensation. He will not be surprised to hear me say now, after what I have just said, that this clause is not intended to provide compensation for loss of territory or rate resources. Its sole purpose is to cushion any sudden and substantial increase in the rate. Following the lines of the passage in the Royal Commission Report which the noble Lord himself read out, this assistance would be only for a limited time. The noble Lord said that the damage would be permanent, but I am not sure that that was entirely borne out by the speech of the noble Lord, Lord Champion, who said that there would be new people and new building going to the areas which would build up a new rateable value, although there would be a time-lag. But I do not think that we can accept the fact that the damage will be of a permanent nature.
LORD SHEPHERD: May I just put this point?—because it is important. The noble Lord said that this should not be regarded as compensation for permanent loss. But in the case of Surrey—and I quoted the figures—the County Council, by a policy decision, has used the resources of one whole county in a particular direction, and they are now to lose that part. Would it not be just to say to those people in the rural districts, who have permitted a large share of the resources to go to the development of that part now to be lost, that there will be some form of compensation? I should have thought that ultimately they would expect some return from their assistance to this particular area.
LORD HASTINGS: I follow the logic of the noble Lord's argument, but it is not a principle we can accept: that one part of a county has an absolute right to expect that another part should assist it in return.
Looking to the future (he is thinking of the future difficulty of rural areas, and the provision of better services), I would point out that any expenditure on that will ordinarily qualify for grant. For
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the major services—education, local health, welfare, child care, fire—the general grant is available, and the distribution formula for that grant is under fundamental re-examination this year. If the new counties feel that there is a case for some special weighting for expanding populations, it is open to them to present their case. But I do not think that, in this context this evening, we can link future commitments of expenditure for new populations to the cushioning of the immediate rate increase resulting from reorganisation.
LORD LATHAM: Does the noble Lord say that, notwithstanding the words in Clause 68:
"If the county of Essex, Hertfordshire, Kent or Surrey incurs an additional rate burden consequential on this Act…"
—and so on? If that is not compensation for the consequences of this Act, what is?
LORD HASTINGS: This is not compensation, or the principle of compensation: it is transitional assistance for a limited period.
We have heard this evening three variations on a theme, and I cannot but answer them all at one go. We have been subjected to, or offered, three possibilities of a different form of transitional assistance. I think I should say—and this follows naturally upon what I have already said—that if the maximum additional burden had been, say, of the nature of a 2d. rate, the Government would never have entertained the need for a transitional assistance scheme at all. Because we believe, as I have said—we do not accept it as a principle that there should necessarily be assistance when we are dealing with local government reorganisation—that Greater London is a special case, because I admit, that it involves an increase of rate, particularly in the case of Essex, which they themselves estimate to be in the nature of 1s. based on the new valuation, therefore there may be said to be special hardship in that direction.
At the same time we are creating a completely new organisation and one which is exceptional in every way. This principle of transitional assistance cannot be transferred to other parts of the country, where local government reorganisation may take place in the evolutionary sense from time to time. In the case of

