Sitting of 6 December 1965

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

    Wages
    Mr. Fisherasked the Minister of Labour by how much average wages have increased during the past 12 months, as compared with the previous 12 months, and by how much the intervals between wage settlements have been reduced during the same period as compared with the previous year.
    The Parliamentary Secretary to the Ministry of Labour (Mr. Ernest Thornton): During the 12 months ended 31st October, 1965, the index of weekly rates of wages increased by 4·6 per cent. compared with 5·3 per cent. in the previous 12 months. The comparable figures for the hourly wage rates index, which also reflects reductions in normal hours of work, are 7·3 per cent. and 5·8 per cent. The average interval between increases
    2
    resulting from settlements of wages and conditions of employment was reduced from 14½ months to 10 months.
    Mr. Fisher: I am bound to say that those figures are rather better than I expected, and I am very glad that that should be so. However, they are not perfect, and I would ask the hon. Gentlemon how the Government propose to make the incomes policy more effective in future and if, as a first step to that end, it would not be a good idea to make further attempts to secure the active co-operation of the Ministry of Technology and the Transport and General Workers' Union.
    Mr. Thornton: I think that the hon. Gentleman makes a mistake in underestimating the degree of success with which the incomes policy has been met. From the figures that I have read out, had it not been for our being caught up in a cycle of hours reductions, the wage advance in weekly terms would have been very little removed from the norm.

    Cancer of the Renal Tract (Advisory Panel)
    Mrs. Joyce Butlerasked the Minister of Labour what progress has been made by the Advisory Panel of the Senior Medical Inspector of Factories on bladder cancer, and if he will make a statement.
    The Minister of Labour (Mr. R. J. Gunter): The Senior Medical Inspector's Advisory Panel on Occupational Cancer

    3
    of the Renal Tract provides him with expert knowledge and advice on a continuing basis. I understand that it has been of great assistance to him, particularly in connection with a long-term survey which the Department is preparing to carry out in the rubber and cable-making industries to determine whether there is still an unidentified cancer hazard now that the use of the known carcinogens has been discontinued.
    Mrs. Joyce Butler: Is my right hon. Friend aware that: there is great disappointment that the Medical Research Council has declined to carry out a comprehensive survey of this very worrying subject, not only in the cable and rubber industries but also in the dyestuffs industry and among workers employed on cured rubber, where the dangers of antioxidants are thought to be responsible for bladder cancer? Is he aware that this delay is very disappointing, and that we want urgent action on it?
    Mr. Gunter: We are fully seized of the urgency of the matter, and we are aware of the disappointment that my hon. Friend has expressed, but I would assure her that my staff are doing all that it can and as quickly as it can.

    Asbestos (Occupational Risk)
    Mrs. Joyce Butlerasked the Minister of Labour when he expects to receive the report of the expert committee set up to review the evidence on the medical problems of asbestos exposure, and what action is being taken to screen all workers and contacts at risk.
    Mr. Thornton: The Advisory Panel on the Medical Problems of Occupational Exposure to Asbestos which the Senior Medical Inspector has set up to advise and assist him, has made a useful start and is continuing its studies of these difficult problems. As regards the second part of the question, it has been decided to revise the existing Asbestos Industry Regulations, and preliminary work has begun. Careful consideration is being given in this connection to the inclusion of requirements for the medical screening of employees.
    Mrs. Joyce Butler: Can my hon. Friend give any idea when these various studies are going to come to fruition and we shall
    4
    have a positive scheme for dealing with this recognised danger?
    Mr. Thornton: I recognise and sympathise with my hon. Friend's concern in this matter, but I think she will appreciate that it raises a rather wider and in some respects a more serious issue, and there are some very difficult medical and technical problems to be resolved.

    American Aircraft Industry (Registered Vacancies)
    Mr. Onslowasked the Minister of Labour how many vacancies in the United States aircraft industry have officially been registered with employment exchanges in England and Wales since October 1964.
    Mr. Gunter: None, Sir.
    Mr. Onslow: Is the Minister aware that applicants from the aircraft industry at employment exchanges have been advised of employment opportunities in the Amerian aircraft industry? How does the right hon. Gentleman square that with his Government's expressed desire to see these men employed elsewhere in the United Kingdom industry?
    Mr. Gunter: The Question that I was asked was how many vacancies in the United States aircraft industry have officially been registered with employment exchanges in England and Wales. I repeat, the answer is "None". I understand that last October indications were given to employment exchanges of vacancies in the American aircraft industry. I think that 13 British engineers known to be interested in work overseas were told the firms' interest, but none took up employment with them.

    Take-over Bids (Redundancies)
    Mr. Benceasked the Minister of Labour what consideration he has given to setting up an early warning system to give him advice on possible redundancies arising from take-over bids.
    Mr. Gunter: The Employment Service, which is constantly on the watch, has had considerable success in persuading employers to give advance warning of all kinds of redundancies; and the Redundancy Payments Act, which comes into

    5
    force today will require advance notice in cases where payments under the Act are involved.
    Mr. Bence: While thanking my right hon. Friend for that Answer, which represents a tremendous advance on anything done in the past, may I ask him to bear in mind that we get cases in Scotland of firms taking over industrial units and transferring the employment to the Midlands and the South? Will he use his good offices when such take-overs occur to see that employment is concentrated in Scotland rather than in the South?
    Mr. Gunter: Yes, indeed. My hon. Friend knows that this would be the intention of the Government. However, on the question of redundancy payments, whether it be a take-over bid or anything else, the provisions of the Act would operate.

    Pit Closures (Scotland)
    Mr. Benceasked the Minister of Labour if he will undertake a survey of possible redundancies from pit closures in Scotland, in order to take steps to provide facilities for retraining and re-employment in new industries.
    Mr. Gunter: I have already made a preliminary review and I shall continue to watch the situation closely in consultation with the other Ministers concerned. In addition, the Scottish Economic Planning Council is actively examining the position.
    Mr. Bence: Would my right hon. Friend step up the creation of training centres in Scotland so that men who are forcibly dismissed from the pits, especially disabled men, may be retrained for employment in the new expanding industries which will be coming to Scotland as a result of the present Government's policies for Scotland?
    Mr. Gunter: Yes, indeed. That is very much in the mind of the Government. By the end of the coming year the training places in Scotland at Government training centres will be 14 per cent. of the total places throughout the country.

    Printing Industry (Industrial Training Board)
    Mr. Hamlingasked the Minister of Labour what discussions he has had with employers and trade union leaders in the
    6
    printing industry on setting up an industrial training board in that industry.
    Mr. Gunter: My programme for setting up industrial training boards has been approved by the Central Training Council and does not provide for early action on the printing industry. I have not, therefore, entered into detailed discussions on this subject with the organisations concerned.
    Mr. Hamling: Is my right hon. Friend aware that technical teachers engaged in the industry whom I met recently are very anxious that steps should be taken in this direction?
    Mr. Gunter: We are indeed concerned about the printing industry, but, as my hon. Friend knows, we must deal with this matter in terms of priority; and we are moving at a very rapid pace indeed.
    Mr. Howe: Would the Minister agree that the training boards can play a very useful part in eliminating restrictive practices as between unions—demarcation difficulties, for example—and would he not also agree that this is an industry in which it is particularly important to reduce the demarcation difficulties as quickly as possible, which is a good reason for making every haste in this matter?
    Mr. Gunter: That point confirms my thoughts on this matter and I therefore agree with the hon. and learned Gentleman.

    Employment (Cornwall)
    Mr. Scott-Hopkinsasked the Minister of Labour what are the latest available figures of unemployed persons in the employment exchange areas of Camelford, Bude, Launceston, Wade-bridge, and Newquay; and what are their age groups.
    Mr. Thornton: On 8th November, 132, 178, 83, 211 and 424 respectively. An age breakdown is not available for November. The latest analysis is for July. As this information consists of a table of figures I will, with permission, circulate it in the OFFICIAL REPORT.
    Mr. Scott-Hopkins: Would the Parliamentary Secretary bear in mind that most of the redundancies occur in the middle-age and younger-age groups, hence the

    7
    urgent necessity to bring industry to these areas as quickly as possible? Is he aware that we are in great need in this part of Cornwall of additional industry so that the people generally, particularly those in these age groups, may be employed

    NUMBERS REGISTERED AS WHOLLY UNEMPLOYED ON 12TH JULY, 1965 BY AGE GROUPS

    Local Office Area

    Under 18

    18–19

    20–24

    25–29

    30–34

    35–39

    40–44

    45–9

    50–54

    55–59

    60–64

    65 and over

    Camelford

    …

    1

    1

    3

    3

    2

    —

    6

    2

    4

    8

    16

    —

    Bude

    …

    2

    3

    3

    3

    4

    6

    6

    5

    9

    8

    24

    —

    Launceston

    …

    3

    —

    6

    1

    1

    3

    5

    4

    6

    8

    13

    —

    Wadebridge

    …

    8

    4

    11

    11

    9

    6

    6

    6

    8

    11

    19

    —

    Newquay

    …

    1

    4

    6

    4

    3

    4

    3

    5

    8

    14

    10

    —

    Factory Accidents
    Mr. J. H. Osbornasked the Minister of Labour which industries Her Majesty's Inspector of Factories has set up working parties to review the codes and tabulate the causes of accidents and whether he will make a statement.
    Mr. Thornton: No such working parties have been set up. The Chief Inspector of Factories has recently set up special accident inquiries into selected factories and an inquiry into construction sites is about to begin.
    Mr. Osborn: Is the Parliamentary Secretary aware that there are many safety organisations which are not satisfied that the right causes are being recorded? Would he not agree that some of the worst causes are carelessness and the failure to use protective equipment and protective clothing?
    Mr. Thornton: I agree that the latter are some of the important causes of accidents.

    Absenteeism
    Mr. J. H. Osbornasked the Minister of Labour what information he has about the number and percentage of voluntary absenteeism in industry, not due to sickness or industrial injury, in each of the past four months; and whether he is satisfied with the detail of the information available to his Department.
    Mr. Gunter: I do not have the information for which the hon. Member asks.
    in this area and are not obliged to leave to find employment elsewhere?
    Mr. Thornton: We will certainly give close consideration to those points.
    The following is the information:
    It would be extremely difficult to get reliable information on this subject, as it would often be impracticable to distinguish between voluntary absenteeism and other forms of absence.
    Mr. Osborn: Would the Minister not agree that absenteeism of this type is one of the worst difficulties confronting many industries at present? Would it not now be worth while making inquiries to discover the extent to which absenteeism is voluntary, particularly, for example, since one industry is today declaring the figure to be 7 per cent.?
    Mr. Gunter: I agree that absenteeism is deplorable. It is, however, equally true that we do not have the information and that many employers do not inform us of the different forms of absenteeism.
    Mr. H. Hynd: Has my right hon. Friend noticed the number of Questions asked so far today and the amount of absenteeism on the Opposition benches?

    Accident Victims, North-East Scotland (Retraining)
    Mr. Wolrige-Gordonasked the Minister of Labour if he will introduce an industrial rehabilitation unit for retraining accident victims to the north-east of Scotland; and if he will make a statement.
    Mr. Thornton: This has been carefully considered, but I find that the number of people from the north-east of Scotland requiring industrial rehabilitation is insufficient to justify a unit there.

    9
    They can and do go to the unit at Grantor, near Edinburgh, which has a residential hostel attached, and can usually arrange early admission for accident victims.
    Mr. Wolrige-Gordon: Is the Parliamentary Secretary aware that it is due to the policy of the previous Government that the north-east of Scotland is well on the way to becoming an important industrial centre? Is he aware that the present unit of rehabilitation for men disabled through injury is a long distance from the area, which means that a number of the men concerned do not have a chance to travel the necessary distance to take advantage of the scheme? Is he, therefore, aware of the very real need to reconsider this matter and to establish a unit of this kind in the north-east of Scotland?
    Mr. Thornton: All our experience shows that only a small proportion of people discharged from hospital, whether near or far from the I.R.U., are both willing and suitable for a course of industrial rehabilitation.

    National Plan
    Mr. Longdenasked the Minister of Labour what steps he is taking to introduce better industrial training as advocated in the National Plan.
    Mr. Gunter: I am pressing ahead with the establishment of further industrial training boards as well as with the expansion of Government training centres. I am also making grants directly and through the training boards towards the cost of courses for training officers and I am proposing to expand the facilities for training instructors.
    Mr. Longden: While thanking the Minister for that reply, may I ask him to assure the House that he is getting the fullest co-operation from management and unions in this matter?
    Mr. Gunter: I think that I can give that assurance to the hon. Gentleman.
    23. Mr. Longdenasked the Minister of Labour what steps his Department is taking to put new zip into British industry as advocated in the National Plan.
    Mr. Gunter: The National Plan contains a check list of action required. My
    10
    Department is getting on with all those matters for which I have a responsibility.
    Mr. Longden: Is the Minister aware that the phraseology of this Question is taken from the National. Plan, but that it is not the case that all of British industry needs new zip being put into it? However, since this can be said of much of industry, particularly the printing industry, has the right hon. Gentleman any plans for putting in that zip?
    Mr. Gunter: I have plenty of plans all right. I think that at the back of the hon. Gentleman's mind are many of the restrictive practices which are alleged to exist in many industries. The removal of then, from both the employers' side and dm workers' side, is a matter which will take some time.

    Apprenticeships
    Mr. Costainasked the Minister of Labour what progress has been made in the development of group apprenticeship training facilities between firms.
    Mr. Thornton: There are some 3,000 apprentices from 850 firms participating in group apprenticeship schemes, of which there are about 70 now running. During 1965, this Ministry has offered grants towards the development costs of eleven new schemes.
    Mr. Costain: Is the Parliamentary Secretary satisfied that proposals for this kind of thing are going ahead sufficiently quickly? Has he proposals to improve progress?
    Mr. Thornton: I am hoping that the industrial training boards will help in handling this very desirable process in industries where there is a large number of small and medium-sized firms.
    Mr. Costainasked the Minister of Labour what progress has been made towards getting a reduction in the number of years required for apprenticeship training.
    Mr. Thornton: I would refer the hon. Member to the Answer given by my hon. Friend the former Joint Parliamentary Secretary to the Ministry to similar Questions on 14th June last. Since then, further sections of the construction industry have reduced the period of apprenticeship, and the electricity supply

    11
    industry has also recommended a reduction.
    Mr. Costain: Would not the Parliamentary Secretary agree that the progressive state of the construction industry is an example to other industries, and will he do his best to see that those other industries emulate the construction industry?
    Mr. Thornton: Yes, Sir. I will certainly look at that point.
    Mr. Bence: Will my hon. Friend bear in mind that it is as important, or even more important, to improve the quality of apprenticeship training as to diminish the number of years to be served?
    Mr. Thornton: My hon. Friend can take it that our Ministry will pay very close regard to that factor.
    Mr. Weatherillasked the Minister of Labour what progress he has made in the last 12 months in arranging that school leavers may start their apprenticeships after the age of 16; and what official discussions he has had with trade unions on the subject.
    Mr. Thornton: In most industries employing large numbers of apprentices, provision is made for entry to apprenticeship after the age of 16. It is one of the responsibilities of the industrial training boards to make recommendations with regard to the age of entry into training and where it is necessary I shall expect them to take a progressive line on this subject.
    Mr. Weatherill: Can the Parliamentary Secretary say how many unions persist in this out-of-date practice? What action will he take to correct it?
    Mr. Thornton: I do not think there are many unions which persist in this practice. There is a common impression that 16 is the maximum age at which an apprenticeship can be started, but that is not so. I should like the hon. Member to appreciate—no doubt he does—that this is rather dependent on agreements between employers and trade unions. Some agreements fix no upper age limit, some have 16 or 18 as the upper age limit and most of those which fix an upper age Limit make some agreement for exceptions.

    Conciliation (Minister's Powers)
    Mr. Mawbyasked the Minister of Labour whether he is satisfied that his powers of conciliation are now sufficient and effective; and if he will make a statement.
    Mr. Gunter: This question is discussed in the evidence of the Ministry of Labour to the Royal Commission on Trade Unions and Employers' Associations. I am, of course, giving careful thought to this and related problems.
    Mr. Mawby: I thank the right hon. Gentleman for his reply, but is he satisfied that in future the employing side will not be put in a position where it cannot make an alternative offer, and so make abortive his efforts for conciliation?
    Mr. Gunter: I am very well aware of the difficulties that are inherent in the attempt of any party to introduce an incomes policy. That is why I am giving careful thought to this and related problems.

    Industrial Hygiene Services
    Mrs. McKayasked the Minister of Labour if he proposes that Her Majesty's Government should accept the principle of Government responsibility for the provision of an occupational hygiene service.
    Mr. Gunter: The Government already have a responsibility in this matter; and H.M. Factory Inspectorate do in fact undertake industrial hygiene work. As I told the right hon. Member for Bridlington (Mr. Wood) on 29th November, I am, in conjunction with my Industrial Health Advisory Committee, reviewing policy on the provision of industrial hygiene services. The nature and extent of the Government's contribution in the future must be determined in the light of the results of the current survey to establish the size of the need for such services. These results are expected in the spring.
    Mrs. McKay: I thank my right hon. Friend for that reply, but would he not agree that the 20 million working days lost annually through industrial ill-health warrant a greater degree of urgency? In the national interest, will

    13
    he recommend the expansion of the Factory Inspectorate in order to provide a full occupational hygiene service for industry?
    Mr. Gunter: I understand the nature of the problem in which my hon. Friend is very interested, but I would still ask her to await the survey results which we expect in the spring, before coming to any conclusions.
    Mr. John Page: Has the Minister any more news from the City of London health authorities, who are trying to arrange an occupational health service for people working in the City? It was to have started about two years ago. Does the Minister know whether it has come to a grinding halt, or has he any news on the subject?
    Mr. Gunter: I have no information, but I will certainly look into the matter.

    Strikes (Lost Working Days)
    Mr. Bishopasked the Minister of Labour how many working days there are in the average year; how many were lost due to strikes of all kinds in the most recent year; and what percentage this is of the total.
    Mr. Gunter: It is estimated that there were about 5,500 million working days in the United Kingdom in 1964. The number of days lost in 1964 through stoppages of work due to industrial disputes was about 2,277,000: this figure is less than 0·05 per cent. of the total number of working days.
    Mr. Bishop: Would not my right hon. Friend agree that some strikes can be particularly harmful to the economy but that his reply indicates that relatively little time is lost through strikes compared with the amount of time lost from industrial injury and sickness where the figures are over 100 times as great?
    Mr. Gunter: I would certainly agree that the figures are low, but I would also say that any interruption of any sort in the production line in the present state of the economy is to be deplored.
    Sir Knox Cunningham: Would the Minister agree that loss of time due to illness often cannot be avoided, but that days lost by strikes can be avoided? Is not this figure far too high? Will he
    14
    say what is the comparable figure in 1964?
    Mr. Gunter: In 1964—I have already quoted this figure—2,277,000 days were lost. I would also remind the House that in 1962 5¾ million days were lost, and 8½ million in 1957. We are not doing so badly.
    Mr. Howe: Will the right hon. Gentleman agree that during the part of the year that has so far elapsed there has been an increase in the figures on last year? Will he not also agree that one cannot measure the effect of strikes simply by counting the days lost, that they represent a slowing-down of the industrial machine and that it is important and of the highest priority that the Government should press on with reducing losses of all kinds arising from industrial disputes?
    Mr. Gunter: The hon. and learned Gentleman is right in saying that some strikes are more harmful than others. Some strikes involving only a few men do terrible damage. We ought to try to eliminate them as far as possible. On the question of a comparison of last year with this, 2,697,000 working days were lost from January to October, 1965, and 2,051,000 working days were lost from January to October, 1964. Therefore, the position is worse, but it is infinitely better than it was a couple of years ago, so I do not see any purpose at all in these comparisons of one year with another. They get us nowhere.
    Mr. Urwin: Is my right hon. Friend in a position to indicate the percentage comparison with other major industrial countries?
    Mr. Gunter: Not without notice, but I am quite sure that the figures will bear favourable comparison.

    Trade Unionists (Victimisation)
    Mr Boxasked the Minister of Labour whether he will introduce legislation to prevent the victimisation of individual trades unionists by their unions or their fellow members.
    Mr. Gunter: No, Sir. The law affecting the activities of trade unions and employers' associations is one of the subjects being considered by the Royal Commission on Trade Unions and Employers' Associations.
    Mr. Box: Would the Minister agree that the case of which I have sent him some particulars, in which Mr. Mike Reardon has been victimised and prevented from working by his colleagues in the Transport and General Workers' Union for the past nine months or more, is a glaring example of the need for such legislation? Whilst the Royal Commission is coming to its conclusions, will the right hon. Gentleman use his influence with the general secretary of the union to see that Mr. Reardon is re-employed immediately?
    Mr. Gunter: I do not want to pursue that case. The hon. Gentleman knows all about it. There were faults on both sides. I still say that it is something that ought not to have happened, but there were faults on both sides, as the inquiry found.
    Mr. Hefer: Will my right hon. Friend make it quite clear that he does not accept this demand for legislation? Further, whilst we are investigating problems like this, will he observe the difficulty that certain workpeople find as the result of a sort of black list operated by the employers?
    Mr. Gunter: I think that my hon. Friend and I would be in a major degree of agreement on the question of legislation. Many hon. Members, and many people outside the House, talk of legislation as though it could cure the problem; industrialists on the other side of the House know that it could not. One can only have legislation that can be enforced, and I doubt whether in this field of industrial relations—and hon. Members opposite know this—we can ever have a state in which legislation will be effective.

    Trade Disputes (Arbitration)
    Mr. Mawbyasked the Minister of Labour how many trades disputes he has referred to arbitration under Section 2 of the Industrial Courts Act, 1919 in the last year to the most convenient date.
    Mr. Gunter: There were 68 in the year ended 30th November, 1965.
    Mr. Mawby: I thank the Minister for that reply. He is obviously aware that arbitration is preferable to strike action, but is he satisfied that the same reasonably happy position will apply—or what will be the position—if an arbitration de-
    16
    cision is reached with which the Prices and Incomes Board disagrees? Will the arbitration decision be upheld, and remain the decision, regardless of what the Board decides?
    Mr. Gunter: The hon. Member should really not draw me into a much wider argument than his Question justifies.

    Youth Employment Service
    Mr. Weatherillasked the Minister of Labour what steps he proposes to take to strengthen the Youth Employment Service in its effort to obtain greater training skills for young people leaving school.
    Mr. Gunter: I am at present considering the future development of the Youth Employment Service in the light of the Report I have received from a working party of the National Youth Employment Council. I hope to make a statement on the Report shortly.
    Mr. Weatherill: Does the Minister think that the £3¾ million which we spend on this vital service is enough bearing in mind that we shall be wasting the vast sums of money spent on education unless we are sure that young people put their skills to the best possible use when they leave school?
    Mr. Gunter: I am in full agreement with the hon. Member on the great importance of this matter. I am hoping that this House in the not-too-distant future, subject to what my right hon. Friend the Leader of the House has to say, will have an opportunity of having a good debate on the Working Party's Report, which I think is first-class.
    Mr. Scott-Hopkins: Is the Minister aware that in some areas there is great difficulty about young people going to training classes because of lack of transport? Will he give consideration to providing local authorities with funds in this respect, particularly in isolated areas?
    Mr. Gunter: If my memory serves me aright, and speaking off the cuff, I think that that point is made in the Report.
    Mr. van Straubenzee: While I welcome the statement which the Minister has made, may I ask if he will bear in mind the importance of giving information to

    17
    young people about the range of skills available?
    Mr. Gunter: Yes, indeed. That is why I want to push ahead as much as possible with the Youth Employment Service.

    Carcinogenic Substances (Manufacture and Import)
    Mr. Shoreasked the Minister of Labour what progress has been made with the draft orders regulating the manufacture and import of carcinogenic substances; and whether he will make a statement.
    Mr. Gunter: A revised draft of the Carcinogenic Substances Regulations was circulated to interested parties for comment in September. The replies are due by the end of this month. Those so far received are generally favourable.
    Mr. Shore: Will my right hon. Friend tell the House something about the causes of delay in completing these Orders? If my memory is correct, this goes back to August, 1964, when the preliminary draft was first prepared. Can he say whether these Orders when issued will include alpha-naphthylamine in its pure as well as its impure form?
    Mr. Gunter: I am afraid I cannot answer the latter part of my hon. Friend's question. On the question about progress being slow in this matter, I have wondered myself. Consultations are taking place and have taken place with the various medical interests, the manufacturing interests and the trade unions, and we have found that they have had to allow reasonable time to consider our proposals.

    H.M. Factory Inspectorate (Staff)
    Captain W. Elliotasked the Minister of Labour how many staff are employed by Her Majesty's Inspector of Factories at the present time; how this compares with each of the five previous years; and how many vacancies there are to make up establishment.
    Mr. Thornton: On 1st December, 1965 there were 482 H.M. Inspectors of Factories in post against an authorised cadre of 517 posts.
    18
    The corresponding figures for the five previous years are:—in 1960, 415 against a cadre of 448: 1961, 424 against 449: 1962, 445 against 479: 1963, 464 against 512: and 1964, 474 against 517.
    Captain Elliot: Is the Minister satisfied with those figures? Can he tell the House if there is difficulty in increasing the numbers to get them up to establishment?
    Mr. Thornton: We are doing all we can without reducing the standards—which I am sure the hon. and gallant Member would not like to see take place—to bring the number in post up to the authorised establishment. This we should pursue. The reason we have not reached the cadre, as he probably knows, is that on several occasions in the last several years the cadre has been increased to meet the rising responsibilities of the Inspectorate.

    Industrial Machines (Manning)
    Sir J. Edenasked the Minister of Labour what studies he has made of the extent to which machines now in use in British manufacturing industry are being overmanned; what comparative studies he has made with industry in the United States of America; and what discussions he has had in this country with unions and management in order to secure the release for more productive employment of the manpower locked up in this way.
    Mr. Gunter: I have not made detailed studies of the kind suggested by the hon. Member. This is only one aspect of the much wider question of the more effective use of manpower which I am continuing to discuss with both management and unions through my National Joint Advisory Council and in other ways.
    Sir J. Eden: Does that Answer mean that the right hon. Gentleman has no factual information on which to judge the extent to which the proposition framed in my Question may obtain now? Will he look into this position as a matter of some urgency, for would he not agree that many authorities think that far too many people are unnecessarily manning the new machines coming into industry and that they could be valuable assets

    19
    to labour in those areas which at present are short of labour?
    Mr. Gunter: I agree with the hon. Member that there is over-manning in certain areas of industry today. Statistical information on it is very difficult to come by, as the Americans themselves have found, because sometimes there is a reluctance to face the facts of life. The encouragement which I am trying to give as a priority is at workshop floor level so that by joint efforts trade unions and management can come to terms on this problem.

    Bank Employees (Five-day Week)
    Mr. John Pageasked the Minister of Labour what representations he has received from the National Union of Bank Employees about a five-day week for bank employees.
    Mr. Gunter: None, Sir.
    Mr. Page: If the Minister receives any representations about the cancelling of Saturday working in banks, while remembering the desirability of a five-day working week for bank employees, will he consider the possibility of Monday closing and the staggering of banking hours to allow banks to be open for shopkeepers and others who wish to have them open on Saturdays?
    Mr. Gunter: I have received no representations. I think we had better wait until I do.

    Government Training Centres
    Mr. John Pageasked the Minister of Labour what is the increase in places available in Government training centres over the last three years; and whether there are at present more applications than there are vacant places.
    Mr. Thornton: The places in G.T.Cs. have been increased by 3,155 since December 1962. There are more persons awaiting admission to training than there are vacant places in Government training centres.
    Mr. Page: I thank the hon. Gentleman for that reply, but he has not said whether the waiting list is very substantial or not. I hope he will realise the very strong support which industry wishes to
    20
    give to people who have been to these training centres, particularly as concerns Scotland.
    Mr. Thornton: We shall certainly give the matter very close attention.

    Fairfield Shipbuilding and Engineering (Trade Dispute)
    Mr. Boxasked the Minister of Labour whether he will hold an inquiry into the recent trade dispute at Fairfield Shipbuilding and Engineering following the inability of four union members to produce their union cards on demand.
    Mr. Gunter: This dispute occurred on 18th November and the stoppage of work lasted for one day. I do not think any useful purpose would be served in holding an inquiry.
    Mr. Box: Is the Minister aware that as a result of four trade union members not being able to produce their cards, 120 men went on strike for the rest of that day? Does he not agree that at a time when Fairfields are fighting for their very existence and are in receipt of £1 million of the taxpayers' money, this is a shocking example of irresponsibility by a small group of workers? Will he warn them that any repetition of this sort of action will result in the withdrawal of Government financial support?
    Mr. Gunter: I agree immediately with the hon. Member that this stoppage should never have occurred, and I am reinforced in the view by the Boilermakers' Union themselves. In the Question I am asked whether I would institute a court of inquiry. As the shop steward concerned has left his employment in this yard, I do not think that a court of inquiry is necessary.
    Mr. Rankin: Is my right hon. Friend aware that the shop steward concerned in this incident left the employment of Fairfields immediately because of the fact that every shop steward in Fairfields condemned his action? Is he also aware that the incident lasted for half a day? Does not the supplementary question show that the only purpose of the Question is to create malice and to do harm to the jobs of 5,000 workpeople at Fairfields?

    Mentally Sick (Rehabilitation and Retraining)
    Mr. Deanasked the Minister of Labour whether he is satisfied with the rehabilitation and retraining arrangements for those who have been mentally ill; and if he will make a statement.
    Mr. Thornton: The Ministry's arrangements for industrial rehabilitation of the disabled have recently been under review and particular attention has been paid to the needs of the mentally ill. My right hon. Friend will consider possible changes in the light of this review.
    Mr. Dean: I am much obliged to the hon. Member for that helpful Answer. Will he bear in mind in the review that those who know most about mental health feel that there are very big gaps in the rehabilitation and retraining arrangements?
    Mr. Thorton: I find myself in substantial agreement with the hon. Member.
    Mr. van Straubenzee: Does the Minister appreciate that the Answer which he has given is a great encouragement to those working in this field? When he makes his review will he direct his attention to the siting of the training centres, with particular reference to the expense involved in some cases in having them in very expensive industrial areas?
    Mr. Thornton: Yes. I will certainly give close attention to that question.

  GIBRALTAR (FRONTIER RESTRICTIONS)
  Mr. Fisherasked the Secretary of State for Foreign Affairs whether he proposes holding talks with the Spanish Government about the frontier restrictions imposed by Spain upon Gibraltar.
  Mr. Wallasked the Secretary of State for Foreign Affairs what progress has been made with the Spanish Government in talks about Gibraltar.
  The Minister of State for Foreign Affairs (Mr. Walter Padley): As I informed the House on 28th October, we have had discussions with the Spanish
  22
  Government regarding the circumstances in which talks about Gibraltar might be held. We have had no response to the last approach made by Her Majesty's Ambassador at Madrid. For their part Her Majesty's Government remain ready to entertain proposals for talks as soon as a normal situation is restored on the Gibraltar frontier.
  Mr. Fisher: Has the Minister seen reports in the Press today saying that Spain would be willing to have talks? If for some reason the Government think that this is untimely or inappropriate, have they any proposals for any political or economic initiatives in order to try to implement their own promise in Cmnd. Paper 2362 last April to sustain the interests of the people of Gibraltar, of which so far there has been very little sign?
  Mr. PadleyWe are not prepared to hold conversations under the duress of the frontier restrictions or in the face of Spanish threats. Substantial economic measures have been taken to sustain the people of Gibraltar. These have been announced in the House. As for the Press report today of the so-called red book, I understand that it is about 500 pages in length. We in the Foreign Office have not yet received a copy and I am therefore unable to deny or confirm the construction which the hon. Member puts upon it.
  Mr. Crawshaw: Is my right hon. Friend aware that immediately following the Prime Minister's visit to Gibraltar fresh restrictions were imposed so that Spanish workmen may not now buy their goods in Gibraltar, which means a loss of £250,000 a year to the inhabitants? Is my right hon. Friend aware that people are losing patience with this attitude of the Spanish Government, and would he please do something and not just talk about it?
  Mr. Padley: We are aware that when in 1954 Her Majesty the Queen visited Gibraltar, restrictions were imposed on loyal British subjects in Gibraltar. We are also aware that when the Prime Minister called at Gibraltar on his way back from Rhodesia one of the events which followed was a fresh imposition of restrictions. We have under continuous review all the types of action which might

  23
  appropriately be taken in accordance with our undertaking to defend and sustain the people of Gibraltar.
  Mr. Wall: Does the hon. Member agree that Gibraltar is getting the kicks for what is basically a quarrel between London and Madrid? Will he see that talks are opened with the Spanish Government as soon as it is conceivably possible?
  Mr. Padley: The truth is that we have on countless occasions made diplomatic representations to the Spanish Government both in London and Madrid. But we are not prepared to have conversations under duress nor are we prepared to have conversations about sovereignty over the Rock.
  Lady Tweedsmuir: Will the Minister of State answer the question put so clearly to him by his hon. Friend the Member for Liverpool, Toxteth (Mr. Crawshaw) who asked him whether he would take action? The only reply which the Minister of State gave was that he had the matter under continuous review—and that is not good enough.
  Mr. Padley: That remains the policy of Her Majesty's Government. The policy of Her Majesty's Government, as announced in the House, is to sustain Gibraltar, and very substantial measures in capital grants and in the reorganisation of the Gibraltar economy have been taken.

  U.S.S.R. (FOREIGN SECRETARY'S VISIT)
  Mr. Blakerasked the Secretary of State for Foreign Affairs if he will make a statement on h is visit to the Union of Soviet Socialist Republics.
  Lord Balnielasked the Secretary of State for Foreign Affairs whether he will make a statement about the discussions he has had in Moscow.
  Mr. Parkasked the Secretary of State for Foreign Affairs if he will make a statement on his discussions in the Union of Soviet Socialist Republics with representatives of the Russian Government.
  Mr. Ioan L. Evansasked the Secretary of State for Foreign Affairs if he will make a statement on his recent visit
  24
  to the Union of Soviet Socialist Republics.
  The Secretary of State for Foreign Affairs (Mr. Michael Stewart): I would ask hon. Members to await my statement on this subject at the end of Questions.

  POLAND (FOREIGN SECRETARY'S VISIT)
  Mr. G. Campbellasked the Secretary of State for Foreign Affairs if he will make a statement on his visit to Poland.
  Mr. Blenkinsopasked the Secretary of State for Foreign Affairs if he will make a statement on his recent visit to Poland.
  Mr. M. Stewart: My visit to Poland was at the invitation of the Polish Minister for Foreign Affairs. I welcomed this chance to meet the representatives of the Polish Government, and to have an exchange of views with them on many questions of interest to both of us. I found much interest in Poland in developing co-operation with us further, particularly in the economic, cultural, technical and scientific fields.
  Copies of the communiqué issued at the end of my visit were placed in the Library of the House.
  Mr. Campbell: Did the Foreign Secretary discuss either the Rapacki Plan or a nuclear-free zone in Europe, both of which have found favour on the Labour benches?
  Mr. Stewart: As the hon. Member knows, the conversations with the Polish Minister were confidential, but, as the communiqué made clear, we discussed various aspects of disarmament and European questions.
  Mr. Blenkinsop: Was my right hon. Friend able to give any assurances to the Polish Government in regard to our attitude on the Western frontiers?
  Mr. Stewart: I pointed out on that topic that the final determination of the frontier awaits a peace settlement with Germany, but I added that when the time comes to make such a settlement one of the factors to be taken into account must be the wishes of the inhabitants of the territories concerned.
  Mr. Blenkinsop: Does not my right hon. Friend feel that the situation is sufficiently stable to allow him at least to suggest that when the time comes for a peace treaty we could not envisage any major change in this frontier?
  Mr. Stewart: If my hon. Friend will give attention to the last part of my reply he will find that it is of interest in the light of what he said.
  Mr. Speaker: Order. We must not allow double supplementary questions to slip through.
  Mr. Dodds-Parker: Was the Foreign Secretary able to get an assurance from the Polish Government that they would see that there was a better balance of trade with this country?
  Mr. Stewart: We raised matters of trade, and I hope that we shall make progress in that direction.

  EUROPEAN ECONOMIC COMMUNITY
  Mr. G. Campbellasked the Secretary of State for Foreign Affairs what change there has been in Her Majesty's Government's policy towards the European Economic Community since 4th August; and if he will make a statement.
  Mr. M. Stewart: Her Majesty's Government's policy remains that we are ready and willing to join the European Economic Community provided that essential British interests are safeguarded.
  Mr. Campbell: Did the Foreign Secretary state on 27th November at a meeting in London, as reported in the Observer, that he favoured something resembling more the E.E.C. principle than the E.F.T.A. principle? If so, does this represent a change in the Government's policy?
  Mr. Stewart: No. It does not represent any change. If the hon. Member will notice what I have just said, he will see that we are willing to join the European Economic Community provided that essential British interests are safeguarded. He will see that what I said at that meeting followed from that.
  Mr. Snow: Does my right hon. Friend accept that the Government's overall
  26
  policy must lead towards greater European economic cohesion in Europe as a whole? In those circumstances, is there not room for further investigation of the possibility of Eastern European participation so that the European Economic Community will be fully European?
  Mr. Stewart: I should like to see a development of that kind, but this Question and the reference to the speech which I made on 27th November were related to relationships with the European Economic Community.
  Lord Balniel: Surely the Foreign Secretary recognises that what he says today is rather different from what he is reported as having said on 27th November—that he favoured a European unity on the Common Market rather than the E.F.T.A. model? Surely the Foreign Secretary recognises that it would be to our interest in Europe if he clarified the view of the Government as soon as possible in view of the confusion which has been caused?
  Mr. Stewart: I do not think that there is any confusion except, possibly, with the hon. Member for Hertford (Lord Balniel). It is clear that the Government are ready and willing to join E.E.C. provided that essential British interests are safeguarded. The Government have also on several occasions made it known that they would like to see a wider European unity. It follows, I think, from those two things that such a wider European unity would partake more of the nature of E.E.C. than of E.F.T.A. But one of the British interests to be safeguarded is our good reputation with the E.F.T.A. partners, and any approach to E.E.C. would have to be in consultation with them.
  Mr. Manuel: Does my right hon. Friend mean by his latest statement that we still abide by the five conditions laid down by Mr. Gaitskell and the Labour Party which have so far been adhered to by the present Administration?
  Mr. Stewart: Yes, Sir. My hon. Friend will remember that I said earlier that these five conditions still remain and to my mind are essential. I think that is true that the actual passage of events makes some of these conditions easier to fulfil now than at the time when they were formulated.
  Mr. Soames: Is the right hon. Gentleman saying that it is the intention and the policy of the Government to join with other countries of E.F.T.A. who wish to join the European Community as opposed to building a bridge between the two permanent bridgeheads of E.F.T.A. and E.E.C.?
  Mr. Stewart: I never use the phrase "bridge building" myself because I think that these metaphors are misleading. If the right hon. Gentleman had had the good fortune to attend the meeting on 27th November he would have heard me deal with this point. There is nothing inconsistent between readiness to join E.E.C., provided that essential British interests are safeguarded, and the pursuit of practical projects on which we and other countries in Europe can work together. It is that which is commonly described as "bridge building", though I think it is a misleading name. Some of the contacts which we have been able to make with Europe are both useful in themselves and will make the atmosphere more favourable in time for a wider European unity.

  EAST GERMAN CITIZENS (DEFECTION)
  Mrs. Renée Shortasked the Secretary of State for Foreign Affairs why he has given instructions to British diplomatic staff abroad to co-operate with West German officials in persuading citizens of the German Democratic Republic, who may be travelling abroad, to defect.
  Mr. Padley: No such instructions have been given.
  Mrs. Short: Is my hon. Friend aware that on 26th August, 1965, a signed letter was sent—and I have a copy of it here—from a member of the West German Embassy staff in Nicosia to a group of East German artists who were appearing there? It says that if these people did not wish to return to what the writer called the "Soviet Occupation Zone" of Germany they could go to the British, French, American or German Embassies for help. Can my hon. Friend say whether this was sent with or without his approval? If it was sent with his approval, does not he think that—
  Mr. Speaker: Order. The hon. Lady must learn to ask shorter supplementary questions.
  Mr. Padley: As my hon. Friend the Member for Wolverhampton, North-East (Mrs. Short) has recognised, the letter in question named the British High Commission as one of a number of missions on which such people might call. It was sent without the knowledge of the High Commission and did not reflect any agreed procedure. East Germans in this position would normally apply to the Federal German Mission in the country concerned. I cannot, however, accept the implication that there is anything reprehensible in assisting people who decide that they wish to live in a free country.

  POLAND, YUGOSLAVIA AND CZECHOSLOVAKIA (FOREIGN SECRETARY'S VISITS)
  Lord Balnielasked the Secretary of State for Foreign Affairs what proposals he has, following his visits to Poland, Yugoslavia and Czechoslovakia, to improve relations with Eastern Europe.
  Mr. M. Stewart: I regard these three visits and further exchanges of visits which will take place in the coming year as part of the process of developing exchanges of view with the East European leaders on international questions and bilateral questions. I believe that it is useful in itself that we should expose our views to each other and try to increase our understanding of each other's point of view. The process of enlarging the area of agreement on international problems is, of course, sometimes very slow. Progress on bilateral questions is often easier and our trade and our scientific and cultural contacts have been expanding in recent years.
  Lord Balniel: As so many of the Eastern European countries, in order to improve the economic well-being of their people, are moving steadily towards Western economic systems, does not the right hon. Gentleman think that the time is psychologically right to follow up his visit by intensive and continuous visits to try to improve the economic as well as the political climates between our respective countries?
  Mr. Stewart: I think that I shall be making further visits to Eastern Europe and we are expecting visits over here from their Ministers. This is a process which we want to continue.
  Mr. Sydney Silverman: Does my right hon. Friend consider that it will assist the process of improving relations with Eastern Europe if he persists in carrying on the outdated and outmoded language of the cold war by making it known and putting it on record in the House that these countries are not free countries?
  Mr. Stewart: I do not think the way to better understanding is to refrain from expressing our opinions. The view which I have always taken in these exchanges is that I expect those who talked to me to express their opinions perfectly clearly, and I do the same. Our opinions do not always agree but we possibly both go our way a little more aware of why the other thinks as he does, and that is part of the process of gradually improving understanding.

  UNITED NATIONS (FINANCE)
  Lady Tweedsmuirasked the Secretary of State for Foreign Affairs what proposals have been made by Her Majesty's Government to solve the financial problems of the United Nations since the decision to waive Article 19 of the Charter.
  The Minister of State for Foreign Affairs (Mr. George Thomson): Article 19 has not been waived. What was agreed was that the question of its applicability to the United Nations Emergency Force and the United Nations Operation in the Congo would not be raised.
  Her Majesty's Government fully supported and continue to support the proposal of the General Assembly's Special Committee on Peacekeeping, which was endorsed by the General Assembly at its resumed 19th session in September. This was that the financial difficulties of the Organisation should be solved through voluntary contributions by member states. Our voluntary contribution of 10 million dollars, which my right hon. Friend the Secretary of State announced to the House on the 21st of June, was paid in August. Recourse was had to the Civil Contingencies Fund. A supplementary estimate will be presented in due course. It would
  30
  not be appropriate to make other proposals until we see the full extent to which those who have not yet done so are prepared to contribute.
  Lady Tweedsmuir: Despite what the Minister of State has said, may I ask whether he is not aware that, despite repeated assurances given in the House that Her Majesty's Government would uphold Article 19 of the Charter and the International Court, if Article 19 was not waived it was certainly skirted round? Can the Minister of State say, therefore, how it is possible to keep the principle of the Charter? As for the proposals for peace-keeping, does not the hon. Gentleman agree that it is far more difficult to get individual members to accept their responsibilities if they will not enforce their own rules?
  Mr. Thomson: The decision was reached without prejudice to the positions of the various States. On the question of the applicability of Article 19, in the interests of the United Nations, this Government with others have to take account of the wishes of the majority. Acceding to the wishes of the majority, we agreed neither to waive Article 19 in other cases nor to wipe off the debts in this case, still less to accept that they had not been validly incurred.

  DISARMAMENT (EIGHTEEN NATION COMMITTEE)
  Mr. P. Noel-Bakerasked the Secretary of State for Foreign Affairs how many meetings the Committee of Eighteen Nations held during the seven weeks of its recent session in Geneva.
  Mr. Blakerasked the Secretary of State for Foreign Affairs if he will make a statement on the most recent session of the Eighteen Nation Disarmament Committee.
  Mr. M. Stewart: Seventeen plenary meetings were held during the session of the Eighteen Nation Disarmament Committee at Geneva between the 27th of July and the 16th of September.
  Much useful work was done at the Committee's last session in clarifying the issues involved in the attempt to reach agreement on preventing the further spread of nuclear weapons and on a comprehensive nuclear test ban treaty.
  Mr. Noel-Baker: Has my right hon. Friend observed from the verbatim record of this Committee that it met on the mornings of Tuesdays and Thursdays, that its working week was, on average, less than four hours and that Lord Chalfont's protest against this programme of work went unheeded? Can my right hon. Friend secure some reform in this most important organ of international negotiations?
  Mr. Stewart: I hope that we shall be able to do so. My right hon. Friend will know that the timetable of meetings has to be settled by agreement among all members. Our representative urged that the frequency of plenary meetings should be increased. I hope that in the future that may be the practice.
  Mr. Blaker: What new proposals were put forward in the Committee by the present British Government which had not previously been put forward by the former Government?
  Mr. Stewart: There were the two proposals I mentioned. There was a proposal for the "freezing" and destruction of some nuclear weapons, and we shall, in accordance with such progress as is made, have further proposals to make.
  Lord Balniel: Can the Foreign Secretary explain why, week after week, he refuses his right hon. Friend's request to publish a progress report on the British Government's achievements in the field of disarmament? We should all be very interested to hear what progress has, in fact, been made in the past year.
  Mr. Stewart: There are Questions hearing on that a little later.
  Mr. Speaker: Very much later, I am afraid.
  The Foreign Secretary—statement.

U.S.S.R. (FOREIGN SECRETARY'S VISIT)
The Secretary of State for Foreign Affairs (Mr. Michael Stewart): With your permission, Mr. Speaker, and that of the House, I wish to make a statement on my visit to Moscow.
I had talks with Mr. Mikoyan and Mr. Kosygin and several meetings with Mr. Gromyko, and I am arranging for the
32
communiqué, which I issued jointly with Mr. Gromyko, to be placed in the Library of the House.
The international subject to which we paid most attention was the proposal for a non-proliferation treaty, and on the Soviet side this was linked with the question of nuclear arrangements in N.A.T.O. We all agreed that a non-proliferation treaty was necessary and that it was important to conclude one as soon as possible. Mr. Gromyko maintained the view that arrangements to associate nonnuclear members of N.A.T.O. with discussions and decisions on the use of nuclear weapons themselves constituted dissemination and, therefore, presented an obstacle to a non-dissemination treaty. I explained that any N.A.T.O. arrangements would be consistent with non-dissemination and would, indeed, contribute towards it. Despite our differences of view, we agreed that discussions on the text of a non-dissemination treaty should be pursued.
In our discussions about European security, the question of German reunification was, naturally, prominent. I regret that the Soviet approach to the question of German reunification remains widely divergent from our own.
Similarly, I cannot report that we were able to make any progress over the steps to bring peace to Vietnam, though I have no doubt that the Soviet Government are as anxious as we are that the fighting should be brought to an end there.
The communiqué records that we had some discussion of the United Nations. I urged the importance of pursuing a constructive line there and not trying to turn the organisation into a platform for disruptive propaganda.
Among the bilateral questions we discussed, I laid particular emphasis, in my talk with Mr. Kosygin, on the need for the Soviet Union to increase its purchases from this country and thus to reduce the present imbalance.
I also discussed with Mr. Kosygin the question of a meeting between him and the Prime Minister. We made progress on this, and I hope that it will be possible to give further information before very long.
We also signed a Consular Convention which will regulate the consular relations

33
between the two countries and which provides for access by consuls to their nationals who are in trouble with the authorities.
I spoke to Mr. Kosygin and Mr. Gromyko about Mr. Brooke. Since then, our consul has been allowed to see Mr. Brooke, for the first time since August.
I did not have any illusions, when I went to Moscow, about the possibility of making quick progress on the difficult international problems. I hoped that each side would listen carefully to what the other had to say, and would then decide to go away and think it over. I think that this is what happened. The communiqué describes the talks as businesslike. This is an accurate description. The fact that both sides found the talks very useful is reflected in the final paragraph of the communiqué which registers our agreement that there should be periodical meetings.
Mr. Soames: We shall study the communiqué with interest, but I imagine, from the statement which he has made, that the Foreign Secretary must be somewhat disappointed with the lack of progress made on any of the major items discussed. Indeed, it seems from the statement that the only success which the Foreign Secretary has to report after his visit is that the consul has been permitted to see Mr. Brooke. This is a valuable but limited outcome of his visit.
Will the right hon. Gentleman say a little more about what he meant in saying that progress had been made on the question of talks between the Prime Minister and Mr. Kosygin. Does this mean that Mr. Kosygin will shortly be coming to visit this country, as has been suggested, and can the right hon. Gentleman say, following his own visit, what subjects he thinks would be likely to be fruitfully discussed were such a visit to take place?
Finally, what views did Mr. Gromyko express to the Foreign Secretary about the compatibility of the A.N.F. as proposed by the British Government and a non-proliferation treaty?
Mr. Stewart: When the right hon. Gentleman has studied my statement a little more, he will, I think, see that the degree of actual achievement is rather greater than the one item to which he referred.
34
I do not think that I should say anything further than I did in my statement about a meeting between Mr. Kosygin and the Prime Minister because, as I said, we hope to give further information before very long and it would be better to keep that until it is possible to make a precise statement.
On the right hon. Gentleman's third point, the problem there was a tendency on the Russian side to use general phrases like "access to nuclear weapons" rather than a willingness to examine precisely what N.A.T.O. might decide to do. I think that the problem can be stated as follows. If it were the Russian view that any arrangement whatever made within N.A.T.O. was to be treated as an obstacle to a non-proliferation treaty, that would be unreasonable, and I made this clear. Therefore, the important thing is to decide exactly what we both understand by non-proliferation. One can then judge whether anything proposed within N.A.T.O. is inconsistent with it. I do not believe that it is. That is why we thought that further discussion on the actual text of a non-proliferation treaty would help to get this point sorted out.
Mr. Grimond: Does the Foreign Secretary realise that, if the talks are to be regarded as businesslike, some business must eventually result and, therefore, the follow-up would seem to be most important? In that regard, can the right hon. Gentleman tell us how discussions for a non-dissemination treaty are to be pursued? Are they to be in the present forum or are they to be in bilateral conversations?
Second, is the right hon. Gentleman aware that they will be some disappointment over the lack of anything definite on the subject of Vietnam? Can he say, if the Russians are anxious for peace, whether any proposals are now being considered by which the two co-chairmen might take a new initiative?
Mr. Stewart: The right hon. Gentleman's first question was about the forum for further discussions. We considered this and we felt that this could be done both in Geneva or through our representatives in New York, or, indeed, through other channels. We shall now get on with that.

35
As regards Vietnam, I took this opportunity, as I have taken all other opportunities when I have met the Soviet Foreign Minister this year, to point out our position as co-Chairmen and the fact that, if we had his agreement, we could recall the conference. I am sorry to say that the Soviet Government are still not prepared to do that. I think that they take the view that this is now a matter entirely for the Government of North Vietnam to decide. In these circumstances, the task for the British Government is to go on making clear their own willingness to promote and take part in discussions the moment there is willingness on the other side to take part in them.
Mr. Ioan L. Evans: Will my right hon. Friend say what progress was made as regards the development of economic and cultural contacts? Second, with regard to a non-proliferation treaty, do the Government now intend to follow this up, in view of the urgency, in the United Nations or, possibly, by a summit conference?
Mr. Stewart: I mentioned just now that we wanted to proceed on the nonproliferation treaty. As regards cultural and personal contacts, the Consular Convention is some help there in making it easier for citizens of each country to visit the other. We have, I think, quite a good programme going of cultural contacts, particularly in the last year, and that we shall certainly be able to develop.
Mr. Blaker: In connection with nonproliferation, did the right hon. Gentleman raise with the Soviet leaders the possibility of their joining in security guarantees to India through the Security Council? If so, would he say something about their reaction?
Mr. Stewart: We discussed that, but I think the feeling was that a nonproliferation treaty would probably be the first step in this direction and that we ought to try to concentrate our efforts there first.
Mr. Park: Would not my right hon. Friend agree that a major obstacle to an Anglo-Soviet peace initiative over Vietnam is the persistence of the American Government in bombing operations
36
and their refusal to admit the direct participation of representatives of the National Liberation Front of Vietnam in peace negotiations? Will he publicly urge the United States Government to re-examine their policies in this respect?
Mr. Stewart: There is, I am afraid, no evidence at all that that is so. There has been no sign from the other side that if the American Government made either of the changes in their policy to which my hon. Friend has referred they would then be willing to negotiate. Indeed, my hon. Friend may have noticed that the Government in Hanoi has recently repudiated the story that it made overtures for peace last year, and described this as a fabricated legend. I do not think, therefore, that we should have, apart from anything else, any ground for supposing that this is really an obstacle to negotiations.
Lord Balniel: Would the right hon. Gentleman say what was the response of the Soviet Government to his suggestion that the Soviet Government should take steps to correct the imbalance of trade with this country?
Mr. Stewart: The response was no more than undertaking to examine this and a recognition of what Mr. Patolicher had said on an earlier occasion. I made it clear that it was not a situation that we could allow to continue indefinitely.
Mr. Frank Allaun: Would not one way of stopping the proliferation of nuclear weapons and of limiting them to America and Russia be for Britain to dispose of her own, notably the Polaris submarines? Even if my right hon. Friend the Secretary of State for Defence seemed to think that this was a daft question a week ago, some of us do not think it is daft at all.
Mr. Stewart: I must none the less call the attention of my hon. Friend to what my right hon. Friend said a week ago. As my hon. Friend will be aware, however, the British Government have put forward proposals for bringing these weapons under international control.
Sir G. Nicholson: May I bring the right hon. Gentleman back to the comparatively narrow question of Mr. Brooke? I believe that the whole country considers this situation to be intolerable.

37
Does he mean to leave it there? Cannot something be done, with all the force of Her Majesty's Government behind it, to rectify a grave injustice affecting a single individual?
Mr. Stewart: I agree with the hon. Gentleman that we cannot regard this situation as satisfactory. None the less, I believe that the securing of consular visits for Mr. Brooke was a useful advance. I think that, quite clearly, we cannot forget this question and must consider what further action might be helpful to Mr. Brooke.
Mr. Emrys Hughes: Does the Foreign Secretary recollect that when the former Prime Minister, the right hon. Member for Kinross and West Perthshire (Sir Alec Douglas-Home), was in Moscow he said that we should not only co-exist with the Russians but co-operate with them? Does not my right hon. Friend think that there is something to be said for returning to Mr. Harold Macmillan's idea of a non-aggression pact with the Soviet Union?
Mr. Stewart: That was one of the ideas that we discussed. There are certain problems about it, but I certainly would not rule that out. As to not only coexisting but co-operating, there is, of course, the one field of Vietnam where I am particularly anxious to do that and have made my willingness to do so repeatedly known.
Mr. Longden: When the right hon. Gentleman was talking about the United Nations did he raise the question of what voluntary contribution the Russians would make towards the peace-keeping arrangements, and did he ascertain whether such a contribution would be conditional on the permanent waiving of Article XIX?
Mr. Stewart: I did in our discussions on the United Nations draw attention to the fact that we for our part had made a voluntary contribution and that we would hope that the Soviet Union would
38
do the same. I am not, I am afraid, able to tell the House what their conclusion on that may be.
Mr. Mendelson: With reference to the statement made by my right hon. Friend at his Press conference in Moscow on the future of negotiations on a non-proliferation treaty and his understanding of the dangers and difficulties that the Soviet Government see on their side, may I ask whether he would accept that there is widespread support for his patient efforts to make progress in these very difficult negotiations and not the cynicism that seems to shine from some of the questions that we have heard from Front Bench spokesmen on the other side of the House? Would he further bear in mind the recommendation of the Gilpatrick Committee to the President of the United States that while these negotiations between East and West are continuing there should be no—
Mr. A. Royle: On a point of order, Mr. Speaker. Is it in order for the hon. Gentleman to make a speech?
Mr. Speaker: Order. It is not in order for the hon. Gentleman to make a speech. However, I hope that hon. Members will allow the Chair to indicate when an hon. Member is out of order.
Mr. Mendelson: Will my right hon. Friend bear in mind the recommendation not to make any nuclear sharing arrangements in N.A.T.O. which might make a wider East-West agreement more difficult?
Mr. Stewart: I am grateful for what my hon. Friend has said. I have tried to show that we are handling this complex matter properly, but I think that my hon. Friend will agree that it will require patience and understanding on both sides if we are to get it right.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: Order. I am afraid that we must leave it there.