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Greater London, any additional burden must be looked at very carefully; and, as I have already said, if it was a low one there would have been no question of the Government considering transitional assistance at all.
A NOBLE LORD: Why not?
LORD HASTINGS: The 5d. threshold is admittedly an arbitrary figure. As noble Lords have said, when the Bill was in another place the figure was 6d., and after strenuous argument it has now been reduced by 1d. Above that we shall give assistance over an eight-year period in the manner laid down in the Bill. The actual amounts of increases to be expected in 1965–66 cannot be determined exactly at present. A good deal of the sum can be dome fairly accurately, because one-half relates to future rate resources and half of the remainder relates to expenditure. Provided that the assumption about the expenditure proves to be right, one can come to a reasonable guess at what the answer will be. But the other quarter is all important and covers a variety of imponderables, such as policy, the effect of reorganisation, administration expenses and so on.
Surrey County Council, as the Committee has heard from my noble friend Lord Ellenborough, estimate that their loss will be almost exactly the 5d. rate mentioned in the clause, and they are therefore unlikely to get anything out of it. Perhaps it is not surprising, therefore, that they should feel a sense of grievance. On the other hand, there is some comfort in the thought that the loss is likely to be much less as a result of the modifications to the boundaries made in their favour since the publication of the Royal Commission Report—much less than the estimates submitted to the Royal Commission.
LORD SHEPHERD: Would the noble Lord not agree that if the boundary adjustments had not been made, Surrey County Council would have been entitled to some compensation, because they would then have been above the bar? They are only just on the bar because of the adjustment to the areas.
LORD HASTINGS: The case of Essex was movingly put by the noble Lord, Lord Champion. He said that £l½ million will have to be found by the rates. I gave the rate poundage
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of 1s. and I accept his figure. I do not know whether that is the total sum. But I think it is worth reminding the noble Lord that Essex, as a result of this operation, will be below the national average, so far as a penny rate product is concerned; as a result of which they will get a deficiency grant calculated at something a good deal over £600,000. I do not know whether the noble Lord took that into account when he was mentioning that figure of £1½ million—I think, perhaps, he did not; but that will help considerably to close the gap.
EARL ALEXANDER OF HILLSBOROUGH: Should not the whole gap be closed, because this is on the initiative of the Government, in a measure for which they had no mandate from the electorate? The Government make interference and then put back the costs on the ratepayers.
LORD HASTINGS: That was the suggestion in the Amendment which the noble Lord, Lord Champion, moved: that all the additional rate burden should be borne by the Greater London Council and none of it should be borne by the truncated counties. That brings me right up against a problem the Government have had to face—the effect of reorganisation on the ratepayers in Greater London itself, since it is the ratepayers who are going to bear the cost of any transitional assistance to the severed counties. There is no evidence in the short-term—and that is what we are dealing with in Clause 68—that local authorities in Greater London will have rate reductions equivalent to the rate increases in the severed counties. I think that the noble Lord, Lord Shepherd, was barking up that tree, if I may use that expression, but I do not think we can accept that. Indeed, some of the present rating areas must expect substantial increases themselves on being merged with other more highly rated areas in a single London borough. The Government do not feel that they should aggravate the difficulties of those ratepayers by asking them to pay too much to the truncated counties. It is the Government's desire to hold the balance between the two groups of authorities and they feel that the present figure of 5d. is about right.
The noble Lord. Lord Shepherd, referred to the shock that the Surrey

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County Council had when they learned that the 6d. rate was not based on the old valuation but on the new. Having had a few moments to make inquiries, I can say that there must have been a misunderstanding, because it has always been made clear that the rate paid would be that pertaining when the Bill became law. It so happened that the Bill was first published before the new rates were published. But, if there was any shock in that regard, it was definitely a misunderstanding. It has never been the intention that the rates should be based on the old valuation.
In regard to the three variants we have heard this evening—that the Greater London Council should bear the whole additional burden, that they should bear all above a 2d. rate, and that the rate should be somewhere in between—I do not want to detain the Committee by arguing all three separately, because we feel that we cannot accept any of them, for the reasons I have given. We have thought over this matter carefully. It has been threshed out in another place. We have come down to a figure of 5d. This is a matter of transitional, exceptional, assistance, which we do not accept as a principle all over the country. We have to bear in mind also the financial well-being, and difficulty maybe, of the ratepayers of Greater London itself. Bearing all these things in mind, we feel that we have come to a fair compromise and that this is the best that we can do. Although I have listened carefully to the speeches with a great deal of sympathy and realise fully the feelings that lie behind them, I cannot honestly advise the Committee to accept any of these Amendments.
9.40 p.m.
LORD WALSTON: May I briefly make one point? I have the greatest sympathy with the unfortunate people who will find their rates going up as a result of all this reorganisation, but I cannot say that I have any sympathy with noble Lords opposite who have been making the case on behalf of those ratepayers. After all,
this is an essential result of the whole scheme that has been put forward. It stood to reason from the beginning that if certain areas were to be taken away from Essex, Surrey and the rest of them, the rates of the remaining counties would go up.
What is more, throughout the whole Committee stage on this Bill we on this side have been putting forward Amendments which have been attempting to increase the efficiency of the new Greater London Council with the idea of reducing the cost to the ratepayer. All those Amendments have been opposed by the Government, and noble Lords opposite have had the occasion, not only on Second Reading but on our Amendments, also, to vote with us against the Government in order to reduce the expense of this whole operation. They have refused to do so. They are like people who go into an expensive restaurant, order a large meal, enjoy it when they consume it, and when the bill comes start making a fuss about it. Now that the bill is being presented to them, surely, having acquiesced and having encouraged the Government in this act, which can result only in higher rates for all concerned, they have no right now to complain about the bill as it comes forward. In spite of that, as I say, I have great sympathy with the ratepayers themselves, who in the local elections and on other occasions have shown their disapproval of this. Therefore, for the sake of these people, I think it is only right to support my noble friend Lord Champion.
LORD CHAMPION: I am not going to reply extensively to the noble Lord. I think he has made it obvious that anything that may be said will not move him. In the circumstances, I do not propose to withdraw the Amendment, in the hope that we shall proceed further.
9.42 p.m.
On Question, Whether the said Amendment (No. 244A) shall be agreed to?
Their Lordships divided: Contents, 21; Not-Contents, 57.