ORDERS OF THE DAY

  RATING BILL
  Order for Second Reading read.
  3.47 p.m.
  The Minister of Housing and Local Government (Mr. Richard Crossman): I beg to move, That the Bill be now read a Second time.
  This Bill is the first jab of a two-pronged attack on some of the inequalities and iniquities of the rating system. Let me admit it frankly—rates is another subject which I approach with a strong initial prejudice. Indeed, my lack of cautious impartiality in this respect reminds me of a famous anecdote about Calvin Coolidge, the most cautious and noncommittal of all American Presidents. So cautious was he that, questioned on leaving church one Sunday morning about the topic of the sermon, he replied laconically "sin". And when his interrogator went on to ask about the view of the preacher, Coolidge replied "he was agin it".
  Well, that is my view of rates: I am "agin" them, and that is why the two local government finance Bills that we are putting forward this Session should be regarded not as measures designed to make rating a good tax—that, of course, is quite impossible—but as interim devices designed to shore up this ancient monument which should not have been allowed to survive from the reign of Elizabeth I into that of Elizabeth II but which must now be prevented from collapsing altogether until we have had time to organise a planned operation for first demolishing rates and then replacing the system with a new local tax, fair, intelligible and capable of being administered reasonably efficiently—three conditions on which rates lamentably fail.
  If there were any chance that either the introduction of rate rebates by this Bill or the partial shifting of the burden from rates to taxes which is the purpose of our second Bill—if I thought either proposal was likely to prolong the life of the rating system, I should be a disappointed man. It is only against this background that I ask the House to judge these interim relief proposals.
  Before I leave the topic of rates in general, I want to call attention to the
  40
  two main defects in rates which not only demand instant relief but which are having a disastrous effect on local government and local democracy. First, the method of arriving at rateable value was always pretty difficult and it began to get detached from reality when rent control was introduced in the First World War. It is now rendered more and more incomprehensible and remote from reality as the number of privately rented houses declines—the only houses where rating has a direct relevance as a tax. The more we move towards owner-occupation on the one side and council house tenancies on the other, the more mythological becomes the rateable value which forms the foundation of this eccentric local tax.
  I noticed in the Press that I am being blamed for the abandonment of the quinquennial valuation due in 1968. Let me first say that, when we took office, it was already clear that, owing to a shortage of valuers, revaluation would have to be postponed. I am sure that the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) will agree that this was the case.
  Since then, postponement has been transformed into abandonment by the demands of the betterment levy which, whatever right hon. and hon. Members opposite think about the Land Commission, is now a tax which both sides agree must be introduced as soon as possible. But there can be no betterment levy without land valuation and there can be no prospect of getting the valuers to do the necessary work in the foreseeable future except by abandoning the revaluation for rating for a whole five-year period.
  If I had considered it possible to improve rating and make it a tolerable tax, I might have fought harder against abandonment, but it is my view that the intrinsic iniquities and, in particular, the built-in regressive character of rating are so vicious that they cannot be removed by revaluation. Revaluation may get rid of some superficial blemishes in the rating system by bringing the relativities up to date. In so doing, however, it leaves its unintelligibility and its inherently regressive nature untouched.
  It is now clear that these inherent defects are undermining the strength of

  41
  local government and enforcing a slow but nevertheless ominous take-over by the central Government of more and more control over the services administered by the local authorities. The more we are forced to shift the burden from the shoulders of the ratepayers to the shoulders of the taxpayers, the more we strengthen Whitehall against the town hall and the Cabinet and the House of Commons against the locally elected councillors and aldermen.
  The reason for this is clear. Under the commitments we inherited from our predecessors, the cost of the social services, particularly education, is bound to rise prodigiously during the next 10 years. If the proportion of cost borne by the taxpayer and by the ratepayer respectively is to remain constant, then rates are bound to increase by at least 10 per cent. a year even if no extra social service expenditure is added by this Government to that implicit in the plans of the last Government.
  The trouble about a regressive tax like rates is that, while it is tolerable so long as it is scarcely noticeable—so long as it takes each year a minor proportion of one's income—it becomes rapidly intolerable when the rising commitments of the social services turn a small if unjust local tax into a monstrous local burden which falls each year with ever greater injustice on the shoulders of those least able to bear it.
  So long as rating survives as a tax, we can only make it tolerable by two processes. The first process is to redistribute the burden among ratepayers so that the better off pay more and more in order to enable those near the poverty line to pay rather less. That is rate distribution within the rating system. The second method is redistribution by shifting the burden from rates to taxes, but this cannot be achieved without increasing the hold of central Government and thereby weakening the vitality of local democracy.
  Of these two processes, our two Bills provide an excellent example. Rate rebates, as some hon. Members opposite have been quick to point out, involve some element of redistribution not merely between ratepayers and taxpayers but between ratepayers themselves. Although 75 per cent. is borne by the Exchequer,
  42
  thus transferring the burden from local to central Government, 25 per cent. is borne locally and this will mean that, to an average extent of a 1d. rate, the better-off ratepayers will be mulcted in order to pay a quarter of the relief. Hence the cries of agony from Tory spokesmen over the weekend.
  Mr. A. E. Cooper: The right hon. Gentleman is simply talking in terms of the amount of rating—that is to say, the difference in terms between £22 million and £29 million. He is not taking into account any extra cost of staff on the local authorities. The average increased rate will be about 3d.
  Mr. Crossman: I shall deal with this point, which the treasurers raised with me, later on. The extra administrative costs are difficult to calculate in terms of rate poundage because they will qualify for rate deficiency grant and will be partially borne by grants. Hon Members have complained bitterly about a 1d. rate being put on the wealthier ratepayers in order to pay for the rebates. But if we did not do this the transfer to the central Government which we shall find such a dominant feature of our second Bill would have been even more marked in this first instalment.
  In principle, it is wrong in almost every field for supply to be entirely divorced from control. If the central Government pays, there should be some control by the central Government. To have control by an authority which paid not a penny would seem extremely undesirable, and I was surprised to hear these complaints from Tory spokesmen.
  Mr. Eric Lubbock: But although the Government have not had complete control of teachers' salaries, they have managed to dictate them in the past. What will be the difference if the central Government are to pay a higher proportion?
  Mr. Crossman: The hon. Gentleman is emphasising the problem I am stating. He may be right in saying that there is so little local democracy left already that it is not worth preserving. But I do not agree. I think that a lot is left but that we shall not preserve it long if we solve the problem merely by transferring the burden from rates to taxes. That is something that we must do in the short run,

  43
  but in my view, while we are doing it, we had better make a more radical reform by getting rid of this inherently regressive system, which is causing us to weaken local democracy, and replacing it by a local tax.
  This Bill will help some 2 million families whose rate bill weighs on them unduly harshly. We shall undoubtedly blunt the effect of rates where they fall most unjustly but we shall not be making rates a good tax. We shall not be making even a social service to help poverty, because we shall find that often, where two people are perhaps equally poor, one will get a rebate and the other will not. We shall be doing a rough and ready job of relieving pressure where rates hurt most. We shall merely be able to make rates less intolerable.
  So, too, our reform of the general grant, although it will ease the pressure on the ratepayers, will actually aggravate the danger to local democracy if it is allowed to become a permanent part of the system. That danger can be eliminated not by measures designed to blunt the harshness and injustice of rates but only by their elimination and substitution by the kind of local tax which will enable local authorities justly and fairly to raise money for themselves and so resist the growth of central power through the spread of central grants.
  Mr. Julian Ridsdale: When will the right hon. Gentleman let us know what his new sources of local taxation will be?
  Mr. Crossman: I was trying to explain the background against which I see this problem. We are not here introducing a reform of rating on the ground that we think the system something to be preserved. We are giving a short-term relief from this unpleasant tax while we make our plans to abolish it. That is the central point. Without a radical reform of local taxation, including the abolition of rates, I see no future for local democracy and its slow sapping through an insidious take-over by central Government.
  I want to turn from that, which puts our reform in its proportion, to the Bill itself. As the House knows, it contains two reforms for the hard-pressed domestic ratepayer. First, it makes payments by instalments mandatory when-
  44
  ever a ratepayer wants it, and, secondly, it imposes on local authorities responsibility for paying the rate rebates laid down by the Government to anybody who applies for them and who is entitled to get them.
  On both these proposals the Allen Committee, which reported last February, provided a firm foundation of fact on which it has been possible to build sensible and practicable proposals. I should like to thank my predecessor for having established the Allen Committee. The more I have looked at its work, the more reliable I have found its statements. In so far as it has been possible to make a decent practicable Measure, we owe as much to the Allen Committee in this respect as in the case of the Rent Act we owed to the Milner Holland Committee.
  On the collection of rates, the Allen Committee pointed out in paragraph 245 that whereas the majority of people who pay rents pay their rates along with the rent, owner-occupiers have to pay rates for a year or a half-year in lump sums and many of them find this an embarrassment, particularly if they have previously paid their rates with the rent. In paragraph 246, the Allen Committee said:
  "We believe that a good deal of the resentment against rates as a tax stems from the failure of the system to keep in step with present day practices. Under the P.A.Y.E. system income tax is deducted from weekly or monthly pay by employers. Houses are bought, furnished and equipped on easy payments. But the tax on house occupation (i.e. rates) is still generally demanded at six-monthly or even yearly intervals."
  There will be widespread agreement that the Allen Committee was right to say that, and Clause 1 sets out the Government's proposals for payment by instalments, to which I will come in more detail later.
  The other area on which the Allen Committee concentrated was finding out who was hardest hit by rates. On the regressive character of rates generally, in paragraph 361 it found
  "… for all households in England and Wales, the regressive nature of rates is most clearly brought out by the fall in rates as a percentage of income, from about 8 per cent. for the lowest incomes (under £312 a year) to less than 2 per cent. for high incomes (over £1,560 a year)."
  The selection from the Report of the Allen Committee is sufficient to clinch the argument that rate rebates should not

  45
  be applied generally to all ratepayers, or even to all domestic ratepayers. If we want to use the limited amount of money available to the best advantage, we must concentrate rebates where rates fall most harshly and in particular to bring succour to three classes. These are, first, the half a million who, the Allen Committee calculated, are entitled by their poverty to National Assistance, but who are too proud to go to the National Assistance Board; secondly, to another one and a half million families who are just above the National Assistance line; thirdly, to a group whose size we do not know and who for one reason or another are just not eligible for National Assistance but are clearly entitled to rate rebate.
  Rate rebates are therefore a tax reform designed to help those three classes and I emphasise the words "tax reform" because this is a rough and ready method which must not be confused with a social service such as that administered by the National Assistance Board. Nor must it be treated as a first instalment of the income guarantee which my right hon. Friend was hoping to put on the Statute Book in this Session, but which, unfortunately, has had to be postponed. National Assistance and the income guarantee are social services designed to relieve hardship and poverty wherever they are found. This is something which rate rebates cannot do. Indeed, if it is not to cause acute disappointment, it is important to realise the Bill's limitations.
  Let us take the example of two houses side by side. In house A there is a son, earning an average wage, who is the ratepayer and a grandfather who has nothing but his old-age pension and who is sharing the home. In this household there are no children and earnings are average and rate rebates will not be payable. Next door the grandfather is the ratepayer and the married son is sharing the home because he cannot get a house. Because our rebates are a tax concession and not a social service, they are payable in the second house to the ratepayer but not in the first house, although the hardship involved may be identical.
  I have chosen the harshest example which I could find—and I do not know that there are many like it—because I want to emphasise that rate rebates will not replace National Assistance, or in any
  46
  way be the beginning of any future income guarantee. They are designed exclusively to help families whose rates bill subjects them to exceptional hardship. Within these limits, I believe that the Bill will do a great deal of good, and it was all the more important to introduce rate rebates once we knew that the income guarantee had had to be postponed from this year and to make the rebates payable after 1st April, next year.
  Having set out those two objects, I will now explain how the Bill gives effect to them. Payment by instalments is dealt with in Clauses 1 and 2—Clause 2 applies to Scotland. Those entitled to pay rates by instalments are virtually all occupiers of dwelling houses and mixed premises used mainly for domestic purposes. Only those, in council houses, for instance, are excluded who, because they pay rates anyway as part of their rent, are already in fact paying them by instalments. Apart from them, people who wish to begin paying by instalments will simply have to give notice to the local authority before the end of next April and the local authority will then tell them how much they have to pay and the dates on which payments should be made. I know that many local authorities already accept the payment of rates by instalments and some at more frequent intervals than the 10 months in the year which we have laid down. Nothing in the Bill in any way limits their capacity to offer facilities which are more generous than those in the Bill.
  Many ratepayers would have preferred a scheme in which they had the right to pay weekly. I sympathise with them, but I have to recognise that accepting payment by instalments costs money and, therefore, higher rates and makes a good deal of work for the treasurers. We have had to strike a balance between the convenience of frequent payments to the ratepayers and the inconvenience of having to pay extra for it, and I think that a scheme for 10 monthly payments in the year is probably a fair compromise. The rest of the Bill deals mainly with rate rebates. There are many ways in which we could have designed a rebate scheme, but throughout I have had foremost in mind the findings of the Allen Committee. Since the aim is to reduce the proportion of income taken in rates, it

  47
  follows that those domestic occupiers whose rate bills are high should receive more assistance than those occupiers with similar incomes whose rate bills are low. The scheme is designed to produce this result by providing that the first £7 10s. of rates, the threshold, shall be disregarded and that the amount of the rebate shall be two-thirds of the rates beyond the threshold. The average householder in this country pays about £36 a year in rates. That being so, it is obvious that those whose rate bills are of the order of £7 10s. do not stand in any great need of assistance. That is why we do not extend the scheme right down the scale.
  The category of those who may qualify for rebate is wider than the category of those who are to be entitled to pay rates by instalments. Only those who pay twice a year—the pukka ratepayers in the sense that they live in separately rated accommodation and receive a rate demand—are now called upon to pay substantial sums. However, there are many people who, while not technically ratepayers, make a concealed contribution to the rates through their rents. That is why the Bill gets complicated when it provides that not merely the occupier of a house may qualify for rebate, but also any tenant of the occupier. Where a rating unit of accommodation is divided among two or more families, a proportion of the rates is to be treated as being paid by each and each will be treated as if he were a ratepayer paying that amount of rates direct. So much for the division of the rates.
  I now come to the income levels. Here, again, the Allen Committee survey showed that rates bore particularly harshly on households with less than £10 a week, and I have taken that as our starting point. I ought to explain to the House the relationship between £10 for the married couple and £8 for the single person, the figures which we have laid down and which some regard as being somewhat bunched together. The reason is to be found in tables 200 and 229 of the Allen Report which show that a retired single person household—and more than three-quarters of the households in the single person group are retired people—pays proportionately much more in rates than any other house-
  48
  hold in that income range. For this reason, because of the special hardship of the widower or widow as distinct from the married couple, we have made a relatively small gap between the two figures.
  The effect of these income levels is not altogether to cut off people exceeding those levels, but to provide limits above which the rebate tapers off. This is effected by Clause 3(1,b) under which for every £ of extra income above the limit, 5s. are deducted from the rebates otherwise due.
  To take an example, a single person will get the full rebate of two-thirds of the year's rates over £7 10s. if his income is not over £8 a week, or £416 a year. How big the rebate is will depend on the size of the rates. For example, suppose a year's rates were £20, one must first take the £7 10s. for the threshold, from the £20, and then one gets a rebate of two-thirds on what is left, which comes to £8. In the same way, for rates of £40 when one has deducted the threshold and taken away the one-third the rebate works out at £22. For rates of £60, it is about £35 and so on.
  If his income is above £8 a week then a single person has his rate rebate reduced by 5s. a week for each £. For instance, in the last example of full rebate which came to about £35, a person would still get some rebate up to an income of just under £11 a week. A married couple will get full rebate up to a joint income of £10; £8 for rates of £20, £22 for rates of £40 and £35 for rates of £60. These are substantial rebates. When the couple's joint income is over £10 a week the amount of the rebate is reduced by 5s. for each £. This again means that for a couple with an annual rate bill of £60, some rebates will still be payable up to nearly £13 a week.
  Lastly, there are married couples with families. The Allen Committee found that such people were among the hardest hit group of all and I am very glad that help is given for them. Clause 5 provides for an income limit of £10 a week to be increased by 30s., so that a married couple with one child will get full rebate up to £11 10s. and some reduced amount beyond that.
  To take the extreme, a married couple with five children can get full rebate up

  49
  to £17 10s. If this family have rates of £60 a year, and this is not impossible in London, it will get some reduced amount on the rebates up to a joint income of just under £21 a week. I have given that figure because it is extremely important to my mind, to look at the extreme to make sure that it is not too large. I think that it is a reasonable thing for a family of five living in a house in London with a very high rateable value.
  Mr. Cooper: In assessing incomes in this particular capacity with a family of five children, is account being taken of family allowances as part of the family income?
  Mr. Crossman: This is assessed as part of the income. These, of course, are children who are below school leaving age. Income of adult children would count separately.
  So far I have assumed the simple case, where all the rates are eligible for rebate. The complexities come again in Clause 4. Suppose that the applicant does not use the whole house but lets part as a flat. The council will then have to apportion the rates on the whole house, and the main householder's reckonable rates will be based on the portion he lives in, and the tenant will be able to make application on the portion in which he lives.
  The second complexity involves household income which concerns the older children. The income of husband and wife is taken as their joint income, but the Government rejected any suggestion of an inquiry into the means of other members of the household in favour of Clause 4(4). There is to be no household means test. Clause 4 provides that where the adult, and this includes earning children, other than the ratepayer and his wife, live in the house, a proportion of the rate bill shall be disregarded for rebate and paid in full. This rough and ready method should provide a reasonably fair solution to a difficult problem without demanding too much inquiry into family incomes.
  Mrs. Lena Jeger: Can the Minister explain whether he has in mind that the borough treasurer's department should be responsible for this inquiry, or whether he has considered the possibility of using the experience of the National Assistance
  50
  Board, even for families not normally within the scope of the Board?
  Mr. Crossman: I have considered this and discussed the matter with the treasurers. It is extremely important to realise that this is not part of National Assistance. This is a tax rebate administered by the local authority.
  Just as a local authority would not go to the National Assistance Board when discussing its rent rebate scheme, it will not go to it for tax matters. It may go to the Board for advice, as it is entitled to do. Nobody can say that the local authority should not discuss this with the National Assistance Board. What we are discussing is whether the treasurers should hand the people over to the National Assistance Board. I do not intend to do this. We are leaving the treasurers with the job of administering this with as free a hand as possible.
  Mr. W. R. Rees-Davies: The right hon. Gentleman may be right about that, but the fact is that the National Assistance Board is covering a very large number of the cases mentioned in this Bill. Has there been consultation with the Chairman of the National Assistance Board so that the Board will continue to pay the rates for all those persons, thereby avoiding an enormous amount of administrative inefficiency, which will otherwise result in a dual inquiry in respect of these matters?
  Mr. Crossman: I was going to deal with this point later, but I will deal with it now.
  The decision we made was that all those at present drawing National Assistance and having their rent and rates covered by National Assistance will continue to do so. Secondly, there will be no compulsion on anyone who is entitled to National Assistance by poverty, but not drawing it, to go to the National Assistance Board. They will be entitled to go to the treasurers. Thirdly, I have had long talks with the treasurers about this and they will, if they think it right, say to a person, "Look you are entitled to National Assistance and you would do far better on National Assistance than by applying for the rate rebate." But having told them that, the treasurers must leave it to the person to decide

  51
  whether he prefers to deal with the National Assistance Board or else apply for the rate rebate because he does not like going to the Board.
  This is clearly understood between the Chairman of the National Assistance Board and ourselves, and we want collaboration between the treasurers and the Board in this matter. I am hopeful that a considerable percentage of those not drawing National Assistance will, in this way, be tactfully persuaded to take what is their right, rather than to burden the treasurers with the special rebate. We certainly want people to do this and they will be encouraged to do so. I am still consulting with the National Assistance Board about whether we may not need a new Clause statutorily laying down certain points, which I am sure will have caught the attention of the Front Bench opposite. They are delicate points and I think that the less said, in one sense, the better. We know they are there, and we are trying to work out a proper method so that there is no risk of double payment.
  I hope that the other mechanics of the scheme will prove relatively easy for the applicants. Rebates will be applied for and fixed every six months. The first rebate period begins on 1st April and applications should be made as soon as the Bill becomes law. For the first rebate period it will be necessary for the applicants, by virtue of Clause 5, to disclose their income in the six months ending 1st December, 1965, or the corresponding period for Scotland. Because the full rates on which rebate is calculated are reduced if there are other adults in the household, the applicants will not have to declare as income any payment by a lodger or member of the household, because the rebates will be automatically adjusted for that.
  The general scope of the word "income" in the Bill is a very wide one. It is not specifically defined, and apart from excluding the contributions of other adults in the family, and minor matters like receipts which amount to a tenant's rates for passing on to the rating authority, it covers everything which comes in. Capital counts only to the extent that it produces income. We are doing this as a tax reform and not as part of the social services.
  52
  How does the applicant get the rebate? The general principle is that the rebate must come direct from the rating authority. It would have been simpler, if the tenant could have got it from the landlord, but we thought there would be possibilities of a quarrel about this so we decided that, although in the case of council landlords the tenant will get it automatically as a deduction of rents, in cases where rates are payable to a landlord as part of the rent the rebate should be payable direct to the tenant at the end of the rebate period.
  Mr. Lubbock: Would the Minister say what happens in the case of local authorities which have rent rebate schemes? Is the rebate deemed to come entirely off the rent and are people then free to obtain the rate rebate from the local authority to which they are paying a combined amount for rent and rates?
  Mr. Crossman: Part of the rent rebate will be reckoned towards the rate rebate. The treasurer will have to calculate this out between the two accounts. This is possible. I do not see anything intrinsically difficult in it.
  I want to say something special about the treasurers. I am enormously aware that we are putting a very great burden on the financial departments of local authorities. I know that the success of the Bill depends on the treasurers and their staff and on the committees. In talking to the treasurers in my visits to local authorities throughout the country, I have become aware of how much thought treasurers have given to the problem with which the Bill tries to deal. I should like to thank once again the committee of the local authority associations which has been consulting us throughout. It has not by any means always agreed with us, but it has always been willing to give its advice, even though we could not do all that it wanted, including getting the Government to pay the whole bill.
  We can look to the treasurers to make arrangements for getting the instalment and rebate schemes rapidly and smoothly into operation, despite the shortage of skilled staff. We shall owe them a great debt of thanks for what will be for them a rather unrewarding job. I hope that they will not try to do the impossible by perfecting and refining this scheme. The

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  rebate scheme is a rough and ready scheme which I do not believe will last long, for the reasons which I have given. It will do rough justice; it will not do more. If they try to run it with the care and skill and fine distinctions and legal theology which may go into a tax system proper, the scheme will not work.
  I am pleased to see that the Institute of Municipal Treasurers and Accountants has set up a working party to examine the implications of the changes in administration which will be introduced by the Bill. This working party is to advise the Institute's members on administrative procedure and other matters to ensure that the new arrangements work as smoothly as possible. I am all for that, and I hope that the Institute will join me in taking a broad view of the way in which the provisions of the Bill should operate as a rough and ready tax reform and not as a social service.
  The final thing which I had to discuss was the one point of controversy between ourselves and the Opposition, that is, who pays? We propose, as the House knows, that 75 per cent. should be paid by the central Government and 25 per cent. by the local authorities. I should have said that a percentage had to be paid whatever happened, for the reasons which I have given, but I do not think that those who supply the money should ever altogether give up the control. We cannot separate and divorce the two concepts. Nevertheless, it is true to say that we have to consider the state of the Exchequer.
  I was interested to see in the Sunday newspapers some vigorous attacks on us for the impositions which we were making on the ratepayers. One Front Bench Opposition spokesman on financial affairs said of me:
  "I wonder that he has the cheek to come to the Commons next week to present his Rating Bill that will further increase the rates for nine out of 10 taxpayers."
  Hon. Members: Hear, hear.
  Mr. Crossman: Any more cheers? Let us wait for the vote at the end of the debate.
  The hon. Member for Stratford-on-Avon (Mr. Maude)—I am glad that he is here to sustain his view—said, according to The Times today:
  54
  "A minority of ratepayers are to be subsidised, and a quarter of the subsidy will be borne by all the rest of the ratepayers".
  I am curious to hear from the Opposition Front Bench spokesmen whether these powerful attacks on the Bill represent the official Opposition view of rate rebates. May I say this in all seriousness to the hon. Member for Stratford-on-Avon? If we are to keep rates longer than I want, there will have to be a much more drastic redistribution among ratepayers than this little Bill suggests, for as we increase the burden of the rates—and they are bound to increase unless we shift them all over to taxes—the accumulative weight on poor people becomes intolerable.
  To say that any attempt to redistribute the burden as between the better off ratepayer and the less well off ratepayer is subsidising a minority is simply to blind oneself to the problems of a viciously regressive tax. If we have a viciously regressive tax, we either let it be viciously regressive—that is, make poor people pay more than their share—or we seek to redistribute the burden. If the Opposition say that there should be no redistribution among ratepayers, let them say so by going into the Lobby against the Bill.
  The second thing which we have to consider is the split between taxes and rates. I do not believe that the hon. Member for Stratford-on-Avon is such a bad democrat that he wants 100 per cent. payment and control by the Chancellor of the Exchequer. He must be a good enough democrat not to want that. Therefore, he is against too big a shift being made from rates to taxes, and any redistribution between ratepayers because he thinks that that is unfair. He wants the rates to remain exactly as they were over the last 12 years when the Tories were in power.
  I can appreciate that, but I would say to the hon. Member for Stratford-on-Avon that, while his party was in power, it did at least attempt to introduce a little reform of its own. We have almost forgotten the little Bill which right hon. and hon. Members opposite produced just before the election to relieve the pressure of the rates. Why have we forgotten it?—because it was totally and completely ineffective. It was a Bill which did not do the faintest good to anybody. So little good did it do that the amount of money

  55
  taken up, except in one of two constituencies, was virtually negligible.
  I suggest to hon. Members opposite that, before they criticise us for the distribution which we make, they should take a look at how their miserable Measure was paid for. The Exchequer grant was only 66⅔ per cent. The rest had to be paid for by redistribution among existing ratepayers in exactly the way which our Bill proposes, which the hon. Member for Stratford-on-Avon attacks. Therefore, the blame which he puts on this Measure, which really does a job of work, is exactly the same as the blame which he should have put on his own party's Measure, with the addition that it did not do anything.
  Mr. Angus Maude indicated dissent.
  Mr. Crossman: The hon. Gentleman shakes his head. Does he deny that under the Tories' rate relief Measure only 66⅔ per cent. of the cost was paid for by grant as against 75 per cent. which we propose and the rest from rates? If he denies that, he had better look at the facts. What do the two Front Bench Opposition spokesmen mean by attacking the Bill for dividing the responsibility for rate relief fairly between ratepayers and taxpayers? This only shows the kind of chaos and disorganisation into which the Tories have fallen after a year in opposition.
  I recommend the Bill to the House in the confident anticipation that, having made the usual kind of insulting noise, right hon. and hon. Members opposite will not have the guts to vote against it.
  4.28 p.m.
  Mr. Boyd-Carpenter: Despite the characteristically agreeable tone of the Minister's concluding observations, the House is none the less grateful, as it always is to him, for the characteristic clarity with which he has expounded the provisions of a highly complicated Measure.
  The right hon. Gentleman knows perfectly well, however, that either he or, it may be, his right hon. Friend the Leader of the House is treating the House with very little consideration indeed in our consideration of this Measure. The Bill was published on Friday, 26th November, and hon. Members have, therefore, had
  56
  only one working week for consideration of its highly complex terms. This is a Bill which, as the Minister has said, if it is to work, depends upon the co-operation of local authorities and their officers. It is, therefore, pre-eminently the sort of Measure which hon. Members, on both sides, would wish, before making up their minds about many of its provisions, to have the opportunity of discussing with those who speak for the local authorities.
  In those circumstances, it is quite wrong to try to rush the Bill in the way in which the Minister and the Lord President of the Council have sought to do. Indeed, the Lord President, when challenged on this following the Business statement on 25th November, which was before hon. Members outside the Government had even seen the Bill, referred to it as a Bill of seven or eight Clauses and suggested that it was a simple Measure. Whether the Lord President knew it or not, it is a Measure of 11 Clauses and, as hon. Members now know, highly complicated with at least three of its Clauses running over three pages of print in the printed edition.
  The matter does not stop there, because on Thursday last the Lord President of the Council seemed to suggest that 10 days was a sufficient time between Second Reading and Committee notwithstanding the shortage of time between publication and Second Reading. I understand—I said as much on 25th November—why the Minister is in a hurry to get forward with a Measure of this sort. I suggest to him, however, that if he is in such a hurry, the right thing to do is to stir up his own Department and get the Bill presented promptly rather than to save time at the expense of the convenience of the House of Commons and, more than the convenience, the efficiency of the House in doing its job in the discussion of legislation of this sort. The right hon. Gentleman will find that if he treats the House a little better in this way in future, the House may be more inclined to treat him and his legislation with similar generosity.
  The Minister, in his opening passages and again when he came to his second or third peroration, seemed to be opening a debate on a totally different Bill. His speech would have been appropriate and effective on a Bill for the complete abolition of the rating system. For all the

  57
  adjectives which, from his well-stored vocabulary, the Minister lavished on the system which it is his duty to administer, can he pretend that any alternative to the rating system is in his mind for legislation in any foreseeable future? If he does, he is certainly contradicting what his right hon. Friend the Prime Minister said in the debate on the Address, when he said:
  "It may be that more intensive examination of problems of local government finance will throw up alternative methods to rates as the main source of alternative revenue. We all hope that someone will stumble"—
  that is perhaps not a very courteous reference to the Minister—
  "on the secret some day, but I cannot say that a satisfactory alternative source has yet been discovered."—[OFFICIAL REPORT, 9th November. 1965; Vol. 720, c. 46.]
  That was the Prime Minister.
  I am not sure that it is very helpful to those throughout the country who have to administer the system of rates, who have to collect the rates and operate the rating system, to have the Minister responsible at the centre making observations of this kind about a system which, he knows perfectly well, he has not the faintest idea how to alter.
  It is fie Minister's duty to work that system as best he can and it does not lie in his mouth to criticise it when, as he himself told the House, he has taken the step, by cancelling the 1968 revaluation, of preventing its being made more fair and equitable in its working, and when he told the House that he had taken away the valuer's from this necessary duty of improving the rating system in order to prop up the preposterous Land Commission which his right hon. Friend the Minister of Land and Natural Resources has said he will introduce.
  I very much endorse the right hon. Gentleman's proper tribute to the Allen Committee, which, as he said, was set up by my right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) and which did a splendid job in the production of its massive clear and cogent report.
  As to the Bill itself however the objects are plainly respectable and I think accepted on both sides. Our criticism of it is that its methods are ham-handed and complicated, that its operation will
  58
  be unfair, and that it is inadequate in scope.
  The Minister had a great deal of fun in referring to certain observations by my hon. Friend the Member for Stratford-on-Avon (Mr. Maude) and one or two other hon. Members, and worked himself up into a splendid tizzy on the suggestion that we should vote against the Bill. The right hon. Gentleman's tongue was, to those who know him, well lodged in his cheek when he made that observation, because he knows as well as any hon. Member, from the speeches, for example, that my hon. Friend the Member for Finchley (Mrs. Thatcher) made at our Brighton conference, that the object of this Measure—the giving of relief to those most hit by rates—is one which is held just as strongly on this side of the House as on the other side, and that for that reason we want to see a Measure go forward which will do just that.
  I should like, however, to pick up the right hon. Gentleman's challenge. He said, quite rightly, that some of my hon. Friends had attacked the Bill because of the 25 per cent. imposition on the local authorities, about which I shall have something to say presently. Can the Minister assure the House that no procedural obstacle will be put in the way of hon. Members on voting on this issue, which, as he has rightly said, is the main issue of controversy in the Bill? Can the right hon. Gentleman give any such assurance? He pointedly does not do so. That blows away his bluff in saying. "Why not vote against the Bill?" If the right hon. Gentleman wants a vote, let him have it on the 25 per cent. provision, although I am not sure that many of his hon. Friends behind him would necessarily be in his company in the Lobby were he to do so. He knows it perfectly well. [Interruption.] I hope that those hon. Members who suggest that they would be with him are explaining their attitudes to their own local authorities.
  On the text of the Bill, Clauses 1 and 2 deal with the object of permitting payment of rates by instalments. The 1964–65 survey by the Institute of Municipal Treasurers brought out the interesting fact, as the result of considering about one-half of the local authorities in England and Wales, that within that large

  59
  sample some 44 per cent. of local authorities allowed instalments to be paid. When the Minister ceases being briefed—if I may say so, very wisely—by his Parliamentary Secretary, I should like to ask him what is to happen to those local authorities which already operate instalment schemes of their own. They represent—I do not know whether the Minister heard what I said a moment ago—as the report of the Institute of Municipal Treasurers made clear, a fairly widespread section of the country.
  I have a case, which I must put to the House and to the right hon. Gentleman, which has been drawn to my attention in respect of my own constituency. The Royal Borough of Kingston-upon-Thames operates a scheme by which rates can be paid by 12 instalments, more instalments than the number provided by the Bill. The borough has worked out a very simple system under which, on the back of the rate demand, the choice of method of payment is clearly stated, and provision is made in respect of those ratepayers who have a bank account for payment by banker's order. Where a perfectly satisfactory system, cheap, economical and efficient as this one is, is operating, when the Bill becomes law will it have to be abolished and will local authorities have to change over to the infinitely more complicated and administratively difficult scheme which is laid down in the Bill?
  I make the suggestion, which was made to me on behalf of the local authority in question, that the Minister should follow an example which will be almost as familiar to him as it is to me—that of the National Insurance Act, 1959—and should provide that where a satisfactory scheme of instalments is already in operation and it secures, as it would have to do, the approval of the Minister of the day, that scheme should be allowed to continue in lieu of that embodied in Clause 1 of the Bill. I hope that the Minister will be prepared to consider this.
  Mr. Crossman: I think that I gave the assurance in my speech that anything which is better than what we suggest would be accepted. I hope that I made this clear.
  Mr. Boyd-Carpenter: If by that the Minister means that Clause 1 would not operate in respect of such authorities, that would be satisfactory. I do not, however, think that he went so far as to say that. This is a matter that we had better probe further in Committee.
  Mr. Lubbock: We should like to get this absolutely clear. I think the Minister misunderstood the right hon. Gentleman. Clause 1 says that the persons must submit a notice to the local authority if he wishes to pay his rates by instalments. The right hon. Gentleman has just said that in his borough ratepayers can do this without any form of submission of notice and by merely taking advantage of the alternative on the back of the rating form. What he was asking the Minister was whether that could continue under Clause 1.
  Mr. Boyd-Carpenter: I am very much obliged to the hon. Member for acting as my interpreter to the Minister. It was a most agreeable and kindly object. The point I have in mind, and the hon. Member described the scheme very accurately, is whether Clause 1 may be excluded in such cases—I think that this will call for some Amendment of the Bill—where there is already a scheme, which, I think, must be a scheme of which the Minister approves—I do not think it should be left entirely to the local authority—satisfactory in achieving the objects of the Bill, and that the local authority will be able to go on with that cheaper and more efficient scheme to which, after all, its ratepayers are in fact now accustomed.
  Now I come to the main body of the Bill, the rebate and relief scheme. As a means of dealing with the problem of the incidence of rates, the Bill, as the Minister has himself made clear he felt, is very small indeed in scope and very limited. The means of this being paid for gives rise at least to a matter of considerable controversy. This leads me again to the famous 25 per cent. to which the right hon. Gentleman referred and to which I referred a moment ago. The cost of the provision is estimated in the Explanatory and Financial Memorandum attached to the Bill as £29 million. It follows that the cost, if 25 per cent. is to stand, falling directly on the local authorities is slightly in excess of

  61
  £7 million a year. On top of that is the cost of administration, which certainly some of the local authorities and those concerned with them estimate at a further £2½ million a year. The right hon. Gentleman sought to give some consolation on the latter point—that is, administration—by saying that those costs would rank for rate deficiency grant. I doubt whether there is very much comfort to be found by the local authorities in that, because the last part of the Explanatory and Financial Memorandum reads as follows:
  "The amount of any increase in grant from these causes cannot be estimated, but is not likely to be very substantial."
  It does not appear, therefore, that there is very much joy to be found there.
  Mr. Crossman: I do not want to leave any misunderstanding. That meant where the costs would not be very heavy, but if they really proved very heavy the amount would be correspondingly higher.
  Mr. Boyd-Carpenter: This again is a point which I think we shall wish to probe further in Committee. The local authority associations estimate that the cost would be some £2½ million, which is a substantial figure and a substantial increase in costs.
  The right hon. Gentleman went on to say that the whole thing was the product of a 1d. rate averaged out throughout the country. Of course, it will not be averaged out throughout the country, and this is part of the fallacy of averages in this context. Probably it will involve very little charge to the local authorities in some of the wealthier areas, in the wealthier towns of the Midlands, perhaps—I do not know—the City of Westminster; but it will fall proportionately heavily on areas where large numbers of retired people live, the sea coast towns, for example, which are precisely the areas most hit as a result of the last revaluation. Therefore, I think it is misleading comfort to suggest that this is only the product of a 1d. rate for the areas most sensitive already to the pressure of rates, with those very people in them. They are just the areas in which the burden will be substantially more. I would accept what my hon. Friend the Member for the Isle of Thanet (Mr. W. R. Rees-Davie) said in an intervention in respect of the area he represents.
  I do not quarrel with the right hon. Gentleman on the general proposition that
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  if a local authority administers a service it should as a matter of general principle have a financial stake in that service, but even for that purpose 25 per cent, is a very substantial figure. And here we come, of course, to the very real distinction between this Measure and the Rating (Interim Relief) Act, 1964, to which the right hon. Gentleman referred. In that Measure the local authorities had a considerable measure of discretion. They had to decide, for example, the infinitely difficult problem of what is hardship. In this Measure, as I read it, they have no discretion at all. This is a nation-wide system with nation-wide standards laid down by the Government of the day and it would not seem that here there was any need for the kind of financial discipline to which the right hon. Gentleman referred.
  As I understand it, this is indeed, in the right hon. Gentleman's words, a simple question of a mathematical calculation based on the means of the people concerned. The fact that it is a complicated mathematical calculation in some cases I do not think affects the argument, and, therefore, in this case it does not really seem that even a smaller percentage, a grant so as to preserve the principle, could really be justified, and it is perfectly clear that 25 per cent. is a very heavy imposition indeed.
  This is the view of the County Councils Association. I received from that body this morning, as, no doubt, many other hon. Members did, a letter setting out the Association's position, and I would read from it a short passage:
  "Prior to the Bill's publication the Association informed the Ministry of Housing and Local Government that in their view the relief of hardship was a national responsibility and that consequently the whole cost of any rebate scheme, including administration and loss of rent income, should be borne by the Exchequer."
  The Association went on to make the very pertinent point that
  "the effect upon local authorities of having the responsibility of providing the remaining part (25 per cent.) must inevitably cause the rate in the £ to be increased for the remaining ratepayers not receiving relief."
  That, I am afraid, is a completely unanswerable criticism. The consequence, therefore, of this Measure will be that, though it will give some relief to what the Minister estimates—he may well be

  63
  right—as some 2 million ratepayers, it will provide an increase in rates for all the rest, and by this means will add—I shall come back to this in a few moments—very seriously to the problem of increasing rates about which in general the Minister has, so far, done nothing at all.
  I want to ask the Minister—or the Under-Secretary of State for Scotland who is, I understand, to reply to the debate—a number of practical questions, and the first, in fact, relates to Scotland. As I understand it, local authorities in Scotland, unlike English and Welsh local authorities, have power to give some rate rebates on grounds of hardship. Indeed, in 1964 my right hon. Friend the then Secretary of State for Scotland increased their grant by about £1 million in connection with rebates of that sort. Is that power to remain? Or does this Bill replace it? Will Scottish local authorities retain the provision which it is my experience—which, of course, in this respect is much less than that of the Under-Secretary of State—has in fact worked very well?
  Secondly, we come to the point which the right hon. Gentleman himself referred to today, which is also referred to in the hand-out made when he announced the terms of the Bill.
  "Because full rates"—
  says the hand-out, and the right hon. Gentleman said very much the same thing this afternoon—
  "are reduced if there are non-dependants in the household, the applicant will not have to declare as income any payment by a lodger or a member of the household."
  I appreciate the point which the right hon. Gentleman was referring to there—indeed, he explained in his speech—that the reckonable rate is reduced proportionately in respect of earning adults in the house. But does it follow, and it seems to me that it does, and I would welcome clarification of this, that if we have a mother and her highly earning son living together in the same house, the mother only—shall we say?—in receipt of a retirement pension, that that household, of which the mother is the householder, will receive a reduction in their rates by one-third, as opposed to two-thirds, in excess of £7 10s.? Does that follow? Does it equally follow that if the householder were the son, simply putting up his mother as a lodger or
  64
  tenant, no relief would be payable by this means? That surely is an example of an indefensible anomaly. Does it not also give rise to the real possibility of abuse by means of a transfer of tenancies? It seems to have a real defect, and it is no good the right hon. Gentleman saying that it does not matter because it is a rough and ready thing which will only last for a few years. Rien dure comme la provisoire, as is so often said. I translate for the benefit of members of the Liberal Party, "there is still an odd Liberal about the House."
  It is not good enough, if this be a change in taxation, as the right hon. Gentleman rightly said, to create in the Measure so patent an anomaly and so powerful an incentive to abuse by arranging affairs so as to take advantage of the provision. This is a matter which I am quite certain we must probe.
  The hon. Lady the Member for Holborn and St. Pancras, South (Mrs. Lena Jeger), raised a point with which I should also like to deal. This is work which is unfamiliar to many local authorities, though not perhaps to those which operate rent rebate schemes. It will involve some extra staff. The right hon. Gentleman said something in reply to his hon. Friend about bringing in the help of the National Assistance Board on a matter in which it has an incomparable record of skill and experience. I hope that we shall find out further whether local authorities are to be compelled to set up something parallel to the local office of the National Assistance Board or whether, though the responsibility will remain with the local authorities, much of the work will be done by the National Assistance Board.
  Let me say at once that I share the right hon. Gentleman's hope that it may have the effect of causing some people who are entitled to assistance and are not yet claiming it, to exercise their rights as citizens. If it does, there will be something good out of the confusion.
  I come then to the case of the local authority tenant. Is it really going to be necessary where a rent rebate scheme is operated for a tenant to inform the local authority of his means for the assessment of his rent, and then for a separate computation to be made for the assessment of the rates which are paid with that

  65
  rent? Would it not be possible to absorb the provisions of the Bill in respect of rates into rent rebate schemes and give relief by way of the rent?
  Mr. Crossman: The answer is, yes. There is every hope that there will be a single payment, and again I think that I said it in my speech. In the case of council houses the rebate will be paid simply through a reduction of what is called the rent, which is the rent combined with the rates. It will be done in one single operation.
  Mr. Boyd-Carpenter: If I may press the right hon. Gentleman further, I hope that the calculation will be made at the same time in respect of the rates and in respect of the rent rebates where the local authority operates a rent rebate scheme. Obviously it would be as well that the payment is made through one payment, but there is the question of the two calculations, and the real risk of unnecessary administration.
  Mr. Crossman: It is something that we have been discussing with the Treasury. Each authority has its own rent rebate scheme with a system of "disregards", and there would have to be a separate calculation in certain authorities because the method of assessment would be different in the two cases. With that one proviso, I can say that every effort will be made to make it a single operation.
  Mr. Boyd-Carpenter: I am much obliged to the right hon. Gentleman.
  I come next to the relationship with National Assistance, about which the right hon. Gentleman also said something. The right hon. Lady the Minister of Pensions and National Insurance answered a Question of mine on Friday to the effect that she did not think that there would be any appreciable effect on the numbers receiving assistance in respect of rent or rates as a result of the present Measure. That means that people who are within the National Assistance scale of rates but who are not in fact drawing National Assistance will have the option of whether to go for assistance or for a rebate.
  I do not criticise that choice as such, but the fact that they have it underlines the wrongness of the 25 per cent. of
  66
  the local contribution, because it will depend upon the decision of the individual concerned whether the expenditure is wholly financed by the Exchequer, as National Assistance is, or is 25 per cent. financed by the local authority. It brings out the fact that it is simply an alternative to a form of National Assistance and that it should be, as the County Councils' Association rightly says, an expenditure borne by the Central Government.
  Mr. Hugh D. Brown: Would the right hon. Gentleman go further? If he is developing that argument, would he insist that the local authorities which are to operate the scheme should require persons to make application to the National Assistance Board before they will be considered under the present scheme?
  Mr. Boyd-Carpenter: No, I would not. That would be an unjustifiable interference with the decision of the individual. I am saying that the fact that the choice is given—a choice which has certain financial consequences—shows how wrong and unfair it is to put 25 per cent. of the rebate scheme on to the local authorities. It underlines the fact that it is a national scheme operated on a national basis.
  I turn next to another aspect of the matter to which the right hon. Gentleman referred in his speech. He will recall that on 5th May, 1965, when we last debated the general subject of rates, he said:
  "The second point is that we are pledged to introduce an income guarantee, and we shall do so. The income guarantee is special assistance for old people and for widows. My right hon. Friend the Chancellor of the Duchy of Lancaster and others are working out plans. We shall be presenting to Parliament a plan for this special assistance—[HON. MEMBERS: 'When?'] It was in the Queen's Speech and they are getting the Bill ready. It will be ready before our Rates Bill. They will do it"—[OFFICIAL REPORT, 5th May, 1965; Vol. 711, c. 1494.]
  We have not seen that Bill. We know from the Chancellor of the Exchequer that it has disappeared into limbo. Are we to take it that the fact that the right hon. Gentleman is introducing this Bill means that it is the last that we shall hear of the M.I.G. scheme? The right hon. Gentleman is aware that it is the effect of the increased burden of rates on the great majority of ratepayers which is the reason

  67
  why his Bill has had so unenthusiastic a reception? The seriousness of it was underlined in what the right hon. Gentleman himself said on 26th November, as reported in a handout that his own Department has issued:
  "Our new rate rebates will bring really substantial benefit to many of the two million families hardest hit by the vicious and regressive system of local taxation under which we are suffering. As a result of the system which we inherited the average burden of the rates will automatically go up by about 10 per cent. next spring, even when no new services have been added since the change of Government."
  That 10 per cent. may well be optimistic in view of the way that local authority costs are rising, as well as the rates of interest which local authorities have to pay on their borrowings. But, even taking the right hon. Gentleman's figure, on top of the 14 per cent. rise last year that will mean that the first two years of Labour Government have seen an increase of 24 per cent. in rates in the country. It is quite untrue to say that "the vicious system", as the right hon. Gentleman described it, "automatically" caused that rise. Operating the existing system, the right hon. Gentleman could perfectly well have increased the general grant. He could have done it in the Orders that he has laid before Parliament on a scale sufficient to obviate that rise. He could have introduced legislation instead of this Bill to relieve local authorities of certain services, and the right hon. Gentleman must not seek to shrug off responsbility for the rise in rates last year and the rise that he foreshadows this year merely by saying that it follows the system that the present Administration inherited.
  Mr. Crossman: I said that we had a two pronged attack. The first part, the Bill, was dealing with specially hard-hit cases, and the second part would deal with the balance between rates and taxes. We are intending to deal with the latter in a Bill next February. It is a more complicated job, and the right hon. Gentleman will have to wait a few months before we can get it ready.
  Mr. Boyd-Carpenter: It goes a little further than that. In the same hand-out, the right hon. Gentleman said:
  "This will be a very big reform and we cannot hope to bring it into force before April, 1967."
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  He is saying, therefore, that by this Bill he is increasing what will already be a very substantial increase in the rates this year as opposed to last year and that—
  Mr. Archie Manuel: Before the right hon. Gentleman pursues that point, when he indicates the further rate increase that will ensue, is he mindful of the fact that very many local authorities already give rate relief to ratepayers who make application? Would he not need to deduct that cost to local authorities from the total for last year and so amend the figure which he is assuming will be the increase for this year?
  Mr. Boyd-Carpenter: I take it that the hon. Gentleman is referring exclusively to Scotland because his right hon. Friend made much of the fact that very little such relief is being paid in England and Wales. I take it, therefore, that the hon. Gentleman is referring solely to Scotland.
  Mr. Manuel: Not entirely.
  Mr. Boyd-Carpenter: Either his right hon. Friend is right or the hon. Gentleman is right. I must leave them to argue it out, perhaps in some other place. The fact remains that only a minority have had these reliefs and that the total increased burden—I have mentioned the figure as being between 24 per cent. and 25 per cent.—will fall on the great majority of ratepayers. This is based on average figures published by the Departments concerned and represents an extremely serious matter indeed.
  Mr. J. T. Price: There is something in what the right hon. Gentleman is saying, but not very much, because if he pursues this argument to its logical conclusion he must say upon whom the extra burden is falling in respect of rates. He must be aware that farm land and hereditaments are derated and are completely relieved of all rating liability. That money must be paid by someone and it does not all go in equalisation grant.
  Mr. Boyd-Carpenter: If the hon. Gentleman wishes to raise the question of Agricultural de-rating, I can only point out that his right hon. Friend has been very cautious not to interfere with that. However, if it is the policy of the Government to re-rate agriculture, I wish they

  69
  would tell us so. That does not bring us away from this position—that the right hon. Gentleman is now doing nothing to prevent a rise in rates this year. Indeed, he is adding to that rise. He is doing nothing to help the payment of rates by the great majority of young married couples who are already hit by high mortgage interest payments and who believed the Labour Party's pledge about rates. Let me remind the House of that pledge, for hon. and right hon. Gentlemen opposite said:
  "While the reform of the rate system and investigation of alternative forms of local government finance may take some time to accomplish, we shall seek to give early relief to ratepayers by transferring a larger part of the burden of public expenditure from the local authorities to the Exchequer."
  That pledge, perhaps more than most things, resulted in the party opposite being elected to office. We now find ourselves faced with rising rates, with a Measure which, for the great majority, will raise these further, and with nothing promised more than the possibility of something taking effect the year after next.
  The right hon. Gentleman seeks to do something good by this Measure, but he seems utterly insensitive to the breach of the pledge which his party made on the wider issue. If I may be permitted to use a metaphor which may not be unfamiliar to the right hon. Gentleman, he rather recalls to mind the habit of the great speculators and operators of the turn of the century who sought to palliate or, perhaps, conceal their failure to pay what they owed by doing some ostentatious, if minor, good work.
  5.5 p.m.
  Mr. James Wellbeloved: It is with a mixture of extreme pleasure and deep sadness that I make my maiden speech today. It is a matter of extreme pleasure because almost 23 years ago to this very day I enlisted as a boy seaman in the Royal Navy—and this is another significant day for me because I am now enlisting in a new endeavour which will, I hope, enable me to play a small part in the affairs of the nation.
  It is also a sad occasion because I come to the House as the successor to a very eminent hon. Member, the late Norman Dodds, whose passing caused great dis-
  70
  tress in my constituency as well as in the House. He sat in the House for 20 years, 10 of them as the hon. Member for the Dartford Division and 10 as the hon. Member for Erith and Crayford, after the redistribution in 1955. He was truly loved and revered in his constituency and I can only hope that, as time passes, I may go some way towards being a worthy successor to him.
  I am told that it is customary when making one's maiden speech to make reference to one's constituency, and I had better be traditional straight away. Compared with some of the constituencies which hon. Members represent, my constituency is very compact. It is comprised of the twin communities of Erith and Crayford, it contains many factories and, of course, a great deal of its rateable value is made up of the rates from industrial premises.
  The products made in my constituency are household names and I doubt if hon. Members could go to any part of the world where they would not come across a manufacture which originated in my part of the world. I am certain that hon. Members could not visit any industrial area in this country without finding a craftsman who did not learn his skill and craft in an engineering factory somewhere in Erith and Crayford. The whole area is teeming with millwrights, shipwrights, vertical borers, lathe operators and many other skilled men who make up our industrial strength. Although I am proud to represent an engineering constituency, I hope that the House will never have cause to think of me as a vertical borer.
  It will be appreciated, from what I have said, that the Bill is of vital interest to my constituency. I suppose that I have the distinction of being the newest hon. Member and, therefore, the hon. Member most recently in contact with the electors via the husting. I assure the House that it was on the question of rates that more interest was shown in my constituency, than on any other matter.
  I am certain that although my ratepayers will be paying 25 per cent. of the increase in respect of the rebate, they will do this willingly because they are no different from the majority of people who are anxious and willing to pay some contribution towards bringing about some form of justice to those poorer members

  71
  of the community who are finding the payment of rates an intolerable burden.
  In my area we have had the advantage, both in the set-up which existed before the reorganisation and since the London Government Act, of having a system for the payment of rates by instalments. In that respect, the Bill will only confirm an advantage which my constituency has enjoyed for a very long time indeed. It was stated in the Press last weekend that, in respect of the payment of rates by instalments, the Bill will result in large increases in expenditure for local authorities. This has not been the experience in my constituency, which has operated such a scheme for a long time.
  I urge the Minister to give serious consideration to the need to ensure that the details of the provision for payment by instalments are printed on the rate demand itself. While the Bill is before the House, and when it comes into operation at the beginning of the new financial year, the Measure will receive a great deal of interest and publicity. However, things soon leave the front pages of the newspapers and sink out of people's minds, and some local authorities may not be as eager as others to make certain that their ratepayers know about this provision. I hope that the Minister will give consideration to so amending the Bill as to ensure that this provision is printed on the rate demand, so that at all times all ratepayers know that they can exercise this option.
  The Minister described the rebates as a rough-and-ready tax relief, but it is not a rough-and-ready operation for the rating authority. Subsection (5) of Clause 3 states:
  "It shall be the duty of the rating authority to consider any application made to them under this section and, if satisfied that the application has been duly made by a person qualified to make it, the authority shall grant the rebate …"
  I hope that the House will excuse me if I concentrate primarily on the administrative effects of this provision. I accept without reservation the whole principle of the Bill, and it is only at the local treasurers' administrative level that I have any fears at all.
  If the rating authorities have laid upon them the duty to satisfy themselves that
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  a person is qualified to receive a rebate, they should have power to call for necessary documents and, perhaps, to inspect premises. I am not aware that such powers exist for this purpose, but if they should be required they ought to be part of the Bill. The regulations that the Minister will make as to the form of application will be of great interest to treasurers. Rating authorities will be most anxious—I am quite certain that my own rating authority will—to know what is to be considered right and proper for them to inquire into in order to satisfy themselves that those applying for the rebate are qualified to receive it.
  Clause 4(2,a) deals with the apportionment of rates. The Minister has said that councils will have to apportion rates in houses in multiple occupation. That will be an impossible task unless a rating authority is given power to inspect premises, ascertain numbers and verify the situation. How else can it apportion rates? At present, the rating authority has not even the power to see the workings of the valuation officer in the compilation of the valuation lists. These are all very small points of detail, but I hope that the Minister will consider them.
  I welcome the Bill. I think that it is a great step forward. It meets a most urgent need that I encountered very much before I entered this House. As I think the Minister recognises quite clearly, it will be on the staff of the rating authority, and particularly on the staff in the treasurer's department, that the duty will fall of getting this thing going. It will depend on the loyalty, the integrity and the enthusiasm of local government staffs, and particularly the staffs in the Greater London Council area who, in the last 18 months, have gone through a most difficult period, consequential on reorganisation. This will mean extra work and strain on them, and we should recognise it. I commend the Bill to the House, and I hope that it will be given the support it so richly deserves.
  5.14 p.m.
  Mr. Frederic Harris: It is always a pleasure and a privilege to follow an hon. Member who has just made his maiden speech. I only wish that when I made my maiden speech 18 years ago I had had the same confidence that the hon. Member for Erith and Crayford (Mr. Wellbeloved) showed

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  in his delivery today. It was obvious to all that he knew his subject very well, and I hope that we shall have the pleasure of hearing him often in years to come.
  I should like also to take this opportunity too of paying a tribute to his predecessor, Mr. Norman Dodds, whose sad death caused a marked shock to all hon. Members. As the hon. Member says, Mr. Dodds was very well liked, and much admired because of the obviously tremendous amount of hard work he put in on behalf of his constituent. I considered him a personal friend. Moreover, on a lighter note, he was the one hon. Member with whom I paired more than with any other, so that it is with some very special regard, if I may say so, that I speak of him. I am sure that the hon. Member will enjoy the same satisfying representation in this House that Norman Dodds did.
  After a long apprenticeship in local government I have naturally, throughout my Parliamentary life, taken a very close interest in rating matters. As I have said before, rating is a hot potato. I have tried to play my own part in getting things done, not only in regard to this ever-frightening and ever-increasing rate burden, but in specifically fighting for the abolition of the then out-dated and out-modal anomaly of industrial de-rating. In conjunction with hon. Members from the other side, we did it also by means of a Private Member's Bill. We eventually succeeded in abolishing industrial de-rating, but it needed two bites at the cherry. I am now trying my hardest to ensure that nationalised industries also pay their full rates. This is a very touchy subject in Croydon. As things are, because the nationalised industries occupy a large number of new office buildings it regrettably means an extra 2d. on Croydon's rates.
  I awaited with very keen interest the rating legislation announced in the Queen's speech. I realised that this particular Bill would be rather limited in scope and based virtually on urgency; and that any real rating reform must come in the second Bill. Nevertheless. I am very disappointed with this present Bill. Like all hon. Members interested in this subject, I went through the Allen Report in considerable detail. That Report pointed to many ways of rating reform,
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  and now I, too, am anxiously awaiting the Report of the Working Party of officials set up by the Minister. A few days ago I asked the Leader of the House what was happening to this Report. He told me that it was not a formal Report, but that after the Minister had had further consultations with the associations in the light of the Working Party's discussions, the Government would make known their conclusions, presumably by reporting to the House, and, again presumably, in a White Paper. Is that the intention? And when is the White Paper expected to be available?
  I trust that this second Bill when enacted will not only provide the real rating reform referred to by my right hon. Friend the Member for Kingston-upon Thames (Mr. Boyd-Carpenter) but will also set right many of the anomalies we all know exist in rating today, such as making the nationalised industries pay their full share. I join in welcoming any proposal that eases the rating burden on those hardest hit. I am the first to recognises that this Bill provides relief for some 2 million pensioners and lower-paid workers with large families.
  It will also undoubtedly help those who for one reason or another regrettably will not apply to National Assistance for rating aid. Many of our constituents will not do that, but for the great mass of ratepayers—that of course must be by far the largest number of our constituents—this unhappily will mean extra expense added to their rate bill because the Government have unfairly decided to pay only 75 per cent. of the rebates from the Exchequer. While the Minister was arguing this point, I was reminded that some of us waited a little longer for the Bill to be published than expected. We waited longer than we thought we would have to wait. I wondered if it was because the Minister had himself advocated more from the Exchequer than the Chancellor would meet of this expenditure. There were detailed reports in the newspapers suggesting that the Chancellor had rather "sat on" the Minister and decided that 25 per cent. would have to be paid by local ratepayers. That seemed so unfair that I was about to interrupt the Minister during his speech, but I realised that many other hon. Members wanted to get into the debate and I did not want to cause delay.