CONTENTS

Alexander of Hillsborough, E.

Latham, L.

Shepherd, L.

Archibald, L.

Lawson, L.

Stonham, L. [Teller.]

Auckland, L.

Listowel, E.

Strabolgi, L.

Burden, L.

Longford, E.

Summerskill, B.

Champion, L.

Lucan, E. [Teller.]

Walstom, L.

Ellenborough, L.

Morrison of Lambeth, L.

Williams of Barnburgh, L.

Henderson, L.

St. Davids, V.

Williamson, L.

NOT-CONTENTS

Abinger, L.

Derwent, L.

Massereene and Ferrard, V.

Ailwyn, L.

Devonshire, D.

Mersey, V.

Albemarle, E.

Dilhome, L. (L. Chancellor.)

Mills, V.

Ampthill, L.

Dundonald, E.

Monsell, V.

Atholl, D.

Falmouth, V.

Newton, L.

Beauchamp, E.

Ferrers, E.

Powis, E.

Bossom, L.

Fraser of Lonsdale, L.

Rochdale, V.

Boston, L.

Goschen, V. [Teller.]

St. Aldwyn, E. [Teller.]

Boyd of Merton, V.

Greofell, L.

St. Oswald, L.

Brentford, V.

Hailsham, V. (L. President.)

Sandys, L.

Buccleuch and Queensberry, D.

Hastings, L.

Sandwich, E.

Chesham, L.

Hawke, L.

Sinclair of Cleeve, L.

Coleraine, L.

Howard of Glossop, L.

Strathcarron, L.

Colville of Culross, V.

Ilford, L.

Stuart of Findhorn, V.

Colyton, L.

Jellicoe, E.

Templemore, L.

Conesford, L.

Lambert, V.

Tenby, V.

Craigmyle, L.

Long, V.

Teyniham, L.

Crathorne, L.

Mabane, L.

Tweedsmuir, L.

Cromartie, E.

Margesson, V.

Wolverton, L.

Resolved in the negative, and Amendment disagreed to accordingly.

9.50 p.m.
LORD LATHAM LORD LATHAM moved in subsection (1) to leave out all words after "1965–66" to, and including, "county purposes" and insert:
"the Minister of Housing and Local Government shall pay out of moneys provided by Parliament."
The noble Lord: I rise to move Amendment No. 246, and perhaps it is appropriate that. I should say that Amendments Nos. 247 and 248 are closely related to the subject matter of this Amendment. We have been discussing the ascertainment of the amount which should be defrayed as a result of the consequences of this Act, and my Amendment is concerned with who pays this sum, whatever amount it may be ascertained to be. We take the view that, inasmuch as the expenditure is entirely consequential upon the action of the Government, it should be paid by the Government and not cast upon the ratepayers of the Greater London Area.
The provisions of this Bill are quite indefensible. The ratepayers of the Greater London Area are to be asked to pay for the cost of the dislocation and dismantling of their local government, about which they were never consulted and in respect of which the Government have no clear mandate to proceed. The ratepayers did not ask for this Bill. It is being imposed upon them, and there is no reason at all, in justice or in equity, why they should be asked to pay the costs of these proceedings. It is true that the cost
838
will be spread over some eight years. But in addition to the material costs, the money costs, there will be other very important costs, namely the costs resulting from the dislocation of the local Government services in the area in question, the review area.
As I have said, the ratepayers did not ask for these changes. They will not benefit from them. It may well be that the normal operation of the local government services of the area will be less efficient, less satisfactory, because of the demolition and the disarray there will inevitably be among the services ordinarily provided by local government. In these circumstances we take the view that the Government should pay for the cost of its own misdeeds. The local government pattern of the area will, it is quite clear from the terms of the Bill, be muddled, will not be thought out. It will not be a balanced pattern of local government; it will be a collection, as it were, of odds and ends, a distribution between the Greater London Council on the one hand and the London boroughs on the other. This Bill, as I have already said in another connection, is a pretty slovenly piece of work.
VISCOUNT STUART OF FINDHORN: Would the noble Lord contemplate getting a bigger typewriter; then he could read his speech more quickly.
LORD LATHAM: I think the noble Lord will make his own speech in his own way without interruptions of that character.
VISCOUNT STUART OF FINDHORN: I will not read it.
LORD LATHAM: As I have said, the Bill is a slovenly piece of work and we do not see why the ratepayers of the Greater London area should pay for the costs of the failure of the Government. I beg to move.
Amendment moved—
Page 82, line 21, leave on: from ("1965–66.") to the end of line 24 and insert the said words.—(Lord Latham.)
LORD HASTINGS: The noble Lord, Lord Latham, has based his entire case for throwing the extra cost of the rate burden in the counties on to the Exchequer instead of the Greater London Council on the hypothetical view that all the services in Greater London are going to be much worse than they are now. He was attacking the whole London Government Bill. He was saying the services were going to be less efficient, whereas of course the whole purpose of the reorganisation is to make London government a much more efficient and comprehensive organisation in every way. If that is what is being done, and we claim it is, there cannot possibly be any reason for saddling the general taxpayer with the transitional cost of these changes in London, the transitional cost of improving local government in the London area.
LORD LATHAM: I wonder whether the noble Lord will be agreeable to the charge being deferred until it is seen that the services in the review area are better than they are now.
LORD HASTINGS: Certainly we do not wish the truncated counties to go without any assistance at all. I am sure the noble Lord will not suggest in the reorganisation of local government in the provinces that we should ask the London ratepayer and taxpayer to pay transitional assistance to some county perhaps in the north-west of England. I do not think we should do anything of the sort. This is on a par. We say that if local government is being reorganised and will ultimately result, as we maintain, in better, more efficient and more economical local government in the whole region, then the temporary provision of assistance
to ease the new system in financially should properly come from the sources that will ultimately benefit. These are the ratepayers of the Greater London Council. That is the whole of the case, and we cannot accept that the taxpayer should be asked to pay.
LORD LATHAM: The ascertainment of this amount is not dependent upon how much is saved by better local government activities or facilities. It is based upon the reduction or the credit that is given to the severed counties. The two are not related.
LORD HASTINGS: I think they are. But coming on to the position of the Exchequer, I mentioned in the previous series of Amendments that the Exchequer would be paying a rate deficiency grant as a result of this reorganisation. So the Exchequer is not really getting away with it, by any means. I have no doubt that that pleases the noble Lord. As a result of reorganisation, we calculate that the rate deficiency grant to the County of Essex might be in the nature of £610,000, equivalent to about a 4d. rate on the new lists; and that Kent, which already receives a deficiency grant, might receive an additional deficiency grant in the nature of some £680,000, also nearly a 4d. rate in the new lists. Therefore the Exchequer is going to be paying out more money to the truncated counties. It would therefore seem unreasonable to throw the whole weight on the Exchequer which is making a substantial contribution in any case; and, of course, I base my argument mainly on the purpose of local government reorganisation, which it is aimed to improve. Therefore the ratepayer should make his contribution.
LORD LATHAM: It should be emphasised that you pay nothing until the local authorities have borne a rate of 5d.
10.2 p.m.
On Question, Whether the said Amendment (No. 246) shall be agreed to?
Their Lordships divided: Contents, 16; Not-Contents, 53.