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  I say to the Parliamentary Secretary, who is to reply to the debate, why not be frank with us and say what was the percentage which the Minister himself advocated? As we now know, the local authorities will have to find the remaining 25 per cent. This is extraordinarily unfair. Such rebates should be a national responsibility. As such they should attract a 100 per cent. grant. It is absolutely wrong to make other ratepayers pay a part of this bill and have a burden imposed on them which, on anyone's guess, will mean an increase of ld., 2d. or 3d. in the £. My hon. Friend the Member for Ilford, South (Mr. Cooper) suggested in an intervention that the amount would be 3d. Throughout the country the average might be claimed to be 1d. but none of us knows because there has not been time to work this out in our own areas. Undoubtedly it could be as much as 3d. in the £.
  Unfortunately, it also does not end there. The instalments plan and the rebate system are embodied in the Bill. As such they must throw a heavy administrative burden on local authorities. They will be very expensive to operate. I consider that the administrative cost at least in regard to the rebate scheme should be reimbursed by the central Government.
  As is generally known by hon. Members, I was very strongly opposed and I still am to the original setting up of the Greater London Authority. The effects of that I envisage will be ever more expensive for Croydon ratepayers. When the first precepts were sent to us at the beginning of the year we in Croydon in effect had to pay double for the same services which we had been financing ourselves a year before. The change put up the cost to ratepayers by about £½ million and put at least 7d. on the Croydon rate bill. I view with great distress the almost scandalous spending which is going in the Greater London Authority at present—especially in the employment of expensive staff. I foresee very high additional precepts being sent in the future to London boroughs of which Croydon is only one. On top of this we have to face the inflationary spiral of increasing salaries and wages, additional numbers of staff so that the bill will add more in all directions to the total extra cost.
  This year rates in Croydon went up by some 18 per cent. Suggestions have been
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  bandied about by the Minister today of a possible general 10 per cent. next year. As my right hon. Friend the Member for Kingston-upon-Thames said, this may be a considerable understatement. I should be surprised if rates in Croydon did not go up by something nearer 20 per cent. This is a very serious matter. This was meant to be a short Bill but I find it hard-going. My reaction when I saw it was that the rate collectors of the future will certainly need to be good mathematicians and also lawyers too to implement some of the provisions of this Statute.
  As to payments by instalments, while one welcomes the general facilities, I find not the slightest difficulty in getting the Croydon authority to meet any specific case of hardship. On the general basis, much additional work must be involved. Think also of the vast number of applications which may be made for these rebates from people who will not be entitled to them. There will be many misunderstandings and a tremendous amount of additional work will be put on staff all to no avail. All this must also mean additional expenditure.
  It will affect local authority borrowing as it will not be financed as freely as it was previously. That means that more interest will have to be paid by the ratepayer. Once again, we shall have a vicious circle. If the facility had to be provided why could it not be on a quarterly basis which, in general, would be quite sufficient?
  As to the rate rebates, I understand that only the income of the applicant will be taken into account, not his capital resources nor the income of a family living with a ratepayer. To give an example, two-thirds of rating relief after the first £7 10s. could be claimed by a ratepayer owning a house no matter what the value of the house and possibly if he also had £5,000 in Post Office savings. An old-age pensioner without other income would also be entitled to relief even if he had his son living with him and the son had a substantial income. This has been referred to in the opening speeches and it seems to me very rough justice.
  I do not know if my impressions are correct, but regrettably not much time has been given for discussing matters with the local authorities and officials concerned. My right hon. Friend the Member for Kingston-upon-Thames made this

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  point. I thought that the Leader of the House threw it off lightly the other day. It is not fair to give hon. Members only a week to try to ascertain the facts on calculations as complicated as these. The Bill, of course, gives some relief, but the main body of ratepayers will unfortunately have to meet a vicious rates spiral which will continue to go up faster and faster.
  In the past—I say this advisedly—we had virtually the subterfuge of revaluation. There was the thought that rates had come down while actually ratepayers paid more. Memories become very short and one forgets the comparison in actual cash rates. The fact that the Minister saw—although he expressed it rather differently, but I nevertheless agreed with my right hon. Friend the Member for Kingston-upon-Thames on this—that there was no alternative to the present rating system than that of adding to the burden of ratepayers, seemed to be a confession of failure. The present Bill seems blatantly a clear manœuvre in accountancy. It certainly is nothing like a rating reform. I can only sincerely trust that there will be a very different picture when the second Bill is produced.
  5.30 p.m.
  Mr. John Robertson: I thought that I should be able to begin by saying that the hon. Member for Croydon, North-West (Mr. Frederic Harris) agreed with me on the need for the Bill. I thought that I heard him say at the outset that he was in favour of rate relief and that he was in favour of the Government taking the burden of rate relief. The right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) said so, although one cannot always be sure about hon. Members opposite. I regret that I was not present in the years when the Conservative Party were the Administration and when, obviously, they advocated this from the Front Bench. I regret that I had not then the opportunity of following them into the Division Lobby. In fact, their enthusiasm is belated. They had so long to do it and they did nothing.
  Mr. Frederic Harris: My advocacy against the rate burden has gone on ever since I have been in the House, as is well known to hon. Members.
  Mr. Robertson: Perhaps that is so, but I have not had the opportunity of hearing the hon. Member speak about this matter, and this afternoon my complaint is that I am not sure whether he is for or against rating relief.
  I think that everyone, in fact, agrees with the purpose of the Bill and that the need for rate relief for people with lower incomes is not in dispute, as was pointed out by the Allen Committee. Not that I agree with everything said by the Allen Committee. There may well have been a time when the house in which a man lived was a measure of his substance, but that is in the long-distant past, and it has certainly not been the case for many years. It is no longer even remotely true since the advent of publicly-owned housing. In effect, rates are now a housing tax, and that is how they are seen.
  The proposals in the Bill take us a long step in the right direction and go a long way to meet many of the anomalies in the rating system. But while I agree in principle with what the Bill contains, I have many complaints to make about its details. I have spoken on previous Bills which contained largely English and Welsh legislation with bits of Scottish legislation tacked on, and I still think that this is a very untidy and slovenly way in which to do the job. I know that this is a matter of convenience to get both through together, but can the Under-Secretary of State for Scotland explain Clause 2? It relates only to Scotland but its terminology relates only to England. It requires another explanatory Clause—Clause 9—in order to bring it into line with Scottish legal and local authority terms. This is not good enough.
  Clearly, we want the Bill through for Scotland as quickly as possible, and it may be argued that this method will save time, but if it is necessary to include a Scottish Measure within an English Measure, as it were, let us do it neatly and in a way which is understandable. I should like the Under-Secretary of State for Scotland to give me an assurance that he is entirely satisfied that the provisions of Clause 2 mean exactly the same as the provisions of Clause 1. We need such an assurance before Committee stage. Is he sure that Clause 6(11) will affect the Scottish situation in the same way as it affects the English situation? I

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  am not too sure about it. Perhaps in Committee we shall have an opportunity of considering these matters.
  The Bill is created in terms of English law and the usages of English local authorities and yet, by subsections in the interpretation Clause, it attempts to translate this into Scottish terms and does not do it very well. I accept that we want the Bill in a hurry, and that the Government's intention is to apply the same provisions to Scotland as to England and Wales. But does the Bill do this? I am entitled to assume that it is the Government's intention that the effect of the Bill on local authorities in Scotland and in England and Wales should be broadly equivalent, but as the Bill stands it does not do this. Even if the words in the Bill are the same, their effect on Scotland will be completely different from their effect on England and Wales, and it is the effect which is important, not the words.
  I will give only one example. It is fairly obvious—one need not do much investigation into the point—that the proportion of the total number of ratepayers who will be relieved of rates will be much larger in Scotland than in the rest of the country. That is self-evident. The family expenditure survey, the Allen Report, the Ministry of Labour statistics and Inland Revenue statistics all point to this fact. On the other hand, as the domestic rates in Scotland are very much higher than the domestic rates in England, then the amount of rebated rate will be very much larger in Scotland than in England and Wales. I often wonder whether English Members realise what is the rate burden in Scotland when they complain about the great burden on the rates in England. The effect will be that the Government, in paying 75 per cent. of the rebate, will have to pay a great deal more, proportionately, to Scotland than to England. But by the same token the Scottish ratepayers who do not receive relief will have to bear a very much larger burden than the English ratepayers who do not receive relief.
  Mr. Manuel: This is an interesting point. Does my hon. Friend agree that another cause of the increased burden in Scotland is the fact that industry is
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  still de-rated 50 per cent. while it is rated 100 per cent. in England and Wales?
  Mr. Robertson: There is more than one reason. De-rating is one and I will try to deal with another. One of our problems in this discussion is the absence of definite information about the number of people who will receive rate relief. It is difficult to calculate the effect on local authorities, but if I may make an intelligent guess I suggest that in the United Kingdom about 8 per cent. of ratepayers will receive rebates whereas in Scotland the figure will be about 15 per cent. This is an intelligent guess based on the Allen Committee and on figures of personal incomes provided by the Inland Revenue Commissioners. But if 15 per cent. of ratepayers in Scotland are to receive relief, this means that the remainder of the ratepayers will find a significant increase in rates. One can assume that the relief in rates will not go to the many retired people in the seaside towns, because many of these, in places like Bournemouth and Brighton, receive substantial pensions. I should think that the rating relief in England and Wales, and particularly in England, will go to the industrial North where wages are lower than they are in Birmingham, Coventry, London and the South-East. If one relies on the Allen Report for information one would expect that the bulk of rate relief would go to the industrial North and the south-west of England.
  Mr. Crossman: It is clear that my hon. Friend refers to the lower wage earners, particularly those with large families. They are one group who will receive the rate relief, but two-thirds will go to retired people, who are not to be found particularly in the North or the South. If they are concentrated at all they are concentrated in the South-West and the South-East. Therefore, the spread of the Bill will be rather more nation-wide than my hon. Friend suggests.
  Mr. Robertson: I do not disagree with that point, but my right hon. Friend must remember that the people with the larger families and younger families are in the north of England and in Scotland. These are the people who will probably receive the most rating relief, but Clause 8 will

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  do something to help the local authorities because the rate deficiency grant will in itself assist the local authorities who have to give an excess amount over and above the average for authorities in England and Wales. It will help to cushion the effect on other ratepayers. There may be consequential increases in the equalisation grant in Scotland but if rate rebates in the English local authority areas will attract rate deficiency grant, this is not necessarily the effect in Scotland, because any increase in equalisation grant which results in a rate deficiency grant will bear no direct relationship to the amount of rebate given by any local authority in Scotland.
  One of the major injustices in the whole matter of local authority finance is the method by which the rate deficiency and equalisation grants are dealt with. The Bill makes no provision to deal with the distribution of equalisation grants. The formula for the rate deficiency grant in England and Wales not only generates the total amount of grants but, by measuring local authority resources and arriving at an average 1d. rate product against which local authority resources are measured, this formula also determines the distribution of rate deficiency grant. The poorer local authorities therefore get the grants, but when it comes to calculating the proportion of equalisation grant due to an increase in the rate deficiency grant arising from rate rebates we have to start with a total of rate deficiency grant.
  Basically, we work on the Goschen formula, with modifications, but the resources of the Scottish local authorities are not measured against the resources of local authorities anywhere else in the country. Any hon. Member who has read the Allen Report must have been amazed to find that the average 1d. rate product of Scottish local authorities is about 19d. and of English local authorities 42d. per head of population. But a local authority with an average 1d. rate product of, say, 17d. per head of population in England would receive a grant which would make resources up to the 42d. standard.
  Scotland again will come badly out of this. Let us assume that we have an increase in equalisation grant because the rate deficiency grant has been increased, not because of any rate rebate that has
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  been given but because when the rate deficiency grant in England is increased the equalisation grant is automatically increased. There is no provision for the method of distribution of the increase in the equalisation grant and therefore there is almost a certainty that Scottish local authorities which will be required to give rate rebates will not receive any part of the equalisation grant.
  One can think, for example, of Motherwell, where because there are still works and other industries the local authority at the moment receives no equalisation grant. I can imagine that in Motherwell many rate rebates will have to be given, but the Motherwell local authority will receive no compensation by way of equalisation grant whereas a nearby local authority giving no rate rebate may receive an equalisation grant. This is why my right hon. Friend must evolve some method whereby we can find a measure of equity in all this. I am not blaming my right hon. Friend for this mess. It has existed for a long time. I do not expect my right hon. Friend and his colleagues to clear it up overnight but surely we can do a little to make sure that the purposes of the Bill are carried out and that broadly it has the same effect in Scotland as in England and Wales.
  It has been said that the reason for the high rates in Scotland is the very low rents. This is simply not true, and it is time that this was pinned to the wall. If the rate contribution to local authority houses was deducted from the rates bill, Scottish rates would still be very much higher than those applying in England and Wales. In considering this point we must compare like with like, but the proper measure is to compare the kind of accommodation one is renting and paying rates for in the two countries. Deducting the rates for local authority houses, the Scot still pays more in rent and rates per room occupied than does the English local authority tenant. I have worked this out and I know that I am right because I have had it checked. If there were equity in this matter, on the basis of per room occupied the Scot would require a deduction on the average of £6 a year in his rates. Seeing that we are going this distance to secure a measure of equity among the "haves" and "have-nots" in the matter of rates,

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  a little effort might be taken to ensure that Scotland, at least this once, has a fair crack of the whip.
  5.50 p.m.
  Mr. A. G. F. Hall-Davis: In May, when we discussed rates in Committee of Supply, I was fortunate enough to catch the eye of the Chair at five minutes to nine and so, of necessity, was able to make only a short contribution to the discussion. However, as the Bill now before us follows very closely the principles which I then commended to the right hon. Gentleman, I am encouraged to develop my argument somewhat further—on this occasion, also, with brevity, I trust—in the hope that I can persuade him to recognise the desirability of moving further along the lines set out in the Bill and not to be diverted to an unnecessary extent into a more complex, expensive and less well directed reform.
  In the comparatively short time I have been a Member, I have not heard a good Bill commended to the House with so little satisfaction and enthusiasm by the Minister in charge. The right hon. Gentleman seems to regard this as an ugly duckling of a Bill and can hardly wait to wring its neck as part of his action to bring the whole rating system as now operated to an end. I ask the right hon. Gentleman to consider whether he ought to give it a little time to develop. It might then grow into a much more swan-like creature and accomplish a good deal more than, evidently, he is prepared to let it at present.
  Before returning to that theme, I have to offer some criticisms of the Bill. I recognise that it will bring great and most welcome relief to a considerable number of people. It will assist materially many of those whose needs are greatest; but there will still be very many, a broad section of ratepayers, whose incomes are just above the limits set in the Bill to whom it will bring no relief whatever. As has been said, the Bill will increase their rate burden by the 25 per cent. share of the rebates given which they will have to carry.
  In constituencies such as the one I have the honour to represent, where there is a considerable number of people who will benefit from the relief, there are
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  also—this applies in many other places as well—a great many people just above the relief limit. The two things go together. Therefore, the 25 per cent. will fall on people who themselves are already heavily oppressed by rates.
  If the right hon. Gentleman were presenting a Bill now to give a measure of general relief from rates, it might be arguable that he could justify 25 per cent. of the individual rebates being borne by the other ratepayers, but, until such time as he does this, he cannot, I suggest, sustain his argument, and I express the hope that he will take steps, at least until he introduces a wider relief Measure, to see that the 25 per cent. is not thrust upon the other ratepayers.
  I come now to what I regard as a rather mean provision in the Bill. I do not believe that any of us associate the right hon. Gentleman with a mean attitude in his normal outlook, but, if it is not a mean provision, it certainly reveals a lack of human understanding. I refer to the provision that, while a married couple with children will receive full rebate if their income is below £520 a year, increased by £78 for each child, a widow with children receives a rebate calculated on the same basic figure as for a single person, namely, £416, plus the increase for each child. I take the right hon. Gentleman's point about why the gap is rather narrow between the £416 and the £520, but, if I may say so, far from reducing the force of my argument, the fact that he has considered this strengthens, if anything, the point which I put to him.
  Considering the circumstances of a widow bringing up a family of her own—I am referring only to widows with children to support—there is every reason why she should be given relief no less generous than that accorded to the married couple. If a widow with children goes out to work, she has to meet some expense in ensuring that they are properly looked after while she is away, or she has to limit her choice of employment to work in which either the hours or the proximity is such that she can come back to look after her family. This limits her earnings accordingly. Furthermore, unlike the single person or the widow without children, the widow with dependent children is almost certainly unable to

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  arrange to share her house or let accommodation in order to reduce her rate burden.
  To return to the Minister's intentions for the future, in the debate on 5th May to which I referred, the right hon. Gentleman discussed his long-term plans in the context of the early introduction of an incomes guarantee. He went so far as to say that the incomes guarantee Bill would be ready before the rates Bill. I am not sure which rates Bill he was referring to—this one or the major Measure next year—but, in any case, several things have become clear since May.
  First, for reasons which I shall not discuss in detail but which reflect no credit upon the Government, it is impossible to set a date for the introduction of the Incomes Guarantee Bill. Second—this is something on which the right hon. Gentleman will come increasingly to agree with me—the Chancellor of the Exchequer will now welcome even less than he would have done last May any substantial transfer from rates to taxation, because he is already discussing the possibility o: yet a third major increase in taxation quite apart from anything which the Minister of Housing and Local Government may heap upon him.
  Third—this is a more controversial observation, controversial on both sides of the House, I know—it is now more widely appreciated, if not accepted, that, if the rate of growth of the amount levied through the rates were held down so that it did not exceed the growth rate of the national income, the present position would be supportable by a wide range of taxpayers. This is where I part company with the right hon. Gentleman and his great dislike of rates. Rates raise £1,000 million, a lot of it from industry and a lot of it, as the Allen Report shows, from people in the higher income brackets to whom it represents only 2 per cent. of income. I think that one must accept, therefore, that for many people the rate burden is supportable. It is the rocketing growth which causes so much concern. The Minister must take action to halt this rocketing increase in the amount levied through rates. We all agree about that. Some rearrangement of local government finance is necessary.
  Nevertheless, I hope that the Minister will not be tempted to try to introduce
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  a revolutionary measure of the complexity of the 1965 Finance Bill, and I hope that he will not feel bound to try to secure a general reduction of the rate burden. I go so far as to say this because I am desperately anxious that people who need relief should have it at the earliest possible moment. The right hon. Gentleman would be well advised and wise to combine steps to contain the general rate of growth with further selective measures like this Bill to relieve those on whom the rates are pressing most heavily.
  I hope that the right hon. Gentleman will pay particular attention to the position of families with children too young to be earning. I am sorry to note that, although, sometimes, the right hon. Gentleman and I seem to come very close together and share many of the same views, he will occasionally suddenly disappear, shying away from the logical conclusion of what he says, making one regret his errors all the more. He mentioned that it was on families with young children that the burden of rates pressed most heavily, and this particular group was, in fact, one mentioned in the Report.
  We are all concerned with certain unsatisfactory aspects of teenage behaviour, but may it not be that, as a society, we do not take sufficient steps to see that parents with young children have sufficient money to spend on their children and, what is more—I believe this to be very important—sufficient money to spend sufficient time with their children in ways which, perhaps, can be pursued sometimes only through some expenditure? This applies particularly to mothers. Even when the Bill is passed, there will still be a marked contrast between the position of the man earning £20 a week with three children over 11 still dependent on him—that is the most expensive age—and the man earning £20 a week with no children—so far as Income Tax payments and rates payments are concerned. The man with no children will pay £130 in Income Tax. The man with three children will be relieved of all tax payments. But both men will pay exactly the same rates.
  The rebate system has intrinsic merits which the Minister, because of his dislike of the rating system, fails to recognise. I hope that he will not hesitate to think

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  in his major Measure of a further extension along the lines in this Bill in combination with any other step. I particularly hope that he will not close his mind to this, rather than plunge into more adventurous but, I feel, much less promising and much less rewarding changes.
  6.1 p.m.
  Mr. Michael English: The hon. Member for Croydon, North-West (Mr. Frederic Harris) was the first person to mention an omission not merely from the Bill but from all the speeches so far delivered, from the Financial Memorandum attached to the Bill and from the Allen Committee Report. The hon. Gentleman mentioned that instalment paying of rates has a cost. Why is this cost not mentioned in the Financial Memorandum?
  The history of these Financial Memoranda goes back a long way, starting with a Select Committee in 1918. We used to have White Papers. In 1927 they turned into these memoranda which are now attached to Bills. There is a series of rules applying to these memoranda. One might think that they applied only to charges on the Exchequer, but one rule is that
  "where a service to be provided by a Bill involves a charge upon rates as well as an increased charge on the Exchequer, an estimate of the charge upon rates … should be included in the Financial Memorandum."
  These are not rules of procedure of the House. They are rules of Her Majesty's Government, but they are derived from assurances given to the House on several occasions.
  But there is a cost here which has not previously been mentioned except by the hon. Member for Croydon, North-West. It arises from the fact that at present local authorities collect their rates in a lump sum before the year has ended. Since money has a value in relation to time, the value to them is greater (if they collect earlier or half-way through the year) than if they simply collect their rates in 12 instalments. There is, in effect, an interest element which is being lost to the local authorities by virtue of instalment payments.
  We would all agree that the principle of extending instalment payments—which is at present adopted by some authorities
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  —to all authorities is a good one, but I do not see why we should thereby be precluded by the Bill and perhaps—I should like the Minister to comment on this—by the Money Resolution, which governs what we can discuss at a later stage of the Bill, from saying that the instalment payments should be measured not by the original rate but by the rate plus such interest element as is involved.
  This cost is considerable. It is not a mere rebate to some owner-occupiers. Every owner-occupier can claim to pay his rates by instalments, irrespective of means. If every owner-occupier waited to the very last day of the year to pay, my point would not arise, but it does arise very much. In my experience, some small businesses may be short of cash and may not be able to pay early. They may be sufficiently businesslike to realise the implications but not have the cash to be able to pay quickly. Big businesses pay promptly, and the majority of owner-occupiers pay fairly early in the year.
  Furthermore, the point is growing more important. In the past, much of the procedure—the sending out of the initial demand and the final demand, leading eventually in a few cases to a summons—tended to take a considerable time because every rate demand was written out by hand. As most authorities, and certainly the bigger authorities with the greater populations, are mechanising their procedures, the rate demands are going out earlier every year.
  I regard it as somewhat improper that the extra cost which will be incurred as a result of the Bill has not been mentioned in the Financial Memorandum. The reason probably is, as the Minister mentioned, that the Bill follows very closely the Allen Report, and the relevant pages, 99–101, of the Report also fail to mention this. The Minister said that the Allen Report is very true and accurate in what is says, but it does not follow that what it has left out is not also true and accurate.
  I pass to the larger issues involved in the Bill. As I said, I think that most hon. Members would regard the extension of instalment payments to all authorities as a good idea. It is possible to question whether rebate schemes should be similarly treated. As a temporary measure to relieve the difficulties outlined by my

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  right hon. Friend and outlined in extensive detail in the Allen Report, we could surely agree upon it, but—with apologies to the right hon. Member for Wolverhampton, South-West (Mr. Powell)—I hardly think that what one might describe as a Powellist philosophy is the desirable end that we wish to achieve in the long term. We can grant rebates for rates, differential rents or rent rebates for housing schemes. We can have innumerable sets of these. The right hon. Member for Wolverhampton, South-West would like to have them in the National Health Service and elsewhere, we understand. If that happens we shall end up with a series of administrations all designed to investigate individuals' incomes separately for each separate purpose for which we give a rebate.
  As a temporary measure the Bill is desirable. Looking at it as a permanent measure, it seems to me that to have whole hosts of rebates on every single commodity or service available to the public would be inappropriate. I hope, therefore, that this part of the Bill—although I accept its necessity and desirability now—will eventually be swept away when my right hon. Friends the Chancellor of the Duchy of Lancaster and the Minister of Pensions introduce a scheme whereby we can extend the Income Tax form to everybody and take taxation from some and give grants to the lower-paid members of the community for what they require. It is better that this sort of thing should be done as soon as possible as one measure by the community than that it should be done as a series of separate little schemes all eating up clerical labour and administrative time and cost.
  Another matter which has been mentioned, particularly by the Opposition, has been the erosion of the tax base. I begin to wonder if they heard what my right hon. Friend said originally, that he intended to erode not only the tax base but the whole tax. This is a logical argument. I would agree with every hon. Member opposite who has spoken if my right hon. Friend had not started off by saying that his intention was not merely to tinker with the rating system. He made a speech rather like a small fire starting on the edge of an ancient forest of rather dry timber. In my view, the sooner the Minister burns down a large
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  part of the forest the better. But he did say this. He did not say that he would merely chip away at the tax base.
  Mr. Hall-Davis: What would the hon. Member recommend planting in place of the forest burnt down in order to yield more revenue timber?
  Mr. English: I will take up that point in a moment. It has often been said in the past that we should chip a little away for this, that or the other reason. For instance, my hon. Friend the Member for Westhoughton (Mr. J. T. Price) mentioned the enormous cost of the subsidy we give by way of derating to agriculture. No one even knows what it amounts to. I am sure that we could not restore rating of agriculture immediately because, of course, it would need such a vast amount of valuation. But it is a far larger sum than we are talking about here.
  The local authority I used to serve on once calculated for me the value of the sum involved in rebates on churches and similar properties. I do not think that anyone would say that such rebates should not be given but we learnt that, in that locality, communicants who represented 20 per cent. of the community, received 80 per cent. of the rebate because they happened to have bigger and better buildings. The situation becomes rather ludicrous and this tax has been so far eroded that just one small point more will not make much difference, provided this is accepted, as my right hon. Friend put it, as an earnest of an intention to get rid of an iniquitous tax.
  Where I part company with my right hon. Friend is that I would not say that this tax is necessarily as iniquitous for corporations and businesses as it is for private householders. My right hon. Friend based his argument on the Allen Report but that only relates to the impact of rates upon the private householders. No doubt he has more information but, if so, he did not mention it.
  Rates in other respects are not necessarily a bad tax. I ask him to consider what would happen if he abolished them completely from business premises. Most office premises, because of the general revaluation of dwellings and business premises a few years ago, underwent

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  a reduction in the actual amount they paid. What happened was that the rents of these offices merely rose to fill the gap. In practical terms, the landlord of such properties simply increases rents to counterbalance the reduction in rates.
  That, of course, cannot happen for most householders because of my right hon. Friend's Rent Act, but it can happen to business premises and I stress the undesirability of not considering this aspect. If we took from local authorities the rates on business premises we should simply give the same sum of money to the landlords of the premises. Businessmen would not benefit, the local authorities would lose money and we would have to think of another tax.
  I am not sure how far it is in order to answer the point raised by the hon. Member for Morecambe and Lonsdale (Mr. Hall-Davis) but I believe that we should consider in this context the possibility and desirability of a local payroll tax. It was right hon. Gentlemen opposite who advocated a national payroll tax. I believe that a local payroll tax would have the advantages of a national payroll tax plus the advantage that it would tax people who commuted into the urban areas but who paid their rates in areas outside. However, I would be straying from the subject if I discussed that in detail.
  I congratulate my right hon. Friend on introducing this Bill purely as a temporary Measure. Perhaps he might consider inserting a provision to that effect. We do not want to think of it as a permanent addition to our decayed timber. But as a temporary Measure, as an earnest of his good will in relation to a large number of citizens and as a direct benefit to citizens in dire need, we must all welcome the Bill.
  6.14 p.m.
  Mr. Julian Ridsdale: The hon. Member for Nottingham, West (Mr. English) suggested that better answers are in the pipeline, as it were. I would say that, at least for pensioners, better answers can only be found when supply and demand get into better balance and we get real stability in prices.
  The objectives of the Bill are admirable. Indeed, this is something that I
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  have been pressing to achieve for some considerable time. It is the means of carrying out this Measure that I wish to criticise. As far back as March, 1961, I drew attention in a Private Member's Motion to the difficulties of the householder with a small fixed income. I drew attention to the great increase in local government spending and discussed new sources of local government finance.
  Now that the right hon. Gentleman has referred to them, I recommend him, if he has not already done so, to read my speech on that occasion. Particularly, I ask him when he proposes to announce to the House some of the Measures which he spoke about. Or perhaps this will be like that national minimum income guarantee—swept under the carpel like so many broken promises of the party opposite.
  In the debate in March, 1961, I pointed out that many of these increases had increased parallel with the national income and that the total Bill for rates was no larger in proportion to what it was in 1939 but that the domestic householder on a small fixed income only knew that he had to pay a lot more money. I pointed out that this situation was becoming not so much one of anger but one of despair, especially for the elderly ratepayer on a small fixed income.
  Following this debate and other pressure in the House and elsewhere, the Conservative Government of the day brought in the Rating (Interim Relief) Act, 1964, and appointed the Allen Committee. I was not surprised that the Committee found clear evidence of hardship in many cases and concluded that 200,000 to 250,000 householders had had an increase in rates which was too heavy for them. Some of these, it was pointed out, were spending a quarter of their income on rates and housing costs while a smaller proportion were spending more than half on housing costs.
  I echo what must be the words which will come from very many retired householders—"For this relief, much thanks." Clearly, something had to be done. The question now is whether the Bill is the right way of doing it. I have not been one of those who thought that the Rating (Interim Relief) Act was a bad one. Indeed, I have been surprised at the Minister's vehemence against it.

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  With the experience I have had in my constituency, which covers many retired people in north-east Essex, I would say that the Act had not failed. I believe, however, that it did not go far enough. I am sure that it could have been extended so as to include householders in need of help. In Clacton Urban District Council area, in my constituency, out of a total of 31,000 people, 545 have already benefited while 200 are in the "pipeline" for further help. It was administered most efficiently and confidentially. In spite of criticism of a means test, confidence about incomes and means was kept. Why do the Government not extend and amend that Act? To do so would undoubtedly save a Treat deal of administrative costs. Has the Minister considered the difficulty of taking on new staff at this time? Has he considered the difficulty of keeping incomes and means confidential, particularly when new staff are brought in? I hope that we will hear no more of that—and I use the word advisedly—damned hypocritical nonsense which was used such a lot at the time when the Act was going through, especially when we were accused of bringing in a means test.
  Mr. R. W. Brown: May I tell the hon. Gentleman that in an authority of 176,000 population only two families could be discovered to be eligible under the previous Act because of the very high ceiling? It was not hypocritical nonsense when it was a shocking Bill designed purely to attract votes.
  Mr. Ridsdale: I was referring to the hypocritical nonsense when we were accused of introducing a means test with that Act. I assure the hon. Gentleman that if he comes to my constituency, which is in the South-East, where, as the Minister has said, the Bill will have particular effect, he will find that there is hardship and that that interim relief legislation brought a great deal of help to a number of very sorely pressed people.
  The Bill seems to lack the experience of rating administration. It is a pity that the only accountant in this Administration is in the Treasury, because if he had been in the Ministry of Housing and Local Government, we would not have had such a complicated Bill as this. It will undoubtedly place additional expense on local rates. I realise that 75 per cent. of the rebate is to be borne by the Exchequer, but 25 per cent. of the re-
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  maining cost, plus administrative costs, will be borne by the greater proportion of the ratepayers and I can assure the Minister that in a town like Clacton-on-Sea many retired people will find that this is a considerable burden.
  Mr. Crossman: Can the hon. Gentleman say what proportion of the cost under that Act was borne by the ratepayer and what by the taxpayer?
  Mr. Ridsdale: It was 60 to 40 per cent. in that case, but I said that it would have been possible to extend and amend that Act.
  Mr. Crossman: So long as we can have it quite clear that the hon. Gentleman admits that in our Bill the ratepayer is made to pay a smaller proportion of the total rebate than under the Tory Act.
  Mr. Terence L. Higgins Mr. Terence L. Higgins (Worthing) rose—
  Mr. Speaker: Order. We cannot have threefold interventions.
  Mr. Ridsdale: I note the right hon. Gentleman's intervention, but it does not get away from my point that too big a proportion of the cost of the Bill will fall on the ratepayer.
  Mr. Higgins: Would not my hon. Friend agree that the point which the Minister is making is invalid? There were two Sections in the Rating (Interim Relief) Act and the total percentage increase came nowhere near the cost of the corresponding Clauses in the Bill.
  Mr. Crossman: The grant under that Act was up to 66⅔ per cent.
  Mr. Speaker: Order. I hope that interventions will be dialogues and not trialogues.
  Mr. Ridsdale: It will be extremely difficult to meet the rising cost of living and rates and that is why, whatever happened with the previous legislation, I am dealing with facts as they are now and as facts are now these proposals will put a further burden on the retired.
  What a pity that the Minister has not been somewhat bolder. Why does he not transfer the cost of certain social services from the county rates to the Exchequer, as was promised at the last election? If there is to be relief for the retired householder with less than

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  £500 a year, why should there not be relief further up the scale as well? Let us make no mistake—it is the retired more than anyone else who has had to pay for the cost of inflation. Is the Minister to transfer the cost of certain social services from the local exchequers to the national Exchequer and, if so, when is this to be done? The Bill means 1½ per cent. to 2 per cent. increase in rates in the main town in my constituency. This is in addition to the 10 per cent. to 14 per cent. increase which it will probably have to face again this year.
  I hope that any changes which the Minister has in mind for transferring burdens, such as education or education salaries, from the local to the national Exchequer will be made before the 1966–67 rate is fixed, especially in view of the extra burden being placed on the ratepayer. I am bound to say that it is not just to shift this rate burden from the retired who definitely cannot pay to the retired who can hardly pay, but that is what the Minister is doing.
  It is impossible to discuss the Bill unless one sees it against the background of the finances of retirement. For 12 years I have been the Member of Parliament for a constituency which covers north-east Essex where there are many retired people, of whom a large proportion have incomes of less than £1,000 a year. I have known people to retire on small incomes which appeared to be inadequate but which in a few years, because of rising costs, have been found to be harshly inadequate. This process has been hurried on far more quickly in the last year under a Socialist Government.
  I welcome any action, like the Bill, which helps the retired, but let the Minister and the Government face the reality of the problem. Let us mend the hole in the dam by all means, but let us see that the water does not spread over the dam again in a spiral of ever-increasing prices. What matters most to the retired and elderly is stability in prices. It is against that background in the end that the Bill and the Government will be judged.
  6.28 p.m.
  Mr. Alfred Morris: The Measure now before
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  the House has been described by the Press in my constituency as a rating Bill which many ratepayers will welcome. It is, of course, but a first step towards making our system of local government finance into one which will be accepted as fair by all ratepayers. And I know that my right hon. Friend will do everything he can to add increasing bite to the wind of change now blowing from his Ministry. In the view of many of us on this side of the House there is a strong case for getting rid of rating altogether, such are the inequities and other defects of the present system of raising local government finance.
  What are the principal benefits of this first step towards a more orderly and fairer system? There is widespread pleasure that by means of the rent rebate scheme the Government will now afford further help to widows, the elderly, the permanently disabled and the temporarily sick who are not in receipt of National Assistance. It is, however, a mistaken view of the scheme to see it as extending help only to those who are no longer able to work. There will be countless thousands of beneficiaries among people who have to work extremely hard for their living and whose modest incomes are sharply reduced by the present incidence of rates. Many of these beneficiaries will be single people struggling to maintain their independence and family men whose low earnings and family responsibilities, taken together, will entitle them to the maximum rebate under the scheme, that is, two-thirds of the reckonable rates of the properties in which they live.
  Few people who are tenants make any distinction between rent and rates. They pay both to the rent collector and usually refer to the combined weekly payment as rent. The rebates which will now accrue to so many tenants will be warmly welcomed as the first reduction in "rent" which even the most elderly of them will have known. One complaint about the facile comparisons which are often made between combined rent and rate levels in the areas of different local authorities is that they are utterly meaningless unless accompanied by comparisons of weekly earnings in the same areas. With respect, I think it could be shown that, because of wage drift and other factors, average earnings in my right hon. Friend's constituency are rather higher than in my

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  own. It is, therefore, very much to his credit that he has selected a rate rebate scheme which will afford most help to wage earners in areas where incomes are lower than the national average. This will help to redress the balance in living standards in different parts of the country.
  Mr. Martin Maddan: Could the hon. Gentleman explain how this Bill will help to redress the changing balance in the living standards in an area like my own constituency of Hove where retired people are particularly hard hit?
  Mr. Morris: My point was that it is useless to compare combined rent and rate levels in one area with another, unless one is prepared to compare earnings in the same areas. Moreover, I am emphasising that the benefits of the Bill increase in areas where incomes are lower than the national average. There are very many retired people, widows and disabled people, as well as people who are temporarily sick, who will benefit from the rate rebate scheme.
  To resume at the point I had reached before the hon. Gentleman's intervention, it is also to my right hon. Friend's credit that he is showing concern, in another Bill shortly to come before the House, for ratepayers who have been faced with an unreasonably heavy rate burden as a consequence of the huge problems of slum clearance in the areas of their local authorities.
  This Rating Bill will also be widely welcomed by owner-occupiers for the provision, in Clause 1(1), for domestic rates to be payable as of right by instalments, instead of in one or two forbiddingly large lump sum payments each year. I doubt if any hon. Member during the lifetime of the present Parliament has made more representations than I have on the need for this reform. I have cause to know that frequent representations were also made to my right hon. Friend's predecessors over many years. Thus it is only fair to congratulate him for acting where his predecessors refused to act. From conversations I have had with owner-occupiers in my constituency, I can assure my right hon. Friend that this long-overdue reform is greatly appreciated and is taken as a mark of the sincerity of the Government's drive to humanise the rating system as a whole.
  Mr. A. P. Costain: Does the hon. Gentleman not appreciate that a number of local authorities have already arranged to give rating instalments? My own authority at Folkestone has done that for many years, on better terms than this.
  Mr. Morris: The existence of local schemes has been frequently mentioned during the debate. Everyone knows that there are local authorities which have already introduced the monthly instalment system, but the owner-occupier has never been entitled by Statute and as of right, as he will be now, to move away from what I have called these forbiddingly large lump sum payments once or twice a year. When this Bill passes into law, I hope the local authorities will help all they can to make the provisions of Clauses 1 and 2 of the Bill work as smoothly as possible. In particular, I hope that a simplified procedure will be found and adopted to enable owner-occupiers to serve the notice, required by Clause 1(2) of the Bill, of their option to pay their rates by monthly instalments.
  As I have said, and as my right hon. Friend indicated in opening the debate, this Bill is only a first step towards making our system of local government finance fairer and more orderly. For my part, I trust that there will be a due sense of urgency in taking the further steps now required and that they will much reduce the share of local government spending which has to be met out of the rates. Some months ago my right hon. Friend spoke of the need for radical solutions if we were to avoid a real possibility of the rating system breaking down. He said that under the system inherited by the present Government, rates were bound to go up by at least a shilling a year by natural increase, even if nothing extra was spent on anything. He described this as a most ingenious system—with constant pressure on the rates, the Conservative Party assumed, the public would not like the social services so much. Notwithstanding all that was said earlier in the debate by the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter), I know that my right hon. Friend has been actively considering many different methods of reducing the share of local spending borne by the ratepayers and I hope that he will carefully try to ensure,

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  in whatever methods he selects, that increased financial aid does not erode the independence of our local authorities. To mention one such method, I very much liked the proposal made by the Association of Municipal Corporations that we should increase to 65 per cent. the amount of local government spending met from the Exchequer. I hope that my right hon. Friend will consider this proposal sympathetically and that we shall have in due course a further Bill, transferring more of the costs of local government to the Exchequer, which will be seen as fair and sensible by ratepayers as a whole. Meanwhile, I welcome this Bill as an important step along the road to a much improved system of local government finance.
  6.40 p.m.
  Mr. Martin Maddan: I would like to take up the point raised, when the hon. Member for Manchester, Wythenshawe (Mr. Alfred Morris) was good enough to give way to me, about people who had not only retired but who were living in an area where there are many retired people, because that is the sort of area where they like to retire.
  Before doing so I should like to say that while it is fine for the Minister to come here and apologise for the rough-and-ready state of his Bill, to tell us, during his Second Reading speech, that he was already discussing Amendments and new Clauses for Committee and to say that the whole rating system was so bad that it deserves to be abolished anyway, it is not in my view consistent with the idea of planning as I understand it. It is not consistent with any sane view of planning to talk about a plan to pull out the whole structure before there is any evidence of anything workable with which to replace it. The hon. Member for Nottingham, West (Mr. English) mentioned—and it is a straw at which the right hon. Gentleman could clutch—the idea of a local payroll tax. But that would not help in areas to which retired people go to live because, by definition, there are not many people on payrolls in such areas.
  Mr. Speaker: Order. I have allowed incidental references in all speeches to rating reform in general, but not in detail.
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  We are not debating rating reform; we are debating this Bill.
  Mr. Maddan: I am obliged, Mr. Speaker. I will continue at the point where I promised that I would take up what the hon. Member for Wythenshawe said.
  Retired people go to areas such as my constituency, set up their home there, keep such furniture as they want, undergo the removal expenses of getting there and plan their life on the basis that they want to be able to continue to live there until they are gone. They make prudent provision for increases in the cost of living. But the increases in the rate burden which such people have had to bear have been out of all proportion and all possibility of having been foreseen by these people when they went there. It is not particularly helpful to say that they should move somewhere else, partly because that would involve them in very considerable capital expenditure, but also because when people reach that age and state of life it is not practical politics in human terms to suggest that, having taken themselves to where they can retire and having made what seems to be reasonable provision they should be driven off by a high rate burden which they cannot sustain.
  It is perfectly true, and is certainly to be welcomed, that the Bill helps people in the very low income bracket.
  Mr. Alfred Morris: My right hon. Friend the Minister, in his speech, attempted to define the area of greatest need among ratepayers. Is the hon. Gentleman arguing that there should be relief for those not in the greatest need?
  Mr. Maddan: I am arguing precisely that point. The Bill stops too soon.
  I want to mention one or two figures which I think are fairly widely known. The point at which full relief stops is £520 a year, and it tapers off, under certain examples which the Minister gave, at about £600 or £700 for a married couple. Average industrial earnings—and there may be more than one earner in the household—are £20 a week, over £1,000 a year. The chapter on household incomes in the Allen Report says that in the south of England the average household income is nearly £1,300. It also tells us the median income, which is just over £1,000.

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  Many of the people between these levels are suffering the worst sort of poverty of all, and that is the erosion in their last years of the standards which they have built up and to which they have become accustomed at a time when it is impossible for them, by effort and by earning more, to do anything to sustain them. It is these people who, through rising prices, rising rates and so on, are cheated of the expectation of the standard of living to which they have been accustomed. Not only does the Bill not help them it actually penalises them. This is the point which I was trying to bring out in my intervention in the speech of the hon. Member for Wythenshawe.
  The Minister may apologise by saying that this is a rough-and-ready Measure. It is net good enough to apologise for it being a rough and ready Measure on the ground that it is temporary, that the rating system will be abolished before very long—when we do not know when: there are no ideas yet.
  The hon. Member for Wythenshawe referred to his local newspaper. The Borough Treasurer of Hove is quoted in the Brighton and Hove Gazette of last Friday as saying:
  "I think you will find that there are quite a number of peope in Hove entited to rebates and this alone will lead to a rate increase. It also means more staff."
  For both those reasons, therefore, to say nothing of the loss of interest on money to which the hon. Member for Nottingham, West referred, people in this intermediate bracket—we might say the forgotten bracket—will undergo greater hardship and suffering as a result of the Bill. While we must support Measures of help to some, the method by which that help is given in the Bill fills us with deep misgiving.
  The Minister said that for various reasons he would not go through with the revaluation which is due in 1968. I hope that it will be in order if I say something very briefly about that as it affects the purposes of the Bill. The hardship which has been caused to retired people suddenly came about when up-to-date valuations were brought in two and a half years ago. Unless there is a speedy replacement of the rating system with something else, it will not be many years before there is another drastic revaluation
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  causing more drastic hardship—drastic because it will have been postponed and left too long. People are hoping, particularly in seaside towns such as Hove, that the revaluation in 1968 will pay some attention to capital values as well as rental values of property such as flats in particular. The people in this forgotten bracket will now be cheated of that hope and relief.
  I very much hope that the Minister and his hon. Friend will regard this not only as a rough-and-ready Measure, and as a Measure which must be followed by the second prong of the attack—that is, the relief of rating generally by the grant of more Exchequer help—but as a Measure which itself contains many actual injustices which must be remedied as soon as possible. I hope that the terms of the Money Resolution will enable us to address ourselves to these points in Committee.
  6.49 p.m.
  Mr. Hugh D. Brown: This has been an excellent debate. I have heard two of the best speeches to which I have listened since I became a Member—those of my right hon. Friend the Minister and of the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter). I compliment my right hon. Friend and the right hon. Gentleman—for different reasons, of course. I confess that I sometimes feel that, in view of the lucidity which we associate with the Minister, it is almost a shame to be critical of some of the arguments which he puts forward. Before I come to my right hon. Friend, however, I should like to deal with one or two of the points which have been made.
  This debate seems to be taking a traditional form. We have had three contributions from the back benches opposite and tears have almost been brought to my eyes. The hon. Member for Croydon, North-West (Mr. Frederic Harris) reminded me of Mrs. Mopp in "I.T.M.A." He was so cheery about it all. We still do not know whether he supports or opposes the Bill. It was quite surprising to listen to the hon. Member for Harwich (Mr. Ridsdale) talking about the erosion of small pensions because of rising costs. He had, however, the political acumen to add that this trend had been increased during the past year. It made me wonder

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  just where his concern and sympathy for this section of the community had been in the past 13 years.
  Mr. Boyd-Carpenter: Is the hon. Member aware that during the 13 years of Conservative Government the real value of the National Insurance pension was increased by 50 per cent.?
  Mr. Brown: The right hon. Gentleman should convince his hon. Friend the Member for Harwich of what his party did, because he did not seem to be greatly enamoured of the record of the Conservative Government.
  I should like to hear hon. Members opposite being a little more forthcoming, and perhaps when the hon. Lady the Member for Finchley (Mrs. Thatcher) replies to the debate for the Opposition she will deal with this point. The hon. Member for Hove (Mr. Maddan) argued the case of retired people. From the Conservative benches, it is always the poor old widow or the poor old retired person for whom so much sympathy is generated. It may be due simply to political tactics and a subjective approach. I concede that we all may be guilty of it.
  Mr. Maddan: I sat in this House for nine years as the Member for a constituency which was predominantly industrial—Hitchin, in North Hertfordshire. I then was adopted and ran for Hove. I can tell the hon. Member that the poverty of old people there, the retired middle-class included, came to me as a real shock and I determined to try to do something about it.
  Mr. Brown: The hon. Member proves my point that we can all be guilty of subjective influences in our constituencies. There is nothing very original about that. I concede that there is poverty and a problem.
  The hon. Member should go a wee bit further. Everyone is quoting from the Allen Report, and so I want to be in the fashion. I wonder whether hon. Members opposite will address themselves to the point in the Allen Report that people, presumably' in that range, who have capital resources tied up in property such as their house should have their resources taken into account in assessing need. The Allen Committee goes further
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  and says that when those people give up or sell their house, or on death, compensation could be paid to the authority, whether local or national, which has helped them during their lifetime to stay in a house which it is obviously beyond their means to pay for. I wonder whether hon. Members opposite will address themselves to this point, which is fundamental to our approach in being fair to all sections of the community but at least to make some kind of contribution to the section of the community which is hardest hit.
  We must bear in mind the natural attitude of local authorities—including Glasgow—that if they can get out of paying anything, they will do so. It is interesting when we hear this talk about the rising burden of rates. On occasion, this is a good whipping boy for every politician, whether local or national.
  In Glasgow we are sick and tired of a feeble progressive—with a small "p"—opposition which always uses the argument that rents should be higher and that if they were higher they would reduce rates. At the same time, we have the argument, which has been reflected here this afternoon, that rates are constantly rising. This is usually attributed, at least in our part of the world, to Socialist inefficiency in administration.
  In Glasgow, in the 10 years from 1954 to 1964 when the Conservative Government were in power, the increases in rateborne expenditure that Glasgow citizens were called upon to pay were just under 100 per cent. The complaints always attribute this to Socialist inefficiency. In the rest of Scotland, however, the increase in rateborne expenditure during the comparable period was something like 116 per cent. and not merely a figure in the nineties. But for Glasgow the average would be higher. Therefore, this has nothing to do with administration. It seems to be a natural fact of life that if we are to expand the social services or if employees in local government are to expect their share in a rising standard of living, rates must obviously go up.
  Mr. Speaker: Order. The hon. Member should now leave Glasgow and the rating system in general and come to the Bill.
  Mr. Brown: I am sorry, Mr. Speaker; I thought that I had been dealing with it. My point is that in this period of rising rates—we have established that there has been a constant rise in rates, and there will probably continue to be a constant rise in them—the greatest need is to relieve the rates upon those who are on the lowest level of small fixed income. That is precisely what the Bill will do.
  We have been given some interesting figures. My hon. Friend the Member for Paisley (Mr. John Robertson) developed a point concerning a different application in Scotland because of lower average earnings. What my hon. Friend said is quite true and it is something about which I am not happy. Again, this is something which might be unduly hard upon local authorities in areas where the average earnings are much lower.
  Reference has been made to the fact that many local authorities operate relief on grounds of poverty and hardship. Certainly that is the case in Scotland. If I use Glasgow for purposes of comparison I am not being parochial but am bringing out a principle. Glasgow represents a fair slice of Scotland and, therefore, it is an important place. If we consider the application of the rent rebate scheme and the rates relief scheme on grounds of poverty, the cost at present to Glasgow, with all its reputation for generosity—and in saying this I might be conceding a point to hon. Members opposite—amounts to something like one-third of a penny which is given by way of relief for rates. We hand out only about £26,000. I must admit that I never felt very happy about the level of the scales that we operated in this scheme, but I have no reason to assume that Glasgow has been any less generous than any other local authority. The point which I am making is that under the proposed scheme, the contribution that will be required to be made by the local authority will cost Glasgow 1½d. to 2d. instead. This is quite substantial.
  I must admit that I was a bit disappointed by my right hon. Friend, because he did not give any good argument as to why it should be 25 per cent. Why not 50 per cent.? Why not 5 per cent, or 10 per cent.? If it is to be argued that it is to preserve local democracy, then I think he must produce a better argument
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  than that, because surely, in this Bill he is laying down even scales and he is not leaving any opportunity for interpretation or for a more sympathetic interpretation by one authority as against another. So, therefore, he is merely using the local authorities in a most limited fashion for the implementation of a national scheme. Of course, I am a believer in local democracy. I think we want to strengthen it, but I do not think this was a good argument to be used for keeping this 25 per cent. Therefore, I should like to hear my hon. Friend the Under-Secretary of State address himself to that point when he replies to the debate.
  I am not objecting to the Bill. I think it an excellent Bill, and I think it is one we should all support, even in Committee, but there are certain details in it which I think should be examined. I am glad we have had the assurance, on the question of instalments, that local authorities operating a scheme, subject to the approval of the Minister will be allowed to continue to operate that scheme. I do not want again to boast about Glasgow: we have got a good scheme there already. Therefore, while the desire, while the aim to help this section of the community is a most important one and one which I think we are tackling successfully, nevertheless there are minor points, particularly in relation to the National Assistance Board cases, which I think we should go into in greater depth.
  No hon. Member opposite—I must admit that the right hon. Member for Kingston-upon-Thames did not fall for this one—has mentioned it, but if it is good enough for local authorities or for Government-sponsored agencies, such as the Scottish Special Housing Association, that one applying for a rebate is obliged to go to the National Assistance Board before being entertained for help, and only at that level is one enabled to qualify, then I cannot see any reason for running away from that in this Bill. I do not accept the odium which far too many Members on both sides of the House are constantly placing upon National Assistance—that people are too proud to go to the National Assistance Board. It is a lot of rubbish. It may be so in some areas, but one always seems to have the impression created that the

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  better person does not go near the Assistance Board. I think Members of both parties have to accept some measure of responsibility for having created an attitude which is wrong—and then having to run away from it when we are trying to bring in sensible legislation, such as we have here.
  I may appear to be critical, perhaps, of the Bill, but I welcome the principle of it. I think it is long overdue, particularly because of the substantial increase in the last 10 years in the cost of rates, and I think that if we are honest with ourselves it should remind us that, even in this so-called affluent, never had it so good society, we have failed lamentably to meet the real needs of people who have been too long forgotten.
  7.4 p.m.
  Mr. W. R. Rees-Davies: When I heard the hon. Member for Glasgow, Provan (Mr. Hugh D. Brown) begin his speech I thought that we had made a mistake in that the Bill had not been published in Gaelic, and that, consequently, he had not read it or paid very much attention to it, but as he came to the latter part of his speech I certainly thought I had done him an injustice, because I think that, in fact, he has given fairly considerable thought to some of the more important aspects of it.
  One of them, of course, is this. The Labour Party in the General Election made is quite clear that it intended to transfer part of the burden of the rates from local authorities to the general Exchequer, thereby carrying the trend of centralisation still further. So far as I recollect, the Labour Party said nothing about a rent rebate scheme. The Tory Party, on the other hand, made it very plain indeed—and many us, including myself, electioneered considerably on the subject—that we were promising to put forward an extension of the rent rebate scheme for the benefit particularly of the elderly and those living on fixed incomes. It was a main plank in our platform, and I may say that every one of those who sit behind me at this moment on these benches was certainly committed to it, and they represent most of the seaside resorts, and one or two major inland towns as well.
  Having said that, of course one has to consider very carefully whether one could
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  have an extension of the Rating (Interim Relief) Act. The Minister is quite wrong to have attacked that Act. It was, it is quite true, a small Act. It was small, but it has been immensely valuable to us in the country, and, apart from what my hon. Friend the Member for Harwich (Mr. Ridsdale) said about it, in the case of Margate it gave us £30,000 last year and at Ramsgate some £25,000. By virtue of grants under that Act for age relief, older members of the community, being in large numbers in those two towns, had no increase in their rates. Consequently it was most valuable at the election for some of us. I was very closely associated with the representations to the then Minister, with my hon. Friend for Harwich and my hon. Friend the Member for Folkestone and Hythe (Mr. Costain), and a number of us went and saw the Minister and pressed for that Act.
  The Bill for it was introduced quite deliberately to assist communities mainly by the seaside. What is said is that if, in fact, we are to retain some local autonomy—and it is quite right—then, of course, we should give, perhaps through the extension of the previous Act, a measure of decision to the local authority to decide in cases of hardship whether or not it will give this benefit to the ratepayer. As to ways of doing it, I should have liked our Act to have been expanded and to have placed a fair and clear duty upon the local authority to extend the cases of hardship and to give that relief.
  That has not been followed. What this Government have done is to introduce a scheme which lays down that people within specific income limits shall be entitled to apply for rebate. That has been done notwithstanding that the effect is that there is no discretion whatever to the local authority. It must do nothing more or less than apply the standards in accordance with criteria laid down by the Government. In my view, that is a wrong approach. I think that if they want to do this the Government should pay the whole bill. If they do not want to do it, they must put a duty fairly and squarely upon the local authority, and that is an argument of principle.
  The second is this. It is quite unnecessary to lay down this very long series Jf provisions in the first two or three Clauses

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  as to how we shall pay by instalments, when a number of local authorities have already got perfectly good schemes. We on this side of the House when in Committee will, I am sure, table Amendments to seek to ensure that schemes in existence can be treated as proper schemes, rather than as laid down by the Government. I should like, as I say, to reserve this point for the Committee stage. I am not satisfied that the Government should lay down any scheme at all, they should merely impose fairly and squarely upon the local authorities a duty of preparing schemes best suited to their needs and to ensure that instalments monthly or otherwise can operate. The Government are apt to think that they have got to lay down everything in great administrative detail, but local authorities are well able to run their own administration and their own schemes themselves, and are able to decide what sort of schemes would best suit their people and how they should treat them.
  The Under-Secretary of State for Scotland (Dr. J. Dickson Mabon): Does the hon. Gentleman mean, when he argues this, that in the details of these schemes there is to be no national standard of the amount that is to be disregarded, or does he mean the level at which full rebate is to be achieved, the gradation scale, or anything like that?
  Mr. Rees-Davies: No. All I dealt with was the payment by instalments. Under that, I do not believe that the long rigmarole contained in the Bill is needed at all. I could shorten it to three or four lines imposing specific duties on the local authority which they would implement in accordance with schemes. Alternatively, they might be allowed to use whatever schemes they liked, providing that they allowed for monthly or quarterly instalment payments.
  I turn now to what is a major point. The Bill provides for a rebate which is biannual—broadly speaking, two parts of the year, winter and summer. What has been completely overlooked is that in seaside resorts many people earn not a penny in the winter and earn extremely well in the summer. Under the scheme at the moment, those people will merely see that a ey do not have to pay in respect of the period in the winter and will be only too happy to pay their rates in
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  respect of the summer period. I will not go into the niceties of the matter in assuring the House that that is the fact and that it will have to be looked at very carefully in Committee, because it is not a satisfactory scheme at all.
  It comes down to this. By taking away the entire discretion from the local authorities as a result of not having adequate and proper consultation with them before the Bill was published and not giving hon. Members sufficient time to consult with the local authorities and other people before the debate took place, we have what is a rushed, makeshift Bill. That is understandable, because the right hon. Gentleman has indicated that he does not really like rates or the rating system at all.
  The estimate of what may be spent is £29 million, of which about £7 million would be found by the local authorities, and £2 to £2½ million would be for administration. That is a relatively high cost of administration, if it turns out to be correct. But I do not think that those figures are viable, and I will say why.
  I do not share the view that there are a large number of people who do not take National Assistance where it is available to them. I share the view of the hon. Member for Provan that they do take it and properly take it. We have gone to great lengths to see, through the various old-age pension and other associations, that they are properly informed. I do not accept that there will be anything like 2 million people who will be entitled to the grants. I understand that in my constituency there are more on National Assistance relief than in any other constituency in the United Kingdom. They are largely elderly people on the relief because of their incomes, which are at the level of £500 a year or thereabouts for a married couple. In my constituency they receive extremely able treatment from the local office. But the position is that they will continue to get the complete rate relief that they receive at the moment.
  Furthermore, there are the sick. Under the scheme, a person applies for rebate only if he knows that he is going to have a weekly income of £10 or thereabouts. If he is temporarily sick, he has lost the opportunity later. He will apply for relief only in respect of earlier months, and he cannot know in advance if he will

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  be temporarily sick or unemployed. Therefore, it will not assist either the temporarily sick or the unemployed. It will not assist those on National Assistance, and really I cannot accept that any borough treasurer worth his salt will not say to a person on National Assistance, "Look, you are on National Assistance. Go and get your money from the National Assistance Board. Do not take it from the local ratepayers when the Government are going to pay for it."
  The only people who will be materially assisted are these. I will take my own area, and hon. Members can check it against their own. First of all, the average rateable value in Margate borough is £80. The rate is 12s. 5d., and the average rate payment per household is £50. I am told that the national average is £35, but it is £50 in my area. A married couple with an income of £520 a year, or £10 a week, are entitled to claim relief and, out of £50, they will get £21 13s. 4d. A married couple with £632 a year, which is still a fairly low income of about £12 10s. a week, will get only 6s. 8d. relief. The band for a married couple is between £10 and £12 a week. There are quite a number, but there are very few who are in the lower band getting full Income Tax relief on £520, and there are only a small number of those people who will receive the relief and who are not getting assistance of any kind from the National Assistance Board. However, it is valuable.
  On the other hand, in the case of a married man with two children, the level of income at which he receives £21 relief on a total rate payment of £50 is £767 per annum, but a married person with two children receives only 6s. 8d. relief on £755.
  It would have been better to have looked more carefully at whether the relief might not have been designed predominantly to assist the elderly and those living on fixed incomes. There is a case for those with large families which can be fairly argued as well.
  I would have preferred an extension of the Act that we brought into effect last year. I believe that it would have been better to have given a discretionary power to local authorities to make a certain grant at certain figures.
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  The Government ought to carry the whole bill rather than 75 per cent., and certainly I hope that in Committee they will look carefully at the rules that they have laid down, particularly with regard to the two rebate periods of six months to see that we do not get a number of smart alecs trying to blow up their incomes for the summer in order to secrete their earnings for the winter. Some of these matters are not easy, and I hope very much that they will be carefully analysed in Committee.
  7.18 p.m.
  Mr. Gordon Oakes: I welcome the Bill very warmly and I say that unequivocally. I have heard a number of hon. Gentlemen opposite welcome the Bill and, having welcomed it, then proceed to attack it. The hon. Member for Croydon, North-West (Mr. Frederic Harris), having welcomed it, ended his speech by calling it a blatant manœuvre in accountancy. If that is how he regards it, surely he does not welcome it.
  To come to the terms of the Bill itself, it deals with hardship. It deals with those members of the community—and the figure has been given of 2 million—who are just about at National Assistance level, or who are entitled to National Assistance but do not receive it, or who have low earnings and large families and nevertheless have struggled to buy their own homes. It provides such people with urgently needed relief. The Bill is therefore a useful, a timely and a practical one.
  Do hon. Members realise what it must be like to be a pensioner or a person with a low income when the half-yearly rate demand comes in? It must be faced with dread, because it means that two and sometimes three weeks' income must be expended at one go. That is the kind of person whom we are trying to help by the Bill.
  I said that it was a practical Bill. A lot of the debate, Mr. Speaker, when it slipped out of your very able guidance, has attempted to range over the question of alternatives to rates. Poll taxes, a local income tax and so on, have been mentioned. However, this is a practical Measure which deals with the existing rating system and makes it possible for relief to be given to the needy now. It does not deal with fiscal theories about

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  local rates. It is a practical Measure which will work quickly.
  I said that it was a timely Bill. Perhaps a more correct adjective is "overdue", because it is certainly an overdue Measure. Hon. Gentlemen opposite have said that for years they pressed the needs of those who could not carry the rate burden. I welcome what they have done, but they must realise that they were pressing their Administration to no avail. In 1957, when revaluation took place, they had an admirable opportunity at least to look into this matter and to give this kind of relief. Instead, they set up the Allen Committee. While I do not wish to detract from the value of that Committee's Report—it was most valuable in our consideration of this subject—it surely did not need the Allen Committee to tell hon. Gentlemen opposite or my right hon. Friend that rates are a hardship, particularly on the poorer section of the community, especially on those living on fixed incomes, and notably on pensioners. In 1957 or later a Measure of this sort could have been introduced. Indeed, the Act of 1964 clearly goes nowhere near achieving what this Bill will achieve when one considers the amount and range of relief which this Measure will give to so many people.
  My hon. Friend the Member for Erith and Crayford (Mr. Wellbeloved)—and I say this without wishing to sound presumptuous, having been here for only a few months longer than he—in a most admirable and knowledgeable speech, and the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) dealt with the effects of the Bill on local authority finance departments. It is important that we consider this because there should be the maximum co-operation between Parliament and the staffs of treasurers' departments which will have to administer the Bill, and quickly. The Measure will be in operation in April, 1966, which is only five months away, and while my right hon. Friend said that there had been consultations, there are many ways in which we can assist local authorities in implementing a Measure of this sort.
  One means of assisting local authorities would be to give the Bill a speedy passage, because it is essential that it should receive the Royal Assent well before the beginning of the next financial
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  year. Only if that happens will borough treasurers, chairmen of finance committees and heads of establishment committees be able to satisfy themselves that they can implement its provisions. As we know, there is a great shortage of staff in treasurers' departments, particularly in the north of England, where I come from. There is tremendous competition between local authorities for staff, particularly accountancy staff, and between local authorities and the world of commerce. It is essential, therefore, that these local authority departments should have the position clear in their minds well before the beginning of April so that they can get the necessary staff, accounting equipment, office facilities, and so on, to administer the Bill. That is one way—the speedy passage of the Bill—in which we can materially assist local authorities.
  The provision of statistical help to local authorities by the National Assistance Board has been mentioned. While that might help, I should have thought that the Department of Inland Revenue would have all the necessary figures. If liaison existed between local treasurers' departments and the Department of Inland Revenue a great deal of time could be saved because local treasurers' staffs would find it easier to check the details of application forms. If this form of help is not given, local authority treasurers' offices will be inundated by applications. All those pieces of paper will have to be checked, each one individually, with local employers. This will not be welcomed by employers, who will have an ocean of work to do. It will be completely unremunerative because it will merely involve them in supplying facts and figures to local authorities to satisfy local treasurers that applications are just and proper.
  The Inland Revenue, on the other hand, has all these figures to hand and if, on the rebate form, an authority were signed by the applicant to the effect that the Inland Revenue could produce figures of the applicant's income in confidence to the treasurer of the local authority, an immense saving in time, money and office routine would be effected.
  The third way to help local authorities would be to give them advice and information now. Many authorities have had

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  no experience of administering a rebate scheme. Some have rent rebate schemes for council houses while others have never dealt with a rebate scheme before. It is essential that the Ministry gives the necessary guidance and information to such authorities now on how such schemes are administered.
  It is to be hoped that the Bill reaches the Statute Book within a very short while—since it comes into operation in five months' time—because when it becomes law there will be a flood of applications from those entitled to rebates as well as many who are not but whose applications will have to be considered and refused. I welcome the Bill and hope that we will appreciate the problems which local authorities will face in administering it. It is no good asking local authorities for co-operation unless we are prepared to consider their problems and give them practical help on the lines I have suggested.
  There are various points in the Bill which we can consider in Committee, not least that raised by the hon. Member for the Isle of Thanet (Mr. Rees-Davies) about seaside resorts. We should indeed look at their problems, particularly in view of the large number of retired people who live in such areas. I suggest, however, that the hon. Gentleman did not make a case for saying that the Government should pay 100 per cent. of the bill. The points he raised can be considered in Committee, along with others; for example, the question of a form of appeal against the refusal of a local authority to grant a rebate. I do not like the idea of local authorities having the ultimate power to refuse, with no form of tribunal or authority to which an applicant who has been refused can go. These are, of course, Committee points concerning a Bill which brings to the rating system some measure of justice, equity and humanity. It is to be welcomed for that purpose.
  7.29 p.m.
  Mr. Eric Lubbock: The hon. Member for Bolton, West (Mr. Oakes) described the Bill as useful, timely and practical. There was a certain amount of force in the arguments he adduced in support of that contention and I agree that the Bill is very much to be welcomed. Although I shall have some criticisms to
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  make of it—and I agree that primarily they will be points which we can discuss at length in Committee—that does not detract from the support which my party is willing and ready to give to the speedy passage of the Bill.
  The hon. Gentleman said that speedy passage of the Bill would materially assist local authorities, but in any case it cannot come into operation before 1st April next. The only assistance local authorities would get by such speedy passage would be that people would have longer in which to serve notices under Clause 1. In the first year in which people become entitled to serve the notices, they can do so within 28 days of their first becoming qualified, but, under Clause 1(2), in any subsequent year they can serve notices at any time between 1st February and 30th April. Therefore, if we can get the Bill through before 1st February people will have as long to submit notices in the first year as in subsequent years. That is an important consideration.
  I disagree with the hon. Gentleman's statement that figures available in the Inland Revenue Department can be of assistance to local authorities in working out whether people are below or above the limits set in the Bill. I hope to be corrected if I am wrong, but I think that most of the people who will benefit from this Measure will not be paying Income Tax, and will therefore not have submitted returns. We must face the fact that local authorities will have a great deal of work in looking at the notices submitted to them, and deciding whether or not a person is qualified to receive a rebate.
  The main feature of the Bill that I endorse is that we shall now have a uniform basis of assessing hardship. My noble Friend Lord Wade criticised the then Rating (Interim Relief) Bill in this House in December, 1963, on the ground that it left the determination of hardship to local authorities, and that, as a result, the benefit varied considerably from one part of the country to another. When hon. Members on this side of the Chamber try to take credit for what they did in that Bill, they should remember that fact. This Measure is a great improvement in that respect.
  I welcome the idea that people should have a statutory right to pay rates by

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  instalments. That was one of our demands in the Liberal rating reform campaign earlier this year, and it has been our policy for a number of years. I should like the Under-Secretary of State to deal with a point made by several hon. Members about schemes already in existence. Clause 1 says quite plainly that in order to get the benefit a person must submit a notice in writing to the local authorities, and it lays down by what time that notice must be received by the local authority. As the hon. Gentleman will be aware, most local authorities which have instalment schemes deal with this as part of the rate demand, and the person concerned does not have to fill in and submit an extra piece of paper in order to get the benefit. I therefore think that the Bill will have to be amended in order to conform with the Minister's undertaking given today that a local authority which already has such a scheme will be allowed to continue it in its present form.
  I have one or two criticisms to make of this Bill. The first is, perhaps, minor, and it relates to phraseology. Hon. Members will remember that when we were considering the Rent Bill, the Minister apologised for its phraseology. He said that he very much disliked legislation by reference, and that he particularly disliked complicated terminology that people might find difficult to understand in a Bill that affected many millions of people.
  That criticism applies with equal force to this Measure. Clause 4(3) is complete double-dutch. I had thought of reading out this subsection, but hon. Members will realise that to do so would take me about five minutes, and I am afraid that if I were to read it out, Mr. Speaker, I would incur your displeasure. It one reads it about five times one appreciates that it means that if a person lives in part of a house, the council will decide what proportion of the rebate that person is entitled to as opposed to the occupier. That provision could have been expressed much more clearly. Clause 4 is by no means the only Clause to which that criticism applies. Subsection (6) of Clause 3 is almost as incomprehensible. It may be difficult to do anything about it just at present, but it is a pity that a Bill that will be applicable to about two million people could not have been made rather more readily understood.
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  A second minor criticism—and it is not minor, or course, to those affected—is that the 250,000 of our citizens who live in caravans are not entitled to any benefit at all. From Clause 3(3,c), it is clear that only
  "… a person who, not being the occupier of such a hereditament … is the tenant of … a part of any such hereditament …"
  is entitled to the benefit. People who live in caravans are not tenants, but licensees. Therefore, however small may be their income in relation to the amount they are paying indirectly in rates, they will not be entitled to any benefit, because the rates of the caravan site are paid by the site operator at the moment, although there is a court case that may alter that position subsequently. For the time being, no one living in a caravan will be entitled to benefit under the Bill.
  Mr. J. T. Price: This is an interesting point, and I am glad that the hon. Member has raised it. Although commercially-developed sites are assessed and rated, there may be many cases in which caravan people pay heavy rentals when the land on which their caravans rest is agricultural land, which is derated. These are the sort of questions that may be presented to the Minister one day, because they need to be dealt with far more fundamentally than they are being dealt with now.
  Mr. Lubbock: I agree with the hon. Member. If a site operator has a licence to put caravans on land, he pays rates to the local authority and recovers the cost in the plot rents, as it were, he charges persons stationing their caravans there. In that way the caravan occupants are indirectly contributing to the rates, but do not get this benefit. That is a valid criticism of the Bill.
  My next point is very much in line with what has been said by the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter). I do not see why local authorities should have to pay out of their own resources one-quarter of the rebate. The hon. Member for Glasgow, Provan (Mr. Hugh D. Brown) asked why it should be 25 per cent., and not 50 per cent. or 5 per cent. The only logic I can see in it is that from the local authorities' point of view, the percentage had to be better than the 33⅓ per cent. they had

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  to pay under the Rating (Interim Relief) Act so that hon. Members opposite could say, "At least it is an improvement on what the Conservatives did". At the same time, the Government did not want it to be so much better that it would place an enormous burden on the Exchequer. So they fixed on 25 per cent., which is slightly lower than the 33⅓ per sent. in the Tory Act.
  The cost of a rebate scheme which is designed to alleviate hardship should fall entirely on the Exchequer. That is the view, not only of the County Councils Association but also of the Association of County Councils in Scotland and the Institute of Municipal Treasurers and Accounants. They have pointed out that the amount falling on local authorities as a result of this provision is equivalent to a 1d. rate nationally, though much more than that, of course, in some parts of the country.
  A very powerful argument has been advanced concerning the National Assistance Board if one is offering to the citizens these two alternatives: "You can either go to the National Assistance Board, if you are entitled to benefit from that source, or ask the local authority for a rate rebate." While the treasurer may point out, "You might be able to recover more from the N.A.B.," he will not be able to refuse if the person insists that he does not want to go to the N.A.B. but prefers to get back the money in the form of rate rebate. It seems that these two payments are equivalent to one another. The whole of the expenses of the N.A.B. are paid through the Exchequer the same should apply to the rebates conferred on people with low incomes. I do not say that this applies to the instalment payment scheme for that is in a different category altogether. That applies to people who are not by any means in the category of hardship. It is a universal right we are conferring on ratepayers and it is reasonable that that part of the rate bill should fall on the local authority.
  The next major criticism I make of the Bill is that it does nothing towards a fundamental reform of the rating system. It is a more generous version of the Rating (Interim Relief) Act. It is more generous and an improvement in a number of res-
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  pects, but does not do anything to shift the burden from the ratepayer to the taxpayer. I am disappointed that we have to wait until next year before the further Measure will be introduced and that we could not deal with the whole problem at one time. If we could have done that there would have been a saving of Parliamentary time. I should like it to be explained why the Government found it necessary to have two separate Bills.
  The Bill does nothing to bring other ratepayers into the network of the rating system and thus to decrease the burden on those already paying rates. I pointed out in a previous debate on rating that we were losing about £25 million through failing to collect rates on vacant properties. I have brought the figures up to date since then and find that the rate collection leakage figure published by the L.C.C. for 1953–54 shows that that authority lost £4 million in rates that year. Pro rata over the country as a whole the loss would be about £34½ million. One can project that to the year 1965–66 in which the amount would come to about £42 million. That is an enormous amount to be lost to rating authorities, and hence to ratepayers who are making a contribution.
  The Minister has said that he accepts in principle that vacant properties ought to be rated. I ask why it has not been found possible to introduce such legislation at the same time as the Bill which is now under consideration. A much more radical reform of the rating system is necessary. I hope that it will not be long before we not only get the second measure which has been promised but before we get a complete re-vamping of the whole system. When the right hon. Member for Kingston-upon-Thames speaks about this he should be a little careful. He should have added quorum pars magna fui because for many years the Liberal Party has preached reform of the rating system and so long as the Conservatives were in power, that fell on deaf ears. All credit to the Government for having undertaken an intensive examination of the problem. I hope that it will shortly produce results.
  7.43 p.m.
  Mr. Trevor Park: I trust that the hon. Member for

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  Orpington (Mr. Lubbock) will forgive me if I do not take up many of the interesting points he made. I wish to return to the first principles of this Bill. It is clear—my right hon. Friend the Minister of Housing and Local Government said it himself—that the Bill owes much to the deliberations and the Report of the Allen Committee. That was the Report which gave for the first time a mass of statistical material, previously unavailable, to support the case of those of us who maintained that the rates system was a basically regressive form of taxation, a form of taxation whose heaviest impact had always fallen on those with the lowest incomes while at the same time those in the highest income brackets paid less than their fair share.
  My right hon. Friend in opening the debate pointed out that the percentage of income paid in rates by the lower income group was as high as 8 per cent. while for those in the higher income group it was as low as 2 per cent. He could have added—this also is in the Report of the Allen Committee—that total housing costs as a percentage of income are as high as 27 per cent. for those in the lower income groups and as low as 6 per cent. for those in the higher groups and rates are a very important element in these costs.
  It is clear that the basis of assessment of this form of local government taxation is inequitable and that it is time the whole principle was reviewed. What the Bill does is to attempt to put right the most blatant injustices which the system causes. My right hon. Friend claimed no more for it than that when he introduced the Bill. He said—and again the evidence is contained in the Report of the Allen Committee—that those who suffer most are those on the National Assistance eligibility line who do not claim such assistance, or those who are just above the National Assistance level. They, in the main, are two categories of people. There are old retired people living in one- or two-person households who feel particularly heavily the burden of increasing rate payments when they are totally dependent upon their pensions. The second category is of young couples, people living on low incomes having to pay high rents and possibly also having heavy family responsibilities. These are the people whom the Bill is intended to
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  benefit. It is a rescue operation on their behalf.
  The other part of the Bill which deals with payment of rates by instalments will benefit all ratepayers quite independently of the size of their income. One of the reasons why people pay taxes in sorrow but rates in anger is the heavy burden which lump sum payments once or twice a year puts on their finances. National taxation such as P.A.Y.E. is automatically deducted from income. Not only that, but it is deducted regularly each week or month. Because of regular automatic deductions for Income Tax the burden is often not felt so heavily, but when the time for rate payments comes only twice a year and people are faced with the need to pay considerable sums, often at inconvenient times, the burden is felt very heavily. By making it possible for people to pay on a monthly instalment system, the Bill will be of benefit to large numbers of ratepayers irrespective of and in addition to those covered by the rebate provisions.
  I would have wished it would have been possible to have gone even further. The Bill proposes to allow monthly payments of rates on an instalment plan. This will be of the greatest benefit to the salary earner who receives his income each month. I should have preferred, had that been possible, to institute a system of weekly instalment payments for those very large numbers who are still paid on a weekly basis. I hope that local authorities will do all they can to encourage some form of weekly instalment system for ratepayers.
  I understand that some authorities have already instituted a system whereby a stamp machine is installed in the council offices and people are able to obtain half-crown or five-shilling stamps each week and when the time comes for them to pay their rates they return to the authorities a completed stamp book. As far as I know, where such schemes are in existence their benefits are greatly appreciated by the ratepayers and the administrative costs are not high. I hope that more of such schemes will be introduced as quickly as possible and that those authorities which already have monthly schemes will take the opportunity to consider going even further in the way that I have suggested.

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  I welcome the Bill, but only as a rescue operation and not as a permanent solution to the problem because the injustice does not lie simply in the incidence of the rate burden on particular sections of the community; the injustice lies rather with the entire rating system. As long as the rating system remains the major source of local government revenue we shall have from time to time to launch rescue operations such as this. As an immediate method of helping those who are hardest hit we have no alternative at the moment but to renovate and repair an edifice which ought to be demolished. If we have to continue indefinitely with such renovations and repairs, the cost of shoring up an inefficient and outdated rating system will rapidly begin to rise.
  Hon. Members on both sides of the House have referred to the fact that 25 per cent. of the cost of the rebate scheme will have to be obtained by local authorities from their rate funds. It is true that we are lifting the burden from the backs of those least capable of paying it and imposing a heavier burden on others, and in the case of those who are just outside the rebate limit, the additional burden to which they will be subjected in future will come as a heavy strain. Where I differ from hon. Members opposite is in attributing the cause of that strain. I do not believe that the basic cause of any additional strain to local authority finances is the provisions of the Bill. The basic cause of the strain is the rating system, and it is only when we tackle the central point of the system itself that we shall be able to deal with the difficulties.
  The Bill deals with an immediate, urgent and pressing problem, but it does not present a final answer, because it is clear that the local rate burden will continue to grow as rapidly as it has grown in the pastand as long as it does, the injustice and unfairness will remain. In 1955–56, £401 million was paid by the ratepayers of this country. By 1964–65 the amount had increased to over £1,000 million. Inevitably as the community demands higher and higher standards in local government, in education, in transport, in health and in welfare, the rate burden will continue to increase. This problem arises basically because the entire system as we know it today is related not to the ability to pay but to property. What is at fault is the
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  fact that we have never taken a new look, as we should have done many years ago, at a system of taxation which dates back to three-and-a-half centuries ago.
  My right hon. Friend the Minister of Housing and Local Government referred to his intention early next year to introduce another Measure which will transfer certain charges now borne by local authorities from the rates to the national Exchequer. This will be of assistance in alleviating the rating problem and in helping to meet the difficulties of people whom this Bill is intended to benefit. In doing so it will make it easier for us to consider the reform of the whole system which is needed.
  I should be out of order if I referred to the possibility of a local Income Tax system as a much more equitable method of proceeding than the present rating system. I should be out of order if I referred to the possibility of a compromise in the form of a differential rating system, whereby the rates which people paid were linked to their Income Tax position. In other words, Surtax payers would pay 100 per cent. of their assessment, those paying the standard rate of Income Tax would pay a lower proportion, those paying Income Tax at a lower rate would pay less still and the smallest proportion would be paid by those who are not liable to income tax at all.
  I fear that I should be straying too far from the Bill if I went into such details or into the proposal of the Royal Institute of Public Administration to give local authorities power to levy a local Income Tax of 3d. in the £. Nevertheless, this is the kind of proposal which we ought to be examining if we are to deal with the problems which the Allen Committee have revealed. For as long as we accept such a system as rating, which bears no relationship to ability to pay, and as long as we accept a system which flies in the face of all modern taxation principles, either of equity or of effectiveness, there can be no final answer. We do not cure the disease by treating the symptoms. We do not eradicate the source of injustice by dealing simply with its results. I welcome the Bill as a rescue operation, but let us resolve that no future rescue operations will be necessary.
  7.58 p.m.
  Mr. C. M. Woodhouse: The Minister will certainly be in no doubt

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  that any hon. Member will vote against the Second Reading of a Bill which provides rate relief for any of his consituents, however few they may be. Some of us may have had second thoughts if we had had a more exact indication from the Minister of how the effect of the Bill was likely to be distributed geographically about the country. As the Parliamentary Secretary knows, I have been reliably informed that the part of the country likely to benefit most substantially from the Bill may be Scotland. If that is so, I hope that the Under-Secretary of State for Scotland, who is to wind up the debate, will explain why. But it is regrettable that we were not told so by the Minister when he opened the debate. In any case, we could not let the Bill pass without some criticism and explanation.
  There are two criticisms which I think will have occurred to many hon. Members. The first is that the Bill does nothing to improve the rating system as such. This criticism has been partly answered by the Minister with his promise of a more radical Measure to abolish the rating system altogether. So far so good, but I recollect that when I was a university student the present Minister of Housing was my tutor and from that day to this I have never been quite sure whether he meant exactly what he said. It caused me some surprise to see that the right hon. Gentleman had no answer at all to my right hon. Friend the Member for Kingston-upon-Thames (Mr. Boyd-Carpenter), who challenged him on this very point, on what form of legislation and what kind of new system he was proposing to introduce in place of the rating system. I also noticed that right hon. Gentlemen apparently smiling encouragement at my hon. Friend the Member for Morecambe and Lonsdale (Mr. Hall-Davis) who urged him not to abolish the rating system at all.
  The point is that if the right hon. Gentleman has no such intention the present Bill will lay up a considerable package of trouble for the future, and even if he is going to abolish the rating system there is the point which must be borne in mind that any relief measure which tends by mitigating and improving a system to consolidate and entrench it may well have consequences which the Minister has not foreseen. It may well create expectations of continuing and per-
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  manent relief, which presumably will be wiped out as soon as legislation comes forward repealing this Bill and the 1964 Act.
  In this way it will create future grievances among the immediate beneficiaries of this Bill when they see how local authority expenditure has to continue to be raised and paid for in the future. We do not know what sort of new ideas the Minister has in mind, but I am glad to learn that he has ideas and I hope that he will bear in mind that the fundamental defect of the rating system is not so much that it is highly regressive. That is true but it is secondary.
  The primary defect is that considered as a system for raising local revenue to pay for local services, there is increasingly less and less relation between what anybody pays and the scale and type of services which the ratepayer receives and enjoys in return. In future there will be even less relation between what the ratepayer pays and receives in return, both for those who get rebates under the Bill and still more, for those who do not.
  This leads me to the second fundamental criticism that although the Bill will relieve many cases of hardship it will do so by increasing hardship on others who are only marginally more capable of paying. I will not elaborate this point, which has been made by many hon. Members on both sides of the House, but I wonder whether the Minister has calculated accurately the cumulative effect of all the increments to rates which he is bringing about by making statutory provision for payment by instalment, by the 25 per cent. of the rebate which falls on local authorities, and by what I think to be the quite sizeable increase of this last 25 per cent. if the large number of people who are at present on National Assistance decide to apply for rebates instead.
  The Minister said that he hopes to persuade them not to apply for the rebates and that he hones to use this Measure even to persuade more people to turn to National Assistance. I heartily agree with the hon. Member for Glasgow, Provan (Mr. Hugh D. Brown) that the odium in which National Assistance is held is most unfortunate and is something which hon. Members should do

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  everything they can to try to overcome. Unfortunately, however, it is a fact, and at any rate in the first stages of the operation of this Bill there may be a tendency to switch from National Assistance to the rebate scheme rather than the other way round.
  I should like to know on what basis the Minister has calculated the number of people who are likely to be involved in the scheme which has led to his figure of £29 million a year. The City Treasurer of Oxford has said that in Oxford it is extremely difficult to arrive at any calculation at all. There is also the cost of the extra staff, which has already been referred to, and this will be increased if the Minister rushes the Bill through the House as he evidently intends to do to bring it into operation before the end of the financial year.
  The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Robert Mellish): The Minister's assumptions and the basis of many of his arguments are to be found in the figures published in the Allen Report.
  >Mr. Woodhouse: I am grateful for that explanation. I am aware that there are abundant figures in the Allen Report but some local finance officers, including the Oxford City Treasurer, are by no means certain whether it is possible at this stage to make a reliable calculation of the impact of these measures.
  Then there is the question of the non-effect of the Bill on the rate deficiency grant. At first sight there appears to be a contradiction between what is said in the Financial Memorandum on this subject and what is laid down in Clause 8, but no doubt that will be explained at a later stage. It seems to me that all these things will add to the rate burden, and in a local authority area where it is thought that the numbers entitled to rebate may be relatively high the impact of the Bill on everyone else will be proportionately less high. This consideration makes it all the more intolerable that the Minister has done nothing to ensure that everyone, no matter what relief may be given, should be assessed in the first instance on 100 per cent. of rateable value as long as we have a rating system at all.
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  This raises the vexed question, of considerable importance in my constituency, of the rate relief for colleges of the university. I hope that the Minister will take care of this in his other plans but it is relevant in the context of this Bill to mention that this new Measure, like the problem of college rates in Oxford and Cambridge to which I have often alluded in the House in the past, is another example of a bad deviation from the principle of fairness and common sense that when a Government wish to give relief in a statutory form to ratepayers they should do so not at the expense of other ratepayers but at the expense of the Exchequer. This is a fundamental point which we should emphasise again and again.
  I hope that the remarks I have made on the Bill will serve to underline the fact that local government finance is a large subject which cannot be dealt with piecemeal and in isolation. There will be many other points to raise in Committee of which I will give brief notice of just two, namely, how the provisions of Clause 3(3,c) will be applied to undergraduates in lodgings in university towns and, secondly, why the Minister has chosen in Clause 3(8) to make relief fraudulently obtained recoverable as a civil debt instead of by the ordinary rate recovery procedure.
  I think that I have said enough to show that in my view this is an imperfect Bill, both in principle and in detail. It is slightly better than nothing in so far as it gives help to the neediest, though in a cumbersome way, but I cannot imagine that it will have more than a lukewarm response from local authorities or the general body of ratepayers once they see its full implications.
  8.10 p.m.
  Mr. Ernest G. Perry: After listening to the speeches of 15 hon. and right hon. Members in the debate and hearing all their suggestions, I find it rather hard to put forward an original idea on this subject. The Allen Report makes clear that the present rating system is responsible for the hardship which exists, and I am very glad that, by this Bill, the Government are finding ways to alleviate the problem confronting many thousands of people today. The hon. Member for Hove (Mr. Maddan) said that the limit of relief under the Bill

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  should be raised. According to some figures issued by the Ministry of Housing and Local Government, 66 per cent. of properties in Hove have a rateable value over £100. In Brighton, another seaside resort, the proportion is only 40 per cent., and in Margate—I was glad to hear the hon. Member for the Isle of Thanet (Mr. Rees-Davies) speak about this—the proportion of properties of over £100 rateable value is only 27 per cent.
  It is evident that any relief which accrues must got to places like Margate or Brighton and some of the poorer seaside resorts where there is a large proportion of ratepayers with very low incomes living in properties of low rateable value. This relief will apply to the very large number of such people living in properties yielding a lower rate. The inequalities of our rating system are partly responsible for this, as the Allen Report conclusively confirms.
  The right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) said that it was the inequalities of our rating system which had created these conditions. The problem has been with us for the past 10 years and more, getting worse year by year. What did right hon. and hon. Members opposite do about it? Granted, a certain amount of relief was given to some seaside resorts, but retired people living in the large conurbations, in London, Glasgow and the big cities, had practically no relief at all from the present Opposition when they were in power.
  Mr. Norman Miscampbell: The hon. Gentleman is forgetting the industrial re-rating brought in during the past 13 years which gave the ordinary industrial town an enormous advantage.
  Mr. Perry: I am coming to that. That alleviation was given but for only a very short time. When industrial re-rating took place in the London area and industrial hereditaments were fully rated, there was relief for domestic ratepayers, but for only one year. As a ratepayer in London myself, I experienced a reduction in rates for one year, but, when the full revaluation came along, domestic ratepayers paid more in proportion than commercial and industrial ratepayers. Year after year, the proportion has been moving against ordinary domestic ratepayers as compared with ratepayers in industrial and commercial hereditaments.
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  This is one of the problems today. The ordinary householder on a fixed income has no means of passing on his rates for Income Tax purposes, whereas commercial and industrial undertakings can pass on any increase in rates and secure Income Tax relief. This is another defect of the system.
  It is a fact that the revaluation brought in two and a half years ago aggravated the hardship of the many people whom we are trying to help now. I am very glad that the Government intend to introduce a Measure to reform our rating system. The question in our minds is whether there should be a local tax or rate as a levy on property which one owns or as a personal tax levied on people living in a certain town. Among my constituents, there are many cases of husband and wife, retired people, living in a five or six-room house and paying the same amount in rates as someone who is letting off two or three rooms furnished and receiving a substantial income from those rooms.
  Mr. Deputy Speaker (Mr. Roderic Bowen): Order. The hon. Gentleman will not be in order if he pursues this subject.
  Mr. Perry: I accept your Ruling, Mr. Deputy Speaker. I was trying to draw attention to the anomalies and inadequacies in the present system. I am very glad that the Government realise that reform is necessary and that they are bringing in this Bill now to give relief to the people most in need. I do not doubt that there are anomalies in various of its provisions. Points have been raised about the percentage that a local authority should pay, and so on. No matter what Measure is introduced, no matter whether a Bill raises taxation or gives relief, there are always anomalies and there is always abuse. Unfortunately, until we have a perfect society, we shall have to live with these problems. I welcome the fact that the people to benefit from this Bill are those who have retired on fixed incomes, widows and others, the very people who need help in these circumstances.
  The system of paying rates by instalments is very important. In the Greater London area, this difficulty has come home to roost. Since the establishment of the Greater London Council and the merging

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  of various London local authorities, different councils have had different schemes. I am sorry to say that some councils do not publicise their arrangements for payment by instalments. In some areas, people are compelled to pay their rates every six months, in others every three months, and in others they are allowed to pay every month. In the old part of the Borough of Wandsworth, known as Battersea, people paid their rates every three months. In the old Borough of Wandsworth area, they paid every six months. But a scheme has been introduced allowing ratepayers to pay their rates in eight instalments. The yearly rate is divided by eight, and people will pay from 1st May to 1st December, having nothing to pay in January, February, March and April. It is thus quite easy to arrange for the payment of rates by banker's order, and many people appreciate this system. Unfortunately, as I have said, such systems are not publicised everywhere. If they received more publicity, many more people would be glad to take advantage of them.
  This is a stop-gap Measure until the whole rating system is reformed. In my opinion, until rating becomes more of a personal tax than a tax upon property, we shall not find a satisfactory answer to the problem as it exists today.
  8.20 p.m.
  Mr. Norman Miscampbell: The hon. Member for Bolton, West (Mr. Oakes) accused a number of hon. Members on the Opposition benches of welcoming the Bill and then going on to criticise it. That is the difficulty which anybody is in when he welcomes the objectives but does not necessarily welcome the Bill itself. The fact that we welcome the objectives of the Bill should not prevent our looking at what we are doing tonight. We are adding, as every Parliament seems to do to all fields of our legal system, a further anomaly and a further differentiation between one set of people and another.
  I do not take the rather sanguine view put forward by the Minister that soon we shall have the end of rating as such and that some new system for the collection of taxation for local government will be found. I suspect that this has echoed through every rating debate during this
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  century, and for those who are at present Members of the House of Commons it may well be a perennial debate for many years. I think that rates are with us and are likely to stay with us for a considerable length of time.
  If that is the position, the Bill must be looked at in a very different light from that put forward by the Minister. Undoubtedly the Bill arises from the anger—I do not think that is too strong a word—occasioned by the revaluation early in the 'sixties. That revaluation was not unfair in itself. It became unfair only because it had been delayed for so long and people had become used to the rates, and when they were changed the unfairness brought about large differences and there were tremendous increases in the rates paid as between one area and another.
  This was particularly so in a number of seaside towns, such as Blackpool and Brighton, and other retirement towns. The hon. Member for Glasgow, Provan (Mr. Hugh D. Brown) queried why a number of my hon. Friends have raised in particular the plight of those living in seaside towns. The truth is that rates bear most hardly upon the retired and those who are either incapable of earning a large sum of money or have a very small income, a stratum of society often looked after by National Assistance. To the person in steady work able to improve his earnings year by year, rates are not an insuperable problem, or at any rate no greater than the problem of many of the other rises in costs which occur. So we have a particular problem, and those of us who represent such areas must recognise that there is a particular problem in relation to retirement. Not only are rates likely to be a continuing factor in our life. Inflation is also likely to be a continuing factor, regardless of what any party may say. Where such conditions exist, those who retire on a retirement pension or other fixed income and may live for 20 or 30 years will be particularly hard hit.
  If that is the position, what are we doing tonight? We are adding an anomaly. I will not go into the details of the Bill, but we are asking, in part at least, those who may well not have a great deal more than those we seek to help to bear 25 per cent. of the burden through helping the others. Undoubtedly

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  the Bill and its intention can be commended, but I find very great difficulty in seeing why, when the whole object is to help those who need assistance because their income is too small, the Government should point to this aspect of our national life and say, "We will help with the rates." Why the rates? This is no different from the necessity to help in many different fields. I should have thought—I echo the view expressed on both sides of the House—that the time had now come when we ought to deal with the whole problem of rebates, which Governments are giving to people in all fields, not just rating, and do so by means of a universal system applied to people who need rebates whether for rates or some other service. It should be applied universally.
  I do not want to go into the considerable difficulties that the Bill is likely to present to local authority treasurers. It is not the small Bill we thought it would be. It is highly complex. It will create a considerable amount of work in local authority treasurers' offices. How will local authority treasurers satisfy themselves that people qualify for the rebates? One has only to think of the difficulties that them may be in collection. People may insist upon paying their rates month by month. This will inevitably place an extra burden on the local authority staff, and the extra costs will fall on other ratepayers.
  All those matters have been dealt with, and so I content myself with the fundamental point that this is simply another patching operation. A number of hon. Members have suggested that this is to be the end of it all and that very soon there will be a change and we shall be able to get rid of the rates and have another system in place of the present one. Why people always think that new systems will be much better I do not know. The money that is required will have to be paid, and it will cost just as much. I think it likely that we shall be stuck with the rating system for many years.
  Although the House will undoubtedly let the Bill go through without a Division tonight, it would be wrong for us not to recognise what we are doing, once again patching and adding anomalies when we ought really to be looking not to the patching up of our various pieces of
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  legislation, trying to shore them up here and there, not to ways in which we can give rebates to persons in difficulty, but to devising a universal system of rebates to meet the need in respect of not just rates but many other spheres of life. Certainly no one will oppose the Bill, but it would be wrong to say that I welcome it.
  8.29 p.m.
  Mr. Denis Hobden: I welcome the Bill, as will anyone who comes from an area like Brighton, which has been hard hit by the rating revaluation. Many of us realise that it might be a long time before we see a solution to this vexed problem and I confess that I have spent many moments of impatience, as my right hon. Friend will testify, wondering when the Government would get down to the problem of solving the iniquitous system of rating.
  I have received more letters on this subject from my constituents than on any other matter. I have been under constant pressure from them. But today we begin to see the end of the road, although I realise that at this stage we are dealing with the subject only in part because of the particular urgency of this single aspect.
  As has been said many times, rating is a regressive system and while it may be true that it does not on average take a higher proportion of our income than it did, it is clear that certain categories suffer tremendous hardship. We are forcibly reminded of this by the Allen Report, which draws attention to the fact that the poor are worst hit. Its example shows that a person receiving £30 a week pays 2 per cent. of his income in rates while the person receiving £6 a week pays an average of 8 per cent. in rates. That has been pointed out before but it needs much repetition for the impact to be felt to the full. It is an indication of the problem. On 29th November, The Guardian stated that
  "… the rate rebate scheme is the first stage in the Minister's campaign to make our system of local government finance fairer and more orderly."
  I speak with some feeling on this matter. As an owner-occupier and, before October, 1964, as an average salary earner, I experienced the drastic effect of the revaluation. My rates increased by

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  over 50 per cent. per annum. Nevertheless, despite what this meant to me personally, I could not but remember time and again how much more those on small fixed incomes must be suffering—the pensioners of all types or those in humble jobs forced to buy their homes because rented accommodation was not available or children were not allowed.
  It is not right that elderly people should have such worries, and many of them have been to see me at my "surgery". I am sure that all other hon. Members have had the same experience. These people have come almost demented with worry wondering how they could meet the financial burden thrust upon them every year. When the rates are due to be fixed each year they wait for the outcome with trepidation, wondering how much bigger the new burden will be.
  There is also in Brighton a special category. These people are known as "self builders". There are many in my constituency. These are people who have taken two or three years literally building their own homes in their spare time under professional guidance. They are not wealthy people. They belong to low income groups. They have despaired of being able to buy their own homes. Some of them have been living in council houses and thus make room on the council waiting list by moving into their self-built houses.
  What has been their reward? After years of back-breaking work building their own homes, after trying to assess the family income and taking on the responsibility of a mortgage, they have found a disproportionate rate burden on top of their self-accepted mortgage commitments. I find that those involved in the most recently completed "self-build" scheme face a rate bill of £2 a week, which represents, to people in their income group, a disaster to the family budget. It is scandalous.
  It is too soon to know the precise way in which the Bill will assist all those in the categories that I have mentioned. But I hope, if all of them are not entitled to assistance at this stage, that I will be in order in saying that all will benefit under the Measure to be brought forward in February. On 27th November, The Times was of the opinion that the rebates would fall on the target area and that the Bill
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  embodies a fair and necessary principle. I want to deal with some criticisms while at the same time making some comments of my own. For instance, it may be true, as the Financial Times indicated recently, that the Bill is a tax concession and that a rebate may by no means be in proportion to hardship. It is difficult, however, to square that view with the comment in The Times that the Bill avoids the hitherto baffling course of defining hardship and then identifying cases of it. As I have said, The Times is of opinion that the rebates will fall in the target area.
  I have read some criticism of the fact that 25 per cent. of the cost of the new scheme will have to come from already overstrained rates. There are two answers to this, but they are not entirely convincing. First, it need not be an addition to the existing rate burdens which, as nobody will deny, are heavy, for pending the overall revision of the local rating system local authorities should trim their sails to make provision for this burden. On 27th November, The Times said:
  "Councils may feel aggrieved at having to raise one-quarter of the total required to match what are mandatory rebates but it is prudent to give them an interest in the scheme's economical administration."
  Nevertheless, I believe that the Minister ought to reconsider this proportion of 75 per cent. to 25 per cent. for reasons to which I shall come later. He should bear in mind that, just as revaluation hit hardest those areas with a high proportion of old people, so will this Measure place additional burdens on the ratepayer at large in those towns like Brighton with a high proportion of elderly people. Quite clearly, grants to local authorities for the elderly should take that into consideration. It seems odd, to say the least, that those who have been helped through National Assistance from national funds are now to be assisted from the local rates, a procedure from which we surely want to get away.
  I have also seen some criticism that those just outside the income limit will be hardest hit. This is a ridiculous proposition, although there may be some fact in it, for with any Measure which attempts to deal out rough justice on a matter of such magnitude there will always be someone left out wherever the line is drawn, and if there were good objections

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  on those grounds we would never do anything.
  I have also seen the criticism, the most banal of the lot, that by extending the principle of paying rates by instalments more town hall staff will be needed and therefore more rates will have to be gathered. This is a defeatist argument. I he principle of paying rates by instalments ought to have been a right years ago and ratepayers for too long have been the victims of local councils who think nothing of squandering thousands of pounds on crackpot schemes, yet begrudge the money to initiate a just system of collection of the very money which they require. This surely is a wrong sense of priorities which is now to be put right.
  There is one other point with which I want to deal and which it may be possible to iron out in Committee. Clause 3(2,b) appears to mean that if some poor old lady does not become aware that she can claim a rebate after 30th April, she must automatically be denied a proportion of the amount which would otherwise he due to her for that period. Indeed, if the thought does not occur to her until September, she will get no rebate for the half year. Why should a local authority be forced to deny a rebate in those circumstances? That would be iniquitous.
  At the same time, the period of one month after the beginning of the rate period is far too short. It is quite possible that many people will not apply for a rebate until after getting their rate demands and in many cases this will not happen until well into April, as in some towns the issue of accounts is spread over a number of weeks to avoid getting out a flood at the rate office at any one time. As the Clause is drafted, a number of deserving people may not get rebates which the Government intend they should have.
  Those are my few observations on a Bill which I welcome. I hope that they will not be considered to be carping criticisms, because, whatever else one may say of the Bill, it is immeasurably superior to the miserable and irrelevant Rating (Interim Relief) Act introduced by the Conservative Party when in office.
  8.40 p.m.
  Mr. Philip Goodhart: I was pleased to see the right hon. Member for Llanelly (Mr. James Griffiths)
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  present during the Minister's speech and, from time to time, during the debate. One of the first political meetings I ever attended was addressed by the right hon. Gentleman, when he described the iniquities of the means test. At that time, some 18 years ago, he was at the height of his oratorical powers and before very long he had reduced the audience to a soggy mass.
  This afternoon the Minister has introduced a Bill which contains the most widespread, sweeping and rigid means test that we are likely to see for many a year. I do not want to salute him for introducing it, but I do want to salute him for passing one mild step in the long history of taxation stretching back, as it does, to the days of the Babylonians. He says that £29 million in rents is not going to be acquired by local authorities. According to the Association of Municipal Corporations, which has expert knowledge in this field, not acquiring this amount is going to cost an extra £3 million which is surely an astonishing state of affairs. This is borne out by what I am able to gather from the experts in my own borough of Bromley, on the effect of the Bill there.
  Mr. Julius Silverman: Whether the hon. Gentleman is right or wrong about the sum of £3 million, he is presumably including the cost of collection under the instalment scheme, which has nothing whatever to do with the rate rebates.
  Mr. Goodhart: Clauses 1 and 2, as I understand it, deal with this. That is included in the estimate.
  Mr. Crossman: I think the hon. Member may be wrong. I do not know whether he has made a careful estimate of the relative cost of the instalment plan and the rebates, but the instalment plan, as I frankly admit, is by no means cheap. It is something which we have to cost up. I did not think that he was going to oppose that as well.
  Mr. Goodhart: May I give the local figures which I acquired? Bromley already runs an instalment scheme for the payment of rates. It is not as good as that proposed in that it does not allow as many instalment payments. According to the estimates I received from the borough treasurer, the new

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  instalment scheme is likely to result in increased charges, and its cost is about £5,000 a year, whereas the collection or rather the non-collection of the rebates is going to cost much more. Certainly it is going to mean an extra staff of 12 to 15 people in the salary range of £1,000 to £1,500 a year to run the scheme.
  Mr. Crossman: What the hon. Member is now telling us is interesting. It is that in a borough which already has an instalment scheme it will cost relatively little to expand it into an efficient one of the standard we require. But since the borough has no rebate scheme, it will cost it a great deal more to introduce one. This seems to be true. There might be another borough, such as Birmingham, which is already operating a very good rebate scheme, which will find that the cost will be much less to introduce both instalment and rebate schemes. This is quite right. What is the hon. Member trying to argue? That we should not make the system, or that we should?
  Mr. Goodhart: I am arguing that the Minister's scheme will be extremely expensive and that in the Borough of Bromley 12 to 15 extra staff in the salary range £1,000 to £1,500 will be needed, and it will be difficult to acquire them in view of the reorganisation problems which we have had in Greater London.
  Mr. Julius Silverman Mr. Julius Silverman rose—
  Mr. Goodhart: I should get on because one or two other hon. Members wish to speak before we have the wind up speeches.
  Not only do these 12 to 15 people have to be recruited and paid; they have to be accommodated, heated, equipped and, no doubt, offered secretarial assistance. Overall, the cost of the administration in Bromley is likely to be at least £30,000, or a halfpenny rate.
  In Committee the burden which will be put on the administrative staff and the administrative side of the scheme must be tightened. It seems to me that it is extraordinarily loose. As a very large number of people will apply for relief under the scheme—and I would estimate that, locally, of 90,000 ratepayers at least 8,000 will apply—there will be a considerable amount of dispute
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  about the merits of many cases. As far as I can make out, there is no form of appeal machinery proposed for dealing with disputes about the facts. In fact, a considerable degree of judgment will be required.
  Clause 5(7) provides:
  "For the purposes of this section, an applicant shall be treated as living with his spouse at any time unless at that time either—

  (a) they are separated under an order of a court of competent jurisdiction or by deed of separation; or

  (b) they are in fact separated in such circumstances that the separation is likely to be permanent."

  I am absolutely astonished that officials of the borough treasurer, who presumably under the Bill are "competent" people, should be asked to judge whether a person should get a rebate according to the matrimonial state of the ratepayers of Bromley. This sort of thing must be tightened up in Committee.
  The Bill will be of considerable benefit to thousands of ratepayers in the Borough of Bromley. But it will confuse and perplex several thousands of other ratepayers because of the complexity of its wording and the mathematical computations which will have to be made. In addition, it will put an increased burden on about 80,000 ratepayers in Bromley whose incomes are only just larger than the incomes of people who will get the relief under the Bill. I do not think that this is what the electorate thought would come when the Labour Party said at the last election that there would be an early transfer of taxation from local rates to the central Exchequer.
  This scheme will add 2d. to the local rates. In addition, the increased loan charges enforced by the central Government since the beginning of the year will add another 2d. to the local rates. To that can be added the extra 10 per cent. about which the Minister has been talking so airily this afternoon. Within two years therefore, we are faced with a rate increase of no less than 24 per cent. That is a pretty rough record. It is a pretty rough prospect and, as the Minister himself said about his own Bill, it is a pretty rough Measure.
  8.51 p.m.
  Mr. Eric Ogden: This will be a very truncated version of what might have been one of

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  the best speeches ever delivered in the House of Commons. I do not say "would have been", but simply that it might have been.
  I should like to think that I have some little responsibility in the business which is today before the House. Right hon. and hon. Members may have noticed early clay Motion No. 17, signed by a number of my hon. Friends and myself. For the benefit of those who have not seen it, I quote from it:
  "That this House welcomes the undertaking by Her Majesty's Government to introduce legislation in this Session to establish a new system of Exchequer subsidies for local authority housing, to provide means to lesson the injustices of the rating system and to limit the burden of rates …"
  Within one week of the appearance of that Motion on the Order Paper, we had the publication of the Bill. Within two weeks of its appearance, we have Second Reading. I should like to hope that any future Motion which I and my hon. Friends put down will receive similar consideration from the Government.
  In a moving peroration, the hon. Member for Harwich (Mr. Ridsdale) urged my right hon. Friend the Minister "to face reality". He then asked "that we should mend tie hole in the dam before the water overflows in the spiral of rising prices". I did not quite follow that one. One reality which the hon. Member did riot mention is that from October, when the Parliamentary Session begins and the House reassembles, to January and February, when rate levies are fixed by the local authorities, and to April, when the rates are levied, we have a period of only five months, little time enough to introduce major legislation, to carry it through and to bring it into operation.
  How much better it would have been for local authorities if the General Election of October, 1964, had been held in June, 1964, when we would have had 10 months to introduce legislation and to make it effective in the following April. My policy is to make the best of what we have before us.
  I should like to put one or two questions to my right hon. Friend the Minister. Perhaps he will take a note of them so that he can, perhaps, give us written replies. [Laughter.] Obviously, he cannot take them all tonight. My first question concerns the allowance for
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  schoolchildren or children under school age. Does this include also those at university or college? Are these, in fact, non-earning children. What is the position of unemployed children? Can they be taken into account? If so, for what length of time have they to be unemployed?
  My next question relates to the position of lodgers or paying guests. It depends what part of the country one comes from whether one has a lodger or a paying guest. One Press report which I have read stated that the income from a lodger or paying guest will not be taken into account. The next Press report, however, said that it would be taken into account.
  Mr. Crossman: It is not taken into account.
  Mr. Ogden: My landlady will be most pleased.
  Thirdly, looking ahead a little, how does my right hon. Friend intend to publicise the Bill when it becomes an Act? Are we to follow the example of many other Ministries which publish booklets or other papers? People in need have the right to know what help is available.
  The point has been made from the other side of the House in connection with the Bill that there has been no time to consult local authorities. There has been time enough.
  We had some information already from the reports before us. The Municipal Review of April, 1965, gave the point of view of the Association of Municipal Corporations. I shall not endeavour at this time to read extracts from that. I have consulted some of the borough treasurers in the areas near where I live and they are concerned about the cost of investigation of applications and they estimate that the cost of the instalment system will work out at a 1d. rate, and then there is the cost and difficulty of getting additional staff.
  This has been emphasised by my own local authority which was good enough to let me have its point of view, and this I will quote:
  "You will understand that at this juncture it is extremely difficult to forecast the cost of rate rebates since we have little reliable information about the levels of incomes of our ratepayers. The best estimate I have been able to formulate so far is that the cost will be between

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  £500,000 and £600,000 per annum, which Exchequer grant of 75 per cent. will reduce to £150,000. Even after taking into account rate deficiency grant this would still involve a rate of about 1d. in the £ What concerns"—
  the treasurer—
  "even more than the cost of the rebates themselves is the amount of administrative effort which is going to be involved in dealing not only with claims for rate rebate but also the mandatory system of payment by instalments."
  In the City of Liverpool we estimate we may require an additional staff of up to 50 persons. Then the recruitment of suitable staff has been very difficult for the past year or two and there is doubt about getting all the people they need. Many local authorities, I am informed,
  "are greatly concerned about this problem and some have been heard to say that the additional staff required will offset, or even wipe out, the economies made in recent years by mechanisation of rating work…. You will understand that the cost of additional staff required here is not likely to be much less than £50,000 per annum, the equivalent of ½d. rate. … The finding of accommodation for the additional staff will also pose a considerable problem."
  The writer concludes by saying:
  "I hope that what I have said will be of some interest and assistance to you. Certainly you will be in no doubt that the pending legislation will impose some heavy burdens upon us."
  The Minister knows Liverpool well, and he will know the special needs and special problems of the area. While we welcome this Bill, which deals with special hardship, it is very doubtful, in present circumstances, whether we can afford this in the City of Liverpool. What we really require is some urgent, massive aid to deal with the whole of the rating burden, and, if possible, before April, 1966.
  8.58 p.m.
  Sir Anthony Meyer: My remarks will be very brief. I shall not be so rude about the Bill as the hon. Gentleman the Member for Liverpool, West Derby (Mr. Ogden). I shall not even be so rude about it as the right hon. Gentleman himself in presenting it. He presented it with growing distaste which, by the end, amounted almost to nausea. He admitted, I think, that he was putting the cart before the horse. I think he rather got the meal bucket before the cart.
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  What bothers me about the Bill is the impact which it will have on certain local authorities. There are only two local authorities in my constituency, Slough and Eton. Rather surprisingly to those who are only superficially acquainted with them, Slough is the rich one, Eton is the poor one, and Eton people came to me saying that they expected that about 25 per cent. of the ratepayers will be entitled to relief and that this will impose a very heavy burden on the local authority which has extremely few resources with which to meet it.
  In passing I may say how surprised I am that the Government have not yet got around to the fact that Eton, like a great many other public schools, is rated as a charity. I hope no one will be surprised that I should sneak on Eton in this way—because they all vote Socialist anyway. The townspeople who vote Tory are the ones who are hit by this particular arrangement.
  As a result of the way in which the Bill is framed it means that a heavy burden will be placed on those authorities least able to bear it. It is rather a case of taking away from those that have not and giving to those that have, at any rate as regards local authorities.
  I very much regret that the Government have missed an opportunity of moving towards a simpler system of providing relief for the needy and have not taken advantage of the opportunity offered of using the services of the National Assistance Board. I believe that if we had brought the National Assistance Board in on the operation, it would have been of further help in bringing down the psychological barriers which a great many people feel about going to the National Assistance Board for the help which it is their right to ask for.
  It is not only a question of bringing down the psychological barriers, because the people who need help most are very often the people who are least aware of where that help may be found. What we seem to be doing in the Bill is creating yet another source of relief for the needy and something else to confuse old people who get muddled between the Citizens' Advice Bureau, the National Assistance Board, the town hall, and local charities, and do not know where to turn for the help which is the one thing

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  that they do know they need. If instead of this very unsatisfactory hotchpotch the Government had used the services of the National Assistance Board, they would not only have saved vast sums in the way of expenditure—[Interruption.] Hon. Gentlemen opposite make indignant noises, but surely all of us in the House want to bring down the idea that there is any kind of disgrace in going to the National Assistance Board. We want to accustom people to the idea that the National Assistance Board is a friendly institution to which they can turn in need. That is why I am glad that my own party came out with proposals to put the onus upon the Board to go out and find cases of distress, because I am sure that that is the right approach.
  If we make the National Assistance Board human and a centre to which anyone can turn who has need of any kind, not only will we ensure that the need is met much more satisfactorily, but we shall effect enormous economies in providing for those needs. So I do not pretend to any kind of enthusiasm for the Bill which is in front of us today. Obviously, we are not going to oppose it—
  Mr. Crossman: Why?
  Sir A. Meyer: —because everyone admits that it is urgent to bring help to people who are in need. If the Bill is the best that the Government can do after 14 months of cogitating, we are not going to send them back to do their homework again. They have done their homework very badly, but time is getting short, and they had better get on with it as best they can. However, if we can improve the Bill in Committee, we shall do so.
  9.3 p.m.
  Mrs. Margaret Thatcher: It is my pleasant privilege to congratulate the hon. Member for Erith and Crayford (Mr. Wellbeloved) on his excellent maiden speech. I do so with special pleasure because his seat was the first one that I fought, and therefore I did my best to prevent his coming to the House. I fought his predecessor in 1950 and 1951, and the hon. Gentleman will be glad to know that I had the same respect and liking for his predecessor as he showed.
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  Another reason for my special pleasure in congratulating him is that my husband has a factory in Erith, and therefore I am very glad that the hon. Gentleman has chosen a debate on rates for his maiden speech. It might be said in one sense that I am wedded to the problems of Erith, and in that capacity I would tell him that the rates on industrial hereditaments are very high. I hope that we will hear often from the hon. Gentleman. Perhaps I should inform him that his predecessor made fairly brief speeches, and I noticed that he followed that example.
  I come to the Bill. Always in the House when we have a debate on the rating system or on any Measure affecting it, we find that the word "iniquities" is rather over-used. We have had a special lot of iniquities mentioned today and I would, therefore, like to begin by quoting from the Allen Report, extracts which have been conspicuous by their absence in debate today. Paragraph 346, Chapter 15, stated in the summary and findings:
  "Looking at rates as a form of taxation … we find that domestic rates are less now than before the last war, as a proportion of all local authority expenditure, or of all personal incomes, or of total taxes."
  Listening to the debate today, one would expect that the reverse was the case.
  Mr. Park: I regret that the hon. Lady did not see fit to quote the whole of that paragraph from the Allen Report, for it goes on to say that while rates are a lower proportion than was the case prewar:
  "The proportion, however, has been rising in recent years. We received evidence that this recent trend, and the prospect that it would continue, is of concern to many ratepayers today."
  Is that not precisely what we have been discussing?
  Mrs. Thatcher: I entirely agree. I did not quote the whole of the paragraph because I wished to save the time of the House. In any case, the hon. Gentleman has quoted the remainder of it and he will see that although it has been rising, in particular since 1957 when we had a tremendous education drive, it still has not reached the same proportion of taxed income and personal expenditure as it did in pre-war days. That is significant.