CONTENTS

Archibald, L.

Longford, E.

Strabolgi, L.

Burden, L. [Teller.]

Lucan, E. [Teller.]

Summerskill, B.

Champion, L.

Morrison of Lambeth, L.

Walston, L.

Henderson, L.

Shepherd, L.

Williams of Barnburgh, L.

Latham, L.

Stonham, L.

Williamson, L.

Listowel, E.

NOT-CONTENTS

Abinger, L.

Devonshire, D.

Monsell, V.

Ailwyn, L.

Dilhorne, L. (L. Chancellor.)

Newton, L.

Albemarle, E.

Dundonald, E.

Powis, E.

Ampthill, L.

Falmouth, V.

Rochdale, V.

Atholl, D.

Ferrers, E.

St. Aldwyn, E. [Teller.]

Beauchamp, E.

Fraser of Lonsdale, L.

St. Oswald, L.

Boston, L.

Goschen, V. [Teller.]

Sandys, L.

Boyd of Merton, V.

Grenfell, L.

Sinclair of Cleeve, L.

Buccleuch and Queensberry, D.

Hailsham, V. (L. President.)

Strathcarron, L.

Chesham, L.

Hastings, L.

Strathclyde, L.

Coleraine, L.

Howard of Glossop, L.

Stuart of Findhorn, V.

Colville of Culross, V

Ilford, L.

Templemore, L.

Colyton, L.

Jellicoe, E.

Tenby, V.

Conesford, L.

Long, V.

Teynham, L.

Craigmyle, L.

Mabane, L.

Tweedsmuir, L.

Crathorne, L.

Margesson, V.

Wolverton, L.

Cromartie, E.

Massereene and Ferrard, V.

Yarborough, E.

Derwent, L.

Mills, V.

Moved accordingly, and, on Question, Motion agreed to.

LORD AUCKLAND LORD AUCKLAND had given notice of his intention to move to insert a new subsection after subsection (1). The noble Lord said: My noble friend Lord Hastings rejected the Amendment moved by the noble Lord, Lord Shepherd, principally, I think, on the grounds that the Greater London Council would be saddled with a very large burden. The Amendment in the name of myself and my noble friend Lord Ellenborough would greatly reduce that burden, but in view of the very negative attitude of the Government I do not propose to move it at this stage. However, I reserve the right to do so on the next stage of the Bill.
Clause 68 agreed to.
Schedules 14 and 15 agreed to.
THE LORD CHANCELLOR: We have now reached the stage in the Bill which I indicated earlier this afternoon that I hoped we should reach. We have done so before half-past ten, despite the protests which were made at that time. Events have shown to be unfounded the protest that there was too much work to be done to-day. Although it is not half-
842
past ten, I should be very willing to move that the House do resume, were it not for the risk that one would perhaps run of again meeting a similar protest to-morrow, that we should have too much work left to do to finish this Bill on Thursday. That would indeed tempt me to ask your Lordships to sit a little longer to make some progress with Clause 69. But as events have shown that the protest made to-day was without foundation, I am prepared to take a risk about what might happen on Thursday in relation to a similar protest, and I beg to move that the House do now resume.
House resumed.

BATH CORPORATION BILL [H.L.]
Reported, with Amendments.
MARINE SOCIETY BILL [H.L.]
Returned from the Commons, agreed to.

MEDWAY CONSERVANCY BILL
Brought from the Commons; read 1a; and referred to the Examiners.
House adjourned at a quarter past ten o'clock.