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  It looks as though it is going to, and perhaps this year and next year it will—although we cannot be blamed for that.
  Among other statistics, one can see that more than half of local expenditure is already borne by the taxpayer while the other half is only part borne by the ratepayer, for about 50 per cent. of that half is borne by industrial and commercial properties. Thus, of local authority expenditure, only about a quarter, taking the country as a whole, is met by the domestic ratepayer. I have begun by giving these statistics to try to put the problem in perspective because at times I thought that we have been getting the matter a little out of perspective.
  I will make a few general observations on the kind of characteristics which one would require for a scheme of domestic rate relief. I suggest that such a scheme should have three characterisics. It should be completely comprehensible to the potential beneficiaries, it should be easy to operate and be administratively inexpensive and local authorities should not be penalised because they happen to have a disproportionately high number of elderly or retired people in their areas who might be expected to benefit under a rate relief scheme. By these tests the Bill does not come out very well. We approve very much the principle of a rate rebate scheme, but, as I say, by these three tests this Measure does not at the moment come out with flying colours.
  A number of hon. Members have referred to the question of hardship in connection with National Assistance. I agree with the Minister that in Committee we shall have to insert words which are clearer than the present provisions and which will enable local authorities either to refuse rebates to those who are at present receiving National Assistance or enable them to inquire the source of income, whether it comes from National Assistance, when a person makes application. Otherwise, I can imagine a person going to a local authority and saying, "I have an income of £7 10s. a week. I want a rebate." The local authority will not be able to ask if the income comes from National Assistance and unless we cover this point there will be considerable difficulty about the inter-
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  action between the two. We shall have to take great care also in operating the scheme, remembering that the dislike of this form of National Assistance started not with the National Assistance Scheme but when it had a local element. It started as dislike of a public assistance scheme, and the thing in public assistance that people disliked—
  Mr. Julius Silverman: And Poor Law before that.
  Mrs. Thatcher: Yes, and before that the Poor Law—was going to local people whom they knew in order to ask their help. They did not like local people knowing their circumstances, and I put the latter factor rather more highly than I do the first.
  In this Bill, therefore, we must be extremely careful that people do not shy away even more from going to a local authority than they would from going to a national authority, which means that it is particularly important that the rules of confidentiality should be adhered to very strictly. I understand that in rent rebate schemes these people have been dealt with by code numbers by the officials of the local authority. This is an excellent method, and one that gives people confidence that their anonymity will be strictly preserved, and that no one will know by name who has applied for the relief.
  We have heard a number of hard words about the Rating (Interim Relief) Act, but I notice that this Bill does not repeal that Act. As far as I can make out, there are probably two reasons for that, one of which would have been advanced by my hon. Friend the Member for Worthing (Mr. Higgins) had he been fortunate enough to catch your eye, Mr. Deputy Speaker. By Section 1 of that Act, very considerable grants—up to £6 million in all—are given to local authorities which have a higher-than-average proportion of old people. If the Act were repealed that £6 million would go, and those local authorities—and the large number of old people who benefit—would have to find their income from the rates instead of from grants.
  The relief to which the Minister referred, which was 50 per cent. and 50 per cent. in the first instance, and 66⅔ per cent. and 33⅓ per cent. in certain

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  exceptions, came under Section 2, but one found that what happened was that the local authority was given a very considerable grant under Section 1, and if it also spent extra money it was given a part-grant under Section 2. As things turned out, the grants under Section 2 were very small, but no one could tell how things would turn out when we debated the Measure. Indeed, going through the debate, I noticed that the present Foreign Secretary thought that as high a proportion as 80 per cent. of the ratepayers in certain areas might have been eligible for relief. As it turned out, they were not, so only about £100,000 was dispersed under Section 2. Nevertheless, that Act was, and is, extremely valuable. There is a definite reason for its not being abolished, and for the Minister to say that it does not matter when some £6 million is involved would, I think, strike fear into the hearts of local authorities.
  I turn from that point to the financing of the scheme. I leave Scotland for the time being—the Secretary of State for Scotland is mumbling on the Front Bench—
  The Secretary of State for Scotland (Mr. William Ross): I was merely saying to my hon. Friend the Member for Paisley (Mr. John Robertson) that the benefit the hon. Lady mentions does not apply to Scotland.
  Mrs. Thatcher: I am glad we still keep some money in England. Nevertheless, the right hon. Gentleman reminds me that an extra £ million for Scotland was mentioned earlier under a separate scheme. However, I leave the Secretary of State to fight that out with my right hon. Friend.
  The financing of the provisions of the Bill has already been referred to, and I will not dwell on it for too long. Undoubtedly the defect and I use the word "defect" advisedly—of the scheme is that in order to give relief to some it will impose penalties on others. This, I am afraid, will come particularly harshly on those who just escape relief. It is not that they will not get the relief but that they will have to pay more in rates because of the relief which has been afforded to others.
  I entirely agree with the sentiments which most hon. Members have expressed to the effect that the
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  Exchequer should pay for the financing of the scheme. This is quite different from the interim rating relief scheme because in that a considerable discretion was given to local authorities. As it happened, they did not use it, but the local authority's stake in the provisions of that Act was reflected by the discretion given to local authorities to operate the scheme. Here no discretion is given to local authorities. Therefore, one would expect that the whole amount should be met by the Exchequer.
  We should not underestimate the problem of finding not only the number of extra staff to operate the rebate scheme but finding the quality of staff which will be required. A large number of people will probably apply for rebate and not all will be entitled to rebate. The method of deciding whether they are entitled or not is very important indeed. For National Assistance every applicant has a personal interview. That is carried out by highly skilled people. It is carried out very sympathetically indeed. It will not be possible to interview every person for a rate rebate scheme. This will mean that the first form will have to be drafted very carefully in order to get the maximum information about income.
  After that has been filled up a certain number of people will have to be interviewed. The Bill is mainly to benefit older people. They often have a fear of form-filling. As soon as a form comes through the door they find they are almost incapable of filling it up because they are mesmerised by fear. Their first reaction is, "What do they want to know now?" A great deal of interviewing will have to be done and it will not be easy for local authorities to find the staff to deal with these people in the right way. I do not make too much of this point because it is one which we would have to face in any event if we agree in principle to a rate rebate scheme and also to an instalment system.
  Clause 5 of the Bill deals with reckonable income. Income on which entitlement to relief is assessed relates to a period which ends three months before that for which relief is given. One may secure title to a rebate during a period in which one's income happens to be low. That rebate might be granted during a period in which one's income has recovered. This seems very strange indeed. One would

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  have expected that there would be a Clause providing that if there is any material change in income between the base period for assessment of income and the period for which the rebate is granted the applicant should have to notify the authority and the authority could cancel the relief. Otherwise we shall find that when the income is low one will get relief which might operate during a period when one's income is high. It might operate in the opposite way as well.
  This would not seem the wisest use of public money nor the best possible system. My hon. Friend the Member for the Isle of Thanet (Mr. Rees-Davies) referred to this anomaly in relation to seasonal workers. Many hon. Members from Scottish constituencies will know of difficulties about seasonal workers. It is obvious that if the rate rebate period is divided into two and income is calculated not by reference to a year but to a six-monthly period, those in seasonal work will be able so to arrange affairs that they can claim a rate rebate in alternate periods of six months. It may be that one would have to have a provision for averaging out the income in such cases.
  A second point which arises in connection with reckonable income is, what is income? As the Minister said, it is not defined anywhere in the Bill. I take it from what he said that it is not equivalent to taxable income. Would he indicate whether that is so?
  Mr. Crossman: It is more than taxable income.
  Mrs. Thatcher: In such cases war pensions would rank as income. They do not rank as taxable income. Sickness benefit and injury benefit are not taxable income, but presumably they rank as income for this purpose. What about income on National Savings Certificates? I do not think that the right hon. Gentleman knows exactly what income is for this purpose.
  Mr. Crossman: We had better leave the details, but interest on capital, as I made clear, would count as income—but not the capital. The interest on National Savings Certificates will count but not the National Savings Certificates. The hon. Lady is making it rather difficult, but, in fact, it is simple.
  Mrs. Thatcher: I assure the right hon. Gentleman that it is a considerable departure from usual policy if interest on National Savings Certificates is to be counted as income. The right hon. Gentleman said that income in this case meant more than taxable income. Perhaps we can get this sorted out later. I have used it as an example because I should have thought that details such as his would have been worked out beforehand.
  So much for reckonable income. I come to reckonable rates—that is, the amount of rates which a person may well be liable to pay and which is calculated by reference to a different period from reckonable income. I refer to Clause 4(4) from which it appears that if a person has another adult living in the house, that affects the reckonable rate. The reckonable rate is calculated not by reference to a period ending several months before the period in which the rate rebate is due. It is calculated by reference to the date of the application for the rebate. Reckonable income is therefore calculated by reference to a different period from reckonable rate.
  We come, then, to a third different period, because instalments are calculated by reference to a third period—not a six-month period but an annual period. One may well get difficulties where the rate rebate applies for a six-month period but the instalments have to be calculated over a twelve-month period. Presumably one does not assume, without a Clause in the Bill enabling one to assume, that the rate rebate will continue after the six-month period. If, therefore, a person applies for a rebate and also applies for the residual rate to be paid by instalments, we must calculate the instalments by reference to a rebated period of rates followed by a full period of rates. We shall therefore find that someone is paying more in instalments in the first six months than he needs to pay. [HON. MEMBERS: "Oh."] I do not think that hon. Members opposite have thought this Bill out at all. Let me give an example. This example, and a number of other points, were provided to me by the Institute of Municipal Treasurers whose members, one would have thought, knew what they were talking about.
  The Institute says:
  "The instalments provisions are to be calculated by reference to the annual rate period

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  whilst the provisions in regard to rebate are calculated by reference to a period of six months. This could have the result of requiring instalment payments during the first half of the year of such amounts as could make it necessary to effect a repayment during the second half of year, and this is illustrated by the following example."
  It then goes on to give an example which I think is too long to quote but which I will send to the right hon. Gentleman. It makes the ponit which I have just made.
  It seems to me, therefore, that there are several periods in the Bill. There is the reckonable income for one period, the reckonable rate for another. The rate rebate period is yet a third period, and the fourth period is the instalment period. This is quite a system and it certainly is not one that could be understood by the potential beneficiaries.
  When we were discussing the Rating (Interim Relief) Act the present Foreign Secretary suggested that the provisions in it might be replaced by algebraic symbols. I should have thought that as there were so many variables in the present Bill they might have been just as well expressed by the integral and differential calculus because one has to make up the sum of so many different things if one wants to find the result.
  I turn now to what the Minister said at the beginning of his speech. The key to it was the viewpoint expressed by my hon. Friend the Member for Oxford (Mr. Woodhouse) who spoke while the Minister was not present. My hon. Friend said that ever since he had been a pupil of the right hon. Gentleman he had had the one very considerable difficulty that he could never tell whether the right hon. Gentleman meant what he said. We have also experienced the same difficulty because the right hon. Gentleman says different things on different days about the same matter. On 5th May, for example, when we had a debate on rates he said:
  "It is … unlikely that any Government can rapidly switch from rates to a local tax. We have got to face that as something which cannot be done."—[OFFICIAL REPORT, 5th May, 1965; Vol. 711, c. 1492.]
  On 2nd December the right hon. Gentleman was reported as saying that the Government
  "want to get rid of the rates system altogether and replace it with a system of local taxation."
  I should have thought that to some extent those were mutually contradictory. [HON.
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  MEMBERS: "No."] But there is a better one. [An HON. MEMBER: "From the Central Office?"] I did not have any material at all from the Central Office. I did not ask for it. I had most of the material from the Institute of Municipal Treasurers.
  The right hon. Gentleman was speaking about the rate deficiency grant, which we were told in this Bill would be increased to take into account the extra administrative expenses for those areas which are entitled to rate deficiency grant. The right hon. Gentleman made some reference to this in his opening remarks today but also on 5th May he said, talking about the rate deficiency grant,
  "I think that we shall scrap it. It is another of the things which will go, because it is no good."—[OFFICIAL REPORT, 5th May, 1965; Vol. 711, c. 1496.]
  The right hon. Gentleman was then going to scrap it. He is now going to increase it for the administrative costs of this Bill. The right hon. Gentleman is very anxious to abolish—
  Mr. Crossman: I am always patiently willing to help the hon. Lady as far as I can. I said that as from today the old rate deficiency grant, which is there now, will assist with the burden of administrative costs as long as it is there. As I told her, we are also preparing a second Bill in which we shall revise the grant system and she will find there that the rate deficiency grant is modified in certain particulars to take account of the criticisms I made at that time.
  Mrs. Thatcher: I see. It is not going to be scrapped now, it is going to be modified.
  As for my third quotation—I know that the right hon. Gentleman does not quite like quotations from The Times—he is concentrating now on saying that he will abolish something before we are certain what he is to put in its place. It is really inexcusable for a Minister to say that he intends to abolish a particular system before we can judge the relative merit of the system which he will put in its place.
  The Financial Times summed up the position very well in a leading article on Saturday, 27th November, headed "Mr. Crossman's Cherry",
  "Assuming that Mr. Crossman is granted time to finish the meal, and that he manages

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  it—he has so far shown a brilliant ability to ask the right questions, but we have yet to judge the quality of his answers …"
  My advice to the right hon. Gentleman, if it is not trying to teach an old dog new tricks, which, of course would be quite impossible, is that until he has something to put in its place it is as well to keep the rating system in order to work extremely well. It is most significant that he is abandoning a revaluation, which is fundamental to keeping the rating system up to date and in order. One of the reasons why he is abandoning it is in order to collect a much smaller tax. Let us keep the system which collects some £1,000 million a year up to date and in order.
  Mr. Crossman Mr. Crossman rose—
  Mrs. Thatcher: The right hon. Gentleman's hon. Friend the Under-Secretary of State for Scotland will have the Floor in a moment.
  The right hon. Gentleman called this Bill rough and ready justice. We like the bits which are justice. We do not like the bits which are rough and ready.
  9.32 p.m.
  The Under-Secretary of State for Scotland (Dr. J. Dickson Mabon): We all congratulate the hon. Lady the Member for Finchley (Mrs. Thatcher) on a good speech, made all the better, no doubt, for the absence of Tory Central Office briefing. Her quotation from the Financial Times was a nice conclusion to a delightful speech.
  First, I join the hon. Lady in the fine praise which she gave to my hon. Friend the Member for Erith and Crayford (Mr. Wellbeloved) on his maiden speech. We all miss Norman Dodds. In the 10 years I have been in the House, I counted Norman as one of my very good friends and I miss him greatly. But we have in my hon. Friend the new Member for Erith and Crayford a worthy successor and one who will pursue in the same tone of public service the welfare of his constituency and, at the same time, the wellbeing and good sense of the House of Commons. My hon. Friend—I envy his name, a most desirable name for a politician—made a very good suggestion in his reference to publicity. This is something which my right hon. Friend the Secretary of State for Scotland as well
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  as the Minister of Housing and Local Government accepts. It raises one comment on the Rating (Interim Relief) Act, 1964, which the last Government passed in a great hurry. They got it through, incidentally, with a speed which makes this Bill look like a tortoise. [Interruption.] A tortoise is a very slow animal, if the Opposition Chief Whip does not know. Perhaps it is my good Scottish pronunciation of an English word which confuses him. I think he has got it now.
  The Rating and Valuation Association had some criticisms to make of the Rating (Interim Relief) Act, 1964, and catalogued them very well on page 8 of its memorandum issued in August, just before the election, to show the effect of that Measure and whether or not it had worked. I take the point which my hon. Friend made about publicity, which we regard as most important.
  I come now to the points made during the debate. I apologise to my hon. Friends and hon. Members opposite if I do not comment on all the questions which have been raised, and I hope they will acquit me of any discourtesy. We shall take up many of the points in Committee. My hon. Friend the Member for Paisley (Mr. John Robertson) had several observations to make about the Bill, and I am reminded that the hon. Member for Thanet (Mr. Rees-Davies), who is not with us at the moment, said that the Bill ought to have been produced in Gaelic. It is very difficult in a United Kingdom Measure dealing with Scottish and English law to decide how the provisions should be written. My hon. Friend makes a very good point, but I hope that he will accept that we took the right option in this Bill in producing a combined Measure rather than preparing two separate Measures, which would, of course, take a long time.
  We have decided to write the Bill in English legal terms and add an interpretation Clause so that it can be translated into Scottish terms. The alternative would be to write it in Scottish terms and apply a translation into English, but, being generous, the Scots gave way on this and decided that we ought in this British Parliament to write these Acts in English legal terms. But my hon. Friend has a very sound point and one that I am sure

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  that we shall want to take up in Committee, particularly in application of the various English terms in relation to Clause 8.
  The hon. Member for Orpington (Mr. Lubbock) made a very good and very commendable speech. We appreciate his praise of the Bill and shall take to heart his criticisms. He mentioned that certain Clauses needed a great deal more elucidation and could be written better. We are a very tolerant Government. On the most recent rent Bill we worked very hard as a Committee, and from the Committee emerged a better Bill than the one first produced by the Government.
  Mr. Boyd-Carpenter: That was not difficult.
  Dr. Mabon: The right hon. Gentleman played a good part—he must not be uncharitable—in making the Bill better. I am sure that the Government will certainly take into account the representations made in Committee to make the Clauses clearer if that is at all possible without defeating the object of the Bill.
  The hon. Member for Croydon, North-West (Mr. Frederic Harris), the hon. Member for Hove (Mr. Madden), my hon. Friend the Member for Paisley and the hon. Member for Oxford (Mr. Woodhouse) all argued points which were in different ways points of substance. Nevertheless, they were hardly points that we could include in this Bill. The Bill is somewhat limited, and, therefore, it is hardly a vehicle to deal with the apportionment of rates in regard to nationalised industries or the position regarding widows and children in this context. The relationship between the Exchequer equalisation grant and the rate deficiency grant and the average assessment and the apportionment between Scotland and England and Wales—these are valid points to be taken on a major Measure but not on a vehicle like this. Even giving my hon. Friend the Member for Paisley the point that perhaps we might concede something in this regard to answer the begged question in the larger Bill, I am sure that my right hon. Friend would concede that point as a matter of fair argument. The situation is similar with regard to the point about relating relief to universities being Exchequer-borne and not borne by the rate-
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  payers. These are all matters which can be dealt in a major vehicle.
  Different views have been expressed particularly by the right hon. Member for Kingston-on-Thames (Mr. Boyd-Carpenter) on the one side and on the other side mainly hon. Friends of mine about the need for the Bill going to come forward so quickly. The right hon. Gentleman took the view that it was all too hasty, but I think he will be fair and accept the general view that the Bill ought to reach the Statute Book quickly and in time for the next rating year.
  Mr. Boyd-Carpenter: In my speech I said that I understood the desire of the Government to get on with it quickly but that it would have been fairer to the House in those circumstances to have introduced the Bill earlier and enabled hon. Members to have a chance to study it and consult outside bodies, including the local authorities.
  Dr. Mabon: I think that the right hon. Gentleman has to concede, nevertheless, that if one is to consult the local authorities and get the Bill in order and do as much as one can outside the House as well as before the Government present the Bill in draft—it is complicated, as he has admitted, for he said that it was much more complicated than he expected; in spite of its simple principles, it is a more complicated Bill than was envisaged at the beginning—there has to be some compromise between despatching it to the Statute Book in time for the next rating year and getting things in their proper order. There also has to be some element of inconvenience. The Government appreciate this and are sorry that this is the position. But I am sure that in Committee we shall make every endeavour to have the Bill examined as fully and as expeditiously as we can. I know that the right hon. Gentleman is very brief in his arguments, and also very good, and I am sure that his hon. Friends will follow suit and that we shall make good progress on the Bill when we examine it in Committee.
  Mr. Boyd-Carpenter: In view of what the hon. Gentleman has said about the Committee stage and his very courteous admission that we have been greatly hurried over the Second Reading, will

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  he give an undertaking on behalf of the Government that there will be adequate time between this stage and the Committee stage to enable hon. Members on this side who have not so far had the chance of discussing this matter with the local authorities to do so properly and in the detail which his own admission of the complications of the Bill plainly makes necessary?
  Dr. Mabon: So far as is consistent with the urgent need—which is admitted even by some of the right hon. Gentleman's hon. Friends—to get the Bill on the Statute Book in time to be operative for the next rating year. The hon. Member for Orpington put it nicely in English terms. If we do not get on with the matter and have it settled in Parliament by February, it will be ineffective for the next rating year and the responsibility for that will have to be shared by those who, rightly or wrongly, asked for much longer examination and by the Government if we are tardy in moving on with consideration. This has to be faced. Consistent with that point, I agree that we must give everyone concerned the maximum possible time to think about these matters and to consult—as long as the major objective of having the Bill operative for the next rating year is not sacrificed or endangered.
  Quite rightly, the hon. Member for Finchley, at some length defended her party in relation to the Rating (Interim Relief) Act, 1964. The hon. Member for the Isle of Thanet, in an intelligent, well-argued speech, gave us to understand that this Bill was actually Conservative Party policy. He said that, at the last election, he and some of his hon. Friends made this a major issue. Knowing the place he represents, I have no doubt that this was a valid and pertinent course for him to take.
  But in the Conservative and Unionist Association's manifesto at the election, this was not a specific pledge. It was only in October, 1965, indeed, that the hon. Member for Finchley went on record, at the Conservative Party Conference, with the words which I shall quote. They are useful words and I take them from the Conservative Party's "Notes on Current Politics". I assume, therefore, that the report must be accurate, so that she
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  can hardly complain if we put a great deal of emphasis on some of the words used. The "Notes" report:
  "Mrs. Thatcher, Conservative Front Bench spokesman on this subject, proposed
  (a) transfer of about £100 million from rates to taxes"—
  now we know the Conservative attitude to the Bill to be introduced in February—
  "(b) relief of hardship probably through rate rebate schemes, and
  (c) the right to pay rates by more frequent instalments."
  This is the first occasion on which, in party terms, we have had a declaration from the Conservatives that they intend to adopt this policy. I give to the hon. Member for the Isle of Thanet the point that the 1964 Act, which he pressed and supported and which he talked about tonight and claimed should be the basis of this kind of Bill, was designed to last until 1968. This was because, as the right hon. Member for Leeds, North-East (Sir K. Joseph), then the Minister of Housing and Local Government, said, the then Government wanted to see what the Allen Committee said before they began to decide what they should do.
  It is a fair assumption, in view of tonight's speeches, that the Conservatives, had they been in power now, would not have introduced this Bill. They would have argued that there was no need of it because the 1964 Act had not expired. It is, therefore, worth examining what we are proposing against the position which right hon. Gentlemen opposite left us.
  It is true that the relief given to local authorities has been along the major lines the hon. Lady mentioned. Her figures were reasonably accurate and I am willing to put them on record again. Section 1 of the Act, dealing with direct grants in respect of local authorities with a high proportion of old people, has cost the Treasury about £5 million. But pray note that that £5 million is a general grant to all ratepayers, not to the elderly people direct. The important difference between this Bill and the Act is that the Bill deals with individual reliefs. All that has been spent by the Treasury in this respect is some £50,000 annually for the whole country. This is almost the cost of putting a Bill through Parliament. Yet this represents the policy of the Conservative Party, not only in 1964, but, as I

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  understand it from various speeches of hon. Members opposite, the policy which they would have pursued if they had won the last election.
  It is interesting to note that hon. Members opposite have argued that the amount should be more than 75 per cent. on the ground that they gave 66⅔ per cent. to local authorities and local authorities had discretion about dealing with the amount. In fact, if they look at the operation of the Act they will see that never at any stage was the 66⅔ per cent. operative. The State has contributed only half, and that half of a very small sum, the round total of £100,000 in any one year. That is a measure—and the hon. Lady the Member for Finchley was wise enough to admit it—of the failure of the Rating (Interim Relief) Act, 1964. Yet the hon. Member for Harwich (Mr. Ridsdale) and the hon. Member for the Isle of Thanet made it a principal bulwark of their resentment, albeit qualified, of the Bill that this help should have been given in a different way.
  The hon. Member for the Isle of Thanet thought that the assessing of hardship should be left to local authorities. If he looks at the Report of the Rating and Valuation Association he will see devastating condemnations of local authorities by the authors of that document. I make one small quotation from the end of that Report:
  "As an indication of the meticulous approach by some authorities, in two areas the total relief given was 1s. 9d. and 2s. 1d. respectively."
  In the summary, the authors of that Report say:
  "The high proportion of authorities receiving less than 10 applications for relief in their areas can generally be explained by the fact that comparatively few ratepayers in these areas came within the rigid definition of a 25 per cent. increased rating prescribed in the Act."
  There is, therefore, no substance in the argument that we should leave it to local authorities to lay down the level of hardship in the hope that throughout the country we would have a homogeneous system of appreciation of this urgent problem. Different levels of assistance would result and they would overlap with national agencies. The Government have, therefore, rejected that proposal.
  The right hon. Member for Kingston-upon-Thames was kind enough to ask
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  about the Scottish provisions for rebates remaining and I am grateful to him for saying that they worked well. Those in Section 244 of the Local Government (Scotland) Act, 1947, will remain. The criteria are:
  "grounds of poverty or inability to pay."
  That is different from the position under English legislation where the ground is solely that of poverty. I am certain that we will have to take this into account in trying to assess the position, but essentially the answer to his question is that those criteria will remain. No doubt we shall later discuss the matter in more detail and the relationship of National Assistance to other forms of rate relief.
  I paid great attention to the right hon. Gentleman's speech, as I always do, because he is always very careful in his choice of words. I noticed in particular two things about his speech tonight. If he will not regard it as offensive, I should like to say that he very much reminds me of Jimmy Maxton. Tonight he rode two horses very skilfully, but, as Jimmy said, one should not be in the circus unless one can do that. The right hon. Gentleman is a horse rider par excellence.
  He said that he did not concede even to his hon. Friends the idea that we should ask, not for a 75 per cent. grant, but a 100 per cent. grant He agreed that there was substance in my right hon. Friend's argument that in giving relief to local rates there should be some element of local contribution. The right hon. Gentleman was very careful about that. At the same time he grumbled about the 25 per cent. and one accepts that he means a figure somewhere between 75 and 100. We are not sure what that figure is and we look with interest to see what public declaration he may make on that score. Another point on which I must congratulate him is that he did not come down on either side on this matter of the National Assistance Board or, for that matter, of rates relief. He was very skilful in his choice of words and he left open to the person seeking relief the choice of whether to go to the rating authority or the National Assistance Board. That is exactly what we have done, and it is a bit hard for him to come and attack us. I cannot say that he did it very forcibly, as did some of his hon. Friends who sought to

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  use him as a battering ram of protest. We were very impressed that he was involved in this and has adopted the same position as ourselves.
  The right hon. Gentleman argued a case which I thought was quite extravagant when he said that we in the Labour Party had an opportunity to get early relief by increasing the general grant to cover the whole amount of the rates increase in any one year—in our last year, over 13 per cent. If he looks at that he will see there are two enormous objections to doing so. As a well-experienced former Government Minister in many distinguished offices, including Chief Secretary to the Treasury, he knows the difficulties of government. The first of these objections is that such a scheme would add an enormous amount of money to the General Grant Order; it would be the largest General Grant Order in history, far in excess of anything ever designed under the local government financial reforms. The second objection is that it would be very difficult, in Statute, to try and justify the total amount of money involved. There would be hundreds of millions of £s involved.
  Perhaps the right hon. Gentleman slipped, in which case I would forgive him, as readily as I am sure he would forgive me.
  Mr. Boyd-Carpenter: I think that the hon. Gentleman has slipped, because, if he recalls my speech, I adduced this possibility in order to demonstrate how completely invalid and untrue was the statement of the right hon. Gentleman the Minister, that the 10 per cent. increase in rates in this coming year which he foresaw would be an automatic result of the "vicious system"—those were his words—which he said he had inherited. I pointed out that this was not an automatic result and that it lay within his hands, through the machinery of the General Grant Order, to prevent that happening if he wished.
  Dr. Mabon: If the right hon. Gentleman thinks that, then let us have a look at the size of rises under his own Administration where he had the same option.
  Mr. Boyd-Carpenter: We never said this.
  Dr. Mabon: The hon. Gentleman is saying "We designed a system, we passed
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  it into law after four years of cogitation and we took one year to implement it; having done that, we will not allow anyone to alter the rules. The only way in which you can fulfil your promise is by altering the General Grant Order." This is a course of action which we reject. His hon. Friends, albeit unsuccessfully, have tried to take this view and isolate it instead of seeing it as a general pattern of reform which we are seeking to achieve.
  Mr. Boyd-Carpenter: The Under-Secretary said that we were asking him to accept the system and we need a positive law. Can he say what provision in law there is to prevent him fixing the General Grant Order at any figure he likes, which will obviate this increase in rates? What objection, other than the Chief Secretary to the Treasury sitting next to him?
  Dr. Mabon: Knowing the Chief Secretary to the Treasury, or for that matter past Chief Secretaries, that is one of the biggest objections there would be. In law and in theory this is true, but the hon. Gentleman and his right hon. Friends never took that as a course of action and they cannot urge upon us a course of action which they rejected.
  Mr. Speaker: Order. There we must leave the general grant.
  Dr. Mabon: I am obliged to you, Mr. Speaker. [Laughter.] It is better to win on points than by a knockout.
  The hon. Member for Croydon, North-West (Mr. Frederic Harris) asked when we would publish the larger Bill and whether it would be preceded by a White Paper. We hope that this will be the case. The Bill will be before the House for discussion in February. It is in that context that one has to view the present Bill.
  As I said earlier, the Conservative Party, from 1954 to 1958, thought a lot about local government reform and the need to change the financial system. We have no doubt that, with the assistance of the Civil Service, it did its very best to find a Conservative solution. The Conservative solution began in 1959, and it has, by common consent, proved unsatisfactory. It has caused immense hardship to many ratepayers—not just old-age pensioners, although they constitute the largest section involved, but many

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  lower paid workers, particularly in the less developed areas.
  It is interesting to note that of the 2 million ratepayers whom we estimate from the surveys will benefit by the Bill, 300,000 will be in Scotland. We in Scotland suffer very greatly by the incidence of lower paid workers. An effort must be made to try to relieve the rate burden on these people as quickly as possible. It took the Conservatives years to achieve their reform and it did not work. It landed us in a mess, which means an automatic escalation of about 10 per cent. every year, even if we follow the pattern of general grant Orders which hon. and right hon. Members opposite pursued.
  The hon. Member for Eton and Slough (Sir A. Meyer) said that he was disappointed by the Bill. I shall be interested to see what propositions are made in Committee to try to improve the Bill along the lines which he suggested. Suffice it to say that my right hon. Friend and all of us associated with the creation of the Bill are very pleased that things have gone so well in designing these Bills, that we have the larger Bill in view and that we have achieved in 14 months what the Conservative Party failed to achieve in 13 years. The money which we obtained for Scotland in exchange for the Rating (Interim Relief) Act in England was obtained by this Government, not by the Conservative Government.
  When we see these Bills—not only what has been done in the general grant Orders—we shall see the evolution of local government finance along better lines, leading perhaps to the ultimate solution to which my right hon. Friend referred in his speech which was so much criticised earlier today.
  Mr. Maddan: Why "perhaps".
  Dr. Mabon: Because, being extraordinarily modest men as we are, with very little to be modest about, we are prepared to admit that reforming the local taxation system is an enormously difficult task to undertake. If we were to introduce local Income Tax, it would mean reforming the whole system of Inland Revenue and the Income Tax system along Scandinavian lines—certainly along revolutionary lines. There has been talk about revising the rating
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  system on capital value lines and the Liberal Party has propounded ideas about site valuation. All these are enormously difficult decisions which cannot be taken in 14 months.
  The Government are very pleased with the reception which the Bill has had. We look forward to it being placed on the Statute Book and to the co-operation of right and hon. Members opposite in ensuring that that happens.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Standing Committee pursuant to Standing Order No. 40(Committal of Bills).

  BUSINESS OF THE HOUSE
  Ordered,
  That the Proceedings on the Rural Water Supplies and Sewerage Bill may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Crossman.]

  RATING [MONEY]
  [Queen's Recommendation signified]
  Considered in Committee under Standing Order No. 88(Money Committees).
  [Sir SAMUEL STOREY in the Chair]
  Motion made, and Question proposed,
  That, for the purposes of any Act of the present Session to make provision for the payment by instalments of rates on dwellings and for the granting of rebates in respect of such rates, it is expedient to authorise the payment out of moneys provided by Parliament—
  (1) of any sums required for making grants to any rating authority equal to three-quarters of the aggregate net amount of any rebates afforded by that authority under the said Act in any financial year in respect of the rates levied in each half respectively of that year, subject to the limitation that—
  (a) any such rebate is afforded to any person only in respect of the amount by which that person's reckonable rates for the half year in question determined in accordance with the said Act exceed £3 15s.; and
  (b) any amount which would otherwise be payable to any person by way of such rebate in respect of the rates levied in the half year in question shall be reduced or extinguished in accordance with the said Act if the reckonable income of that person determined as aforesaid in such previous

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  period of six months as may be so determined exceeds the following limit or such other limit as may from time to time be substituted therfor by order made by statutory instrument, that is to say—

  (i) if at the date of that person's application for the rebate he is married and living with his spouse, £260;

  (ii) in any other case, £208;

  apart from any increase of that limit provided for by the said Act in respect of a child;
  (2) of any increase attributable to the provisions of the said Act in the sums payable out of moneys provided by Parliament under any other Act.—[Mr. MacColl.]
  10.0 p.m.
  Mr. Boyd-Carpenter: During the Minister's Second Reading speech, he said, wholly accurately, that the main controversy as he understood it between the parties and outside arose over the question of whether the local authorities should be bound to contribute 25 per cent. of the cost of the rebates. I am sure that in those circumstances the right hon. Gentleman would not have agreed to the tabling of a Money Resolution which could have the effect of excluding an Amendment in Committee which raised this issue.
  I am conscious of my inexperience in the construction of Money Resolutions, despite the fact that, as hon. Members may know, my name has on occasion appeared on such a Motion. Nevertheless, reading tonight's Money Resolution as a layman—I am sure that I am wrong about this, and I rise only to obtain correction—it rather looks as if paragraph (1) might be construed as excluding the possibility of raising the question of the 25 per cent. imposition on local authorities.
  It would be such a monstrous act on the part of any Government to inhibit the discussion of Amendments raising an issue which, as, the Minister knows well and has indeed said, has raised acute controversy outside, that I cannot help feeling that I must be wrong in my construction of the terms of the Money Resolution.
  I know that what is or is not in order in Committee is a matter for yourself, Sir Samuel, or for the Chairman of the Standing Committee. On the other hand, even the present Government must be presumed to know what they are doing—this is, at least, a charitable assump-
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  tion—and I should like to know from a representative of the Government—[Interruption.] As the Chief Secretary says, it would be a happy change. One can hope that even the most appalling of reprobates will reform.
  I should like to know from a member of the Government whether, in their understanding, the Money Resolution is framed so that it tends to exclude discussion of an Amendment directly raising the 25 per cent. issue or whether, as I hope is the case, my reading is wrong, that this issue is open and that it will be open to the Committee to consider that matter on its merits.
  Mr. Michael English: In my speech on Second Reading, I made the point that the Financial Memorandum did not include all the charges upon local rates, contrary to one of the rules laid down for such Memoranda and one of the practices normally followed in accordance with assurances given to the House on many occasions. I asked whether my right hon. Friend the Minister would comment upon whether the Money Resolution permitted discussion of such costs, namely, the equivalent of the interest element of rates collected in a lump sum early in the year as against rates collected over a twelvemonth period throughout the year.
  I did not get a reply to that on Second Reading and it is important, before we pass the Money Resolution, to know whether it is so worded that it would inhibit Amendments of that type to the Bill. I think it is even more important when the matter is not merely one of a policy consideration but one which has been omitted from the Memorandum in which it should have been. I gave the charitable interpretation that this was omitted because it was omitted from the Allen Report. I believe that interpretation to be correct, but if this Money Resolution also inhibits discussion of an issue which was accidentally omitted, then I think we are going rather far. I sincerely hope that the interpretation of the Money Resolution is different from that. If not, I hope that some Amendment will be made to it.
  Mr. Terence L. Higgins: The difficulties of keeping within the rules of order when discussing the complications of a Money Resolution are well

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  known in this House, and anyone who attempts to do so for the first time must do so with some trepidation. But I think I should be failing in my duty to my constituents if I did not stress that this Money Resolution supports a Measure which seems to me to be woefully inadequate and completely misconceived. Therefore I rise to ask, with my right hon. Friend, whether we can have an assurance from the Chief Secretary with regard to the extent to which this Money Resolution will inhibit Amendment of the Bill in Committee. We have given the Measure a Second Reading, because we all support the principle involved, namely, that help should be given to those worst hit by the constant increase in rate demands. At the same time, I think we should make clear that we on this side of the Committee will want to table very considerable Amendments to the Bill as a whole.
  This is particularly important because, as has been pointed out the members of the present Government, in their election addresses, stressed that they would, to a considerable degree transfer the cost of public expenditure from the rates to the Exchequer whereas this Measure, for the large majority of ratepayers, will have precisely the opposite effect. At the Committee stage we on this side will certainly wish to offset this effect which, as I say, is quite contrary to what hon. Gentlemen opposite put in their election addresses, and we shall wish to do so by tabling Amendments with regard to the 25 per cent. of this cost which is to be paid by ratepayers.
  I hope we shall have an assurance from the Chief Secretary that the Treasury would not oppose any Amendment of this kind. On a previous occasion when this matter was raised the argument was put forward from the Treasury Bench that more of the cost of public expenditure could not be transferred from the rates to the Exchequer because of the economic situation. I think we should be quite clear that that is a completely invalid argument. The economic situation is quite irrelevant to the actual split between the rate burden and the Exchequer—
  The Chairman: Order. We cannot on this Money Resolution discuss the economic situation.
  Mr. Higgins: The point which I was trying to make was that this split between the Exchequer, on the one hand, and the rates on the other should not be opposed by the Treasury, and that Amendments to the Bill should not be opposed because of the economic situation at any one moment of time.
  The second point I want to raise is that we have in the Money Resolution the expression
  "the aggregate net amount of any rebates".
  I would ask the Chief Secretary whether this can be construed to include the cost of organising payment by instalments as covered by the Bill, because if it does not, then it may be that Amendments we would wish to table on this subject will also be precluded. In view of the short time which we on this side have had to study this Measure, I think it is extremely undesirable that the Money Resolution should be used to prevent us tabling Amendments of this kind. The same is equally true, I would suggest, with regard to the cost of organising the rate rebate schemes, because here again it appears that the cost of this is to fall on other ratepayers, whereas I believe it should fall on the Exchequer. Again, I would ask the Chief Secretary whether Amendments of this kind will be precluded by the terms of the Money Resolution.
  Finally, I would like to ask the Chief Secretary whether there is anything in the Money Resolution which will prevent us tabling Amendments so that the incomes of households can be taken into account, because it seems quite definite that we shall wish to amend the Bill in that respect. One of the main objections raised against the system of rates is that in assessing them no allowance is made for the fact that the income of a household may be very high, because there are a large number of children in it. It would seem that allowance should be made for the ability to pay in assessing hardship under the Bill.
  I would ask for a clear assurance from the Front Bench opposite that the Money Resolution which is before us will not preclude us from introducing Amendments of the kind which I have been asking about.
  Mr. Martin Maddan: I should like to raise a question with the Chief Secretary on paragraph (1,b) (i) and (ii),

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  though it may be that I should address it to you, Sir Samuel. In my simple way, I was always brought up to believe that back benchers could not propose anything designed to increase taxation, but if I read the Money Resolution aright, we are being prevented from doing the opposite—from raising in Committee suggestions that would reduce the tax burden of certain households whose half-yearly income in a case of a married man exceeds £260 and in the case of a single man exceeds £208. What I should like, either from the Chief Secretary or from you, Sir Samuel, is an explanation of whether we may do that.
  The Deputy Chairman: It is not for me to give any explanation of what would be in order in Standing Committee.
  Mr. Maddan: In that case, the matter falls squarely upon the Chief Secretary. Will it be in order to increase those limits of £520 for a married man and £416 for a single man? Will it be in order to move Amendments to that effect?
  The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. James MacColl): I will try to deal with each of the points that have been raised, with the proviso that I do not decide what is in order and what is not in order. Thank goodness, I no longer draft Opposition Amendments, so I cannot be responsible for what is in order and what is out of order.
  My hon. and learned Friend was anxious to make the Money Resolution as wide as would be reasonable. In these matters, inevitably one is faced with precedents. One particular precedent was as recent as 1964 in the Rating (Interim Relief) Bill, and one of the difficulties which inhibited us from going beyond what we have done was the fact that that Money Resolution was extremely tight.
  There were two grants in it. One was a grant of £5 for each old person, and that was completely tied by the Money Resolution. It was quite impossible to increase the amount. The other was the double grant on the hardship side, which was 50 per cent. in some cases, rising—although, as my hon. Friend pointed out, it never did rise—to 66⅔ per cent. Not only was the maximum of 66⅓ per cent. fixed, but the figure of 50 per cent. was
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  also fixed. We were, therefore, faced with a very rigid Money Resolution which, as a precedent, it is difficult for us to go beyond. It appears to be a principle which the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) laid down quite early in his brilliant career, when he was Financial Secretary to the Treasury; the general principle that grants should be fairly clearly and definitely limited in a Money Resolution.
  10.15 p.m.
  My hon. Friend the Member for Nottingham, West (Mr. English) spoke of the problems of the payment of interest arising through having to pay interest before the full amount of the rates was received. The hon. Member for Worthing (Mr. Higgins) wondered whether the aggregate net amount could be increased to cover the cost of administration. The position is that the costs of administration are not covered by the grant.
  The difficulty in the instance mentioned by my hon. Friend the Member for Nottingham, West is that this matter would be extremely difficult to define, because local authorities have working balances of varying sizes at different times of the year. They also vary in their financial methods and in the way they calculate rates of interest. It would, therefore, take a very long time to find out how much of these are relevant for grant purposes. It would also be difficult to isolate the matter from the general costs of collecting the rates. For these reasons, we are leaving this out of the specific grant which is covered by the Bill, although this naturally ranks for deficiency grant.
  Mr. English: Is my hon. Friend saying that that will apply in the case I quoted, since I do not believe that it would rank for rate deficiency grant? Rates at present come in fairly early in the year in a lump sum. That will not happen in future and, since this will represent a loss to local authorities what will be the position?
  Mr. MacColl: I see that you are watching me like a hawk waiting to swoop, Sir Samuel, if I break off into a discussion of local government finance. I suggest that at some later stage, if my hon. Friend is in a position to do so, he tries his luck with an Amendment

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  to see whether or not it would be in order. In any case, if it is an expense paid out of the rate fund it must be paid out of the rates, and if it is paid out of the rates it must rank for rate deficiency grant. That would be my rough guess of the position, although I should not like to be committed to that in any later discussion we may have of the matter,
  I was fascinated by the question asked by the hon. Member for Worthing. He wondered what would happen if, instead of going in the direction which everyone wants to go—namely, to be more liberal in this matter—the Committee wanted to be tougher and to alter the allowances in such a way as to reduce the charge which had been met in connection with rebates.
  Mr. Higgins: Before the hon. Gentleman proceeds, since I have not understood his explanation of what I said, would he care to try again?
  Mr. MacColl: I thought the hon. Gentleman wanted to move an Amendment at a later stage which would increase the amount of income which was deducted from the rate rebate to reduce the charge on rate funds.
  If that is what the hon. Gentleman wanted, there are two aspects to it. One is that the allowance for children is free and can be amended up or down, but the allowances for married couples and for single people are tied by the Money Resolution. On the other hand, if the effect was to reduce the amount, the Money Resolution probably only fixes a ceiling to the charges on public funds. The hon. Gentleman might get away with an Amendment and an ingenious argument to that effect. I am not responsible for his drafting, but it would be worth trying.
  Mr. Maddan: We on this side are rather confused. I asked whether we might increase these limits so that people who now would be excluded from the Bill could be brought into its benefit. Do I take it that this Money Resolution excludes that type of Amendment?
  Mr. MacColl: Yes, except in so far as it is connected with the allowances for children.
  I think that I have dealt with the major points. We are very anxious in this
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  Money Resolution to have as much freedom for debate as is consistent with precedent and something we felt reasonable to offer to the House.
  Mr. Boyd-Carpenter: The Joint Parliamentary Secretary was his usual agreeable self, but the result is simply not good enough. The Committee knows that reliance on precedent is the last resort of a Minister in difficulties, and when the precedent relates to a Measure which the right hon. Gentleman the Minister spent some minutes in denouncing in all its aspects, the sincerity of the Government's arguments is plainly called in question. As far as I know, nothing in that Measure appealed to the Government, yet the Parliamentary Secretary still seems to shelter behind the precedent it affords, but he produced a precedent that does not apply to this issue.
  He said that it was a precedent—and, as a representative of this brave, progressive and streamlined Government, he is devoted to precedents—the precedents of his predecessors—that grants should be limited by Resolution. When one is dealing generally with grants, that is no doubt an arguable proposition, but it has nothing to do with this Money Resolution, and you would rule me out of order, Sir Samuel, if I discussed it.
  In this Bill the Government propose to impose on local authorities not a charge but a diminution of the income which otherwise they would get. To say that because the Government seek to limit the amount of that loss of income which the Government will reimburse to them it comes within any precedent about grants being limited by resolution is just a misuse of words. What the Government are saying is that they want to limit by this Money Resolution the amount they refund to the local authorities which by this Bill they propose to take from them.
  The reality of the matter is this. The Minister admitted earlier, and everyone admitted during Second Reading—and some hon. Members opposite as well as my hon. Friends argued—that this 25 per cent. was a very doubtful proposition, and that it was the main issue arising on the Bill. The Minister knew that before he made his Second Reading speech, because the fact that it was the main issue of controversy was typed in the script he used. To come forward at the same time

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  with a Money Resolution designed to prevent that being tested by way of an Amendment in a Committee of this House seems to be an abuse of our procedure.
  It is a clear indication that the Government are frightened on this issue. It is a clear indication that the Government do not think they can put up a justification for it. It is a clear indication that the Government do not think that they can carry their supporters with them if that issue is raised. Therefore, they deliberately and in advance—and I hope this will be noted outside—use the procedure of the Financial Resolution to prevent the House of Commons in Committee coming to a decision upon a matter which bodies outside representing local authorities, the ratepayers, and the great bulk of public opinion want us at least to debate and argue.
  If the Government think they have a case, let them have that case deployed in argument by a Motion and let the Committee, when it comes to a conclusion on it, decide it. What is quite wrong and an abuse of the procedure of this House is to prevent any possibility of that being discussed. This is a vivid illustration of the Government's consciousness of the weakness of their case.
  Mr. English: The right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) will know that we have always to face the fact that on Money Resolutions Governments have to decide how much money they are prepared to spend on particular projects. I do not want to press the issue I raised too far but, because the Ministry seem to have forgotten something, this is a rather different matter. That the Government should consider a principle and then decide that the Committee should not discuss it is something which we all have to suffer on Money Resolutions. The fact that a matter has been omitted from the Resolution is a rather different thing.
  Here we are possibly precluded from discussing something which has not been
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  mentioned because it was not mentioned by the Allen Committee and that seems rather different. I want an assurance that if the rules of the Standing Committee make this matter out of order my right hon. Friend will produce a modification of the Money Resolution so that this will be in order and we can discuss it.
  Mr. Hugh D. Brown: I apologise for speaking at this time, but I have not been impressed by the argument of my hon. Friend the Parliamentary Secretary. It seems shocking to base a case on precedent which we have been condemning. I hope that I am not going far into the camp of the right. hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter). Hon. Members on the Government side should pay a little respect to the fact that there is a point here. This Bill has been published for only a week. Although officials in the Department may have discussed it with officials of local authorities, I hazard a guess that practically no local authority members know the implications other than what they have read in the Press during the past week.
  We on the Government side should not be too complacent in thinking that there will not be no reaction to this. I say this perhaps through inexperience and, some hon. Members may say, in ignorance. If we are tied to a particular sum of money, would there be anything to stop Amendments being moved on the 75 per cent. to be found by the Government? If any alteration were to be made, could it be compensated for by increasing the amount of rates which would be excluded? In other words, if we altered the first paragraph of this Resolution could we alter paragraph 1(a) by increasing the amount to be excluded for rebate purposes? Are we tied to the extent that we cannot move one against the other after discussions with colleagues in local authorities?
  Question put and agreed to.
  Resolution to be reported.
  Report to be received tomorrow.

  RURAL WATER SUPPLIES AND SEWERAGE [MONEY]
  Resolution reported,
  That, for the purposes of any Act of the present Session to increase the limit on the contributions out of moneys provided by Parliament which may be made under section 1 of the Rural Water Supplies and Sewerage Act 1944, it is expedient to authorise the payment out of moneys so provided of any increase attributable to the provisions of the said Act of the present Session in the sums payable out of such moneys under the said section 1 or by way of Rate-deficiency Grant or Exchequer Equalisation Grant under the enactments relating to local government in England or Wales or in Scotland.
  Resolution agreed to.

  RURAL WATER SUPPLIES AND SEWERAGE BILL
  Considered in Committee.
  [Sir SAMUEL STOREY in the Chair]

  RURAL WATER SUPPLIES AND SEWERAGE BILL

    Clause 1.—(INCREASE OF LIMIT ON CONTRIBUTIONS)
    10.31 p.m.
    The Chairman: I think that it would be for the convenience of the Committee if, with the first Amendment in line 12, we considered the Schedule—Conditions for the Assessment of Contributions.
    If the Minister is satisfied that there are special circumstances of an exceptional nature which justify an increase in the limits of £600 and £800 hereinafter specified, he shall increase the said amounts to such extent as he shall see fit, but otherwise he shall assess the contributions under section 1 of this Act as follows:
    For the provisions of rural water supplies—

    (i) he shall take the estimated cost based on tender of all work between the source (and associated works) and the curtilage of the properties to be served by the proposed supply, including the cost of work on the source and associated work, the pumping stations, the service reservoirs and similar installations and equipment included within the scheme for the proposed supply;

    (ii) he shall deduct from the said estimated cost a sum calculated by mutiplying the number of properties to be served by the proposed supply by £15;

    (iii) he shall divide the residual amount by the number of properties to be served by the proposed supply and where the cost per property obtained by that division is £600 or less, the contribution shall be 35 per cent. of the sum so ascertained multiplied by the
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    number of properties to be so served; amounts in excess of £600 shall be disregarded.

    For the provision of sewerage schemes—

    (i) he shall take the estimated cost based on tender of all work from the curtilage of properties to be served by the proposed sewerage scheme to the sewage disposal works or sea outfall sewer or to the connection with another authority's main sewer, including the cost of work on the sewage disposal or outfall sewer, ejector stations and similar installations and equipment included in the said scheme;

    (ii) he shall deduct from the said estimated cost a sum calculated by multiplying the number of properties served by the proposed scheme by £25;

    (iii) he shall divide the residual amount by the number of properties to be served by the proposed scheme and where the cost per property obtained by that division is £800 or less, the contribution shall be 35 per cent. of the sum so ascertained multiplied by the number of properties to be so served; amounts in excess of £800 shall be disregarded.

    Mr. Graham Page: I beg to move, in page 1, line 12, at the end to insert:
    Provided that so far as the said subsection (5) as substituted as aforesaid increases the limit contained in the Rural Water Supplies and Sewerage (No. 2) Act 1955 on the aggregate contributions no contribution shall be made thereout unless it has been assessed in accordance with the conditions set out in the Schedule (Conditions for the assessment of contributions) to this Act.
    The words of the Amendments are an introduction to the new Schedule. The reason for the Amendment is that prior to the Local Government Act, 1958, and the introduction of the rate deficiency grant, the amount of the grant for rural water supplies and sewerage was entirely in the discretion of the Minister. There have been some formula which was applied inside the Ministry in assessing the grant to be given, but that was not made public, and it was not evident from the amount or the manner in which the grants were given.
    When the rate deficiency grant was introduced in 1958, an interim scheme for assessing grants was devised and was applied for a few years. That was put into a semi-permanent form by means of Circular No. 15 of 1961 from the Ministry, dated 4th April, 1961. There, a formula was set out upon which the Ministry would in future make the grant under the Rural Water Supplies and Sewerage Acts, 1944 to 1955. Of

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    course, in law the calculation of the grant was still in the discretion of the Ministry, but it was undoubtedly an advantage to water undertakings that they should know the formula on which their grants would be calculated, and it was an advantage to have it set out in such a circular so that they might know how much they could expect and could plan their schemes accordingly.
    Circular No. 15 of 1961 set out this formula, which has been in operation now for four years and eight months. The formula, which is partially repeated in the Schedule which I have put on the Order Paper, was set out in the circular in the following way, if I may summarise it: that the grant will be assessed by taking the estimated cost of all works between the source and the properties to be served, and excluding the cost of work on the source and associated works, that is to say, excluding the cost of head works of any water supply. Having got that figure one deducted from that amount a sum calculated by multiplying the number of properties served for the first time by £15. One is therefore dealing with properties served for the first time.
    Finally, one divided the residual amount by the number of properties being served for the first time and where the cost per property obtained by this division is £300 or less the Minister's grant is 35 per cent. of the sum so ascertained multiplied by the number of properties being served for the first time. That sum of £300 referred to the properties being served for the first time with a water supply. The figure for sewerage was placed at £400.
    During the Second Reading debate I asked the Joint Parliamentary Secretary whether he thought that this formula needed some revision. I said:
    "I think that this is the first opportunity which the House has had of considering this change from a flexible system of grant to a formula system laid down in 1961. It is worth considering now whether there can be any improvements".
    The only reply that I received from the hon. Gentleman was,
    "I think that so far the formula has operated fairly well, and that the limits which have been given in it of £300 and £400 have shown themselves to be adequate, but prices have risen since they were fixed, and discussions are
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    shortly to start with local authority associations about what future ceilings should be provided. When these discussions are complete, I hope that it will be possible to look at the position again."—[OFFICIAL REPORT, 26th November, 1965; Vol. 721, c. 919–47.]
    There was, therefore, no firm undertaking given that these figures and this formula would be revised or even reviewed.
    This was wholly unsatisfactory and the Government are bringing forward this Bill to increase the amount to be devoted to grants for rural water supplies and sewerage and in doing so, if I understand the Joint Parliamentary Secretary aright, they are saying in effect, "We think that the present system of distributing these grants is all right but we are talking to the local authority associations." I interpolate, why only the local authority associations? Why not the water boards and water companies? The Government add, "We hope that it may be possible to look at the position again".
    This is extraordinarily casual. When a sum of £30 million is being brought before the House of Common it is vitally important to know on what basis the grants will be calculated and paid out of that £30 million. There will be no opportunity for the Committee to consider this matter again. If the Government decide to revise the formula or to leave it as it is, I assume that this will be done merely by issuing a circular, as was done before, and the matter will not be brought before the House of Commons for consideration.
    To do this in this vague way is most unbusinesslike. The purpose of the Amendment, therefore, is to make the Minister's mind up for him. The Amendment sets out a formula which shall be written into the Bill and not be just left to government by circular. The Amendment does more than just make up the Minister's mind for him. It amends the 1961 formula so as to bring it up to modern requirements after it has been in operation and tried out and tested for nearly five years.
    The Circular promised that this would be done and said in paragraph 18:
    "It is the Minister's intention that the scheme should operate in this form for three years from that date. It will then be reviewed, though the Minister will be willing to consider an earlier review should anything occur to affect seriously the factors in the formulae."
    So it was contemplated by the Ministry at the time that this formula should be reviewed.

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    As the Parliamentary Secretary knows, several points have been put to the Ministry through the water undertakers and the British Waterworks Association giving evidence of cases in which the formula has not worked satisfactorily. I have endeavoured to take these points into account in the Amendment. First, the formula in the Circular does not take into account in calculating the grants the cost of headworks. Second, it does not take into account the properties which are not served for the first time but in respect of which the supply is improved. Third, the formula in the Circular has the figures of £300 on which the water supply grant is based and £400, on which the sewerage grant is based.
    The formula in the Schedule which I am proposing would take account of the cost of headworks. This has been proved essential over these five years. The water undertakings are finding great difficulty in meeting the cost of headworks without getting grant towards that cost. It is not tenable to continue to argue that an urban water undertaking has to provide headworks and, therefore, no grant should go towards the headworks supplied by a rural water undertaking. To provide storage at the source and all the ancillary equipment is far more expensive for a scattered supply than it is to provide the same sort of equipment for an urban supply. I have endeavoured to take this into account in my proposed Schedule.
    The second point is that the formula applied by the Ministry is restricted to properties served for the first time. I think that this might be better argued on the next Amendment, so I shall leave it for the moment.
    The third point is, perhaps, the most important of all, namely, the need to increase the figure on which grant is based. At present, for water supply, the Minister's grant is 35 per cent. of £300 per property if the cost comes up to £300. Over the years, of course, the cost has increased, and it is now estimated by the British Waterworks Association to be £600 rather than £300. This estimate is supported by a number of examples from the water boards. One comes from the North Devon Water Board which, in 1964, considered 33 schemes, in 19 of which the cost per property exceeded £300, the highest being £700. In the case of the East Shropshire
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    Water Board, which took a test over certain schemes, it was coming out at £500 per property. In the case of the West Cornwall Water Board, it was £400 on water supply and £800 on sewerage per property. These are the sort of figures which show that the present formula is quite out of date and inadequate. It should be increased to the maximum of £600 in respect of water supply and £800 per property in respect of sewerage.
    Those are the maximum figures. It does not mean that the grant must be based on those figures if a scheme does not, in fact, cost that, but the Minister should not restrict himself to the figures of £300 and £400 as they appear in the formula at present but should increase them to £600 and £800. If he is not prepared to give an undertaking to do that and to apply that sort of formula in future, it is our desire on this side to write that into the Bill. I hope that the Minister will accept that the formula set out in the Schedule is the right formula now and that he will have it written into the Bill.
    10.45 p.m.
    Mr. James Scott-Hopkins: The case has been put extremely well by my hon. Friend the Member for Crosby (Mr. Graham Page) in arguing the Amendment. I shall confine myself mostly to the second part of the Schedule concerning the sewerage side. The point that my hon. Friend made about water undertakings, particularly in reference to the North Devon Water Board, which operates in my part of the world, was extremely true. It has had great difficulty in the past because of schemes costing more than the limit laid down in the 1961 Circular.
    It is also true that in the West Country, certainly in my part of Cornwall, the sewerage services are extremely behind the times in many areas. Although we now have a water supply to a great many of the outlying rural districts, this has not been followed as quickly as it should have been by sewerage services, and the result is not particularly happy. Part of the reason is the enormous cost.
    I attended a conference not long ago of all the authorities in my constituency concerned with water and sewerage, particularly sewage and its disposal. One

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    authority, the Wadebridge Rural District Council, has sewerage works in hand, which ought to be carried out, to cost about £1 million. This is not a precise figure because the exact costings have not yet been done. Altogether the amount of work which needs to be done in one constituency is of between £2 million and £2¼ million capital value, which is a fantastic amount of money.
    Under the existing system, outlined by my hon. Friend, the limit is £400 per property, but most schemes cost more than this. Indeed—I hope that my hon. Friend will not mind my saying this—I have doubts as to whether the words in the Schedule are not a little too rigid and not likely to allow enough flexibility. I would hope that in special cases the formula would not have to operate. I understand that this is so in existing circumstances. I believe that it is purely a Ministerial decision based on the 1961 Circular as to what the rate of grant shall be up to a certain maximum. So there is a fair amount of flexibility.
    While I agree with my hon. Friend that the levels must be raised, and from the sewerage angle £800 is certainly a better level to start thinking from than the £400, I have doubts whether it will be sufficient. I hope that before the Minister finally decides he will see whether further flexibility can be imported into the provision. I trust that if he rejects my hon. Friend's suggestion, which is better than the existing position, he will give an assurance that, far from sticking to the 1961 Circular because the £400 limit there laid down is unrealistic, especially in rural areas, he will have the closest consultations immediately with the authorities concerned, not only in my constituency but elsewhere in the West Country, which are facing the problem of needing to do a great deal of work in providing sewerage facilities in their hamlets and villages in the remoter areas, something which in 1965–66 should be done. I hope that the Minister will make provision so that this can be done at a reasonable cost.
    I also hope that the servicing of the capital interest will not be too great a burden on the local authorities, which is the other problem with which the local authorities which have to do the work
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    are faced. This, of course, increases the rate burden which the ratepayers, who are rather scarce, have to carry.
    I hope that the case has clearly been made out to the Joint Parliamentary Secretary that there is a great deal of disquiet in rural areas about the level of the existing grants. The Amendment would go a long way to help put this right, but over and above this I hope that there will be flexibility in respect of cases such as those of my constituency and elsewhere in rural areas, and that additional grants can be made to the local authorities with a great deal of high capital cost to face.
    Mr. Peter Bessell: I, too, hope that the Minister will feel able to accept the Amendment. I share the view that the position in rural districts is very difficult. The hon. Member for Cornwall, North (Mr. Scott-Hopkins) mentioned an example in his constituency and I reinforce his argument by mentioning a similar case in my constituency, which adjoins his. The example is that of Lostwithiel, where the river board has, rightly, stated that the local authority may no longer discharge sewage into the river.
    The local authority, in turn, is unable to provide a new sewage works because of the cost. The consequence is that it is unable to build any new houses, being unable to link any additional sewerage to the existing means of disposal. Thus, it cannot raise additional rates as a result of building new houses, which would create new rateable hereditaments and increase its income, enabling it perhaps to pay for a sewerage disposal plant. The local authority is between the devil and the deep sea.
    In such a situation, the proposed Schedule would perhaps go some way to alleviating the position. It would not go the whole way and I was glad that the hon. Gentleman emphasised his hope that the Minister would retain some degree of flexibility so that he could make special orders in these circumstances. In the case of Lostwithiel, and possibly in the case which the hon. Member mentioned, special powers should be exercised.
    Nevertheless, the Amendment and the new Schedule would go some way to meeting the problem of rural areas and

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    I hope that the Minister will not be obstinate about this but will recognise that, with increasing costs, the original figure of £400 in the case of sewerage is no longer adequate, and that, while £800 may not be adequate, it would go a long way towards meeting the demand. I hope we shall hear that this is acceptable to the Government.
    The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. James MacColl): I am grateful for the speech of the hon. Member for Cornwall, North (Mr. Scott-Hopkins), who made a reasonable and balanced approach to the problem. I do not think I had the pleasure of seeing him at our Second Reading debate on 26th November. If he had been here, he would have heard the hon. Member for Crosby (Mr. Graham Page) making virtually the same sort of speech as he himself has just delivered. But the hon. Member for Crosby has now contradicted himself, which has puzzled and rather embarrassed me. The hon. Member for Crosby said on Second Reading:
    "I do not think that we ought to return to the completely flexible system, but it is worth consideration to see whether the present system of formula grant is too rigid."—[OFFICIAL REPORT. 26th November, 1965; Vol. 721, c. 919.]
    That is the point of view that the hon. Member for Cornwall, North put forward tonight and it is a reasonable view. In fact, this Amendment and the Schedule would introduce great rigidity into the Bill. The Amendment would bind the Minister to the comparatively narrow terms of the Schedule, with certain exceptions which are there anyway.
    As I tried to explain on Second Reading, we inherited from the previous Government a survey into the working of the Act and particularly the Circulars. The results of that survey are now being assimilated and on the basis of the evidence produced my right hon. Friend will initiate discussions with the associations concerned to see how far and in what respects the present formula should be altered. The hon. Member for Crosby asked why only the local authority associations. The answer is that the British Waterworks Association itself is representative of both local authority and company undertakings and will be a party to the discussions.
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    That seems to be the sensible way in which to tackle these problems. We have the evidence and we will discuss what changes should be made in the present schemes laid down in the Circular. That can all be done without further legislation because those are administrative matters. The provisions in the proposed Schedule might be too much or too little. If the sums have not been done correctly and too high a maximum is inserted into the grant formula, although the amount can be reduced when shown to be excessive, there is always a danger that people will get into the habit of thinking in terms of the higher figure. It is very difficult to keep down costs when it is believed to be all right to add on another £200 or £300. It would be unwise to take a rather wild jump at saying what the maximum figure should be.
    Mr. Scott-Hopkins: I follow the hon. Gentleman's argument this is the right way to do it, but are not the limits rigid at the moment? Is not the hon. Gentleman—quite naturally—adhering to the Circular and therefore to the rigid limits which are now operating harshly? While discussions are going on, could he not be a little more flexible?
    Mr. MacColl: In the present arrangements as laid down in the Circular there is power to go beyond the normal limits in exceptional circumstances. On Second Reading in a discussion with the hon. and learned Member for Montgomery (Mr. Hooson) we quoted some cases in which that had been done and others in which it had not been done when some scheme had not been economically the most desirable. The Department is flexible about this matter and we recognise that there is a sort of concession stage.
    One of the problems is that we are working on 1961 prices. One of the odd things about the proposed Schedule is that the hon. Member for Crosby starts by doubling the maximum in one case and he has included what is normally called the urban deduction, the supposed difference between doing this work in a rural area and doing it in an urban area, but he has left that figure at the 1961 level. That is departing from the principle that the scheme is to help rural authorities which suffer from special handicaps. That is the difficulty about headworks. It is not practical to include

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    headworks in the grant because they are normally of the same sort of cost whether serving urban or rural communities.
    11.0 p.m.
    This is something we could look at if there is convincing evidence that there is a marked disparity between them. I ask the House not to accede to the hon. Gentleman's Amendment. I think his formula is wrong. Even the hon. Gentleman nods occasionally, and it is a warning to lesser Members, that we might ourselves get into trouble. The thing to do is to continue these discussions which are going on in the normal way. There is no doubt that there will be a fair bit of haggling about it. But at the end of it an agreement will be reached on the best formula. When that is done the Circular will be amended.
    Mr. Graham Page: I would draw the attention of the Parliamentary Secretary to the first few lines of the Schedule. It reads:
    "If the Minister is satisfied that there are special circumstances of an exceptional nature which justify an increase in the limits…"
    then he shall make provision accordingly. That is far less rigid a formula than the one laid down in the Circular, so his argument that I am endeavouring to make it more rigid falls to the ground. This Schedule provides for the Minister to consider special circumstances and to increase the grant in those cases. There have been very few cases, as far as I understand it, under the Circular, in which any increase in grant has been made. It may have been reviewed later, when some exceptional circumstances have arisen in the provisions of the scheme, but not outright, when the grant is first made.
    The second point is that we have been given no assurance that the figure will be amended as a result of the review which is now taking place. I do not ask the Parliamentary Secretary to prejudge what may come out of the review, but does he not think that prices have increased since 1961, and that there is a real justification for increasing the formula figures on that basis? He held out a tempting word or two about the cost of headworks, saying that they might be considered again. Can he not go further than that and give some assurance that these various factors com-
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    bined will make the Minister increase the formula figures?
    Mr. MacColl: We have had some forward estimates of what we think the average cost will be and they do not show very substantial changes from 1961. They are greater. Certainly in England they have been running recently at about £100 more. The estimates do not show that there is going to be a very substantial jump. These are matters we are prepared to discuss with the people who know the facts.
    Mr. Graham Page: If the Parliamentary Secretary is not prepared to go further than to say that his information does not show a very substantial change from the original figures, I feel no inclination to withdraw the Amendment.
    Mr. Scott-Hopkins: I was very disappointed with the reply of the Parliamentary Secretary. What I was trying to argue is that there are a lot of special cases, and what worries me is the existing position. If the Parliamentary Secretary will not give an assurance to the Committee, and I cannot see why he will not, that there will be a reasonable increase, though I accept that he cannot prejudge the case, I think that he should give an assurance that there will be an increase in these levels of grant.
    The thing that bothers me is that he is going to have these discussions with the local authorities concerned sitting round a table and then he will come to a conclusion, and the conclusion will be his. He said that there will be harsh bargaining during the negotiations, but it is the Minister's decision which is final and, as far as I can see, this Committee will have no opportunity whatever of knowing what this decision is. Nor shall we have any opportunity of being able to debate it, and trying to persuade the Minister that he has got the wrong formula, or that he has been too niggardly in dealing with the generality of cases. This is the most worrying aspect. I should like the Joint Parliamentary Secretary, if he is authorised so to do, to give the Committee an assurance that when he has come to an arrangement with the local authorities, he will find means of announcing to the House the levels at

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    which the grants will run from the time of that agreement.
    Mr. MacColl: I will take advice about the way that it should be drawn to the attention of the House. A circular, however, is a document which is available to hon. Members in the Library. It has the good fortune that it is also open to discussion on the Adjournment, because it does not involve new legislation. I think, therefore, that the opportunities available to Parliament will be adequate.
    Amendment negatived.
    Mr. Graham Page: I beg to move, in page 1, line 12, at the end, to insert:
    Provided that no contribution shall be made under this section towards replacing, enlarging, augmenting, linking or adding to the capacity of an existing water supply, sewerage scheme, or sewage disposal works unless the Minister is satisfied that the replacing, enlarging, augmenting, linking, or adding will result in the provision of a more efficient supply, scheme, or disposal works.
    The intention of the Amendment is not restrictive, as might appear from reading it. It has necessarily to be in this form to be in order with the Long Title of the Bill and the Money Resolution. The intention is to force the Minister to recognise that
    "replacing, enlarging, augmenting, linking or adding to the capacity of an existing water supply, sewerage scheme, or sewage disposal works "
    comes within the purview of grants originating under the 1944 Act.
    The major consideration of water undertakings is the increased consumption of existing users and to provide an adequate supply of both water supply and sewerage for existing users to cope with that great increase in consumpiton. In some cases it has doubled over the last dozen years. The estimated increase in water consumption is 4 per cent. a year, which at least doubles it over a score of years. The replacement of small, inadequate supplies by modern, adequate supplies is, and increasingly will be, absolutely necessary over the next few years in many rural districts.
    The circular to which we referred on the previous Amendment denies that the Minister has power to make a grant in those cases. It states in paragraph 7:
    "The Minister has no power to pay grant for any work of replacement, whether in
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    water or sewerage schemes. Further, work which simply augments supplies of water from mains will be ineligible except in so far as the augmentation is incidental to the scheme for making first time provision. In calculating grant in cases where supplies are augmented, regard will be had only to the number of houses receiving a supply of water from mains for the first time."
    This precludes the Minister from giving grant for a water undertaking laying another lot of pipes along the same line to provide an adequate supply to users who are increasing their consumption of water. It prevents, for example, any grant being made to a water undertaking which is taking over an estate or village supply which itself is adequate but which needs the linking pipe. It prevents any grant being made when larger pipes are provided, whether for water supply or for sewerage.
    But, in fact, it is not what the Act says. The Act does not preclude grants in these cases, and it is my submission on this Amendment that the Circular is wholly wrong and that it does not follow out the terms of the 1944 Act. Under Section 1 of the Rural Water Supplies and Sewerage Act, 1944, provision is made as follows:
    "Subject to such conditions as the Treasury may determine, the Minister…may, in any case in which it appears to him to be desirable so to do, undertake to make a contribution towards the expenses incurred by a local authority at any time after the passing of this Act—(a) in providing a supply, or improving an existing supply, of water in a rural locality; (b) in making adequate provision for the sewerage, or the disposal of the sewage, of a rural locality."
    "Improving an existing supply": that surely must include replacing, enlarging, augmenting an existing supply. What else can the words "improving an existing supply" mean? Then the sewerage provision, "in making adequate provision for the sewerage" must surely include enlarging the existing scheme to make it adequate for the locality. Why, then, should the circular say that the Minister has no power to make grants in these cases?
    The fact that grants are being made only in respect of property which is supplied with water or supplied with a sewerage system for the first time is causing great difficulty to the water undertakings and the sewerage undertakings. It is preventing what is so important at the present time—in fact, I

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    think, in many cases more important than installation of a new supply—and that is the improvement of an existing supply. There is no purpose in having an inadequate supply, whether of water or sewerage, and to continue to reduce grants in those cases is depriving many of the rural areas of a proper supply.
    I hope the Minister will accept this Amendment so that there will be written into the Act a recognition that grants can be made in these cases. As it stands, because he has bound himself by this circular not to give grants in these cases, grave hardship is being caused to rural areas where the water undertakings just have not got the money to carry out these schemes without grant.
    Mr. Scott-Hopkins: There are two points I wish to make very shortly on this Amendment so ably moved by my hon. Friend. As I understand the position, it is quite clear that in the 1944 Act there is permission to make these grants in particular cases including the improving of an existing supply, or a supply which is inadequate, and making changes to it to ensure better disposal of sewage. It is this 1961 Circular which has prohibited these payments. I accept the fact that it was brought in under the previous Administration—for other reasons.
    The first of the two points I wish to make is that under existing Regulations at the moment about the pollution of rivers there are many small towns in the countryside, particularly in rural counties like Cornwall, which are being put in extreme difficulty by the operation of the local river authorities, the new river authorities under the recent Act, and therefore, if they are going—[Interruption] I am sorry that the Minister should be quite so placid about it as to carry on a private conversation. I know that what I am saying may not be very interesting to him, and he may know the answers to all these matters and questions, but he could be a little more courteous. I shall not be more than two minutes—or three minutes at the maximum.
    The Minister of Housing and Local Government (Mr. Richard Crossman): Will the hon. Gentleman allow me? No?
    Mr. Scott-Hopkins: The point I was making was that in these rural areas where local authorities have had to change the disposal of their sewage because of the operation of local river authorities they will be in the position where they will not be able to get grant under the existing Circular of 1961. As my hon. Friend said, it is absolutely necessary that that should be so under the new arrangement that I hope the Parliamentary Secretary and his right hon. Friend will be bringing in after discussions with the local authorities. If that is so, I am more than satisfied. If it is not so, I hope that the Parliamentary Secretary will be able to accept the Amendment.
    11.15 p.m.
    Mr. MacColl: Whatever may be said about the Amendment, there is no doubt that it goes right outside what was the intention of the original Act. The Act was intended to be a short-term operation dealing with the special problem of catching up on the extension of rural supplies for sewerage and water and something that would be a once and for all job. It is ironical to note that the Minister of Health at the time thought that he could do the whole job on —15 million. Already it has been running for much longer than that.
    The Amendment would put a permanent charge on the Exchequer to go on paying out subsidy and grants indefinitely for the continual improvement of water and sewerage undertakings, and it might mean something like another £9½ million added on. So that, in addition to new works, there would be the improvement of existing ones—
    Mr. Scott-Hopkins: They have to be done in the case that I have mentioned, so that the £9½ million would be borne by the ratepayers and the rate deficiency grant. That is surely a more suitable way of doing it.
    Mr. MacColl: It is to deal with the special problem and the inherent difficulties in getting a supply to an area which has never had it. Where great increases of population lead to a more intensive use of the source or where, for some other reason, it is necessary to improve it, it becomes a different problem. It is the ordinary development of local authority services, and some of them will be picked

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    up in the ordinary local authority provisions. It might well apply in the case of an expanding town, just as it would apply in the case of a village which suddenly doubled its population. There would be little point in making a rigid distinction between rural and urban the basis of the Bill.
    If we accepted the Amendment we should be recasting the principle upon which the legislation works and making quite a different goal. I want to make it clear that where both jobs can be done and where a particular operation is primarily concerned with extending a service to a new area and happens to have the ancillary result that it improves or augments an existing supply, that can rank for grant.
    The present arrangements are fairly flexible. As I said in the Second Reading debate, the water position is much more satisfactory than the sewerage position, and one has more cause for looking critically at the sewerage position. Certainly my right hon. Friend will be doing so in the course of the next few months when it is under review.
    Mr. Graham Page: I cannot accept that the words of the Amendment go outside the Act, which states that for water supplies the Act authorises grants for improving existing supplies. What on earth can that mean except replacement, enlargement, augmenting or perhaps linking up with another supply? It cannot mean anything else.
    Mr. MacColl: The hon. Gentleman and I appear to be at cross purposes. I am not chopping law. I was giving, in the ordinary lay sense, the object of the exercise. Indeed, on 18th May, 1944, Sir Henry Willink stated:
    The object of this Bill is to foster and stimulate the making of those plans so that we shall be ready to make a sustained attack, without one day's unnecessary delay, on the problem of the 30 per cent. of the inhabitants of rural England and Wales who are still beyond the reach of adequate wholesome supplies of water in pipes."—[OFFICIAL REPORT, 18th May, 1944: Vol. 400, c. 361–2.]
    Mr. Graham Page: It is satisfactory to note that since that time the 30 per cent. has dropped to the 1 per cent. we discussed on Second Reading. Thus, the 1944 Act has had this good result. However, that does not mean that this process need come to an end now.
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    If the hon. Gentleman were now presenting a Bill it would be open to him to interpret what he meant by it and to give its intentions. But he is not doing that. He is presenting a Measure which authorises the payment of grants under a previous Act. The grants authorised under the 1944 Act extend to work on improving existing schemes, providing adequate sewerage or sewage disposal. This must necessarily include improvements to existing schemes.
    I admit that the Circular issued in 1961 was issued by a former Administration and that it was stated in it by the then Minister that grants would not be made for such improvements. But that scheme has worked for nearly five years and it was stated in the Circular that the scheme would be reviewed in three years' time. I am now asking that it he reviewed, certainly to the extent that grants for improvements be admitted.
    We are now concerned with the 1 per cent. hard core of houses in this country which do not have a water supply and, perhaps, sewerage. We can, therefore, go on using these grants for improving the existing schemes; and it is no good saying that, compared with expanding towns, the same problems exist. We have recognised, in the previous Act, that the rural districts are entitled to some assistance from the community in general in the provision of water and sewerage. Progress has been made and in these areas the point has almost been reached when dwelling houses can be supplied with water and sewerage, but to do this we must continue to use the grants for improving existing schemes.
    Amendment negatived.
    Clause ordered to stand part of the Bill.
    Clause 2 ordered to stand part of the Bill.
    Bill reported, without Amendment.
    Motion made, and Question proposed, That the Bill be now read the Third time.
    11.25 p.m.
    Mr. Graham Page: I do not think that we can let the Bill go just on the nod, as it were, on Third Reading, because I should like the Parliamentary Secretary to give us a little further assurance about the way in which this Measure will be

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    administered, and how the grants will be administered. I appreciate that this Bill is another stop-gap Measure like the Rating Bill and the Housing (Slum Clearance Compensation) Bill, but while these stop-gap Measures are on the Statute Book they have to be administered, but it is no good—
    Mr. Crossman: Hear, hear.
    Mr. Graham Page: I am glad that the Minister says "Hear hear"—but it is no good saying "We are just carrying on while we think about what to do," which is what we have been told, in effect, during the course of the debates on this Bill.
    Last year the Minister addressed a questionnaire to the water undertakings. He now tells us that he is having discussions with the local authority associations, but there has been no formal indication as to how the Bill and the grants made under it are to be administered in future. The basis of water supply and sewerage schemes and the administration of these grants in the past has been a partnership between the Government, the county councils and the water undertakings. If one of those partners, the Government, does not intend to be, in legal language, just and faithful to the other partners the partnership will collapse. Indeed, some water undertakings will soon have to find the excess money over the grant to provide water supply and sewerage schemes.
    It would be a very great pity if the partnership were to collapse because of bad administration by the Government of these grants, which has made great progress in the last dozen years, and I hope that the Parliamentary Secretary will be able to tell the House of his own proposals for reforming the assessment of the grant in order to make this Bill, when it becomes an Act, as much a success as have past Measures which have authorised these grants.
    11.28 p.m.
    Mr. MacColl: This Bill has nothing to do with anything about which the hon. Member for Crosby (Mr. Graham Page) has been talking. It is about increasing the amount of grant available for rural water supplies and sewerage by about £30 million, as there would otherwise be
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    nothing in the kitty. That sum ought to last for about five years. With great respect to the hon. Member, I do think that we have spent an awful lot of time to get this very necessary Measure approved.
    11.29 p.m.
    Mr. Scott-Hopkins: I must take issue with the Parliamentary Secretary when he says that we have taken an awful lot of time on this Measure. The amount of money involved is quite considerable, and in some areas there is very great hardship because they do not have either the water supplies or the sewerage, and now hope to get it. I welcome the Bill—it does add to the amount of money that will be available for these grants to bring that about—but I feel that the hon. Gentleman has been very cavalier in criticising and condemning my hon. Friend the Member for Crosby (Mr. Graham Page) for taking time to examine the matter. We want to make sure that the proposed way of administering the grant is the right way, and that the remaining 1 per cent. of areas concerned get supplies at the earliest possible date.
    I am extremely glad that the subject has been brought forward in this way. There are special cases in areas like Cornwall, where a large proportion of the 1 per cent. is concentrated, which will need special arrangements made for them out of the fund being provided, but we should not let this Bill go through without examination, neither should we allow the Parliamentary Secretary to say that we have been taking an awful lot of time. This is an important Bill—and important to a great many of my constituents—the sum of money involved is very considerable, and we want to be quite sure that it is rightly and properly administered.
    11.30 p.m.
    Mr. Peter Bessell: I will not take up much of the time of the House, but I wish to underline the remarks made by the hon. Member for Cornwall, North (Mr. Scott-Hopkins). Both he and I represent constituencies where the problem of sewerage and in many cases water supplies remains quite acute for a large number of people in those areas. I hoped throughout the debate in Committee for a positive assurance from the Parliamentary Secretary that the moneys which will be provided

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    under the terms of the Bill will be administered in such a way as to ensure that the hardship which at present is experienced by the 1 per cent. mentioned again and again will be alleviated and the money used to ensure that there are proper sewerage works and proper water supplies to those areas which at present are suffering real hardship. For those boroughs and rural districts which are quite unable to fund these things from their own resources, I hope that we may still have an assurance from the Parliamentary Secretary.
    Question put and agreed to.
    Bill accordingly read the Third time and passed.

  POST OFFICE SAVINGS BANK [MONEY]
  Resolution reported,
  That, for the purposes of any Act of the present Session to enable deposits in a post office savings bank to be received for investment in securities, and at rates of interest, other than those authorised by the Post Office Savings Bank Act 1954, it is expedient to authorise the issue out of the Consolidated Fund of the amount of any deficiency in the sums available to meet any claims in respect of deposits made under the said Act.
  Resolution read a Second time.
  Motion made, and Question proposed, That this House doth agree with Committee in the said Resolution.
  11.31 p.m.
  The Postmaster-General (Mr. Anthony Wedgwood Benn): I thought this an appropriate moment to answer questions raised on Second Reading of the Bill by the hon. Members for Howden (Mr. Bryan) and Hereford (Mr. Gibson-Watt), who asked whether it would be possible under the Money Resolution to increase the rate of interest on the existing Post Office Savings Bank which is now 2½ per cent. This has been queried in the past. I am sorry that the two hon. Members are not now present. I gave the political reason why this was not desirable when I spoke on Second Reading, but
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  the point arises whether the Money Resolution is wide enough for this point to be raised. It is not wide enough because it provides only for payment on deficits in the Consolidated Fund. It is excluded by the Money Resolution and also by the Long Title of the Bill, so there is no loss by having the Money Resolution drawn as it is.
  Question put and agreed to.

  WAYS AND MEANS
  [3rd December]

  POST OFFICE SAVINGS BANK
  Resolution reported,
  That it is expedient to require the payment to the Commissioners of Inland Revenue, in connection with any loans made in pursuance of agreements authorised by any Act of the present Session to enable deposits in a post office savings bank to be received for investment in securities, and at rates of interest, other than those authorised by the Post Office Savings Bank Act 1954, of the sums which would have been chargeable by way of stamp duty if each loan had been secured by mortgage by deed, being the only or principal or primary security for that loan.
  Resolution read a Second time.
  Question, That this House doth agree with the Committee in the said Resolution, put forthwith, pursuant to Standing Order No. 90 (Ways and Means Motions and Resolutions), and agreed to.

  LOCAL GOVERNMENT (PECUNIARY INTERESTS)(SCOTLAND) BILL
  Order for Second Reading read.
  Motion made, and Question put (pursuant to Standings Order No. 62 (Public Bills relating exclusively to Scotland)), That the Bill be committed to the Scottish Standing Committee.—[Dr. Mabon.]
  Question agreed to.
  Bill (deemed to have been read a Second time) committed to the Scottish Standing Committee.

  FISHING VESSELS (BUILDING SUBSIDIES)
  Motion made, and Question proposed, That this House do now adjourn.—[Mrs. Harriet Slater.]
  11.34 p.m.
  Mr. Patrick Wall: The fishing industry is facing a serious position. Not only have costs increased but fishing grounds have become more limited partly through the action of foreign Governments extending their fishery limits and also through over-fishing. There is also uncertainty over the future of the voluntary minimum price scheme which the Government could correct by introducing a statutory scheme, but the most immediate problem is the grave uncertainty about building grants.
  Before going into the whole question of subsidy and grants, I wish to make clear that I in particular and the distant-water vessel owners in general never wanted a subsidy but unfortunately events have made subsidies essential. Some examples of these events are found in the extension of fishery limits in Norway, Greenland and Iceland and the fact that middle-water vessels now, because of the extension of fishery limits, are now fishing in waters which were originally reserved for distant-water vessels.
  I would now like to take the House back to the start of the subsidy scheme for distant-water vessels. I suppose that it arose from the Fleck Report in 1960–61. The House will remember that this Committee said that the policy for the next ten years at least should be to maintain the catching power of the fleet at the current level of supply. In November, 1961 grants for building vessels of 80 ft. and over were first introduced. Some of the conditions were that for every new ton built, two old tons should be scrapped, that grants would not exceed 25 per cent. of the cost of the new vessel, that the ceiling was £50,000 and that this money was available only for conventional vessels. The House allotted £2 million for the purposes of this scheme.
  In December, 1963, the scheme was revised. It was agreed that two old vessels should be scrapped for every new vessel constructed, that the building grant should be extended to non-experimental
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  freezer trawlers—experimental vessels being covered by certain other special grants—that the grant should still remain at 25 per cent. of the total cost, but that the ceiling should be raised to £80,000 for conventional vessels and £110,000 for freezers. But the House at that time voted no additional money, and it was not until July, 1964, that an additional sum was voted, in this case £560,000. I understand that at that time, in the summer of 1964, there was a total of about £1¼ million uncommitted for building grants on distant-water vessels.
  The House will recall that in October of that year came the General Election. In November, the new Government announced that the whole question of building grants would be reviewed. I understand that the review will not be completed until the end of 1966. What was not made clear at that time was that by the end of 1964 available funds for building subsidies for distant-water vessels had run out. It was not until July, 1965, that a further £1·6 million was provided, and this sum was not only to cover the distant-water vessels but to cover the whole fishing industry, and it would have to last until April, 1967.
  I want to make it clear that of the £1·6 million voted, £860,000 was voted for vessels of 80 ft. and above—distant-water vessels—which catch, broadly speaking, 83 per cent. of the fish sold in this country. The balance of about £740,000—the sum was, therefore, divided nearly 50–50—was allocated to the smaller vessels, inshore vessels and others, which altogether catch only 17 per cent. of the fish sold in this country. Although it may have been thought that £860,000 was a fair amount, it must be borne in mind that not only had this sum to last until April, 1967, but it had to fill the gap from the period when the funds ran out in November of the previous year. In other words, it had to be spread over two years and three months. I want the House, to consider the result of this paucity of funds for building grants, first on the distant-water fishing fleet, secondly on the White Fish Authority and in particular on the Port of Hull.
  First, I will deal with the result on the distant-water fleet. No new grants have been provided since the money ran out at the end of 1964. I have said that the

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  £860,000 had to cover no less than two and a quarter years from November, 1964, to April, 1967. I understand that it is estimated that already applications for building grants made to the White Fish Authority total between £4 million and £5 million—and this at a time when the total sum allocated by this Government and the previous Government to distant-water vessels amounts to £2¼ million, whereas the total sum allocated over the years to smaller vessels, the near, middle and inshore fleets, totals about £20 million. This emphasises the disparity.
  I suggest to the House that this position is particularly serious because since 1960 the distant-water fleet has shrunk from 234 to 190 vessels or by about 20 per cent. Although new vessels are going forward. 31 of the existing vessels were built before 1948 and are due to be replaced in the early 1970s. Therefore, the distant-water fleet is facing a pretty serious future.
  Turning to the effect on the White Fish Authority, I suggest that the Authority is set a virtually impossible task because it has to make £860,000 cover grant applications ranging up to £4 or £5 million. It has been suggested that there should be a lowering of the ceilings for grants, For example that the ceiling for freezer trawlers should be reduced from £110,000 to £80,000. This would be grossly unfair, particularly to the small firms. It is clear that the larger firms have the capital to build these expensive ships and take the initial risk. Now these vessels have been proved and the smaller firms are asking for grants to build them; if they are to be denied the same amount of grant as their larger competitors had originally they are placed in an invidious position.
  I understand that there has also been a tendency for the larger firms to put in bulk applications for three or four vessels together, which is impossible for the smaller firms. Therefore, the reduction of grant would be very unfair to the smaller firms engaged in the catching industry. It has also been suggested that the White Fish Authority should set up some system of priorities—in other words concentrate the grants on the stern fisher freezers which are obviously the vessels of the future. This form of priority is possibly justified but, again, this is tough on the smaller firms who cannot afford
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  this expensive and sophisticated type of vessel.
  It is clear that many of the applications will have to be turned down and this will have an effect on shipyards, because if building grants are not available for the large programme for which applications have been made it is clear that many owners will have to go abroad where it will be cheaper to build than in this country, for example, to Poland.
  The White Fish Authority has therefore been placed in an impossible position. It must have more funds before 1967 to carry out its task and to make an equitable allocation of grants to cover at least 60 per cent. to 70 per cent. of the applications already made. Faced with the Government's apparent lack of understanding of the position, it is perhaps no wonder that the Chairman of the White Fish Authority wrote an article in The Times on 12th November pointing out the many problems at present facing the Authority—problems of minimum prices, quality control, fish farming, and promotion.
  I will quote only part of the article, referring to building grants, in which the Chairman said:
  "There must also be fresh thought on the purposes of grant and loan assistance to encourage modernisation of the fleet."
  Referring to the industry as a whole he said,
  "… the possibilities are so great and the money involved so comparatively small that, even in these difficult times, the nation would surely be making a sound investment."
  I believe that Mr. Roy Matthews was quite right in making that statement.
  We must allocate more money to the fishing industry and in particular to the Authority to carry out the task which it has been set by this and the previous Government. I do not believe that it can carry out that task, not only as far as building is concerned but in other respects, without a further allocation of funds.
  I turn finally to the effects of these problems on the port of Hull which is by far the greatest fishing port in this country. In Hull, the distant-water fleet has fallen in numbers in the last three years from over 140 trawlers operating from the port to about 110. In addition, many of the vessels were built between

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  1948 and 1952 and therefore will be due for replacement by the 1970s. An impossible situation is facing the owners. They cannot plan ahead. Applications have been held up for many months because funds will not cover them. Obviously an owner cannot start building until he has approval otherwise he loses any possibility of a grant. Thus, the forward planning replacement programme of the industry over the years is thrown out of gear.
  Unless the Government can make more financial provision for building grants there will inevitably be further shrinkage of the fleet operating from Hull. The situation is serious and cannot wait until completion of the present review due at the end of 1966. I quote the Chairman of the Authority again:
  "I hope the Government will reach a positive, a clear-cut and a happy solution of all these problems."
  Hull is feeling very sore, as no new trawler building grants have been approved since the Government took office. The roads programmee has been delayed until the 1970s. There is to be no Humber bridge and there is the threat of a new town in Lincolnshire and a rumour that Immingham may be built up as a modern fishing port to compete with Hull. The Joint Parliamentary Secretary may laugh, but Hull is not happy with the Government's present policy and wants to see positive results from the Government.
  11.47 p.m.
  Mr. James Johnson: The hon. Member for Haltemprice (Mr. Wall) has a deep and personal interest in deep sea fishing. He is my neighbour. In his division are many workers from Hull. But I feel that he is somewhat closer to the fishing owners in his case tonight. I am Member for Hull, West and I have in my constituency fishermen, bobbers, filleters and auctioneers—those who work in the dock itself. Perhaps this explains our different attitudes. My constituents live and work in the docks.
  The hon. Gentleman and I both wish to have a dynamic and healthy deep sea fishing industry in Hull. But, of course, this can be achieved in different ways. He wishes to shore up the industry by
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  the taxpayers' money. I do not desire any subsidy for the owners. I believe that it is possible for these tough, individualistic, adventurous industrialists to stand on their own feet. He thinks they need help. Candidly, I do not think so in the manner he does.
  I think that the owners have been doing fairly well. I have been there for two or three years, listening to the well-informed men on the dockside. I am not sure that all the owners themselves wish for a subsidy. All sections tell me that they are doing well and do not need help at this time. Obviously I am against the net subsidy of £12 per day for vessels which voyage into deep waters. This is given to all vessels whether good, bad or indifferent.
  But for some companies the building subsidy may well make all the difference—the small fishing firms which may be short of capital, for instance. These are what I term the old family firms in Hull. The Fleck Report said certain things about the future of the industry. I know that the fleet has declined in numbers. The hon. Gentleman was quite correct with his figures. But there are still some 30 vessels left in the fleet which were built before 1948. These will be obsolescent by the end of the transitional period in 1972. The big combines—Associated Fisheries, the Ross Group and others—are, I believe, doing very well. They can raise their money in the open market. The hon. Gentleman spoke of the smaller firms. A case can be made out for the middle sized firm found in Hull, the older family firm. I believe that the firms must justify their applications with facts and figures when they go before the White Fish Authority.
  I believe that the British Trawler Federation has asked for about £2¼ million for the immediate future for all purposes. The Minister said some weeks ago that £860,000 was available until May, 1967. In view of the financial stringency facing the country, in my opinion the vessel owners must accept this with good grace and not complain. When I think of what is happening to other sections of our economy, particularly the coal mining industry, to which my people belong, when I think of pits being closed and thousands of men who have worked 30, 40 and 50 years in the pits being asked to do something else,

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  I cannot believe that the fishing industry cannot also play its part in the future of our economy.
  11.51 p.m.
  The Joint Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. James Hoy): I want to say something in reply to the debate raised by the hon. Member for Haltemprice (Mr. Wall). His peroration had nothing to do with the fishing industry—absolutely nothing. He thought that it was not a bad start to make to a by-election that will take place in Hull, and anyway for him it was a change from discussing Rhodesia. I am sure that Hull was delighted that he had time in his Parliamentary itinerary to mention it tonight. That was what the peroration was about.
  The hon. Member also spoke about the £4–5 million. My hon. Friend the Member for Kingston upon Hull, West (Mr. James Johnson) took a very balanced view of the whole matter. I am a little surprised at the hon. Gentleman and those associated with him. They are for ever coming to the House and telling the Government that they must cut taxation. They say that we must have cuts in taxation. Then they come along every night to demand that the Government provide more and more money for every possible subject. Hon. Gentlemen opposite had better make up their minds where the money is coming from.
  Mr. Wall: The Conservative Government provided it.
  Mr. Hoy: They did not manage to do that. They laid down a programme, but they did not provide the money. The present Government have had to provide the money to meet what was laid down then. In 1964, the then Government were always handing out money no matter who came along. They said "This is going to be an Election year. Have all the money you want. Have all the approvals you want." But the present Government have had to find the money to pay for it. The hon. Gentleman had better keep that in mind when he goes to Hull.
  The hon. Gentleman said that there were applications for £4 or £5 million worth of vessels. That is just not true. It may be an expression of intention, but there have been no applications to that
  206
  exent The hon. Gentleman had better not get the two things mixed.
  Mr. Wall: What do the applications come to?
  Mr. Hoy: They would be made to the White Fish Authority, and there have not been hard and fast applications. They do not come to us, as the hon. Gentleman knows. It is for the White Fish Authority to receive applications and make decisions accordingly.
  I should like in the time available to discuss the question of the adequacy of the funds that have been provided for grants for building fishing vessels, because I think this is important. My right hon. Friend in July, as the hon. Member said, made clear what was happening. My right hon. Friend recalled that we were continuing the policy which had been laid down even by the hon. Gentleman's own Administration. To that no objection was taken. The effect of that was that there was limited assistance for replacing old vessels without expanding the fleet. The hon. Gentleman said that, and this is what is happening. My right hon. Friend went on to say that the modernisation of the near and middle water fleets had been substantially achieved, and he accepted that the distant water fleet had further to go. But he recalled that a substantial number of freezer trawlers are being built—that is exactly what I was saying to the hon. Member—and, I may add, being paid for this year and next. The approvals were all right, but the cash had to be provided; and that is what is being done now.
  My right hon. Friend went on to remind the House that there were great uncertainties—these had been expressed on previous occasions—about the numbers and types of vessels which would be required in the future. One of the objects of the review of policy which is being undertaken is to try to resolve these uncertainties, and I think that this was the intention of the previous Administration also.
  It is against this background that. we have provided a total of £1·6 million for grants to be approved this financial year—that is, what remains of it—and next. I accept that this is not enough to assist as many vessels as the industry could conceivably build, but that is not our object,

  207
  and neither was it the object of the previous Administration. There has always been a limit to the amount of new building it would be wise to encourage. The sum provided is, in our view, an adequate amount of assistance for the rate of building which is required in the short period involved.
  It is no more than prudent to take stock of the freezers now coming into the fleet and try to assess future requirements before committing ourselves to the longer term. Comparisons between one year and another can be overdone. New building tends to be undertaken in fits and starts, and limited periods, therefore, tend to be unrepresentative. The average of £800,000 for approvals this year and next compares favourably, to put it no higher, with the average of £700,000 in 1962–63 and 1963–64. True, it is only half the figure of £1·6 million for the peak year 1964–65, but £1·2 million of this represents the existing programme of freezer trawler building which is still going on. It is not a figure to be matched every year, and neither was it ever intended to be.
  I come now to the division of funds between the trawler fleet, on the one hand, and the inshore and herring fleet on the other. The allocation to inshore and herring vessels is £740,000, somewhat less than half the total sum, but a good deal more than was provided in previous years. We have accepted the view of the White Fish Authority that rebuilding in the inshore fleet has been somewhat restricted in previous years, and we have taken steps to put this right. The allocation to the trawler fleet is £860,000, and it is this that the hon. Gentleman has criticised. I accept that the proportion allocated for the current year is £190,000. It is small, but the hon. Gentleman will recognise that there is not very much of the current year to go. The balance of £670,000 for next year is a fair figure for a full year and, frankly, it is in line with the industry's own view.
  Mr. Wall Mr. Wall indicated dissent.
  Mr. Hoy: Yes, that is so. It is no good the hon. Gentleman shaking his head. He was confused in his figures. He mixed up a three-year period with a one-year period. This is for next year.
  208
  If he cares to treble it for three years, he will get nearer to the figure for which he has been looking.
  In saying that the sum available for trawlers this year accords with the time available for giving approvals, I do not overlook the fact that a year has passed since the funds provided for approvals by the previous Administration were exhausted. I realise that the industry has felt some impatience—
  Mr. Wall: The year during which right hon. Gentlemen opposite have been in power.
  Mr. Hoy: It is easy to give approvals and not provide the cash, as I have explained. We have had to provide the cash for the programme which the previous Administration approved without finding the cash. It is fair to recall that a substantial programme of freezers has already been approved and these vessels are now in the process of joining the fleet. The previous Administration made no provision for anything more and it fell to us to carry out the review which it had proposed. I think that all concerned in the Authority and the industry appreciate how difficult this has proved to be.
  Nevertheless, we have made this further provision despite the need for economy in expenditure and despite the uncertainty of the future. We have done so because, as was said in the Gracious Speech, we believe in promoting the economic development of the industry and we are prepared to back our judgment. I underline the word "economic" because we owe it to the taxpayer and the industry to encourage what is sound in investment. Anybody who knows anything about the industry will know just how correct that is.
  It has been suggested that the trawling industry has far more building in hand than the grants available will run to. We should be failing in our responsibility if we set out to provide for every vessel which might be built. The previous Administration said quite clearly in its 1961 White Paper, which the hon. Gentleman will recall, that the industry might well finance some of its own building. What we have set out to do is to provide sufficient assistance for the amount of building which we consider reasonable in the short term. Only time will tell whether

  209
  there is more to be done and that is the purpose of the studies which are now in hand.
  As the hon. Gentleman said and as my hon. Friend reminded us, it is true that in the past three years there has been a reduction in the size of the trawler fleet. About 50 vessels have left the distant-water fleet and about 100 have left the near and middle-water fleet, but as against this about 25 new distant-water vessels and about 50 near and middle-water vessels have come in. We must remember that the new vessels' are much more efficient catchers than those which they have replaced. If the hon. Gentleman wants the reason for that—and his hon. Friend the Member for Cornwall, North (Mr. Scott-Hopkins) can remind him—the previous Administration laid down quite clearly a replacement ratio of broadly one new vessel for two old. That is exactly what has happened. It is no use the hon. Gentleman complaining about it as though it were some responsibility of the present Government, when the plan was laid down by the previous Government. Nor need he get excited about because we all agreed to the programme. He regards the falling number as though it were something terrible.
  210
  I am simply saying that this was the programme which was laid down by the previous Administration.
  I have given the House the broad allocation of the funds between trawlers and other vessels. As I said in the fishery debate in July, the Government have never laid down precisely what should be spent on each section of the fleet, or on what type of vessels. No Government have ever done that. This is the responsibility of the White Fish Authority which has taken the industry into its confidence in this matter. It is a responsible task to decide how the approvals should be given, but I know that the House has confidence in Mr. Matthews, the Chairman of the Authority, the Authority itself and his colleagues on it. We are well aware of our debt to him, and I have expressed it on a number of occasions. The hon. Gentleman says—
  The Question having been proposed after Ten o'clock on Monday evening and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
  Adjourned at four minutes past Twelve o'clock.

MINISTRY OF LABOUR
  Restrictive Practices
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MINISTRY OF TECHNOLOGY
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  Old People (Consessionary Fares)
  Old People (Consessionary Fares)
  Christmas (Road Accidents)
  Christmas (Road Accidents)
WALES
  Water Resources
  Water Resources

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

CONTROL OF LONDON OFFICE BUILDING
2.36 p.m.
LORD MOLSON: 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 whether they will state:—

(a) the number of applications which have been made under the Control of Office and Industrial Development Act, 1965, to build or provide offices in London;

(b) the number which have been granted and the superficial area;

(c) the number which have been refused.]

THE PARLIAMENTARY SECRETARY, BOARD OF TRADE (LORD RHODES): Yes, my Lords, under (a) 413 applications for office development permits in Greater London had been made by the end of November, 1965; under (b) 84 permits have been granted for a
2
total area of approximately 1·7 million square feet; and under (c) 172 applications have been refused.
LORD MOLSON: My Lords, I am very much obliged to the noble Lord.

USE OF SURPLUS RAILWAY LAND
2.37 p.m.
LORD MOLSON: 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 how much railway land within the Greater London area has been declared by the Railways Board to be redundant; how much of this has been made available to the Greater London Council and how much to London boroughs for housing and at what average price per acre; how much has been made available to local authorities for other public purposes; and how much to private individuals or companies.]
THE PARLIAMENTARY SECRETARY, MINISTRY OF TRANSPORT (LORD LINDGREN): My Lords, I understand from the British Railways Board that since January 1, 1964, approximately 800 acres of its land in the Greater London area have been declared surplus to railway requirements or likely to become surplus in the foreseeable future. The local authorities have been, or will be, informed of these sites. Of this total, the Board has already sold or agreed to

3
sell, first, 140 acres to the Greater London Council, at £125,000 per acre for 28·2 acres at Marylebone and at an average price of £9,900 per acre for the rest; secondly, 84 acres to London boroughs at an average price of £15,900 per acre. The remainder of the 800 acres are still under negotiation or investigation or are not yet available for release. I understand that the local authorities propose to devote the greater part of the land they are acquiring from the Board to housing and associated purposes. Apart from these 800 acres, the Board has sold to private interests approximately 100 acres, including fully developed sites unsuitable for new development. This land had been declared surplus before 1964 and the sale of most of it had been negotiated before that year.
LORD MOLSON: My Lords, I am very much obliged to the noble Lord for what is an unusually full and complete Parliamentary Answer.

COMMONWEALTH PEACE MISSION AND VIETNAM
2.39 p.m.
LORD BROCKWAY: 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 whether representations have been made by members of the Commonwealth Peace Mission to the Governments of the United States of America and North Vietnam regarding intensification of the war in Vietnam and the immediate need to initiate a cease-fire, and negotiations for a settlement on the basis of the Geneva Agreement.]
THE PARLIAMENTARY UNDERSECRETARY OF STATE FOR FOREIGN AFFAIRS (LORD WALSTON): My Lords, the United States Government have repeatedly reaffirmed their readiness for negotiations, but these have been rejected by North Vietnam. Nevertheless, Her Majesty's Government will continue, through every channel open to them, to urge on all concerned the imperative need for negotiations to end this intensifying war.
LORD BROCKWAY: My Lords, while thanking the noble Lord for that Answer,
4
may I ask him whether it is not the case that, while the United States has said that she would be prepared for unconditional negotiations, she has added conditions regarding the maintenance of a separate South Vietnamese State? Also, is the noble Lord aware that, as I shall endeavour to urge in a later debate, my own talks both with North Vietnam and with the National Liberation Front indicate that if the four points of the Geneva Agreement were accepted, negotiations could begin for a cease-fire and for a peace settlement?
LORD WALSTON: My Lords, I cannot say that I am aware of the facts as my noble friend has stated them. The facts of which I am aware are that the United States has on many occasions in the last six months stated publicly and explicitly that she is prepared for talks without any conditions whatsoever. However, the North Vietnamese Government has refused to enter into any talks and has demanded acceptance of its four preconditions, which mean, in effect, the cessation of South Vietnamese assistance by the United States Government. Also, on more than one occasion, the Government of China has further said that talks or negotiations are out of the question.
LORD BROCKWAY: My Lords, I defer comment until the debate.

CIVILIAN CASUALTIES IN VIETNAMESE WAR
2.41 p.m.
LORD BROCKWAY: 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, in the interests of peace, representations have been made by member of the Commonwealth Mission or by the Foreign Office to the Government of the United States of America regarding the decision to direct bombing not only on military targets but on civilian communities, and to the widening use of gas and chemical instruments of war which are destructive of the lives and livelihood of the peasant population.]
LORD WALSTON: My Lords, so far as we know, no decision to change the

5
character of their bombing has been taken by the U.S. Government and therefore no representations have been made by Her Majesty's Government. So far as I am aware, the only gas being used in South Vietnam is tear gas, and I am sure that my noble friend would not wish me to press for the use of more lethal weapons, because tear gas can actually preserve lives that would otherwise be lost.
LORD BROCKWAY: My Lords, while again thanking the noble Lord for his Answer, may I ask whether he has seen the statements which have been made during visits to South Vietnam by representatives of the United States: that the war must now take the form of a total war, which means the destruction of villages, women and children, and the burning of their bodies in an inhuman way, which is just affronting the conscience of the world? Cannot Her Majesty's Government make some appeal, not only to America but also to the other side, which has been engaged in assassinations in Saigon, for these methods to be stopped?
LORD WALSTON: My Lords, Her Majesty's Government and I naturally share with the noble Lord his horror at the killings and sufferings which are taking place there, but I am afraid the only way in which this can be brought to an end is by an end of hostilities themselves. It is idle to think that an appeal to any of the participants for moderation, while it might have some effect, if there were any opportunity for it, would increase humanity. I do not accept that there is deliberate inhumanity on the part of the United States Government. But the only way in which this undoubted suffering can be brought to an end is by bringing to an end the actual fighting itself.
BARONESS SUMMERSKILL: My Lords, would my noble friend not agree that, if bombing is intensified, the Vietnamese will become more obdurate? Therefore, is it not feasible that the right atmosphere, in which discussions might be initiated, could be created by asking the Americans if they would cease bombing for a temporary period—say, two weeks—during which time perhaps tempers would cool off a little and it might be possible to have discussions?
LORD WALSTON: My Lords, it would be a very happy circumstance indeed if that were likely to be the case, but I am afraid that experience has already shown that the very opposite happens. As the noble Baroness doubtless remembers, there was a temporary cessation of bombing—speaking from memory, I think it was in April or May of this year, about six months ago—but there was no response whatsoever from Hanoi after that; and, in fact, recently, in their attack on Russian policy, the Chinese repudiated the idea of negotiation if the bombing of North Vietnam stopped unless all U.S. troops were withdrawn. Therefore I am afraid that any cessation of bombing would not have the desired effect, but might even be counter-productive, in that it might suggest to the North Vietnamese and to the Chinese that they were on the point of winning.
LORD BROCKWAY: But, my Lords, is it not the case that the previous pause was for only five days? Does the Minister really think that within that short period there could be the opportunity for renewed negotiations?
LORD WALSTON: My Lords, I think that five days would be long enough if there were real eagerness on the part of the North to negotiate. But even if it were not long enough, the statement I have just quoted from the Chinese Government shows that they are in no way impressed by any cessation of bombing.
BARONESS SUMMERSKILL: My Lords, is my noble friend not being rather defeatist? If the bombing had ceased for five days during the blitz in this country, at no time should we have said, "Now the Germans are prepared to negotiate peace". Five days is just about enough time for an enemy to say, "Well, he is getting a second breath". Could my noble friend really not suggest at this stage, when we see this senseless bloodshed, that another effort should be made by the United States? Could he not ask them to try for two weeks, or even a month, before they start again? Discussions will have to be initiated eventually. Why not at this stage try to save the thousands of lives which might be saved?
LORD WALSTON: My Lords, I could not agree more with the final remarks of my noble friend—" Eventually, this will be settled by negotiation; why not do it now?" My right honourable friend the Secretary of State has said that on more than one occasion in making his appeal. But surely the correct and only possible way in which negotiations can now be started is for the North to respond to the often repeated offers of the United States to come and talk to-day without conditions.

FOREIGN SECRETARY'S VISIT TO MOSCOW
LORD SHEPHERD: My Lords, at a suitable moment after 3.30 p.m. my noble friend Lord Walston will be making a Statement on the Foreign Secretary's visit to Moscow.
COAL INDUSTRY BILL
Brought from the Commons on Friday last, and printed pursuant to Standing Order No. 45; read 1ª.

BUSINESS OF THE HOUSE
LORD SHEPHERD: My Lords, I beg to move the Motion standing in the name of my noble friend the Leader of the House. Perhaps I should apologise to the House for any inconvenience caused by bringing this Bill forward, but the reason is that, as the House will know, we are faced with a long debate to-morrow, and the usual channels felt that we should bring forward the two Bills mentioned on the Order Paper. It was necessary for this Bill to be brought forward because it needs to receive the Royal Assent by December 13, when a previous piece of legislation is due to expire. My Lords, I beg to move the first Motion.
Moved, That the Second Reading of the Housing (Slum Clearance Compensation) Bill (which stands appointed for
8
To-morrow) be advanced to To-day.—(Lord Shepherd.)
On Question, Motion agreed to.
LORD SHEPHERD: My Lords, I beg to move the second Motion on Business.
Moved, That the Third Reading of the Corporation of the Trinity House of Leith Order Confirmation Bill (which stands appointed for Tuesday the 14th December next) be advanced to To-morrow.—(Lord Shepherd.)
On Question, Motion agreed to.

PERSONAL BILLS COMMITTEE
THE CHAIRMAN OF COMMITTEES (THE EARL OF LISTOWEL): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That a Committee be appointed to whom all Petitions for Personal Bills shall stand referred; and that the Lords following, with the Chairman of Committees, be named of the Committee:

V. Gage,

V. Simonds,

L. Cohen,

L. Grantchester,

L. Morton of Henryton,

L. Silkin.

—(The Earl of Listowel.)
On Question, Motion agreed to.

LEAVE OF ABSENCE
LORD SHEPHERD: My Lords, on behalf of my noble friend the Leader of the House, I beg to move the Motion that stands in his name on the Order Paper.
Moved, That a Select Committee be appointed for the general supervision of arrangements relating to leave of absence, and that the Lords following, with the Chairman of Committees, be named of the Committee:

E. St. Aldwyn,

L. Amulree,

L. Shepherd.

—(Lord Shepherd.)
On Question, Motion agreed to.

EXPIRING LAWS CONTINUANCE BILL
2.49 p.m.
Order of the Day for the Second Reading read.
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE, HOME OFFICE (LORD STONHAM): My Lords, I beg to move that the Expiring Laws Continuance Bill be read a second time. As I expect your Lordships are aware, this is something of an "all-sorts" Bill. It continues in force a miscellaneous collection of measures which would otherwise expire on the 31st of this month. It deals with immigration, horror comics, public-houses, accommodation agencies and the powers of the Ministry of Aviation. It is beyond my powers to find a coherent theme in all this, and I shall not attempt to do so.
I shall speak primarily of the two immigration measures, the Aliens Restriction (Amendment) Act, 1919, and the Commonwealth Immigrants Act 1962. My noble friend Lord Champion, who will be winding up the debate, will discuss the other measures at whatever length the debate indicates to be necessary. He will also deal with the wider aspects of immigration; the problems of integration, housing, health and education. My purpose is to discuss the crucially important measure by which we control the admission and stay of aliens and Commonwealth citizens in this country.
First, I will say a few words about the Children and Young Persons (Harmful Publications) Act 1955, because whereas all the other measures to which I have referred are hardy annuals, this Act is making its debut in an Expiring Laws Continuance Bill. It was passed ten years ago to deal with a situation created by the importation from the United States of America in the early 1950s of a large quantity of what came to be called "horror comics". Noble Lords may remember that representatives of the teaching profession and of the Church expressed concern about the effect of the comics on the impressionable minds of children. Under the Act it is an offence to print, publish or sell horror comics or to have them in possession for sale. Provisions are made for their for
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feiture, and their importation is prohibited.
During the passage of the Bill through Parliament apprehension was expressed as to its scope and about the possibility of interference with the legitimate freedom of expression, and in deference to these opinions the Act was give a limited life of ten years. It was provided that proceedings should be brought in England and Wales only with the consent of the Attorney General. I am glad to say that the Act has been entirely successful. Importations of horror comics have ceased, and it has not been necessary to bring any prosecutions. In the circumstances, I do not think there can be any ground for complaint about the way in which the Act has been operated. However, we know that there is still in the United States of America a flourishing market for these comics and any relaxation in our law might well result in their entry into this country. Hence the Act's inclusion in the Schedule to the Bill.
Now, my Lords, for the more important matters. First, aliens. Your Lordships will have heard many times how, at the outbreak of the First World War, the Aliens Restriction Act 1914 was passed. It was more comprehensive than previous legislation and enabled the Home Secretary to impose further restrictions on all aliens in time of war, of imminent danger or of great emergency. Section 1 of the Aliens Restriction (Amendment) Act 1919 provided that, for a period of one year only, the power conferred by the 1914 Act should be exercisable not only in those circumstances but at any time. This power has since been continued from year to year by successive Expiring Laws Continuance Acts. Control over aliens is at present exercised through the Aliens Order 1953 (which consolidated previous Orders), as amended by the Aliens Orders in three later years. These Orders make provisions for dealing, among other things, with the landing and embarkation of foreigners and with the control of their activities here.
The fact that the control of foreigners in peace time has for over fifty years depended upon temporary legislation has been, naturally enough, a source of criticism for many years. There is general

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agreement that it is anomalous and illogical, that powers which seem likely to be needed for the foreseeable future should not yet have found a permanent place in the Statute Book. Year after year, for decades, the Government of the day have agreed in principle on the need for permanent legislation; but nothing has been done. The Act of 1914 is proving as durable as that other temporary, emergency, war-time measure—income tax. This Government have taken a first step toward the achievement of permanent legislation. We have set up a Committee to consider a key problem of any review of the aliens law—the possibility of giving both aliens and Commonwealth citizens a right of appeal against refusal of leave to land and deportation. As your Lordships know, the Prime Minister announced, during the debate on the Address, that a small independent Committee is to be appointed with the following terms of reference:
" To consider whether any, and if so what, rights of appeal or other remedies, should be available to aliens and to Commonwealth citizens who are refused admission to, or required to leave, the country ".
Sir Roy Wilson, who is the President of the Industrial Court and a distinguished lawyer, has agreed to serve as the Chairman of the Committee.
No doubt we shall be told by those responsible for years of total inertia that this first step is the wrong step or that it is not a big enough step forward. We may be told that legislation should have been introduced without delay and without special consideration of the problems involved. I am sure that your Lordships will see that the study we have undertaken is a necessary preliminary to worthwhile permanent legislation. Until this Committee presents its report and a Bill can be prepared and fitted into the numerous other demands on Parliamentary time, we must either pass the Bill before us or enter the coming year with no control whatever over the admission and residence of foreigners. There is nothing in the present state of the world to suggest that this is a suitable time to dispense with this power. Security considerations are of obvious relevance; and so is the pressure of the would-be immigrants wishing to settle here for economic or social reasons. We feel
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great sympathy for those who are driven by conditions in their own countries to try to make a better life for themselves here, but this small and overcrowded country can afford to absorb only a limited number of immigrants. In present circumstances there can be no reversion to the nineteenth century concept of the "open door", particularly when we are seeking the continuance of a power to regulate the admission of our fellow citizens from the Commonwealth.
It has been suggested, in another place, that the terms of reference of the new Committee are inadequate because they do not cover the rules which govern the admission of foreigners. But, my Lords, these rules are a matter of Government policy; the Government must have the right to decide who may enter the country and who should be excluded. The Aliens Order 1953 forbids an immigration officer, without the authorisation of the Home Secretary, to allow an alien to land in the United Kingdom in any of the following cases: if he is not in a position to support himself and his dependants; if he proposes to work and has not first obtained a labour permit; if he has been sentenced in another country for an extradition crime; if he is a person of unsound mind; or if it is certified by a medical inspector that it is undesirable for medical reasons that he should be allowed to land.
But there are certain other persons who do not fall within these categories though they may be undesirable for one reason or another. There are those, for example, who represent a threat to this country's security or whose activities are inimical to a freedom-loving society. A case in point is that of Lincoln Rockwell, the American Fascist. Then there are those with criminal propensities, such as drug traffickers, who must be refused admission. In general, the intending immigrant not eligible for settlement here under any specific head of policy is not admitted. But although we must have some control over foreigners, we must see that this control is exercised with fairness and humanity.
The effect of a decision to refuse admission to the individual foreigner or his family may be far-reaching. The most full and sympathetic consideration is always given to each case. When there is any doubt, the foreigner is invariably

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allowed to telephone friends or relatives, or those who may speak on his behalf. In any event, the immigration officer never refuses admission on his own authority. Difficult cases are referred to the Home Office in London, and not infrequently to Ministers. I can vouch personally for the sympathy and skill with which immigration officers do their job. I have seen them at work. There is no ground at all for saying that the wide executive powers they exercise on the Home Secretary's behalf are in any way abused. A glance at the refusal figures will bear this out. Nearly 2,700,000 foreigners entered the United Kingdom in the year ended September 30, 1965, and only 4,154 were refused leave to land. This is 0·15 per cent., or one in just under 700.
Nor do we operate an illiberal policy when it comes to expelling foreigners already here who have in some way abused our hospitality. If our system of immigration control is to be effective, the Home Secretary must have the power to deport those who cheat their way into the country, or who refuse to comply with the conditions upon which they were admitted. This ultimate sanction must also be available against a foreigner who has offended against the laws of our country which has offered him a second home.
The Home Secretary never signs a deportation order without considering all aspects of each individual case. He has the final responsibility for a decision to deport, and he takes each decision personally. Every mitigating circumstance is taken into account; for instance, marriage to a British subject, a good work record, or previous long residence here. If a foreigner has lived here for two years or more and is not being deported on security grounds, he may plead his case, with legal advice if he wishes, before the Chief Metropolitan Magistrate at Bow Street. And where the Chief Magistrate has disagreed with a proposal to deport, no Home Secretary has yet signed a deportation order. If a deportee wishes to go, not to his own country but to another, then everything possible is done to meet his wishes. The deportation order requires him merely to leave and stay out. If there is another country willing to receive him, he is allowed to proceed there.
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I hope your Lordships will agree with me when I say that these procedures are far from being harsh and arbitrary. Indeed, when one considers that over 400,000 foreigners are here at any one time—and the number is probably well over half-a-million in the holiday season —then the figures of 59 deportations, covering every kind of case, made last year, and of 54 made in the first nine months of this year, can be viewed in their proper perspective. It is quite untrue to suggest that this aspect of the control, or indeed any aspect, is not exercised with the greatest sympathy and humanity.
LORD ROYLE: My Lords, may I interrupt my noble friend? The figures he has quoted with regard to deportations refer purely and simply to aliens and not to members of the Commonwealth? Is that right?
LORD STONHAM: Yes, my Lords, I am glad to make that clear. I have not yet begun to deal with the Commonwealth Immigrants Act, 1962, but I shall do so quite shortly, and I will give such figures as are available.
It is sometimes suggested that an alien who is refused leave to land, or who is deported should always be told the reason for the decision. Normally he is told, but there are cases—for example, those which involve the protection of the individual, security considerations, mental health, or crime—where disclosure would not be appropriate. By far the commonest reason for refusal of leave to land (last year it accounted for well over a third of the total) is that the foreigner has come to work without a valid labour permit. Such persons are left in no doubt about why they have been refused admission. Staff at the Home Office are instructed that if a friend or representative of a foreigner who is refused leave to land, or any other person with a legitimate interest in the case, asks the reason for the decision, he should, wherever possible, be given a clear and concise explanation. I submit that if you accept, as I think you must, that the "open door" policy is no longer a practicable policy then I think you must accept that our alien immigration policy is necessary, and it is with confidence that I ask your Lordships to agree that these provisions should be continued for another year.

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The next question before the House is whether Part I of the Commonwealth Immigrants Act, 1962 should continue in force during the coming year. I believe that the great majority of people in the country think that it should, because it is now generally agreed that there must be power to regulate the flow of immigrants from overseas into this densely populated island. Controversy starts over the extent of the powers required for this purpose and the way in which those powers are exercised. In asking the House a year ago to continue the control during 1965, my right honourable and learned friend the Home Secretary said:
"We must reshape our control. We must watch the problem as it develops and so shape our legislation as to deal with it in all its various phases."—[OFFICIAL RFPORT. Commons, Vol. 702, col. 289-290: 17/11/64.]
The conclusions we have reached, after a comprehensive review of the control, were laid before the House in August, but as there has not yet been an opportunity for us to debate them your Lordships may now wish me to give the reasons for our decisions.
In 1964, when we took office, 55,900 Commonwealth citizens from overseas were admitted for settlement, compared with 56,071 in 1963. The total volume of immigration had thus remained at about the same level, despite the fact that the previous Government had halved the number of voucher-holders admitted—. from 30,125 in 1963 to 14,705 in 1964. That is the number of voucher holders actually admitted, as distinct from the number of vouchers issued. We therefore believed that unless new restrictions were imposed, the total volume of immigration would continue to rise at a substantial rate. The Government also found that evasion of the existing control was being practised on a considerable scale. Some would-be immigrants were claiming false relationships with Commonwealth citizens already resident here, or were falsifying their ages—29 year-olds having a very close shave and trying to come in as 16-year-olds—in order to appear to qualify for admission as dependants. Others, although fully intending to stay here, were passing themselves off as temporary visitors or students. I announced on February 4 this year that the Home Secretary was taking action
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within the framework of the existing law to combat evasion, and made it clear that this action was being taken as an interim measure pending the outcome of the general review that the Government were conducting.
The 1962 Act gives the wife and the children under 16 of any Commonwealth citizen the right to accompany or join him here. One of the first questions that the Government had to consider in the course of their review was whether this right should be withdrawn or modified. We decided against any change, and I firmly believe that the consensus of opinion in Parliament and the country has supported our decision. It followed that any reduction in the number of Commonwealth citizens admitted for permanent settlement could be only through a reduction in the number of employment vouchers issued. In fixing the new limit on the number of vouchers, the Government had to take account of the fact that voucher-holders are usually accompanied or eventually joined by several dependants. The number of dependants still overseas who have a statutory right to join immigrants already settled here cannot be estimated with any accuracy, but last year 67 per cent. of the Commonwealth citizens admitted for settlement were dependants.
It is therefore quite wrong to suggest that we have decided to admit only 8,500 Commonwealth immigrants a year. In fact, the only numerical limit on the entry of Commonwealth immigrants is that which governs the issue of vouchers. A single voucher guarantees the admission not only of the holder but also of his wife and of any children he has under the age of 16. In addition, as I mentioned two weeks ago, the family may be joined by older children under 18 years of age who are still dependent, by elderly parents and so forth. Thus, one cannot say in advance precisely what will be the effect on the total volume of immigration of the issue of a given number of vouchers, but obviously a substantial reduction in vouchers was unavoidable, if the total volume of immigration was to be kept within manageable bounds. Even after this reduction, there is no guarantee that the total volume of immigration over the next few years will be reduced, and certainly this year the figure is likely to exceed the 1964 total.

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It is sometimes suggested that the rate of immigration depends on the demand for labour in this country, and that it is wrong to restrict immigration because the economy here needs more workers. But in framing our policy, we must take account not only of the great usefulness of immigrant labour, which I have often gladly and gratefully acknowledged, but also of the social consequences that arise from the continued settlement of large numbers of people from overseas in areas that are already overcrowded and where the social services are already overstrained. We have the difficult task of striking a balance between the economic advantages of immigration and its social costs and we must also take account of the facilities available to immigrants when they come here, particularly the housing, education and health services.
A good deal of play has been made with the supposed contrast between the 8,500 vouchers, a year to be issued to the workers from the Commonwealth and the much larger number of foreign workers whom we admit. They totalled 42,584 last year. But this is not a fair comparison, because the majority of foreign workers do not settle here. The right comparison, comparing like with like, is between the total number of Commonwealth citizens, on the one hand, and aliens, on the other, allowed to settle permanently. For 1964, the figures are 55,900 Commonwealth citizens, of whom 14,705 were voucher-holders, as against 19,211 aliens, of whom only 9,195 were workers. And it is likely that the rate of settlement of Commonwealth citizens from overseas will continue to be substantially greater than that of aliens.
Much has also been made from time to time of the fact that we have not proposed any measures to control immigration from the Irish Republic. Indeed, I know that that has been used as the one peg on which to hang the label, which I utterly reject, of colour discrimination. I do not believe that those who criticise the Government on this point have ever stopped to think—perhaps they do not want to think—about the almost insurmountable difficulties involved in establishing any such control. The choice would lie between exercising a control on the border between Northern Ireland and the Republic or controlling traffic between Northern Ireland and Great Britain as well as from the
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Republic. Unless we were to build some sort of "Berlin wall"—it would have to be a very long one—control on the border is impracticable, because of the large number of possible crossing points and the fact that people in this country do not carry identity cards—I do not suppose that anyone wants them to. Control over traffic between Northern Ireland and Great Britain would involve people carrying passports, or some such document, to travel from one part of the United Kingdom to another. I should have thought that that was unthinkable.
It is quite untrue to say that measures specially directed to Commonwealth immigrants make any distinction between white and coloured or are inspired by racialism. The only control is a quantitative one, designed to ensure that immigration does not exceed our absorptive capacity. It is, of course, true that most of the immigrants are coloured, and if we permitted uncontrolled immigration we should strain social facilities to breaking point and ill-feeling against coloured people would inevitably result. We are all aware that in many of our towns there are streets of sub-standard property in which immigrants are crowded 20 or more to a house. For desperately overcrowded accommodation, with primitive cooking facilities, no baths and inadequate sanitation, they may have been paying each year in rent nearly as much as the house is worth. This is the only sort of place where new immigrants can find accommodation. In the face of these conditions, those who demand uncontrolled or considerably expanded immigration are doing a great disservice to immigrants already here and their dependants who are still coming and who will still be welcome, and they might indeed make a difficult situation intolerable.
To sum up, over the past year the Government undertaking to review the whole question of immigration from the Commonwealth has been fulfilled. We have not hesitated to take necessary action designed to reduce the rate of immigration. At the same time, we have preserved the right of all immigrants, past and future, to bring their immediate dependants to this country, and we have taken steps to promote the integration of the immigrants and their families into the community—and we shall take many more. in the belief that the existing

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statutory provisions are essential, and in the hope that they will soon be improved in point of effectiveness in operation, I ask your Lordships to continue them during the coming year.
Moved, That the Bill be now read 2ª.—(Lord Stonham.)
LORD GRANTCHESTER: My Lords, may I ask the Minister a question before he finishes with this matter? I should like to know whether any special consideration has been given to the nationals of the Council of Europe countries, who are the subject of a European Convention—a Convention which was signed eight or nine years ago by representatives of this country but which has not yet been ratified by us? Also, has any special consideration been given to the nationals of EFTA countries, with whom we have a special trade relationship; and particularly to the subject of temporary permits for the admission of students on special courses of study either from Council of Europe countries or from EFTA countries?
LORD STONHAM: My Lords, if the noble Lord's question refers to our obligations under the Human Rights Convention or to matters in the Human Rights Convention, which we have not yet ratified—
LORD GRANTCHESTER: No, my Lords. It relates to the European Convention on establishment, which came into force during the last year when five or six European countries had ratified it. This is a Convention that representatives of this country signed, but it has not yet been ratified by us, although it is now in force among the European countries which have ratified it. It deals with the question of the admission of nationals moving between European countries.
LORD STONHAM: I am hesitant to answer on any particular point at this stage; I think it would be better if I had this looked up. However, I think I ought to say that my understanding of the matter is that there is no special provision in relation to the nationals of any foreign country who wish to come to this country, or in relation to any group of countries. They must all comply with the regulations with regard to the admission of aliens which I have described.
LORD GRANTCHESTER: I think that is correct. But would the noble Lord look into this Convention and let me know whether he can make any observations in regard to it?
LORD STONHAM: I will certainly look into the matter and write to the noble Lord, but I cannot at this stage enter into any kind of commitment.
3.22 p.m.
LORD DERWENT: My Lords, I too, am going to talk mainly about alien immigrants and Commonwealth immigrants, but I would say first that I was glad to hear from the noble Lord, Lord Stonham, that the "horror comics" legislation had worked so well. That is a most satisfactory piece of legislation. I agree with a great deal of what the noble Lord, Lord Stonham, has said, though I may have one or two final remarks that he will not like so much. However, he is used to that.
I should like to discuss the aliens immigration system and the Commonwealth immigration system together, by way of comparison, because I want to put forward certain ideas. As the noble Lord has said, alien immigrants come in under a quite different system of control from Commonwealth immigrants. Aliens who do not hold British passports are required, first of all, to hand in a landing card, and later, when they leave, an embarkation card; and that is the rule in practically all Commonwealth countries. These cards are then despatched to Princeton House, where they are alphabetically filed and paired. Seventy-five per cent.—in fact, I believe possibly a little more—of the aliens who come here are bona fide visitors; and they come and go. When, however, after a specified period, one card in the filing system is not matched with another card, chasing inquiries are then set on foot. Therefore, we know who has come in and who has gone out. There is also a need for a portion of these aliens to register with the police as a further check. The important part of this is that we have a full and proper accounting system.
With Commonwealth citizens the procedure is quite different. There is no card system, and there is at present no

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registration. A Commonwealth immigrant, if he is a legal immigrant, comes in for life; he comes in for one job, and he can change his job. That is quite different from the aliens system. Last year the Home Secretary said:
"Since the control began, nearly half a million visitors have come into the country, but it is difficult for me to say what is the number who went out, because Commonwealth citizens leaving the United Kingdom are not, under the existing system of control, classified."
Later he said:
" When they leave one does not know whether they are workers, visitors or students, because no record is kept to classify them."
We have been told, in addition, that an estimated number of, I think 10,000 has come into this country illegally, evading the Commonwealth immigration laws. But we do not know even if that number is right. We do not know whether it is too small or to large, although one has a feeling that it may be rather too small. However, we do not know how many Commonwealth immigrants are in this country, whether legally or illegally. The whole position is only estimated, because we have no proper accounting system for Commonwealth immigrants. We have that system in the case of alien immigrants, but not in the case of Commonwealth immigrants.
LORD STONHAM: My Lords, if I may interrupt the noble Lord, we do know how many Commonwealth immigrants are admitted to this country officially and in accordance with the Act. What we do not know precisely is how many get in illegally.
LORD DERWENT: But the noble Lord does not know, nor do I know, how many are now here, because we do not have a proper check when they go out. So we do not know how many are here, and what is the size of the problem.
LORD BROCKWAY: My Lords, may I put this point to the noble Lord?
LORD DERWENT: Perhaps I might continue. The noble Lord is going to speak, and he will doubtless answer me then. I want to digress for a moment on the question of Commonwealth citizens who are already here. I think it is now generally agreed, although some people may disagree, that all Commonwealth immigrants who are now legally here
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should be allowed to remain if they want to. I think it is also now generally agreed that all dependants as described in paragraph 19 of the White Paper should be allowed to come here and remain here if the head of the family (as one might call him) is already here legally; that is to say, he should have his dependants here. I agree with the noble Lord, Lord Stonham, that it would be regrettable if they could not come here. I have confirmation of that from the police in various towns, where they have less trouble—not that they necessarily have much trouble—after the family has arrived than they did before. This is an important point. But, in spite of that, we know that we have here an explosive situation on our hands. I think everybody agrees about that.
There are three reasons for this situation. The first is purely a question of numbers. We do not know how many Commonwealth immigrants are here at the moment. The estimate is something over one million—I think that is probably right, including, of course, dependants. We have this large number, and the bulk of them have come in over a comparatively short space of time. That is one of the main difficulties in this situation. Secondly, this large number of immigrants has come in over recent years, and, unfortunately but quite naturally, they are not spread about the country but have tended to settle in two or three large centres. It is the fact that they have settled in these centres, rather than spread about the country, that in many ways makes it a more difficult problem for local authorities to handle. Then, we now know from the foreign entry statistics that, on the average, there are about four dependants for each voucher holder. So that is the size of the problem.
We know in particular the appalling difficulties which local' authorities are having—and the difficulties are not getting any better at the moment—in housing and education. There are are other problems, of course, but they are the two principal difficulties of local authorities. Unless we can speedily develop a proper system of control of new entrants —not for those already here—and particularly for illegal entrants, we are making our task of integration of those already here almost impossible. I think that at any rate the Government Front Bench

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agree with me on this, because the noble Lord, Lord Stonham (I quote from the OFFICIAL REPORT of March 10, col. 101), speaking for the Government, and therefore obviously repeating Government policy said:
" We are determined that the number of new immigrants shall be restricted to levels which can properly be assimilated."
My first question is this: How can we tell what are the numbers that can properly be assimilated when we have no proper accounting system? As I say, we do not even know how many immigrants are in this country at the present time. We certainly know what were the Government's intentions last August, from the White Paper, Immigration from the Commonwealth. I would refer your Lordships to certain paragraphs in that White Paper. The first is paragraph 11, and that paragraph, among other things, says:
" … the Home Secretary … had found evidence that evasion of the existing control was being practised on a considerable scale. He was therefore instructing immigration officers to scrutinise more carefully the intentions and bona fides of Commonwealth citizens who sought entry, and to make fuller use of their power to impose conditions. One effect of the latter instruction is that students, although admitted as freely as before, are now admitted only for a specified period, which is extended if necessary so long as they are genuinely pursuing their studies."
That point is taken up again in paragraph 22, which says:
" The Government will continue to welcome people who come from other Commonwealth Countries on holiday, social or business visits or to follow a course of studies. At the same time it is important to prevent people admitted on the pretext of a visit or a course of study from obtaining permanent settlement."
How can you do that without a proper system of control and, above all, without any proper accounting system?
If your Lordships do not agree with me on what I say, I would refer you to paragraph 24, which starts:
" If a person admitted to this country for a limited period remains here after that period has expired, it is difficult, very often impossible, to trace him."
What does admitting people for a limited period, with quite a weak system of control and with no system of accounting, mean? At the end of that paragraph we come to the first part of the Government's intentions. It reads:
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"The Government propose to seek power for an immigration officer to include among the conditions on which a particular Commonwealth citizen is admitted one requiring him to register with the police."
That is a power which is not necessarily enforced by the immigration officer, but it is something which they say is necessary. That means legislation.
We then go on to paragraph 25 which deals with repatriation:
" At present a Commonwealth citizen may be deported only if a court has made a recommendation to that effect on convicting him of a crime punishable by imprisonment. The Government regard it as important that there should be a speedy and effective power to repatriate immigrants who in one way or another, e.g., by obtaining entry by misrepresentation or by flouting the conditions on which they were admitted, evade the stricter control over immigration that is now envisaged. Without it "—
and these are important words—
" the effectiveness of the control would be greatly weakened. It is therefore the Government's intention to seek for the Home Secretary a general power"—
in other words, more legislation.
Before I go on to the question of legislation, may I at this moment give my own personal views on two matters which I think are necessary?—and I would stress that these are my own personal views, and I am not speaking for anyone else. First of all, I believe it will be found essential to bring the Commonwealth immigration system closer to the alien system, although I do not say that it should necessarily be the same. But I think it is absolutely essential so as to have an accounting system. Secondly, I feel very strongly that at this moment, and for a period of time, except in special circumstances, we ought not to admit any more Commonwealth immigrants for permanent residence—I say advisedly "for permanent residence"—until we have looked after those already here; and we have hardly started to tackle that problem. If we allow people to come here for permanent residence in large numbers, or even quite large numbers, we shall not be able to deal satisfactorily with the people already here. I feel certain of that. That does not mean if we have a system of control we cannot allow Commonwealth immigrants in in fairly large numbers over a limited period. But we cannot do it at present because the control is not effective; an accounting system does not really exist.

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Last Session, in August, the Prime Minister, discussing this matter and the White Paper, gave the impression that the Government thought that the legislation they required was urgent and important. He appreciated that the situation was very difficult. All of us interested in this subject confidently expected that we were going to see legislation forecast in the gracious Speech. In spite of what the noble Lord, Lord Stonham, said, what has happened? The Prime Minister has swept this question under the carpet by appointing a Committee, presumably under pressure from his Left Wing. I wonder whether we ought to pass this legislation to-day until we have had from the Government some idea of when we may receive this urgent legislation—will it be this Session, or when? Or is it going to be another Steel Bill, something we are always promised by the Prime Minister, who takes jolly good care we do not get it.

FOREIGN SECRETARY'S VISIT TO MOSCOW
3.38 p.m.
LORD WALSTON: My Lords, With your Lordships' permission, I should like to repeat a Statement being made by my right honourable friend the Foreign Secretary in another place on his visit to Moscow. The Statement reads as follows:
" I had talks with Mr. Mikoyan and Mr. Kosygin and several meetings with Mr. Gromyko, and I am arranging for the communiqué, which I issued jointly with Mr. Gromyko, to be placed in the Library of the House.
" The international subject to which we paid most attention was the proposal for a non-proliferation treaty, and on the Soviet side this was linked with the question of nuclear arrangements in NATO. We all agreed that a nonproliferation treaty was necessary and that it was important to conclude one as soon as possible. Mr. Gromyko maintained the view that arrangements to associate non-nuclear members of NATO with discussions and decisions on the use of nuclear weapons themselves constituted dissemination and therefore presented an obstacle to a non-dissemination treaty. I explained
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that any NATO arrangements would be consistent with non-dissemination and would, indeed, contribute towards it. Despite our differences of view, we agreed that discussions on the text of a non-dissemination treaty should be pursued.
" In our discussions about European security, the question of German reunification was naturally prominent. I regret that the Soviet approach to the question of German reunification remains widely divergent from our own.
" Similarly, I cannot report that we were able to make any progress over the steps to bring peace to Vietnam, though I have no doubt that the Soviet Government are as anxious as we are that the fighting should be brought to an end there.
" The communiqué records that we had some discussion of the United Nations. I urged the importance of pursuing a constructive line there and of not trying to turn the Organisation into a platform for disruptive propaganda.
" Among the bilateral questions we discussed, I laid particular emphasis, in my talk with Mr. Kosygin, on the need for the Soviet Union to increase its purchases from this country and thus to reduce the present imbalance.
" I also discussed with Mr. Kosygin the question of a meeting between him and the Prime Minister. We made progress on this, and I hope that it will be possible to give further information before very long.
" We also signed a Consular Convention which will regulate the Consular relations between the two countries and which provides for access by Consuls to their nationals who are in trouble with the authorities.
" I spoke to Mr. Kosygin and Mr. Gromyko about Mr. Brooke. Since then our Consul has been allowed to see Mr. Brooke, for the first time since August.
" I did not have any illusions, when I went to Moscow, about the possibility of making quick progress on the difficult international problems. I hoped that each side would listen carefully to what the other had to say, and would

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then decide to go away and think it over. I think that is what happened. The communiqué describes the talks as businesslike. This is an accurate description. The fact that both sides found the talks very useful is reflected in the final paragraph of the communiqué which registers our agreement that there should be periodical meetings."
That, my Lords, is my right honourable friend's Statement.
THE DUKE OF DEVONSHIRE: My Lords, I am most grateful, as I am sure noble Lords on all sides of the House are, to the noble Lord, Lord Walston, for repeating that Statement. I hope he will not think me either ungrateful or ungracious if I say simply that, as a result of the Statement, we can be thankful for small mercies. The Foreign Secretary has made it quite clear that he did not expect a great deal from his visit to Moscow and, equally, that a great deal was not achieved. Nevertheless, we should be grateful for what progress was made.
It is comforting and reassuring that we and Russia are agreed that a treaty of non-dissemination is needed, and that discussions on how to reach an acceptable text should continue. Equally, the Consular Agreement must also be a small yet further step towards the betterment of relations between the two countries. In regard to the Foreign Secretary's efforts to help Mr. Brooke in his plight, all of us, not least on humanitarian grounds, must welcome these very warmly.
I think there is little one can say about the Statement, and certainly it raises no controversial issues. On behalf of these Benches I would congratulate the Foreign Secretary on the initiative he took in going to Moscow. The fact that he had the courage to go when little could be expected makes his expedition all the more praiseworthy. The final sentence of the Statement says that discussions are to continue. It is a very unoriginal thought, but nevertheless true, that the more conversations which take place between our two countries, the better. I would therefore sum up by thanking the Foreign Secretary, and the Government for small progress; but progress it was.
LORD REA: My Lords, from these Benches I should like to echo those remarks, but I would give them a rather less tepid welcome than the noble Duke did. I think that our Foreign Secretary, who has done such good work in many directions, has made a constructive impact by this visit to Russia, and we should all be very grateful to him. May I now ask one or two supplementary questions? First, I would ask whether the Foreign Secretary discussed the various financial agreements and claims still outstanding between our countries. Then I would ask whether he discussed the difficulty between India and Pakistan and whether Russia should join with us in coming to some helpful conclusion. Finally, did he go into the question of welcoming more travel between the two countries and more exchange of population, even in marriage between Russians and Britons?
LORD WALSTON: My Lords, like the noble Duke we, too, are thankful for small mercies, even when they come from the Benches Opposite, at least so far as foreign affairs are concerned. Occasionally we find praise or approval from that side somewhat embarrassing, but so far as our relations with other countries are concerned, we welcome his kind words, and also the rather warmer words of the noble Lord, the Leader of the Liberal Party. I would certainly agree with the noble Lord and endorse, if I may, his praise for my right honourable friend and his efforts. I am quite certain that the personal contacts which my right honourable friend is making are of enormous value in all these tricky international problems. If there can be understanding between Ministers as human beings, rather than as representatives of Government, we shall have gone a long way.
With regard to the three specific questions put by the noble Lord, Lord Rea, the short answer to each of them is "Yes". There were discussions—short discussions—on the financial claims and it was agreed that the negotiations should continue. There were also short talks on the problems of India and Pakistan, and my right honourable friend emphasised the hope that if such a meeting could be arranged it would lead to an improvement in relations between India and Pakistan. He also spoke with Mr. Gromyko

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about visits of Soviet citizens to this country, and vice versa, and emphasised how important it is to the growth of understanding between our countries that these exchange visits, which have taken place to an increasing extent over the past years, should continue, and increase; and, in particular, my right honourable friend expressed the hope that there might be a happy outcome of a number of cases in which a British citizen and a Soviet citizen wished to get married.

EXPIRING LAWS CONTINUANCE BILL
3.48 p.m.
Debate on Second Reading continued.
THE LORD ARCHBISHOP OF CANTER-BURY: My Lords, I return to the Commonwealth Immigrants Act. When, a year ago, the Act was passed continuing that Act, it appeared that there was then, as there seems to be now, widespread agreement about the need for some control of immigration; and it appeared that one matter of controversy, at least, might be disappearing. There was great hope that there might be less political friction on the whole subject and, consequently, a greater national concentration on integration as a task for citizens, quite irrespective of politics. It is about integration that I want especially to say a few words. I am not specially fond of the word, though I do not know that a better comprehensive word has been invented. But 1 think we know what we mean by integration; namely, to secure that citizens from overseas in our land shall be able to reside happily and in peace with their neighbours, wherever they may be, and to play a full and welcome part in our society.
Since 1962 most important work in connection with integration has been done by the Advisory Council, under the Chairmanship of Lady Reading, set up by the then Home Secretary. The four Reports issued by Lady Reading's Advisory Council show remarkable progress made through three years—progress in the growing knowledge of the problems and in the will to tackle them and to apply many skills to them. In the autumn of this year a new body was set up, partly to continue the functions of Lady Reading's Council and also to add some
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other functions to them. The new body was called the National Committee for Commonwealth Immigrants, and I was invited to be its chairman. I accepted the invitation, and my motive in doing so was simply to encourage my fellow citizens in giving practical service to an immense task with which the citizens of this country are greatly concerned.
May I say a word about the work of this new Committee? Its work is going to be done largely through panels on the particular subjects of health, housing, education, employment, training for social work, public relations, legal and welfare problems. These panels are in touch with many liaison committees already existing in many parts of the country. My own initial impression of the task is that there is in the country a great body of people aware of the practical problems and working at solving them within their own localities. But, at the same time, some localities are a considerable way behind others, and therefore I conceive it to be the work of our central body to ensure that knowledge is conveyed to a locality which urgently needs knowledge as to what other localities are able to achieve.
For instance, if, rather unexpectedly, there arrive at the school of a particular district a body of children from overseas who cannot speak English, there at once come about a whole group of problems for children, teachers and parents; and for others, as well. And if it is known in a particular locality how the problem is being tackled with great skill in some other locality, then the sooner the knowledge can be brought to bear upon the spot the better. Let me add one further impression; that is, that in the work of local committees dealing with integration the immigrants themselves have been playing a steady and increasingly valuable part as contributors to the whole task.
But at the moment there is another side, and a very sad side, to the matter. The work of integration, as is being reported from many parts of the country, is being hampered by bad feelings aroused by the Government's White Paper. It may be wrong that this should be so; and it may be unnecessary. But we have to face the fact that it is so, and for those concerned with integration the resulting immediate problem is a pretty grave one. One effect is that in a good many places

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immigrants, having had their feelings hurt by things read in the White Paper, find themselves in a non-co-operative kind of attitude and sometimes withdraw their co-operation with bodies dealing with integration into bodies of a racialist kind. Another effect is that some of our own workers for integration, people who have been giving themselves to the tasks for a long time, find themselves discouraged and depressed by this wave of unrest on the matter. It is in relation to integration that I am viewing the matter and asking your Lordships to view the matter. While those of us concerned with integration want to concentrate on these tasks, and not to be drawn into political controversies, it is the fact that things said and done in other parts of the territory do vitally affect the work of integration.
Let me mention three things in the White Paper concerning which criticism is made. First, in the distribution of categories there is the bias in favour of professional people among the immigrants, which means that there is an impression that immigration is being organised in a way that may be detrimental to some of the countries from which immigrants come. I remember this point being made in the corresponding debate here a year ago by the noble Baroness, Lady Summerskill, who pointed out that a doctor in Pakistan may be looking after a population of 50,000 people, whereas in England he or she may be looking after, say, a population of 5,000 people. This state of affairs which draws a specially big proportion of professional people within the categories of the immigrants is now being described as a "brain-drain" upon the countries concerned. I do not know what the answer is. I think it is very difficult to find an answer, and certainly it will need co-operation between the countries to find it. But I think there is just criticism of the fact that this matter has been left unanswered in the text of the White Paper.
Secondly, there is much concern about the new regulation concerning the admission of children between 16 and 18 who want to join their parents, or a parent, in this country. It indeed seems rather a rough attitude to families to say, in effect, "We will consider sons and
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daughters under 18 if their exclusion would cause hardship." I find myself wondering what I might have said at the age of 17 if I were told I might join my parents in the family if by being separated from them it would cause hardship, how I should have interpreted the phrase. I think that if at the age of 17 my sisters had been told they might join their mother if their separation was a condition causing hardship, they might have been even more puzzled. I do not feel that the present state of these regulations is satisfactory, even though I know the law is administered with sympathy.
Then there is, thirdly, concern about the powers for removal of immigrants from the country and about the limitations of the rights of appeal. I believe that this matter caused a great deal of distress, though it is now good to know that the Government, through the Committee which they have set up, are having a new look at this matter.
Certainly, on the other side, we have to recognise that some of the reactions to the White Paper have been caused by sheer misunderstanding. We also have to recognise the need for firmness in controlling evasion, and indeed such firmness is only a kindness to bona fide would-be immigrants. If I were a student anxious to come to this country to study, I should feel injured if my place in the queue were taken by somebody simply masquerading as a student—it is apparently possible to do that successfully. Again, if I were a child eager to join my parents, I should be aggrieved beyond words if my place in the queue were taken by somebody just masquerading as a child wanting to join his parents. I think that, with those thoughts in mind, we sympathise with the need for firmness about evasions.
However, my central idea is really this. It does not quite do to say, "We have a lot of immigrants in this country. Let us concentrate upon the work of integration and, when we have achieved that, perhaps it may be well to consider something more because it is quite evident that policy about controls arouses feelings of the sort that make the task of integration difficult." I have no doubt that the Government do indeed sympathise with these considerations. I believe that is partly a matter not just of the text of

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regulations but of what I would call Government public relations with the immigrant community. The Government must not only have regulations and adjust, but also take far greater pains to convey the meaning, intention and the humanity of any regulations to the immigrants themselves.
I believe that the coming year may be a crucial year for the growth of the integration that we all so greatly hope is going to happen. There are, alas!, ominous and unhealthy signs. There has been an unhealthy recrudescence of white racialist organisations in this country; and, as I indicated earlier, there has been the tendency for some immigrants to have their feelings hurt in a way that causes them to group themselves in non-cooperative ways. There is a story that an immigrant citizen from another part of the Commonwealth once said, "If you do not like my habits, teach me better habits. If you do not like my attitude to life, teach me a better attitude to life. But if it is the colour of my skin that you object to, well, I can only refer you to the Creator who made me."
One last word. I think it is most important how the immigrant community in this country are talked about and referred to by us who are their fellow citizens. There are many problems about their relation to the rest of the community, just as there are many problems about ourselves and about every part of our community in this land. But while we can discuss the problems concerning groups of people in the country and their relation to each other, I think we need to guard ourselves against talking of people themselves as being a problem. No person as a person is a problem he is a person, a fellow citizen and a fellow man, and the more that that is conveyed in sympathy and understanding to the whole body of our citizens, the greater will be the chance of this formidable problem being overcome, and of our citizens, of whatever colour, living happily together in their common service to one another and the community.
4.5 p.m.
LORD ROYLE: My Lords, like the noble Lords who have preceded me I want to concentrate what I have to say on the Commonwealth immigrants section of the Bill which is before us this afternoon. I am happy, and consider myself
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most fortunate, to be following the most reverend Primate in the spirit which he has shown in his approach to this matter. With everything that he said I am completely in agreement. This works out quite differently from my attitude to the speech which the noble Lord, Lord Derwent, delivered to the House a short time ago.
I do not want to be unfair, but it seemed to me that the noble Lord opposite concentrated on more and more controls, stronger and stronger controls, rather than approaching the matter in the spirit shown by the most reverend Primate, who urged that we should regard people from the Commonwealth who desire to immigrate to our land as fellow human beings, who are desirous only of making a better life for themselves than they would have the opportunity of doing in their own countries. Therefore I do not hesitate to be associated with the section of people in another place referred to by the noble Lord as "the Left Wing". I do not think that is any association at all. I am associated with them because I believe that in their attitude on this matter they are the humane wing of the Party and regard this question in the proper light.
I made my maiden speech in your Lordships' House on this particular subject just about twelve months ago. How time flies! I feel almost at home this afternoon, compared with the feeling that I had on that occasion. On that occasion, I know, I really did let myself go. This is a subject on which I have deep emotions, and my relationship, particularly with the people of the West Indies, has brought a love for them that I cannot adequately describe; and perhaps my thoughts on these matters are dictated by my knowledge of them and my appreciation of the people from that part of the world. I see opposite the noble Lord, Lord St. Just, who was a shipmate of mine on my first visit to the West Indies some eleven or twelve years ago, or perhaps rather more. I hope he will not mind my saying this, but I hope that he achieved in that visit some of the love for those parts and for these people that I myself achieved. So that is where I begin.
But while I know that I spoke strongly on this matter a year ago, I recognise that there is to-day something of a

35
changed position—not a change in my mind by any means: I see no reason to change my mind in regard to what I expressed a year ago. But I recognise that since that day Her Majesty's Government have issued the White Paper which has been referred to by the most reverend Primate as well as by the noble Lord, Lord Derwent; and it is that White Paper that is worrying me at the present time.
It would be an under-statement to say that I was disappointed at the change of front in a Labour Administration. I find the White Paper shocking in its content, and I must say this. When the noble Lord, Lord Derwent, referred to the Front Bench on this side, if he was indicating that they were in agreement with him I am glad he was not including me. When I look at some of my noble friends on the Front Bench I wonder how many agree with him and the White Paper and how many of them might possibly agree with me. I must confess to some relief that many of the points in the White Paper have not been included in the immediate legislation along the lines suggested, and today your Lordships are only being asked to re-enact previous legislation. I am glad of this, as it might give the Government time for reconsideration, and I hope that it will avoid many of the implications of the White Paper.
I have to accept that in my views on the matter I am in a minority, perhaps a small minority, but in the light of the circumstances as I find them, I have the temerity to suggest to the Government one or two ideas which might be useful pending legislation. For my sins, I am co-President of the British Caribbean Association with my friend, Mr. Nigel Fisher, M.P. Recently that organisation sent a letter to the Lord President of the Council containing suggestions pending any legislation which might come along. I want to draw attention to some of those thoughts this afternoon, and I hope that when my noble friend Lord Champion comes to reply he may be able to deal with some of them.
First of all, I would mention the new limitations of what I call the arbitrary 8,500 vouchers. In spite of everything my noble friend Lord Stonham said in his opening and very reasonable speech, it seems to me that it is impossible to
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get away from the idea that this obviously brings in a colour bar restriction. Is it not ludicrous that there should be a ceiling on the number of Commonwealth citizens to be accepted when there is no such ceiling on aliens. And is it not still more ludicrous when we look at the situation of the Irish coming into our country? When the Irish broke away from the Commonwealth they ceased to be a part of the United Kingdom, and yet we are compelled to treat them in a much more liberal way than we treat fellow beings from Commonwealth countries. Once a ceiling is defined and imposed on one category of people, it becomes a matter of pandering to colour prejudice. This may not be the intention, but it certainly is the effect. This is the more obvious when the vouchers are given only to people in prearranged jobs or to people with special skills. There is no question of any evasion in this matter, and the cut which is sustained is a cut in the labour which is needed by British firms.
Secondly, I would express, with the most reverend Primate, my distress because there are restrictions on the entry of people between the ages of 16 and 18 who wish to join their families. Family life in the West Indies—and I am sure this also applies to other parts of the Commonwealth, as it indeed applies to our own country—is very cherished indeed. I regard it as completely inhuman that we should keep out of this country young people in their teens who desire to join their own relatives who have become established here. I would ask Her Majesty's Government for assurances that young people will not be harshly kept out and that instructions to immigration officers in this regard should be elastic.
Another point I would mention is this. The Minister of State at the Home Office, Miss Alice Bacon, when speaking at the Labour Party Conference in October suggested that what was set out in the White Paper was, in effect, merely a pause. Can it be made quite clear exactly what she meant by this? Is it a period of definite duration in order to give the Government a chance to integrate immigrants who are already here, after which there will be some return to the former rate of vouchers? I should be glad if my noble friend could help me in this matter. I welcome the suggestion in the White

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Paper that a committee is to be established to investigate the appeal procedure when people are refused admission or when deportation has been ordered. The most reverend Primate has dealt with this matter at great length and has saved me the task of doing so. I do not want to weary your Lordships further about this, but it is a very important matter which I hope will receive attention.
I want to object as strongly as I can to the suggestion that deportation—even the deportation of evil doers, people who have offended against this country—should be in the hands of the Home Secretary alone. I believe that this is entirely against the principles of British justice. I am one of those people who have to sit at least once a week on a magisterial bench, and in my humble duties I am very jealous of British justice. It seems to me all wrong that we should consider the possibility of deportation without recommendations by some part of the .Judiciary to the Home Secretary. That this matter should be placed in the hands of the Home Secretary alone seems contrary to all our ideas of British justice.
I am also unhappy that the possession of an entry certificate does not entitle a Commonwealth citizen to admission, and that it is for the immigration officer to decide. I want to see some clearer instructions given to immigration officers about this matter, so that there is not the rigid attitude that exists at present. I believe that Her Majesty's Government should consider strengthening the British High Commission in Commonwealth countries so that all applicants who wish to come to this country can be carefully investigated; and so that the entry certificate may be made the relevant document, without which no one can secure admission to Britain. Then the document should be one that would be accepted by immigration officers—in other words, it should be a kind of visa, as given by many foreign countries.
While I deeply appreciate the work carried out by Mr. Maurice Foley, M.P., along the lines of integration in many parts of the country, I am most disturbed at the lack of progress in certain aspects of integration. I think that there could be better approaches than have already been made. I envisage that approaches should be made to the trade unions, for there are often little problems in that re-
38
spect when a Commonwealth immigrant wishes to obtain employment in a large factory. This applies not only to trade unions but also to employers, and is clearly necessary in order to ensure an acceptance of immigrants at all levels in commerce, in industry and in the professions. I hope that we are not very far from the time when we shall be appointing coloured policemen in this country. In very many parts they would be of tremendous service, and I am quite sure it would help to lift the standing and the standard of the immigrant population if some of their people were put into responsible positions in such services as the police force.
There is another matter about which I am concerned. We talk about educating the children of the immigrants, but I am very worried about the lack of education of the British public as a whole in their outlook towards this problem. I get more and more worried when I get letters condemning me and the Association with which I am connected for having been associated with these problems. I regularly get anonymous, nasty letters and telephone calls, which show an attitude of mind which is completely deplorable in a country such as ours. I want to see the British people understanding the background difficulties of the people who come to us.
May I in passing say something which I have mentioned before on previous occasions, and that is that I wonder what Her Majesty's Government have ever done in approaches to the white Commonwealth to take some of the burden off our shoulders. In countries like Australia and New Zealand, coloured people are hardly known. They do not bear part of that Commonwealth burden which they might be bearing, and I hope that when we come round again to the Commonwealth Prime Ministers' Conference efforts will be made to persuade them to take some of the immigrants from the poorer parts of the Commonwealth and so ease our own particular problem.
Before the legislation envisaged by Her Majesty's Government is introduced, I should like to see consultations with the local and regional officers of the Ministry of Labour, along with the local authorities, in relation to housing. I hope your

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Lordships will pardon me if I repeat what I said twelve months ago, about what I envisage may happen when an immigrant arrives at a port or airport. The immigration officer may ask, "Where do you intend to go?", to which the immigrant may reply, "Lambeth", or "Notting Hill", or "Birmingham". On being asked by the immigration officer why he wants to go there, the immigrant may reply, "I have got a cousin who has been there for a couple of years and he can find me some accommodation and a job". The immigration officer may then ask, "If we were to send you to a small town in Lancashire where there are not many coloured immigrants, where there is work for you and where the local authority will try to do something about housing you, would you go there rather than to Notting Hill?" I am assured by friends who work among Commonwealth immigrants in this country that on any day they can find a score of families who would be prepared to move in circumstances of that kind. So in that sense, this is not so much a matter of integration as of dispersal.
We are all worried about what have become ghettoes of Commonwealth citizens. I should like to try to do something about this, but I feel that the effort which should have been made along these lines has not been made. I put the suggestion to the noble Lord, Lord Butler of Saffron Walden, when he was Home Secretary. That seems a long time ago, and as the days have gone by nothing along those lines has been done, but I believe that it could be done. As noble Lords know, I used to sit for a Salford seat in another place. They have never been worried by the Commonwealth immigrant question. The Irish have always been their trouble. But I would say that Salford could take 200 families and Bourton-on-the-Water could take a couple. I am quite sure that if this kind of thing could be done we should ease a lot of our problems. So I throw out these ideas to my noble friend, in the hope that in his closing speech to-day he may be able to say something about them. I also express the hope that Her Majesty's Government will look at suggestions of this kind, to see whether the burden can be eased and to try to avoid
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the strong measures envisaged in some quarters.
4.26 p.m.
LORD BROCKWAY: My Lords, my noble friend Lord Royle has remarked that his maiden speech was on this subject and that he then spoke very strongly. Perhaps because of acclimatisation to this House, he has spoken in more moderate terms to-day. I do not think that my experience in this House has led me to speak less strongly on issues about which I feel keenly than when I first entered, but to-day I am in the mood to speak more with sorrow than with anger.
I regard the White Paper, and the legislation which is foreshadowed in it, as a great blot upon the domestic legislation of this Government. That legislation has been splendid in its record and it is still more splendid in its prospects, but the White Paper and the legislation which is to follow it seem to me a repudiation of all for which our Party has stood and a repudiation of the deepest principle of life—that men and women in their personalities are sacred, whatever their race or the colour of their skin.
I always listen to my noble friend Lord Stonham with respect, but, quite honestly, he cannot ask us to believe that this is not a racialist White Paper, with racialist legislation to follow it. I put the simple point to him that if the Commonwealth immigrants had been white persons with white cultures, the White Paper would never have been introduced and the legislation which it is intended to bring before the House would never have been thought of.
LORD STONHAM: My Lords, I cannot expect to convince my noble friend on this matter, but I must point out to him that the White Paper applies to all Commonwealth countries including, of course, the older Commonwealth countries where most of the population have white skins. If legislation is introduced, it will apply equally to the citizens of all Commonwealth countries, irrespective of the colour of their skins.
LORD BROCKWAY: That I appreciate, but I cannot believe that my noble friend thinks that an answer to the charge which I have made. It is true that legislation will not mention race or colour,

41
but more than 90 per cent. of those who will be kept out of this country under the legislation will be coloured; and that legislation would not have been introduced at all if they had not been coloured. There is no other argument to-day for any legislation, except that the Commonwealth immigrants have caused problems related to their race, their colour and their culture.
I want to admit at once the kind of justification which is put forward for this proposed legislation. As the noble Lord knows, I have been involved in discussions with members of the Government who have been responsible for the White Paper and for the legislation. Their argument has been this: that the feeling about race and colour is so intense in many parts of the country that it is necessary to have the pause to which Miss Alice Bacon referred in the speech that my noble friend Lord Royle has mentioned. They say that it is necessary to have this pause so that, during it, policies of integration may be pursued which will diminish colour and racial feeling and which, if the word "pause" is to be accepted literally, would allow even larger immigration of the coloured in a few years' time.
In another place I represented a constituency which had these problems, and I was largely defeated on this issue of colour and race. I appreciate, therefore, the intensities of feeling. They arise from housing, due largely to the fact that the immigrant population is concentrated in 33 towns in this country. I endorse what my noble friend Lord Royle has said: that pressures can be exerted (although I should not want compulsory direction) to bring about a greater dispersal of that population. But the real problem, surely, is that the immigrant population go to those areas in this country where work is easily available; and the difficulty is that not only do the Commonwealth immigrants go to those places but that workers from other parts of Britain which are not so prosperous concentrate upon those towns, too. Therefore, we have in a number of towns not the 2 per cent. immigrant population which there is over the whole country, but 5 per cent. and 7 per cent. and, in the case of the borough with the highest percentage of all, Paddington, over 10
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per cent. Arising from that there are housing difficulties.
I say to the Minister that the coloured immigrants are not the cause of housing shortage: they are the scapegoats of it. The Party on the opposite side, when it was responsible for the government of this country, and the Party on this side, even with the new housing measures which it is now intended to produce, are not yet understanding the tragedy to the whole social life of the country by our housing shortage. It causes more suffering, it breaks up more families, it causes more ill-health, it is a greater cause of juvenile delinquency, than any one other thing. We ought to be having a Government which will wage war on the housing shortage with the same concentration as in waging a military war against a foe. We ought not to be surrendering the fundamental principle of belonging to the same human family because we have failed in housing; and we ought not to make Commonwealth immigrants the scapegoats of our failure. We ought also to remember this: that in actual fact a large proportion of those employed in the construction industries are the very Commonwealth immigrants whom it is now proposed to restrain.
The second problem which causes difficulties in localities is that of education. I was a little surprised to hear the noble Lord, Lord Derwent, say that this problem is becoming more difficult. That is not my experience. My experience is that within the last eighteen months the problem has been eased considerably. It has been eased considerably because reception classes where the children learn English have been introduced into the schools; it has been eased considerably because special help in the way of extra teachers is now being given to those schools; it has been eased considerably because headmasters and teachers in those schools, having had experience of these problems, are acting to meet them in new and successful ways.
The Ministry of Education have published a pamphlet on the subject of the immigrant child in the school. What impresses anyone who reads that pamphlet is the fact that the Ministry say that the children of different race and of different colour are actually an educational advantage to the white children who are in the school. They are an

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advantage to the white children who are in that school because they bring to those children knowledge of different parts of the world which they read about and see on a map but which mean little to them until children from those territories are there. It is only when these children reach teenage, and where they have been influenced by adults, that any colour or racial feeling arises. I believe that when we can deal with the problem of insufficient teachers and can deal with the problem of teaching the English language (they are mostly Indian and Pakistani children who need it), our education is going to develop and progress because of the fact that we have children of different colour and different race in our classes.
The third immediate problem which is causing, or intensifying, the ill-feeling is that of hospitals, and particularly is this so in the case of English mothers who are seeking beds for maternity and who find that there are coloured women occupying those beds. Again, that is due partly to our failure to provide sufficient hospital accommodation. But, much more than that, our National Health Service would hardly be able to exist at all if it were not for the Commonwealth immigrants. My Lords, 40 per cent. of the doctors who are in our hospitals are Commonwealth immigrants, and 17 per cent. of the nurses in our hospitals are Commonwealth immigrants. When we begin to say that Commonwealth immigrants must be excluded because of the problem of hospitals, the problem they create, due to the absence of beds—which we have failed to provide—it is insignificant compared with the great contribution which they have made to our Health Service.
Now I want to say to my noble friend Lord Stonham—and I do not use the word "friend" in a formal way—that it cannot honestly be argued that this Bill is not a Bill the object of which is to exclude coloured and Commonwealth people—people of other races—from this territory. I have admitted the argument put forward by the Government; but that very argument acknowledges that the cause of the proposed legislation is colour and race. I want to say to my noble friend that this is of enormous importance at the present time, because the whole future
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of our Commonwealth is now in doubt. I am very closely in touch with the leaders of the Asian and African peoples. I know the effect that the original 1962 Act of Parliament had upon them: a worsening of their psychological attitude to this country.
That feeling has been intensified almost beyond description because they found, when a Labour Government came into office in this country, that that Government endorsed what the Labour Party had so strongly opposed when in Opposition. Because the feeling among Asian, African, and Caribbean representatives is marred in this kind of way (and for other reasons which are irrelevant to this debate) the future of our Commonwealth is now in very grave doubt. One of the factors that have contributed to these worsened feelings has been the fact that we have had a measure in this country which has excluded Commonwealth immigrants who used to be regarded as our citizens and as our equals. By not only maintaining, but even strengthening, what has been done before, we are deepening those kinds of psychological relations.
I want to say just this to my noble friend Lord Stonham: I am aware of the difficulties of excluding the Irish— and I am not sure that I would want to exclude them. I have some Irish in my own ancestry, as perhaps has my noble friend. But I put this point to him. When you have people from a country which is not even in the Commonwealth (a country which by its own decision has remained outside it) able to enter freely and without any restriction, and then you say to immigrants from the Commonwealth: "You should be limited; you should be restricted", inevitably they see that contradiction and inevitably they feel that it is a Bill based on race and colour.
Forgive me, my Lords, for speaking with this sincerity; but I believe that the principle at stake here is the most fundamental principle in human life. I am the descendant of three generations of missionaries. I was born in India; my father was born in Africa. I do not share the Christian theology, but I accept the Christian ethic. I believe that the principle we must hold if mankind is to go forward in co-operation is the Christian ethic, which says that in the core of the personality of every man there

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is a potential of fulfilment in tune with the infinite which makes the spirit of man more important than the colour of his skin or the race to which he belongs. It is because—to my almost despairing regret, because I love the Party to which I belong—I believe that the White Paper and the legislation which is to follow epudiate that most essential principle of all human life that to-day I have spoken in this way.
4.45 p.m.
LORD GIFFORD: My Lords, I find it difficult to follow such a truly moving speech as we have heard from my noble friend Lord Brockway. I share his feelings in much, if not all, of what he says. But this afternoon my part must be to speak more particularly of the difference which I have found between the effect of the Government's White Paper on Commonwealth immigration and the intentions behind it. I spoke on this subject three weeks ago in your Lordships' House, but before going further I should like to say how much I appreciated the spirit, and much of the content, of Lord Stonham's reply at that time. If one cannot agree with the policy of the Government, surely the next best thing is to have one's objections so fully and kindlily dealt with. I hope that my noble friend Lord Champion will recognise that it is in the same spirit of co-operation that I take up the issue again to-day.
In my speech three weeks ago I speculated on the hardening of attitudes and the increased tensions which I felt would arise from the publication of this White Paper. My noble friend replied in these terms:
" I cannot believe that the Race Relations Act "—
and then he mentioned many other measures that the present Government had put forward—
" can leave any doubt about our determination that immigrants shall be full members of the community with the same rights and responsibilities as anybody else."—[OFFICIAL REPORT, Vol. 270, (No. 5) col. 551; 16/11/65.]
My Lords, if I could be satisfied that this were true, that there were no doubts in the country about this, I would withdraw my opposition to the Government forthwith. But from correspondence and conversations with individuals and
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organisations working in this field, and from reports in the Press, I am convinced that it is not.
The noble Lord, Lord Derwent, spoke of the protest against this Government policy as being a Left-wing protest. I submit to your Lordships that it is not. It is not just another predictable outburst of the Left wing; it is supported by Labour Members of Parliament of all shades, by the Bow Group, by Liberals, by The Times, by the Economist and, most significantly, by the overwhelming majority of the individuals who are actively fighting in the cities for the improvement of race relations and whose efforts should never be forgotten by noble Lords who discuss this issue in the remote comfort of this House.
Perhaps your Lordships will forgive me if I read one passage from a letter I have received. It comes, most eloquently, from Oxford:
" Several immigrants came to me to say that they felt now that there was no one they could trust; they had always felt before that at least the official attitude of the Government was against racialism, but now they felt abandoned and bewildered."
I received many letters expressing similar views from almost all the organisations that are working in this field. I think the surest indication that their views are accurate and widespread is to be found in the speech of the most reverend Primate, the Archbishop of Canterbury. I am sure that he will bear me out when I say that it was because of the nearly unanimous reports that the National Committee had received from local authorities that they spoke the other day to the Prime Minister of the distress and frustration among immigrants and of the increasing difficulties they were experiencing.
There has already come to light some very disturbing evidence of this distrust; of a hardening of the attitudes of the immigrant community. The Indian Workers' Association called last week in the strongest terms for the dissolution of the National Committee, calling it, "the product of a racialist document". The West Indian Joint Standing Conference has taken a similar line. May I again ask your Lordships' permission to

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read one small passage from a letter to me from an immigrant? It states:
"The White Paper has provided the proof, if one were needed, of what status we have got here. All this polished talk of integration from high quarters seems to many of our people downright hypocrisy. Though they emphasise that we should not be made second-class citizens. most of our people know this by bitter experience."
The position of moderate leaders of immigrant opinion, such as Dr. David Pitt, to whom I should like to pay the warmest tribute, has become increasingly difficult. By becoming a member of the National Committee he is accused in many quarters of selling out on his people. These attitudes may not be commendable, but I submit that they are wholly understandable. I believe we are horribly in danger of entering a vicious circle of inter-racial antagonism, where apparent intolerance on one side is met by intolerance on the other. We must break out of this circle or else the cause of racial harmony in this country will be lost.
I have so far spoken to show that, whatever the Government's intention, they have failed to give a strong lead. They have failed to convince the country of their determination, as my noble friend put it, that immigrants should be full members of the community. If I may have the temerity to point briefly to one or two of the causes which I feel have contributed to this failure, I would say that undoubtedly the first cause is the imposition of the numerical ceiling. So far as the reaction of the immigrant is concerned, the issue is quite plain. Four years ago a Conservative Government introduced a Bill which controlled the admission of Commonwealth immigrants on a basis of employment broadly similar to the basis of admission of aliens. The Labour Party called this "colour bar legislation" because it did not include the Irish. Now the same Party puts forward a policy which appears to be directed against only the coloured immigrant and to put him in a worse position than the alien, and makes no mention of the Irish. The coloured immigrant is asked to believe that this policy is not discriminatory against him.
I accept the answer which my noble friend has given to me on two occasions
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about the admission of aliens. I also accept, with greater difficulty, his explanation of the omission of the Irish. But I submit to the Government that their public relations have been very bad. They made no mention of the Irish or of the aliens in any White Paper or ministerial Statement after the publication of the White Paper, and it is small wonder that their intentions have been misinterpreted.
The second reason for the ill-feeling in the country must be the specific measures envisaged to prevent evasion of the controls. The Government have made some welcome concessions and given assurances on this point. I have already welcomed the appointment of the Independent Committee to deal with appeals against deportation and refusals to admit. I welcome the assurances given by my noble friend the other day about the admission of children between the ages of 16 and 18, and I would ask my noble friend Lord Champion only one question. It is about students. It is worrying enough to face the ordeal of a difficult examination in a strange country without the additional anxiety of not knowing whether you will be able to stay for the following year. Will my noble friend give an assurance that, provided the student devotes a substantial part of his time to his studies, permission to stay will be automatically extended for the whole duration of his course of study?
My Lords, I come back to my central point. The Government are failing to get their intentions across. They are failing because their policy is taken to be a policy of coloured immigration control, when it should be a policy of general immigration control. There are signs, particularly in the appointment of the Independent Committee, that the Government are beginning to look at the problems of immigration in a general and rational way. I urge them to look at the whole question of admissions in this way; in a way which is genuinely related to economic and social factors and in a way which allows no possible accusation of colour discrimination.
The absurdity of the present situation cuts both ways, because not only is it easier for a Spaniard to obtain admission to this country than a Pakistani, it is also easier for an American than for a Canadian. If the reply of the Government to this is that Commonwealth

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immigrants are admitted on a different basis, that their dependants have an absolute right of entry, why not review the Aliens Law? Why not consider the admission of the dependants of alien immigrants to this country on the same conditions as for their breadwinner?
If the Government persist in thinking of Commonwealth immigration as a special problem, one is forced to the conclusion that they are being influenced not by the housing shortage, not by overcrowding, but by the prejudices of the British people. Indeed, there is evidence from the statements of Mr. Maurice Foley that this is the case. This is very dangerous reasoning, and, with your Lordships' permission, I will quote a comment of a leading authority in this matter, Mrs. Ruth Glass. She said:
" Because prejudice is being taken for granted, it is being appeased. And the more this happens, the more, it will grow, and it will become a political handicap for the appeasers. Already the restrictionists are demanding still harsher control."
I am convinced that the strongest possible lead is required to combat prejudice. I am supported in my conviction by the magnificent work done in Willesden where the two Members of Parliament, Mr. Reginald Freeson and Mr. Laurence Pavitt, have taken a strong and courageous stand on this question. Incidentally, their electoral popularity has increased in the process. I urge my noble friend Lord Champion to declare that the Government are not appeasing prejudice, but will take much stronger steps to convince both immigrants and the host community that they genuinely desire to promote healthy multiracial communities in the cities of Britain.
LORD ILFORD: My Lords, I desire to intervene only for one moment in order to say that I am very glad to find that some future useful life is anticipated for the Accommodation Agencies Act of 1953. That Act was a Private Member's Bill for which I was responsible when I was in another place. It was a Ten-Minute-Rule Bill, and I remember moving my Motion for leave to introduce it at 6 o'clock in the morning, which was a very favourable hour if you wanted to get a Motion through.
I remember that I was assured by all the official agencies, including, I think, the Home Office, that the Bill was unnecessary and that the existing law was
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I adequate to deal with the evil at which it was aimed. The Bill's life was at first limited to five years, so it expired in 1958. Since then, I am glad to say, the Home Office have continued it from year to year, and from that I deduce—I hope that the noble Lord who will reply will be able to confirm this—that it has proved a useful measure and done something to combat the evil against which it was aimed.
5.0 p.m.
LORD CHORLEY: My Lords, I should like to say a word because I do not find myself completely in agreement with some of my noble friends who have spoken this afternoon. The part of the White Paper which I dislike intensely is that dealing with civil liberties. While I associate myself with what they said about it, I think that other parts of the White Paper are much more reasonable and that the mass of modern opinion is behind these parts. But the part on civil liberties is against the whole tradition of civil liberties in this country.
There has been a great deal of protest, not only from members of the Labour Party, but from members of other Parties as well, and I have reason to believe that the Government have been much influenced by this. As more than one speaker has said, from the appointment of a new Committee, it seems that, for the time being, the Government do not propose to continue with this part. It seems to me that this is an extraordinary valuable concession, and one that should go a great deal of the way to meeting opposition to the White Paper. I am sure that among the immigrant population it is this side of it which has aroused the greatest amount of indignation, and I feel that the Government should withdraw this part of the White Paper.
Some people think that they have, by implication, already done so, in the appointment of this new Committee to consider the whole problem of immigration, both from the Commonwealth and from foreign States. I hope that that is so, but it is not so clear as it ought to be, and I believe that it would make a good deal of difference if the Government were to withdraw this part of the White Paper and say that, when the new Committee has reported, they will look at the matter again. This would be a valuable move, and I think it would remove a

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great deal of the indignation and difficulty which undoubtedly exists in the country at the moment.
5.3 p.m.
THE DUKE OF DEVONSHIRE: My Lords, I hesitate to intervene, as I have spoken on this subject in your Lordships' House more than once. I should like to offer my sympathy to the noble Lord, Lord Champion, who has been assailed from both sides of the House during this afternoon's debate, though he needs no champion, as he can more than fight his own battles.
One of the things that strikes one most in discussing Commonwealth immigration is that there has been a marked change in the view of the majority of the Government since their days in Opposition. When the Bill first came before Parliament, there was bitter dispute, both in another place and here. Now noble Lords on the Front Bench opposite are supporting what is put forward in the White Paper, while there are other elements opposite who do not support their Government in this. We have heard speeches of burning sincerity from the noble Lords, Lord Brockway and Lord Royle, and no one who had the good fortune to listen to them could fail to be struck by the conviction with which they spoke. I do not make this point for Party political reasons. I think that the reason why there has been a change of heart in the Government, in their attitude towards immigration, is that during the months they have been in office they have had access to the facts about immigration, and the hard realities of the situation have forced them to change their point of view.
Listening to the debate this afternoon, I do not think that anyone could possibly quarrel with any of the sentiments put forward by noble Lords opposite. Of course, we should all like to see our less fortunate brothers in the Commonwealth coming here, as to a kind of Utopia; but we just do not have the physical resources to do it. We may criticise successive Governments for their housing programmes and hospital plans, but the fact remains that no Government, whatever its achievements in these all-important fields, could have created the conditions in which we could go back to the old days of unlimited Commonwealth immigration into this country.
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I would say to noble Lords opposite that certainly we on this side—and I am sure that some noble Lords on the Front Bench opposite will support me in this —do not quarrel at all with the principle which they have put forward. But it is the Government's job to govern, and to do so for the greatest good of the greatest number of people; and we must accept physical limitations as they exist. I make this point because I should very much dislike it to be thought that we had not great sympathy with the ideal, though at this stage, and for the foreseeable future, that ideal must be regarded as totally impracticable.
With the publication (of the White Paper last August. the Government have taken another bolder stride forward, and I find myself largely in agreement with their proposals. The first one I should like to refer to is the annual rate of 8,500 vouchers. This is a sad figure; it is a substantial reduction. But the situation is even sadder, now that only "A" and "B" voucher-holders are to be admitted. Those with "C" vouchers, that is, those without skill or without a job to come to (and I believe that there is a waiting list of over 300,000 of them), are no longer to be admitted.
The admission of immigrants with special skills is very satisfactory for us, but I confess that it worries me, because they are the very people whom the developing countries of the Commonwealth can least afford to lose. It has been pointed out that doctors and dentists, and others, come here, work for two or three years and return to their own countries with greater skill and knowledge, to the benefit of their own people. This is wholly admirable—and certainly I do not think that we should underestimate the benefits of the study of medicine in this country. We have the example of Dr. Banda, who practised in North London, and is now the leader of a Commonwealth State in Africa. There is no knowing what a few years of medical study and practice in this country will achieve for the right chap!
The point has been repeatedly made this afternoon that we ought to be able to meet the needs of the people coming to this country for houses and hospitals, as if that were the ultimate aim. To my mind, the ultimate aim is for us so to help and support the developing countries that

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the people there will not want to come here. People do not usually want to live away from their own shores. Noble Lords who have had the misfortune of hearing me before will have heard me make this point and I should like to repeat it. We must get the social and economic infrastructure in the developing countries of Asia and Africa so off the ground that the flood of people coming to this country will diminish to a mere trickle. That is the ultimate aim, rather than the improvement of housing and hospitals for everyone who comes here.
As other speakers have said, the White Paper contains, in paragraphs 23 to 25, some important proposals for legislation. The reason for these proposals is the alarming rate at which the evasion of the existing conditions continues. It has been stated in another place that it was estimated that in the first year of the working of the Act 900 people from Commonwealth countries entered this country illegally. In the second year, this figure multiplied tenfold, to 9,000. The most recent figure shows that by September of this year we had already reached the figure for the whole of last year namely, 9,000. These are substantial figures. I welcome the fact that the Government are determined to take steps to put an end to this illegal entry, because, as my noble friend Lord Derwent said, unless the figures are genuine; and unless, when the Government say they will admit so many, they do, in fact, admit so many, the whole of their scheme and planning for Commonwealth immigration falls to the ground.
LORD GIFFORD: My Lords, may I interrupt the noble Duke? I speak subject to a correction, but I believe I remember, from my reading, that in another place the noble Duke's right honourable friend, Mr. Thorneycroft, quoted the figures of 900 and 9,000, a rise of 1,000 per cent., in relation to the old Commonwealth, whereas the new Commonwealth, I think, was 30 per cent.
THE DUKE OF DEVONSHIRE: If the noble Lord looks at the official record, I think he will find that my right honourable friend Mr. Thorneycroft quoted the figures from the old Commonwealth and the new Commonwealth. The ones I quoted were the accurate figures from the new Commonwealth.
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We welcome, as I have said, the steps proposed in paragraphs 23, 24 and 25 of the White Paper, and our only hope is that legislation will be forthcoming. My noble friend Lord Derwent, in his speech, made some reference to the fate of steel legislation, and I must confess that I am a little worried. There has been appointed this new official Committee. I hope that the Government are not going to ride off their responsibilities by putting the work on to a Committee. As I have said before, it is the Government's duty, however unpleasant the task may be, to govern.
The situation should be clear, I think, because on November 4 of this year in another place the Prime Minister, when referring to Commonwealth immigration, had this to say:
" I cannot believe that there is any subject in recent times which has had more research, more discussion and more careful consideration than this one. The White Paper was put for ward as a result of that."—[OFFICIAL RFPORT, Commons, Vol. 718 (No. 670), col. 1231; 4/11/65.]
So, quite clearly, a great deal of trouble, discussion and research had gone into the subject before the White Paper was produced. Why is it then necessary to have yet another Committee to advise the Government before they can decide on legislation? Surely the work that is being done by this new Committee should have been done before the White Paper was published. It seems to me to be putting off the day when this thorny problem is tackled and legislation is introduced. The time for the new Committee was before the White Paper was produced, not afterwards.
LORD STONHAM: May I intervene for one moment? The noble Duke has overlooked the fact that this Committee will also inquire into aliens, and, as I have said, we shall regard its advice as most important when we come to consider permanent legislation in respect of aliens.
THE DUKE OF DEVONSHIRE: I accept that. But I think it is a valid point to say that the best time for the work of this Committee would have been prior to the publication of the White Paper, and not afterwards. One only hopes that the Government will stick to their guns and carry through the proposed legislation outlined in paragraphs

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23, 24 and 25. We have every reason to suppose that they will, because, speaking more recently, on November 9, the Prime Minister said in another place, referring to the White Paper:
" This represents our policy and we are implementing it."—[OFFICIAL RFPORT, Commons, Vol. 718, (No. 671), col. 49.]
That is a categorical undertaking that the proposals set forth in the White Paper will be embodied in legislation at an early date.
I should now like to turn, quite briefly, to the happier section of the White Paper, the third section, which talks of how Commonwealth immigrants can become one of us, and can become in every sense as good citizens as those who have lived here for generations. I am glad that the noble Lord, Lord Champion, when replying to the debate is going to amplify these points. As other noble Lords have said, there are three main problems to be faced in getting—like the most reverend Primate, I hesitate to use the word "integration", but to get these people happily established here. I refer to housing, education and health. The first and last, housing and health, are really outside the scope of this debate. I feel, speaking from these Benches, that my Party are more likely to build more houses overall than the present Government; and I also think that our hospital programme will be more satisfactory; but this is a matter for argument, and naturally noble Lords opposite would not agree with this. I think it fair to say, however, that those two problems, as they are bound up with domestic problems, would be better discussed in a debate on housing or the Health Service.
That is true also, to a certain extent, about education, but here I feel there are certain specialist sides of that subject which would help enormously to make Commonwealth immigrants, and particularly their children, feel more quickly at home, and I should like to make reference to them. I think it is in paragraph 47 of the White Paper that reference is made to discussions which are going on as to the use of language laboratories, modern techniques of wireless and television, and teaching English as a second language to immigrant children who do not speak English. One of the great difficulties in the education
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field is that these children, however high their I.Q. may be, are seriously handicapped when compared with our own children by being able to speak little or no English. I thought that the White Paper might have been a little more urgent on this aspect of the matter. It says that discussions are taking place. There have been great advances in recent years in the technique of speaking English as a second language. I have already referred to the language laboratories. The British Council have been pioneers in this work, as have London University, the University of Leeds and one or two others. There is great scope, without spending too much money, for a "crash" programme, and I would ask the Government to look into this to see how much can be done in putting forward a "crash" programme so that immigrant children can master the English tongue within a reasonably short time of their arrival in Britain.
The second point is whether more could be done among volunteer youth workers in this country. Noble Lords on all sides of the House will be aware of the magnificent work done by Voluntary Service Overseas. I think this is one of the most successful things we have achieved in this country since the war. I wonder whether something of the same kind could not be done among the substantial numbers of Commonwealth immigrants in our great cities. There is a body called the Youth Service Development Council. I am afraid I do not know much about the work of this Council as I should, and it may well be that this Council is already tackling the problem. There is undoubtedly in this country a great urge among young people to help the developing peoples abroad —and to go abroad, of course, is more of an adventure. There is this genuine feeling of service among a large number of young people when they leave school or university. I wonder whether it would be possible for the Government to sponsor and organise in this country something on the lines of Voluntary Service Overseas—call it Voluntary Service at Home, or what you will—because it is much easier for young people to help people of their own age and generation to get accustomed to our ways in this country. This is only an idea which I put forward, and it may well be that the Council to

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which I have referred are already tackling the work.
Finally, I should like to quote the beginning of the last paragraph of the White Paper. There it says:
" The good name of Britain, our relations with other members of the Commonwealth, and, above all, justice and common humanity, demand that Commonwealth immigrants in this country should be absorbed into our community without friction and with mutual understanding and tolerance."
That is a splendid sentence, and one with which every Member of this House, no matter where he sits, will wholeheartedly agree. There is no quarrel here, I should like to assure the Government, on the end—the end is stated clearly—the quarrel is on the means. We must accept our physical limitations. We must make ourselves as sufficient as possible, but we must accept that we have substantial physical limitations and that it would be the height of folly to allow more people into this country than can be properly assimilated, because racial feeling would suffer infinitely more than it does now by a number of people feeling that they have been badly treated by not being allowed in. Far more racial trouble is caused by one Nothing Hill riot than by several tens of thousands of people being unable to obtain admission into this Island. I congratulate the Government on producing the White Paper, and I hope they will have the strength and courage to go through with the proposals tabled in it.
5.22 p.m.
THE MINISTER WITHOUT PORTFOLIO (LORD CHAMPION): My Lords, this is the sort of debate to which I do not like having to reply. Most of the criticisms have come from behind me, and most of the support for this White Paper continuing the power that we are here seeking has come from in front of me. That is always a difficult situation for someone who is to speak for the Government.
A NOBLE LORD: A stab in the back!
LORD CHAMPION: It is not exactly a stab in the back. I should rather think it was a pin in the behind, which is just a little different but, nevertheless, is something which might be very uncomfortable, if not deeply wounding.
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This debate has been marked by a deep seriousness and profound feeling about the issues raised by this Expiring Laws Continuance Bill, particularly as it applies to immigration. The noble Duke used better words than I had thought of when I was scribbling this down just now. He said, "a burning sincerity" and he was absolutely right. It seemed to me that that burning sincerity came through all the speeches of my noble friends and of course of the most reverend Primate, all of whom, in varying degrees, criticised this White Paper.
Perhaps the most forthright was the noble Lord, Lord Brockway, in the sort of speech that we expect from him and know we shall get, because of his deep feelings in this matter. What he told this House is what he has told us so many times: that we are all brothers under the skin, no matter what our colour; and I agree with him. I remember George Lansbury using a phrase many years ago, at a public meeting which I attended as a youngster, when he said, talking of coloured people, "Scratch them and they bleed; tickle them and they laugh, the same as we do. They are human beings, they are our brothers." The noble Lord may agree with this, as I agree with it. Unfortunately, we are some distance from a general acceptance of this idea by the whole of the people of this country, and by those in the areas to which most of the coloured immigrants have come during the past two years. Here is our difficulty. We know, too—and this has been stressed by many noble Lords to-day —that racial prejudice exists and has been exacerbated by the conditions in which, unfortunately, these people have to come here and live—housing, school difficulties, the general overcrowding and massing in these areas.
To admit unlimited numbers in present day circumstances would, I agree with the noble Duke, have the opposite effect on Commonwealth relations to that which the noble Lord, Lord Brockway, thinks it would have. I believe that if immigrants were permitted to come in in numbers of the kind that some people to-day say should be allowed, the results would be disastrous to the Commonwealth, rather than helpful. I am sorry to have to disagree with him on this, but it is a point of view which I hold, and

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which the Government hold. That is why we have frankly to admit that our attitude towards the 1962 Act has changed. A greater knowledge and a greater experience in the meantime have definitely taught us that.
My noble friend Lord Gifford said, or suggested, that we were giving greater preference to aliens than to Commonwealth immigrants. I am bound to say that this is quite untrue. He said, too, that the White Paper tends to exacerbate racial feelings. They might be to some extent. He has pointed out instances, as have others, including the most reverend Primate and the noble Lords, Lord Brockway and Lord Royle. But we, too, as individuals have a responsibility, and if in our speeches we exaggerate some of these points we also are exacerbating racial feeling. That is why we have to accept responsibilities and, when we make speeches, realise that they are read outside this House and that they themselves might add that little additional fuel to the conditions which we seek to avoid, and which we do not want to exacerbate. We have individual responsibilities, and we must exercise them when we speak in public places. The noble Lord, Lord Gifford, asked me a question which was of rather less importance than his main speech. He asked whether there was, or would be, any difficulty about students who are genuinely studying remaining for the whole period of their course. The answer to this is, No; there is no difficulty at all, provided that they are genuinely studying and pursuing a course of study which will provide a result which they want, and we want for them. The difficulty we have found is that so many people have come here under the guise of students but have not followed a course of study.
The noble Lord, Lord Ilford, gave me some relief when he told us that he was delighted about the Bill he had introduced, about its effect over the period, and the fact that it was being continued by this legislation today. If everybody had spoken in those terms my task tonight would have been an easy one.
The noble Duke and the noble Lord, Lord Derwent, spoke about the problem of evasion of control. Lord Derwent suggested methods of check on this
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matter. I cannot attempt to answer here the points that he has made, but I am bound to say that I think his suggestions are worthy of study. Indeed, some of them are under consideration at the moment, or are being put into operation, but I can go no further than that. As his suggestions come from an ex-Minister of State in the Home Department, knowledgeable about this whole subject, we can assure him that we will give them the consideration they deserve. On this point, I can add nothing to paragraphs 23 and 24 of the White Paper, Immigration from the Commonwealth. At the moment, what can be done by administrative means is being done.
However, as we say in those paragraphs, some of the powers which are required will necessitate legislation. Here I can assure the noble Lord, Lord Derwent, that the Committee was not set up in order that the whole problem might be swept under the carpet. That is always a good opposition phrase when one sets up a committee to consider something of this sort, but so often when a committee is set up something emerges which is really worth while. The question has perhaps been given that little additional consideration which such a committee can give; and we are extremely grateful to Sir Roy Wilson for having accepted the responsibility in this case. I cannot imagine that Sir Roy would have accepted the chairmanship of this Committee had he thought it was merely a nice little shuffling-off job by the Government.
LORD DERWENT: My Lords, I am sorry to interrupt the noble Lord, but what I am really interested in is the speed with which this Committee can do its work; and as the noble Lord is talking about pinpricks into the hide, perhaps the Government would exercise that and ask the Committee to go even more quickly than it has intended to go.
LORD CHAMPION: Yes, my Lords. We always say this about committees which are set up. I think the reply almost invariably is that we would rather they do their work well, than hurriedly and not well.
LORD DERWENT: A bad answer!
LORD CHAMPION: My Lords, as I have heard the noble Lord give that

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answer himself it must be a pretty good answer, and not a bad one.
My noble friend Lord Royle found the White Paper disappointing and distressing. He referred to the statement that was made by the Minister of State at the Home Office at the Labour Party Conference, which was something to the effect that what we must have is a pause. As I understood the noble Lord he asked me to clarify the word pause Unfortunately, I have not the context of the speech by me, but I think that it is quite clear that no definite reply can be given at this stage about the length of the pause, until it is known for certain what effect the present and proposed measures for integration—social services, housing, education and the like—will have. So we cannot set a date to this. Indeed, this is a matter which this and future Governments will have to keep under continuous review. But unless conditions change enormously I personally doubt whether we shall, in the foreseeable future, be able to revert to the open door for all who wish to come to this small island.
The noble Lord, Lord Derwent, said that we must admit no more. I think he would, for this present moment, cut out the 8,500 vouchers.
LORD DERWENT: My Lords, I particularly did not say that. I said that we should admit no more for permanent residence, but that there was no reason why we should not admit them on a temporary basis, as we do with aliens.
LORD CHAMPION: My Lords, I did not quite understand the noble Lord that way, but I shall check Hansard— well, I do not need to check Hansard, because of course I accept absolutely what the noble Lord has now told me. I think it would be a most difficult thing to admit them on a temporary basis, to do a job, and then at the end of the period turn them out. Moreover, I should have thought it was unworthy of this country to tackle the problem in quite that way.
The noble Lord, Lord Derwent, has taken one point of view which exists in this country. The right reverend Primate has taken the other point of view, as so many have done. As I said here last week, the job of Government is always to balance: to balance the points of view
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which have been expressed in various quarters. We have done this here to the best of our ability, and we believe that the White Paper indicates the best way to tackle this problem, which is certainly a tremendous problem for us all.
The noble Lord, Lord Royle, is unhappy about the fact that an entry certificate does not guarantee admission. My Lords, an entry certificate indicates to the immigration officer that the Commonwealth citizen holding it has satisfied a responsible person overseas that he is eligible for admission to this country. It is rare for the holder of an entry certificate to be refused admission, but there are unfortunately, cases where it is discovered at the point of entry that the certificate has been obtained by misrepresentation, and therefore admission is refused. These things happen very rarely.
LORD ROYLE: My Lords, are these the only cases?
LORD CHAMPION: My Lords, so far as I am aware, this is the only sort of case in which a person in possession of an entry certificate is refused admission. I will speak to officials after this debate is over, and if I find out that I have in any way misinformed the noble Lord I will write to him.
LORD ROYLE: Thank you.
LORD CHAMPION: My Lords, we have not heard to-day, as I rather expected that we might, anything about the health checks. I thought we should do so, considering the fact that we have had the B.M.A. Report presented to the Government recently. Perhaps I might just say a word about this Report. The Report, which was received on December l, is a detailed document of some 30 closely typed pages, with eleven appendices, which have many implications, legislative, administrative and medical. Clearly we have not had time to form firm views on it, but all I can say at this stage is that we regard this as a serious document which will be carefully studied by the Government. Meanwhile, the Government's own policy is clearly set out in the White Paper on Immigration from the Commonwealth. A quick reading of the Report, however, indicates that, broadly speaking, the Government's policy is very much in line with the recommendation of the B.M.A. Working

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Party. But, as I have said, this is a detailed document which will be subjected to close study by the departments concerned.
Turning now to education, the noble Duke was quite right when he said that this is extremely important, and he mentioned some of the aspects which the Government also feel to be important. The circular, 7/65, issued by the Department of Education and Science in June, made a number of recommendations to local education authorities on the special measures which might be necessary in some areas to ensure that immigrants receive the best possible education. These recommendations covered, among other matters, the appointment of additional teachers and non-teaching staff in schools; the provision of extra books and equipment; English classes for adult immigrants and training courses for teachers.
In this connection I do not know whether the Department have, in fact, made any suggestions to the local authorities on the lines of the suggestions made by the noble Duke, but if they have not done so, I am sure they will study the problem. But of course the actual way in which they do this is very much a local education authority matter. They have the responsibility. What we have to do at the centre is to try to provide the additional finance, and so on, which will make it possible for them to carry out the suggestions we make to them, or the ideas which they might themselves have on this matter of providing the sort of education which is going to turn the immigrant into someone wholly acceptable to our society.
The only recommendation in the circular sent out at that time that has been criticised is one which suggested that local education authorities should, wherever possible, limit the proportion of immigrant children in any school to not more than about one-third of the school roll. This has been interpreted in some quarters as discrimination against immigrants. It was, in fact, an attempt to ensure that schools did not have to cope with so many children with educational problems arising out of their different cultural and social background, and often inadequate knowledge of English, that the standard of education or the standard
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of English provided by the school for all its pupils was in danger.
It is accepted that this recommendation is not' easy to implement, and authorities are not obliged to implement it. There are, nevertheless, increasing signs among teachers, in particular very recently in London and Birmingham, that they agree with the principle of limiting the proportion of immigrant children on the ground that this will ultimately be for the benefit of all children, immigrant and non-immigrant alike.
On the question of financial assistance to local authorities the White Paper announced in paragraph 60 that the Government intended to contribute towards approved expenditure incurred by certain local authorities that undertake exceptional commitments by engaging extra staff to ease pressure on the social services arising from the difference in language and cultural background of immigrants and to deal with the problems of transition and adjustment. The Government intend that the necessary powers should be taken when Parliamentary time permits, possibly in the course of this Session. I cannot be absolutely sure, but I rather hope it will be the case.
"Integration" has proved to be a word that a lot of people regard as not very blessed, and they have sought to find different words, but the problem remains the same, no matter what word is used about it. The Government have recognised that Britain is already a multiracial society and have made it clear that there can be no question of Commonwealth immigrants being regarded as second-class citizens. They must be full members of our community in every sense of the word, with the same rights and responsibilities as everyone else. It is only honest to admit, as I am sure we all do, that there are many difficulties to overcome. They must be overcome if we are to translate into reality our belief in the equality of our citizens irrespective of their countries of origin or the colour of their skins. To achieve our purpose we need a concerted effort by all those who are or should be involved, and I hope that we shall be able to rely on the full co-operation in this work of employers, trade unions, local authorities, the churches and voluntary organisations, and the immigrants themselves. As the House knows, the Government have instructed a Minister,

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Mr. Foley, to take a personal responsibility for co-ordinating Government activity in this connection, and I will not say any more about it.
The most reverend Primate has accepted the chairmanship of the new National Committee for Commonwealth Immigrants. We are deeply grateful to him for having undertaken that additional task, a task over and above the great responsibilities which he bears. We know that he brings to it the sympathy and understanding which shone out through the whole of his speech here this afternoon. I think I should mention here that we are grateful to the Council which is now defunct and which was presided over by Lady Reading, a Council that produced two excellent reports that I can think of at the moment—I know they produced more. The first was on housing and the fourth was on housing, and in between we had two others. My noble friend is whispering something to me; he is not quite sure whether they were about employment and education. Nevertheless we are grateful for those reports, and I am sure the Department learnt a lot from them.
I need not talk about the work of this National Committee for Commonwealth Immigrants because it was described by the most reverend Primate. He asked me a few questions when he was talking about the work of that Committee. He said that considerable difficulty was being created as a result of our decision to put the age limit at 16 with a discretionary power being left to the Department concerned for the ages between 16 and 18. We explained in the White Paper how the previous rule was being abused to the detriment of family unity by the bringing in of children only as they reached working age. As my noble friend, Lord Stonham, said on November 16 in the debate on the Address, the Home Secretary does not exercise his discretion on any narrow interpretation of the word "hardship". When both parents or only the surviving parent are in this country, a dependent son or daughter aged 16 or 17 is normally allowed entry to join them here.
We are here up against, as one always must be in this sort of question, the difficulty of setting an age. If we set 18, there would be difficulties created of those between 18 and 21, and so it goes
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on. You have to decide on an age and allow some little flexibility on one side of it, as we have done; and I think in the circumstances this age was perhaps the right one. I can assure the most reverend Primate, as I am sure he heard from the Prime Minister when his deputation met him the other day, that the Home Secretary does apply this decision with the greatest sympathy and understanding.
The most reverend Primate also mentioned the bias that seems to exist towards allowing professional people to come in. He mentioned doctors and said that this has been described as a brain drain from countries that simply cannot afford it. I believe that in the debate on this Bill last year I agreed that there was difficulty here, but I frankly do not know the answer. I know that in many cases these professional people conic here, the doctors in particular, to gain experience which they can then take back to add something of value to the communities from which they have sprung. Some remain because the conditions here are so much better than those in their own country. There is no simple answer to this; but we recognise the problem, and if the most reverend Primate has any ideas on how to overcome it, I am sure we shall be very glad to look at them.
My noble friend Lord Royle supported the most reverend Primate on that point, and also on the point of the sixteens to eighteens. I cannot agree with the noble Lord, Lord Gifford, that we have failed to give a strong lead to the country. I believe we have, in this White Paper. What we must face is the fact that there is no sudden, dramatic move that the Government or any Committee can make that will solve this problem of immigration and integration. Racial feelings and hatreds are not suddenly dissolved by telling people that they just ought not to exist. To translate our belief in the equality of all our citizens into reality we have to overcome the social difficulties which are obvious to everyone, and especially to those who are living in the forty or fifty already overcrowded towns where immigrants have settled. These towns must have a breathing space in which to tackle the physical conditions —housing, educational facilities, health and the other services which are at present under great strain. In this they must be

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helped to the maximum by the central Government, and indeed we have set our hands to that task. Only time can change psychologically and emotionally deep-seated attitudes. To shorten that period of time must be the aim of every decent member of our community, whether he be black or white.
On Question, Bill read 2ª, and committed to a Committee of the Whole House.

WORKMEN'S COMPENSATION AND BENEFIT (AMENDMENT) BILL
5.51 p.m.
Brought from the Commons; read 1ª, and to be printed.

DEVELOPMENT OF INVENTIONS BILL [H.L.]
5.52 p.m.
Order of the Day for the Second Reading read.
THE LORD CHANCELLOR (LORD GARDINER): My Lords, I beg to move that this Bill, which is a Consolidation Bill, be read a second time.
Moved, That the Bill be now read 2ª.—(The Lord Chancellor.)
On Question, Bill read 2ª, and referred to the Joint Committee on Consolidation Bills.

MINES (WORKING FACILITIES AND SUPPORT) BILL [H.L.]
Order of the Day for the Second Reading read.
THE LORD CHANCELLOR: My Lords, I beg to move that this Bill, which is also a Consolidation Bill, be now read a second time.
Moved, That the Bill be now read 2ª.—(The Lord Chancellor.)
On Question, Bill read 2ª, and referred to the Joint Committee on Consolidation Bills.

HOUSING (SLUM CLEARANCE COMPENSATION) BILL
5.53 p.m.
Order of the Day for the Second Reading read.
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF LAND AND NATURAL RESOURCES (LORD MITCHISON): My Lords, I beg to move that this Bill be now read a second time. In order for you to understand the background of this Bill, I must ask your Lordships for a moment to cast your minds back about ten years. In December, 1955, we had a period of ten years since the end of the war and the duration of the war itself. During the whole of that time there had been little or no slum clearance. The reason for that is obvious. At the end of the war the building resources of the country were urgently required for war damage where the damage could be repaired, and for building new houses, not only as the result of enemy attacks but also, of course, as the result of changes in industry and the distribution of the population during the war.
That was the position then, and the Government of the day were minded to resume slum clearance and to invite the local authorities to play their necessary part in it. Indeed, they had already collected information from the local authorities as to how many houses would require to be dealt with. In the course of considering this, they came, I think rightly, to the conclusion that to one group of people the pursuance of this programme might cause some rather unfair hardship—namely, the people who during the war, and during the years after it, had been compelled to buy unfit houses because they could not get others, and had bought at a time when they had not in mind early renewal, at any rate, in slum clearance.
The position at law is clear enough. Since 1919, with the agreement of successive Governments of all Parties, the owner of an unfit house will, if the house is purchased, get the value of the site but nothing for the house; and if the house is demolished or closed, he will get no compensation. The most he can get on a purchase is site value. Though there are some rather obscure

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exceptions, undoubtedly that has been the general rule, and was the general rule in this case. Early in 1956 a Bill was introduced which had been foreshadowed by a statement made by the then Minister of Housing and Local Government, Mr. Duncan Sandys. It was a Bill which gave to certain people additional supplemental compensation, or compensation where there had been none, in both cases giving compensation, or making it up, to the full market value.
The class of people who were to be protected in this way under this additional compensation were those who had bought their houses between the outbreak of war and the time when the statement was made and the slum clearance campaign accordingly inaugurated or foreshadowed, and who at that latter time, which was the date of the Minister's statement, December 13, 1955, were in occupation of the house that they had bought, or, if there had been a change, had a close member of their family in occupation of it. Those people were to get full market value compensation. But this was intended as a temporary expedient, and I shall in a moment refer your Lordships to what was said by those who introduced the Bill at the time. Therefore, the giving of compensation on this scale was to go on for ten years only and was to expire actually next Sunday or Monday of this current year.
If nothing whatever is done about this, the position will be that those who would have become entitled after that date will in fact get nothing. That was, I might point out, the clear intention of those who introduced this as a temporary expedient in 1955. I have in mind two passages, but I think I need refer to only the statement of Mr. Duncan Sandys himself, in the Second Reading debate on the Bill then introduced. He said, at the end, with reference to Clause l—and it is to the provisions of Clause 1 that I have been referring:
"Clause I is temporary—there is a ten years' limit—and the other two are permanent."—[OFFICIAL REPORT, Commons, Vol. 550, col. 2275, 28/3/56.]
The other two clauses were concerned with other matters, to one of which I shall have to refer later. As I say, all I have been saying so far relates only to Clause 1. Mr. Sandys continued:
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"Clause 1 is temporary because we feel that when an owner-occupier of a slum house has had ten years' or perhaps, up to 26 years' occupation "—
the reference there to twenty-six years is, of course, the maximum that could have been had at that time—
" he has probably had good use from the house and there is no reason why he should have special treatment after that time."
A similar statement, without any reference to twenty-six years, had been made by the Parliamentary Secretary of the day, Mr. Enoch Powell, in introducing the Bill. Therefore, what it was intended to do and its limits were perfectly clear.
To-day the Government could leave it at that, but we believe that there is still a case for continuing, in some measure, the special treatment which has been given. We agree that this cannot go on indefinitely. We have no intention of infringing—nor had those who introduced the Act in 1955—the long-established principle that one does not get payment for an unfit house. We propose to deal with this problem by removing the time limit of next Sunday or Monday. If matters stayed there, the whole business could go on indefinitely. The time limitation which we propose to put in will take a different form. We propose that, after that day, compensation shall be available only to those who have had less than fifteen years' occupation of the house. The reason for this is the reason that was given by Mr. Duncan Sandys, in the passage I have just read: that people who have bought an unsound house at a price appropriate to an unsound house, and are then affected by a clearance or demolition order cannot expect to be entitled to extra compensation beyond the ordinary legal compensation when they have had a reasonable period of use. The Government of those days thought that ten years was reasonable. We are a little more generous about it and are going to make it fifteen years.
Let us see how this will work out. To take the position to-day, the only people who can have had less than fifteen years' use of their house are people who bought after a given date in December, 1950. Next year it will be only people who bought after a given date in December, 1951, and so on, year by year. Finally, the whole business will come to an end

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in December, 1970, by reason of the fifteen years' qualification. This, I think, is the right thing to do; it is also a felicitous way of ending a piece of temporary legislation, gradually and, as we see it, fairly.
When the original Bill came forward, it was opposed by the Opposition of the day with commendable vigour, but on only one ground: that the money was to come from the local authorities, and we thought that there ought to be an Exchequer subsidy. Two things have entirely altered that situation. The first is that for ten years payments of this special compensation for slum clearance and slum property have been made out of the funds of local authorities. That having been done, there seems little to be said for changing the incidence of the burden at the moment when we are providing for its ultimate termination. Moreover, today, as it happens, my right honourable friend is introducing in another place a Rating Bill—a rather sweeping measure, as I understand it. This is all part of something that has been going on for some time, a thorough review of the financial relations between local authorities and the central Government, which is now being carried into effect. Therefore, I would not now seek to apply the arguments which were put forward with such clarity and force by the Opposition in 1955.
I should like to say a few words about the total amount involved. It is exceedingly difficult to get accurate figures without asking local authorities for one return after another, and so taking up a disproportionate amount of their time. The best figure we can give is that the total cost to them will be somewhere in the region of £3 million. The total cost to the Exchequer will be much smaller, and it will arise mainly out of changes in the rate deficiency grant. I would repeat that the 1956 Act was introduced as a temporary measure, on the footing that ten years' occupation of a slum house was sufficient consideration for the supplementary compensation to be paid, and that thereafter no further payment by way of compensation, beyond the ordinary site values, should be involved.
LORD NEWTON: My Lords, I have been listening very patiently, and I should
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like to ask the noble Lord one question. If he is maintaining that the 1956 Act laid down the principle that ten years' beneficial occupation was long enough, why in fact did that Act provide that even after 26 years' beneficial occupation the owner-occupier should get market value?
LORD MITCHISON: For this reason. It divided matters at the date when the slum clearance was to begin again. It treated in one group those who had not been able to find accommodation, and who had had to buy houses, during or after the war, which probably they would not otherwise have bought, without regard at that time to the possibility of compensation if slum clearance were resumed. That was the reason for the mention of the 26 years. I am sure the noble Lord would not have approved if the Government of the day had confined it more closely than that. They had to have that period because of the circumstances at that time. I read that passage from Mr. Duncan Sandys' speech, and if there is any doubt about it I may say that there is a similar passage in Mr. Enoch Powell's speech.
LORD NEWTON: Yes; I have read it.
LORD MITCHISON: What we are now dealing with is what was introduced as a temporary expedient, founded on the basis that ten years' occupation of a slum house was sufficient consideration for this purpose, and that where that had been enjoyed, or tolerated (whichever word one likes to use), there was no occasion for the additional compensation to which I have been referring. That is the main purpose of the Bill.
There are two other points which are involved. The first is a comparatively small matter related to what I have just been saying. The original provision in the Bill fixed as the period to be taken for the purpose of the slum clearance order not the order itself but the demolition or vacation of the condemned house. That might have been all right if only demolition or vacation had to be considered; but there are also questions of purchase. A local authority under a clearance order frequently purchases the houses concerned: and this is a matter upon which entitlement to compensation can depend. In such a case inconvenience would be involved. Under the

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compulsory purchase procedure it is rather hard to say when the purchase actually takes place; there are difficulties which arise over delays, and matters of that sort. Therefore, for the purpose of this provision and for the future, the date to be taken is the date of the order which had the result of condemning the house.
My Lords, I have been talking about slum clearance orders. What I think are really involved are clearance orders which affect a group of houses, all of which must be unfit for the purposes of the order—demolition orders affecting a single house or closing orders which have a similar effect but a rather different scope. It is the date of one of those orders that is going to matter in future. This will mean that a comparatively small group of people, who at the moment have not reached the stage of finishing the purchase or the demolition or whatever it is, will be able to come in, because the order is always the first step and they will therefore have had the order. I feel very doubtful whether any of your Lordships will object to that small modification.
The third point is also not a very large one in practice, and it is this. There are two other clauses in the previous Bill, to which I referred just now, and one of them related to the position of mortgagors and mortgagees where the subject of the mortgage was a house which was going to attract one of these supplementary payments. Broadly speaking, it gave the county court power to adjudicate between the two parties, both where there was a formal mortgage and where there was a deferred payment by instalments, as there quite often is in that type of case. That jurisdiction was in addition to such powers as the courts have otherwise in connection with mortgages. It was in broad terms (I can refer to it if need be) and all that happens in this Bill is that the jurisdiction is extended generally to slum houses which are condemned—condemned, as it were, to demolition or vacation—or are under a clearance order. Indeed, it extends to them now, if the facts justify it. It is, in fact, a small change because there has been comparatively little use of this provision. There is a very small number of cases year by year. But there is no doubt that the existence of a provision of this kind makes it easier for the two
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parties concerned to come to a fair agreement between themselves, if they know that the matter can be dealt with on these broad terms in the county court.
The present Bill also entitles the county court to take account of something which has not been, at any rate, specifically mentioned before, and that is the price that was paid for the house. I can develop these matters further if your Lordships wish, but I notice that they attracted comparatively little attention in another place. I doubt whether there could be much objection in principle to the last two points I have mentioned; it is, perhaps, the first of them that I ought to have dwelt on and which I have tried to dwell on.
Before I sit down, I should like to say this. I feel like somebody who changes the whole thing at the last moment, but this is only a matter of form. The 1956 Act was, in fact, incorporated in the Housing Act, 1957, which was a codifying Act, and your Lordships will find it in its full beauty without any alteration in Part II of Schedule 2 at the end of that Act. That is merely a question of reference, and accordingly your Lordships will notice that in the Bill now before us the references are not to the 1956 Act but to the codifying Act —the Housing Act, 1957. I hope I have made matters clear. I think I ought to wait till I am attacked and then try to meet the attacks, but whatever attacks are made I hope that your Lordships will join with me in recognising that it might well have caused hardship to terminate this provision as it was originally intended to be terminated, and that there is a great deal to be said for terminating it gradually. That is, in effect, the result of the stipulation that there should be no more than 15 years' residence in the house if this additional compensation is sought. My Lords, I beg to move.
Moved, That the Bill be now read 2ª. —(Lord Mitchison.)
6.15 p.m.
LORD NEWTON: My Lords, I am sure that we are all grateful to the noble Lord for the care with which he has explained to us what this Bill is about, for although it is a small Bill it is fairly complicated. I think it will have been apparent to the House as well as to the noble Lord, because of my intervention, that I do not go the whole way with

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him in his construction of what I may call the philosophy behind the 1956 Act.
As the noble Lord has explained to us, one of the main purposes of this Bill is to prolong for the benefit of certain persons, and certain persons only, some of the provisions of the Slum Clearance (Compensation) Act, 1956, which, as he told us at the end of his speech, was subsequently consolidated in the Housing Act, 1957. I propose to talk about the 1956 Act rather than the 1957 Act, but I do not think it will matter. These things being so, I thought I ought to refresh my memory as to what transpired during the proceedings in Parliament on the 1956 Act, and it is obvious that the same thought has occurred to the noble Lord, Lord Mitchison. It was a very good thing that I did, because I discovered—and this I had forgotten—that on the Second Reading of that Bill in another place the then Opposition moved and divided the House on a reasoned Amendment, which invited the House to reject the Bill because it did not provide for direct Exchequer subsidies towards the payments which it proposed, and thereby placed an undue burden upon the rates. This Amendment was moved, as the noble Lord said, with commendable vigour—I think those were his words—from the Opposition Front Bench, and indeed it was. But the noble Lord is being unduly modest, because he failed to tell us that it was the honourable and learned Member for Kettering who moved that Amendment.
LORD CHAMPION: Who is he?
LORD NEWTON: The honourable and learned Member for Kettering now adorns the Government Front Bench in your Lordships' House, and is in charge of this Bill. These things being so, one might have expected that this Bill would provide for direct Exchequer subsidies towards the payments which it proposes, thereby avoiding an undue burden on the rates. The noble Lord felt it incumbent on him to explain this omission, and I hope he will not mind my saying that I was not fully convinced by his first argument, that because this has been a burden on the rates for ten years it would jolly well go on remaining a burden on the rates for a further five years.
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As regards his other arguments, I hope the noble Lord will forgive me if I say that I thought the explanation given in the other place by Mr. MacColl, the Parliamentary Secretary, was rather more convincing. What Mr. MacColl said was this.
"The review of housing subsidies, which is likely to be an early piece of legislation, and the more general review of local government grants, will both have some relevance to this question. Therefore, this is not the final word about the apportionment of the financial burden between the ratepayer and the taxpayer." [OFFICIAL REPORT, Commons, Vol. 720 (No. 6), col. 892; 15/11/65]
Your Lordships may think, and I think, that that was a perfectly plausible explanation. Indeed, a similar explanation was given at the time of the Second Reading of the 1956 Act, because it so happened that at that time a similar review was taking place of local authority finances. But that explanation did not satisfy the honourable and learned Member for Kettering. On the contrary, his argument was that, precisely because that review was shortly to be completed, it was unnecessary to impose an additional burden on the local health authorities even for a short period of time. But I am not complaining that the Bill does not provide for direct Exchequer subsidies. All I am trying to do is, rather gently, to pull the leg of the noble Lord. I hope, though I sometimes doubt it, that I, too, grow in wisdom.
As the noble Lord explained, the 1956 Act undermined the rule which had been almost universally accepted since 1919: that only site value, not market value, is payable when a house is declared to be unfit for human habitation. It is possible to argue—indeed, it often is argued—that a moral principle is involved here, the principle being that it is wrong to pay more than a nominal sum for rubbish. But I do not think it is really necessary to bring in ethics at all, because I personally have always believed that the explanation of the site value rule is really financial. There is usually, or at any rate very often, a considerable difference between site value and market value, and I would think it probable that, but for the existence of the site value rule, there might never have been any plans for slum clearance in this country, or at any rate very few. This point was eventually admitted by the other Parliamentary Secretary, Mr. Mellish, in another place on

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Second Reading. I do not think I need trouble your Lordships with the quotation, but if any noble Lord doubts that he admitted it, I have got the quotation here.
However, as again the noble Lord, Lord Mitchison, said, the last war and its aftermath introduced a new factor, because slum clearance stopped, as he said, after the beginning of the war, and it did not really start again until 1955. That is why the 1956 Act introduced the principle of market value compensation for the owner-occupier of an unfit house who bought his house between the outbreak of war and December 13, 1955. The main point was, of course, that at the time those people bought they had no reason to anticipate that in the foreseeable future, at least, their houses would be compulsorily taken away from them. Now that one has the benefit of hindsight, one can naturally make out a strong case for saying that in fact December, 1955, W AS too early a terminal date, and that a later date—perhaps 1960, or something like that—would have been wiser and fairer, in that it seems likely that quite a number of owner-occupiers of unfit houses bought after 1955 without fully realising, as perhaps they should have dole, what they were letting themselves in for. But I am not concerned to argue that point this afternoon. 1955 is the terminal date we have, and have had for ten years, and I am sure in my own mind that, back in 1956, it was the right year to choose.
One of the conditions imposed by the 1956 Act was that for an owner-occupier to qualify for market value—or, rather, for the supplement, making his payment up to market value—his house should have been purchased by the local authority or vacated by him before next Monday, December 13. There are at this moment of time, of course, some people—I do not know how many, but certainly some—who have had their houses made the subject of a clearance order but who, none the less, will still be living in those houses next Monday. Their rights, as the noble Lord has told us, are protected (or preserved, if you like) by subsection 1(a) of Clause 1, and I am very glad they are.
LORD MITCHISON: My Lords, the rights are created. They would not have had any under the previous Bill.
LORD NEWTON: If the noble Lord likes to put it like that, he may; but if he wants to talk about creation, I would prefer that he talked about re-creation, because the rights were in the 1956 Act. If he is just reminding me that the Act is going to expire next Monday, I know that, of course. As I say, I am very glad indeed that there is this provision in this Bill, but I should like to ask your Lordships to note, in passing, that even if one of these owner-occupiers bought his house as long ago as September, 1939, his rights will still be protected or re-created by this subsection; and there is no test in the case of these people as to the length of beneficial occupation of the house.
When Mr. Mellish was explaining in another place the reasons for the introduction of this Bill, he said, among other things—and I am now quoting from column 853:
" the number of slums which remain to be cleared is so large that there must be many owner-occupiers who expect to get the supplement whose houses are still waiting to be included in authorities' clearance programmes."—[OFFICIAL REPORT, Commons, Vol. 720 (No. 6); 16/11/65.]
Yet, my Lords, we know—and we have been told very clearly by the noble Lord —that in the Bill it is proposed in future to pay the supplement only to those owner-occupiers who bought their houses between December 13, 1950, and December 12, 1955, and who have not lived in those houses for longer than fifteen years. However you like to make it out, this position is in fact discrimination against those owner-occupiers of unfit houses who bought before December 13, 1950, and it seems to me (I am not just trying to make a debating point) that this discrimination is horribly unjust and unkind. I am quite certain that it is going to create a deep sense of grievance in the minds of those who will suffer from—it people who will not, I fancy, appreciate the subtleties of sophisticated argument about the length of time in which they have enjoyed beneficial occupation.
Let us just consider two identical, adjacent houses in the same street in a clearance area. One owner-occupier will get market value by means of the supplementary payment: the other, because he bought his house a few days or a few weeks earlier, will get only site value;

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and the difference could amount to perhaps anything up to £1,000 or £1,500, a difference large enough to determine whether the individual in question is in a position to buy a new house for himself or whether he will have to become a council tenant. To make matters even worse, under the Bill as it stands at present some people will lose the market value which they have been expecting to get, for no other reason than the fact that the local authority did not get around to making the clearance order before next Monday. This, I suppose, is a Committee point; and I do not want to discuss it at great length. But I should like to say two things now. First, I find totally unacceptable the Government excuse that when an owner-occupier of an unfit house has had fifteen years' beneficial occupation, he does not deserve anything more than the site value in compensation. Personally, I do not think that the length of occupation is relevant at all in this connection and I never have thought so. But, if it had any relevance, I would stand the argument on its head and insert this principle: the longer one has lived in one's home, the greater the hardship when one is turned out of it.
The other point I should like to make is that all Parliamentarians know that many Statutes have to contain dividing lines, and there is always an argument about where you draw the line. But wherever you draw the line there is hardship. The moral of that seems to me to be that one should never write dividing lines into Statutes unless it is absolutely essential to do so. I do not consider that it is necessary to draw a dividing line in this Bill. There was no dividing line in the 1956 Act. To think this, is a mistake on the noble Lord's part. That Act said that the provisions would last for ten years. That, of course, left the way open for those provisions to be extended if necessary; as, in fact, they are being extended in this Bill, though in a limited capacity. It would have been easy in this Bill simply to provide that the relevant provisions of the 1956 Act (which I think are in Section 1 of that Act) should continue for another five years—I say five years since that is the time chosen by the Government—for the benefit of what I may describe as the whole 1939–1955 class.
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My Lords, I wish I knew why the Government have not done this. Is it, I wonder, that they are afraid of the cost? But, however that may be, I would ask the noble Lord to tell us, if he can—and I have given him notice of this question—what the additional cost would be over and above the £3 million mentioned in the Explanatory Memorandum of the Bill if the relevant provisions of the 1956 Act were extended for five years to cover all the remaining people in what I call the whole of the 1939–1955 class.
The noble Lord said very little about Clause 2: I have little to say about it. I welcome its provisions and I am quite sure they are right in principle. To be frank, I think that principle ought to have been recognised in the 1956 Act. A Bill on the lines of this Bill is certainly necessary to-day and I hope your Lordships will give it a Second Reading—but I wish it did not contain the real blemish that I have mentioned.
6.34 p.m.
LORD MITCHISON: My Lords, I will not take very long in replying. If I understood the noble Lord aright, he is concerned with substantially two points. The first I must admit I could not have resisted deploying myself if I had been in his position: it was too good. I refer to the one about the distribution of cost as between the Exchequer, on the one hand, and the local authorities, on the other. But I had intended to refer to it; I made reference to it when I spoke first, and I do not think I have anything further to add. To summarise it shortly, since half of the exercise with which this Bill is concerned has gone through on one footing, it is really untidy and unnecessary to shift now on to another footing, when it is, in effect, half way through. Moreover, as there is a complete revision of local authority and central finance going on at the moment, this would be the worst possible time to make a change of that sort.
The second point was a more substantial one. The noble Lord pointed out that there was a philosophy in this Bill. I have always regarded Mr. Enoch Powell as a bit of a philosopher, and I once accused him of being like Diogenes, who was no mean philosopher, even if he lived by himself in a tub: but in this period, there was no question of a

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tub. I must read what Mr. Enoch Powell said:
"As this concession—
the ten-year temporary provision, as he called it—
"is designed to meet temporary and exceptional circumstances due to war-time and postwar conditions, so it should itself be temporary and exceptional. When ten years have elapsed even persons who bought such houses as these for their own occupation immediately before my right honourable friend's statement will have had a very substantial use and enjoyment of those houses. The Government do not propose, therefore, that the concession should apply to houses dealt with as unfit after 13th December, 1965."—[OFFICIAL, REPORT, Commons, Vol. 550, col. 2164; 28/3/56.]
That is the reason, and so far as the debates show, the only reason, why the ten-year limit was put in. We are going a bit further—a bit better in one sense: we are now having fifteen years' limit. I can only say this to the noble Lord. If he had done what I think he intended to do, and carried on these provisions for another five years, then at the end of that time there would have been one unmitigated bump, if I may call it so. This is, at any rate, a tidy tapering off of the intention and provisions of the Act.
I do not think I need say much more. It is said that this Bill makes a distinction between one owner and the owner of a similar house next door—
LORD NEWTON: It does.
LORD MITCHISON: Any provision of this kind, of course, does that. The original Bill did it just as much. I think the noble Lord himself provided the answer: that the moment a limit of any sort is fixed, there are bound to be some people on one side and some on the other. The question always to be considered is whether it is desirable to make some intermediate provision. We find this again and again when dealing with financial provisions. If you draw a sharp line, some people are on the right side, while others, from their point of view, are on the wrong side. I think that people understand this by now.
Then the noble Lord said that there was discrimination. Really, that is a bit stiff. These people would have had no rights whatever if the original piece of legislation had been allowed in this respect to lapse on Sunday or Monday
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next. Yet we are now told that we are discriminating against them because we rescue some people from the Conservative morass, if I may use that phrase, and do not rescue them all. We have our reasons for making the distinction and I have tried to explain them. It is monstrous to suggest there is discrimination in any pejorative sense. It is as if you had half a dozen drowning men and you rescued only three of them. And we did not drown them.
LORD NEWTON: My Lords, may I ask this question? The noble Lord keeps trying to get the House to take the view that the 1956 Act contained a dividing line similar to this dividing line. It did not. What it did was to say that the whole range of people who bought between 1939 and 1955 would be eligible. What it said was that the Act would run for ten years, and it left the door open for the Act to be extended, as it is going to be extended now, although only to a limited extent. That is not imposing a dividing line.
LORD MITCHISON: There was no word or intention of extending the Bill. I do not think I need say any more.
On Question, Bill read 2ª, and committed to a Committee of the Whole House.

RAIL COMMUTER TRAFFIC CONGESTION
6.42 p.m.
THE EARL OF KINNOULL THE EARL OF KINNOULL rose to ask Her Majesty's Government whether they are aware of the increasing congestion of the daily commuter traffic on the rail services both into London and into provincial cities and whether they are now able to announce their future plans to relieve this congestion. The noble Earl said: My Lords, in raising this subject of commuter traffic this evening, I do so in the belief that it is one of the main social problems facing the Government at the present time, ane one which must be acted on very quickly if the Government are to avoid a general thrombosis spreading through our cities. Before coming here to-day, I sought the views of the railway authorities, city planners and some local authorities. One is left with the impression that the challenge of this problem must be

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accepted by three partners. First, good planning; secondly, capital expenditure; and, finally, State subsidy.
Perhaps I may first describe the present commuter traffic problem as I see it. At present 90 per cent. of this traffic is looked after by public transport and the remaining 10 per cent. by private transport. The bulk of the responsibility lies with the railways. Those who commute daily by rail are finding it more and more difficult to obtain a seat. In some areas, notably in Kent, over one-third of the passengers are forced to stand, sometimes for up to an hour, when travelling to and from their work. Many of these people leave the heavily congested surburban trains to battle their way on to the Underground services. By the time these people reach their destinations, the first thing they require is a cup of tea to revive them. I do not think that I have exaggerated the situation at all.
The railway authorities are, of course, very concerned at this state of affairs and their view was expressed clearly in the Report, Re-shaping of British Railways. They admit that in many areas, particularly South of London, saturation point has been reached and passengers suffer extreme discomfort. The railway authorities say that they are doing their best to extend capacity. I understand that they are enlarging carriages, lengthening platforms and trains, and even improving the signalling system. But the crux of the matter, surely, is that the capacity of the system is limited by physical restrictions and any real expansion of capacity requires a large capital investment.
If one looks at the South-East Study Report one notices that a figure of £100 million is mentioned as the capital required, but the railways point out that the existing commuter services cost them something like £13 million a year at the present time. I understand that this sum could well reach £20 million within two or three years. Naturally, the railways ask whether they are expected to subsidise this unprofitable service. Equally they appreciate that any increase in fares would push more traffic on to the roads, which is not exactly what is required.
If one discusses the problem with city planners and local authorities, one finds that they are equally aware of the situa-
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tion. They are concerned because it is useless to provide housing land when the rail capacity does not match it. A survey recently made in Kent showed that in every new housing estate 70 per cent. of the population were actual or potential commuter passengers. Many local authorities despair at trying to provide a counter-magnet to London. They say that industry and jobs should be brought with the overspill population, or the problem will never be solved. In other words, it is necessary to decide on a drastic form of decentralisation and reverse the present trend of employment growth in central areas. But the immediate crisis which the planners see staring them in the face is the annual increase of commuter travellers. I understand that it is something like 22,000 passengers a year on the railways, and the question is rightly asked: How can the present services absorb this increase?
When one examines the active part the Government play in this crisis, one finds it is very small. They appear to hide in the wings and urge with a very loud voice, but apparently take very little action. Surely now is the time for the Government to step in as the third partner, to co-ordinate the service and also to act in a financial capacity. The importance of co-ordinating services was again revealed in the Report on reshaping the railways. In my discussions with a Liverpool planning officer I discovered that his council had this problem. They found they could obtain no cooperation between the rail and bus services. In this case the bus companies were afraid that such co-operation would lead to the creaming off of their profitable services. Believe it or not, two of the bus companies were municipally owned. Surely the Government could take action and set up a unified transport authority for such areas. The Minister should take up two other points on this question of co-ordination. First, he should see that local authorities are given more power over transport, along with land use; and, secondly, he should see that public transport undertakings do not deliberately undercut each other and so cause both services to become uneconomic.
To turn to the financial side, the issue is simply this: is the State or is it not to subsidise these commuter services? I believe that it should and, furthermore,

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I believe that local authorities could help as well. If one takes an area such as may be found in Surrey, where there is a large population of commuter travellers, surely it would be right, when such populations are benefiting from low subsidised fares, that they should contribute something towards a State subsidy. I believe that this argument would be quite acceptable to the local authorities in such areas if they saw that the result would lead to an improved commuter service.
Finally, I do not feel that I can sufficiently emphasise the urgency of this problem and so perhaps I cannot do better than end with a quotation from the final sentence of the Steering Group Report. Urging the Government to take action over the growing traffic crisis, the Report went on to say:
" We must meet it without confusion over purpose, without timidity over means and, above all, without delay."
6.49 p.m.
THE DUKE OF DEVONSHIRE: My Lords, I am quite sure that we are grateful to my noble friend Lord Kinnoull for raising this vital subject. Some of your Lordships will have heard quite enough from me already for one evening and therefore I do not propose to detain you for more than a few moments.
We face an ever-increasing problem, with the gradual strangulation of the roads and streets in the great cities of this land. This surely must be an opportunity for the railways to ease the burden by means of a competitive and alternative method of transport; so that more of the people who now drive their cars into the cities will decide that they would get a better deal and arrive more quickly at their place of work, if they travelled by rail. This seems to me to provide a golden opportunity for the railways to strike hack. Much as I approved of the Question put down by my noble friend, I was not altogether happy when I heard him talk about a unified transport authority. I must say that it would be something at which I should look very suspiciously. I feel that if people could get to work by rail it would help those wishing to use their cars for shopping for buying weekly supplies, and all the rest of it. As my noble friend has said, the fact that people are compelled to stand in railway carriages shows that
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there is a demand for more accommodation.
I see this as a challenge to the railways. Things are going their way. People like to use the railways. And it is up to the railways to deliver the goods and persuade people that it is better to go by rail than go "one man, one car", because it is this which causes the chronic congestion we have in all our great cities to-day. I sincerely hope that the Government will take note of my noble friend's Question and will do all they can to stimulate the State-owned railways to meet the challenge that has been placed on their doorstep.
6.50 p.m.
LORD SOMERS: My Lords, I should like to thank my noble friend for drawing attention to this important subject tonight. Anybody who has travelled by either Underground or Southern Railway suburban services during the rush hour realises what a terrifying experience this is. Frankly, I cannot see any solution without the expenditure of an enormous amount of money, because the trains are carrying absolutely up to the limit at the moment and are running, as I have said before, almost within sight of each other, so that one cannot put more on the line. What we need are more tracks; and, of course, particularly in the case of the Underground, that is a very expensive business.
What I think might be done, just for the sake of convenience, is this. At the main line termini there could be a little more direction and controlling of passengers, so that they are not all rushing in different directions and bumping into each other. On the Underground, the supply of a few more automatic change-giving ticket machines would be useful. It is an extraordinary thing that whenever I travel by Underground and want to get a ticket from one of these machines, I find a metal plate over it saying, "Not in use". One does not necessarily have the exactly change, so more of these change-giving machines would have a great value.
VISCOUNT STONEHAVEN: My Lords, I would throw only one point into the discussion. On surface railways, if we take the cubic content of a train, we find that roughly 10 per cent. is the space allocated for seating of passengers. If we

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could increase that proportion to 20 per cent., which ought not to be beyond possibility and would not be very costly, we could carry twice the number of people sitting. Half of those passengers now have to stand in these trains. It is high time that a commuter carriage was designed to give more seats. People may still have to be packed like sardines—but let us have sitting sardines instead of standing sardines.
6.54 p.m.
LORD LINDGREN: My Lords, I am most grateful to the noble Earl, Lord Kinnoull, and to other noble Lords who have spoken this evening. A great many interesting points have been raised, but I am afraid that I have time to deal with only a few of them. Taking my cue from the noble Lord's Question, I propose first to try to get in perspective the present state of rail commuter services, and what the possibilities for development and improvement are. First, it must be said that both the provision of rail services and the planning of their improvements is primarily the responsibility of the operators—the Railways Board with, in London, the London Transport Board. The Government's; responsibilities are confined to matters such as investment, as the noble Earl mentioned, and rail closures; and, of course, in a wider context, the Government's regional and economic policies provide a framework within which public transport must operate. But it is the Boards who are directly responsible both for day-to-day operation and for the planning and carrying out of improvements to the rail system.
The Boards are well aware that there is serious congestion on some of the commuter rail services, but the picture is not quite so bad as it has been painted. Let us take the Provinces first. I know that the noble Earl, in his speech, paid most attention to the London services, but his Question covers the country as a whole. The position is that, outside London, peak traffic on most suburban rail lines has been falling. We asked the Railways Board for their comments on the Question we are debating to-night and they have said that, in general, they do not concede that there is in fact any increasing congestion on the commuter trains serving
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the big cities outside London. And this emphasises the noble Earl's point that London is the big problem. For example, in Glasgow, which is second only to London in the volume of suburban rail traffic, the Board say that, although some standing occurs over relatively short distances, the trains are not overcrowded and conditions are tolerable. On the occasions of one-day bus strikes in Glasgow, and when other surface transport has been disrupted by fog, carryings on the Glasgow commuter services have increased by 25 per cent. This shows that the physical capacity is there.
In fact—and this is a point I want to emphasise—the provincial rail services are faced with quite another problem than congestion. Their main difficulty is that on many lines there are not enough people travelling to cover the costs of providing the services. On some of these lines the commuter traffic is substantial and cannot be catered for other than by rail. That is why my right honourable friend refused consent to the closure of the Manchester—Bury electric service and of the service from Glasgow to Edinburgh, via Shotts. Thus, outside London, it is not a question of making plans for relieving congestion on the commuter rail services. Rather, the congestion is on the roads, and rail services may be needed to relieve this congestion. A major rôle for public transport is to provide for the bulk of journeys to work in the central areas of large cities; and where there is a substantial volume of commuter traffic, rail transport has large advantages over road transport.
We believe that long-term plans for the rail services in each urban area should be based on a study of the transport needs for all purposes and by all forms of transport in the area. Studies of this kind are in progress, or planned for all the big conurbations. Their method is first to establish the requirements of the passenger movement in future years, taking into account the growth of, and any shifts in, population and employment. Then plans can be made, embracing rail, road and bus, for an effective passenger transport system to cope with commuter and other needs.
If I may turn to London, on which the main emphasis has been placed this evening, congestion is severe on many services.

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Many of us know from personal experience the appalling crush on some of the trains at the height of peak. But let us first look at the problem from the operators' point of view. They have been faced with a steadily increasing number of commuters who are travelling longer distances and concentrating their journeys into a shorter peak period of travel. During the 'fifties employment in Central London increased at a rate of something like 20,000 each year. At the same time, road congestion became worse and prevented the buses from taking their proper share in the increased load. The net result has been a growth in rail commuting by train and Underground during the last twelve years from 750,000 to 900,000 each day.
At the same time, there has been a drift of population away from London to beyond the Green Belt: the population of the outer part of the London Passenger Transport area increased by 550,000 during this period. And with an increasingly standardised day, the concentration in the peak is worse than it was. Within the peak hour on British Railways there is even a super-peak of twenty minutes which accounts for 40 to 50 per cent. of the total traffic. To deal with 40 to 50 per cent. of the traffic within twenty minutes, with this density of traffic, is a headache for those who have to operate it. In spite of this increase in demand, many services are far better than they were. It is easy, and natural, for the frustrated traveller of to-day to look back nostalgically to a rosy past. But, so far as most London commuters are concerned, this rosy past is pure imagination. Liverpool Street and Fenchurch Street may not be heavens on earth, but would anyone choose to go back to the old steam services on those two lines, daily miracle though the service may have been from an operational point of view?
There have been many other striking improvements. For example, in the rolling stock on the Central, Piccadilly and Metropolitan Lines; the new trains carry l5 per cent. more people and are much more comfortable. And in the Kent services, to which the noble Earl referred (and, as he said, they are the most crowded of all), the Railways Board have done what they can to increase capacity by lengthening platforms and, providing ten-car instead of eight-car
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trains. Many more improvements are in hand. Most notable of these is, of course, the Victoria Line, due for completion in three years' time. This new Tube will enable many journeys to be made more directly and quickly, and will give considerable relief to some of the most congested parts of the existing Underground system.
The noble Earl, quite rightly, not only emphasised the present, but asked: what of the future? What are the future plans to relieve congestion on the London commuter services'? The Railyway Plan for London was prepared by a joint Working, Party of British Railways and London Transport, was was submitted to my right honourable friend in March of this year. The main proposals are for three extensions to the Underground system—the Victoria Line extension to Brixton, the Fleet Line, and the Aldwych-Waterloo Line, and minor railway works to increase capacity. The estimated cost of this London Plan as submitted is over £125 million. The plan is a tentative one. Noble Lords may have read the evidence of the Select Committee on London Transport, paragraph 472, in which it is said of the largest item in the plan:
" The Fleet line lies further ahead. The Board stressed that it needs much more work. They have not completed the survey for the lines and they must have further discussions with the Planning Authorities concerned. Only then could the Board decide whether or not to recommend the Government to approve it. At present the delaying factor was the work that they themselves had to do; no out-side body was holding it up."
In view of the tentative nature of the plan, and the uncertainty of some of the assumptions underlying it, my right honourable friend asked the Board not to give it general publication. The plan has, of course, been available as a working document to the authorities concerned with transport planning in London and the South East. In view of the work yet to be done, the plan as a whole cannot be acted on immediately. But two of the proposals in it—the Aldwych—Waterloo Line and the Victoria Line extension to Brixton—have been developed in detail and formally submitted to my right honourable friend, who is now considering them. I hope that his consideration will not be as long as that of the previous Government in regard to the Victoria Line.

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In the long term, the elimination of congestion on the rail commuter services in London requires, as the noble Earl has suggested, a co-operative effort from Government, local authorities and the Transport Boards. In the Government's view, transport cannot be planned in isolation from town planning as a whole, and this, to be successful, must take account of a number of important factors—land use, employment, and population, to name the most important. One of this Government's earliest actions was to put a stop on office building in the metropolitan area. That should at least check the continuing growth of employment in London. The Boards have been working together on possible further developments of London's railway systems to follow the Victoria Line. Their plans will have to be considered together with road proposals as part of a coordinated transport plan for London. The Government are determined that public transport in London, of which the commuter rail services are an important part, should be developed so as to meet the needs of a great city and provide a high standard of service to all those who live and work in it.
The noble Earl asked three other questions, which I took down. The first was in regard to a subsidy for commuter services. With great respect to the noble Earl—and we are all grateful to him for the manner in which he introduced the debate—this really is outside the general scope of this debate. But, as I have indicated during my speech, outside the London area, and in some cases inside the London area, commuter rail services do lose money, and, therefore, in the deficiency grant which the Government pay to the Railways Board there is a subsidy to the traveller. So far as London is concerned, Londoners will know that the Board's financial problems have been the subject of urgent study by the Government, and a statement will soon be made about London Transport fares.
The noble Earl referred to the powers of local authorities as transport authorities, and though I do not want to widen the gap between the noble Earl and his noble friend the Duke of Devonshire, I must say that I entirely agree with the noble Earl that when local
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authorities operate bus services, many of them running duplicate services in each other's area by agreement, there is perhaps a tendency to overlap. We agree that you cannot plan transport for a conurbation on the basis purely of local authority operation of bus services within that area. We take the view that, as a result of the transportation studies which are now taking place, some changes in organisation in the conurbations may be necessary. I hope that we shall have the co-operation of local authorities in this matter, although it means a diminution of certain local authority functions as they are at present. We are considering transport for the people, and transport area authorities over an area.
I was sorry to hear what the noble Earl said about the Liverpool experiment, because I have always understood from one report I have seen that the Working Party in the Liverpool and Mersey area were securing a great deal of cooperation, and in the Ministry we have high hopes that something tangible will come from that report.
The noble Earl raised the question of duplication of services. Of course, in urban areas we must have at least some duplication. For instance, London Transport run buses over the whole length of Oxford Street, while underneath runs the Central Line. They perform two different functions, surface transport being much more for the short journey, whereas the Tube train carries people on longer journeys. All fares are governed by the Transport Tribunal in London, and outside London bus fares are controlled by the traffic commissioners. Personally—and this is only a personal point of view—I do not know of any fares which are deliberately lowered in order that there can be competition between road and rail services. If the noble Earl has any such examples, we shall be only too pleased to look at them. Whilst we at the Ministry cannot do anything about them, we can, of course, pass them on to the traffic commissioners, who will look at them in the light of operations in the area.
The noble Lord, Lord Somers, referred to the automatic ticket machines of London Transport. This method would be better if everybody was honest. But from personal experience I can tell the noble Lord that the number of people

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who try to get Tube tickets with milk checks in those automatic machines, and who interfere with the mechanism, is considerable. London Transport are at the moment considering a much bigger extension of automatic ticket issuing. They are also looking at automatic signaling and also other things under a general mechanization policy, but we hope that all developments will be to the benefit of the public.

STATUTORY INSTRUMENTS
The LORD CHANCELLOR acquainted the House that he had received, under the proviso to Section 4 of the Statutory Instruments Act 1946, a notification that the Reserve Bank of Rhodesia Order 1965, had come into operation before being laid. before Parliament, with an explanation thereof.
The said notification and explanation was ordered to lie on the Table.

SOUTHERN RHODESIA (BANK ASSETS) ORDER 1965
Order made under Section 2 of the Southern Rhodesia Act 1965 by Her Majesty in Council.
Laid before the House (pursuant to Act) for Affirmative Resolution, and referred to the Special Orders Committee.

RESERVE BANK OF RHODESIA ORDER 1965
Order made under Section 2 of the Southern Rhodesia Act 1965 by Her Majesty in Council
Laid before the House (pursuant to Act) under Standing Order No. 62 on Friday last for Affirmative Resolution, and referred to the Special Orders Committee for consideration under Private Business Standing Order No. 216/3.

CONSOLIDATION BILLS
Message from the Commons to acquaint this House that they have appointed a Committee of twelve Members to join with the Committee appointed by this House to consider all Consolidation Bills in the present Session.
Ordered, That the evidence taken before the Joint Committee from time to time be printed, but no copies to be delivered out except to Members of the Committee and to such other persons as the Committee shall think fit until further order.
Leave given to the Joint Committee to report from time to time.

  LOANS AND AID TO OVERSEAS COUNTRIES
  LOANS AND AID TO OVERSEAS COUNTRIES