Sitting of 10 July 1967

Preamble
The House met at Ten o'clock
PRAYERS
[Mr. SPEAKER in the Chair]

PUBLIC BUILDINGS (EXTERNAL CLEANING)
The Minister of Public Building and Works (Mr. Reginald Prentice): With permission, Mr. Speaker, I should like to make a statement about my plans for extending the external cleaning of Government buildings in London and Edinburgh.
A number of buildings have been cleaned in the past, but it was prudent to proceed on a limited scale and from time to time to test methods and reactions to results. For example, it was always necessary to consider whether the cleaning would be successful. Whether staining would occur and whether the result would be acceptable.
The results which can now be achieved by current methods are clear for all to see at Admiralty House, No. 36 Whitehall, the Horseguards and Dover House.
I am satisfied that a start should now be made with a more extensive programme. After a review of the major buildings for which I am responsible, I have decided to have the following build-
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ings in London cleaned: the Old Treasury Building in Whitehall, the National Gallery, Admiralty Arch and the Mall facade of the Admiralty; and to make a start with the Old and New Register Houses in Edinburgh. I have been in touch with the Royal Fine Art Commission and the Royal Fine Art Commission for Scotland on this.
This represents a large increase in the scale of cleaning activity. We shall be trebling expenditure on this work, raising it from £20,000 in 1966–67 to £60,000 in 1967–68, and the size and nature of the buildings will ensure that the cleaning has a strong impact. I hope to be able to continue the work at least at this level in subsequent years.
I am aware that the growing interest in cleaning is shared by local authorities and by private owners. I hope that what is now to be done for Government buildings will encourage them further in this activity.
Mr. Channon: Is the right hon. Gentleman aware that there will be general satisfaction and welcome for his statement both from those who live in London and those who visit it?
Further, is the right hon. Gentleman aware that the success of the past programme leads us to be very pleased with the fact that he has decided to extend it? Can he tell me what have been the criteria which have governed the choice of the buildings that he has announced? Can he say whether there is likely to be an

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increase of cleaning in the Palace of Westminster, especially on the Terrace side, which many hon. Members would like? Finally, can he say whether he has put some of this work out to tender, and if so, how many contractors will be taking part in it?
Mr. Prentice: I am grateful to the hon. Gentleman for his general welcome for the statement. The choice of buildings was based on two considerations: first, the state of the building at the moment —how badly it seemed to need cleaning —and, secondly, to some extent the position and importance of the building. As I said in my statement, we are concerned to make a public impact and hope to set an example to local authorities and private owners. As to the Palace of Westminster, over several years there was a process of replacement of the stonework by new Clipsham stone. At that time the Department considered whether to do general cleaning but decided against it. The older stonework was brushed down, and it was decided to allow the old and new stone to weather together. I do not think that general cleaning is necessary at the moment, but I should welcome the views of hon. Members. All this work goes out to tender. None is done by direct labour.
Mr. Whitaker: While warmly welcoming my right hon. Friend's announcement, may I ask him whether he would consider compelling private owners to participate in a cohesive plan such as that of M. Malraux in Paris, and since the cost is soon recouped in tourist revenue, can he give a date for completing the whole of Whitehall and other important buildings such as the Bank of England?
Mr. Prentice: So far as private owners are concerned, I do not think I have any powers to do as my hon. Friend suggests. It is something which we might think about, although at the moment I do not thing it is very feasible. Perhaps my hon. Friend would like to develop his ideas on this and we could have a talk about the matter. As to the date, I am not sure that there will be a date on which we can say that the work is completed. At what stage have we completed the cleaning of buildings? They all need to be done from time to time. Certainly what I have proposed will make an impact in Whitehall, which suggests that
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we would take up the rest of what is needed in a relatively short time.
Mr. Sandys: Is the right hon. Gentleman aware that his statement will give very great satisfaction to all who care about the good appearance of their town and its dignity? May I pursue the point raised by the hon. Member for Hampstead (Mr. Whitaker)? Will the right hon. Gentleman also realise that this may well be the moment to try to give a lead to the whole country to do the same thing? Will he consider, with his right hon. Friend, what might be done, perhaps by cooperative action, to get large-scale cleaning done in this country?
Mr. Prentice: I am grateful to the right hon. Gentleman for what he said at the beginning of his supplementary question. I will certainly give further consideration to his suggestion. It has been raised by hon. Members on both sides of the House, and I appreciate its importance. Perhaps there are other steps we can consider to give encouragement to local authorities, but I remind the House that some of them have already been doing this job. For example, the previous Mayor of Westminster issued an appeal to private owners. To some extent, the initiative should rest with the municipalities, but I will consider the extent to which the Government should take a further initiative.
Sir J. Rodgers: The right hon. Gentleman's statement has given great pleasure to both sides of the House. Will he consider the steps that were taken by M. Malraux in Paris, both in regard to the public sector and the private sector, which have made Paris a sparkling jewel bringing joy not only to tourists but to the Parisians themselves? Will he look into what has been done there and consider what action might be taken to encourage private enterprise to do this cleaning as well?
Mr. Prentice: It was the example of Paris that led me some months ago to give thought to what further steps we should take in this country. But our problems are rather more difficult. The atmosphere of London is worse than that of Paris from the point of view of cleaning buildings. By washing its buildings, Paris can get fairly good results. That is not so here. In recent

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years, we have been experimenting with new cleaning techniques. The main technique is blasting with grits. It has proved successful, but it is a bigger and more expensive operation than is necessary in Paris if we are to get lasting results.
Mr. Costain: Is the Minister aware that a large number of private owners are concerned about cleaning for the reasons that he has given? In order to help them, will he give publicity to methods of cleaning, whether by steam or grits, and also report on how the stone work stands up after cleaning?
Mr. Prentice: I will consider that. I want to be helpful to private owners in this matter. Until comparatively recently the method normally used was water spray or steam. But, as I have said, we have now gone on to a blasting process using, first, soft grits and now harder grits. Of course, one thing to be considered is the effect on the fabric of buildings. We are fairly well satisfied so far, but we must watch this aspect. We shall certainly pass on the lessons learnt to other building owners.
Mr. Monro: Is the right hon. Gentleman aware that his statement will give great pleasure to the people of Edinburgh? When will the cleaning of the Old Register House be completed? What other buildings has he under consideration for similar treatment?
Mr. Prentice: I cannot give dates without notice, but I will write to the hon. Gentleman. We made a start in Edinburgh in the previous financial year. The Old Register House will be started in this financial year, and there may be others to come.
Mr. Ridley: I, too, welcome the statement. Can the right hon. Gentleman say whether the buildings that his Department will clean are confined to buildings under public ownership? If that is so, will he give consideration to extending the principle to buildings under private ownership or are owned by local authorities?
Mr. Prentice: The buildings I have referred to are in Government ownership. My Ministry is responsible for Government buildings. In relation to buildings owned by local authorities or in private
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ownership, what the hon. Gentleman has said follows up the point made by several other hon. Members.
Mr. Iremonger: What is the right hon. Gentleman proposing to do about Nelson's Column and statue? Since what we are considering is the highlighting of the elegance of our most beautiful buildings, will he get his right hon. Friends to look at buildings occupied by their Departments when it comes to painting and decorating? For example, the Parliament Street Post Office is a beautiful Queen Anne building, but its exterior has been totally ruined by careless painting and—
Mr. Speaker: Order. Questions must be brief.
Mr. Prentice: Nelson's Column and statue are not in our preliminary programme. They present very great difficulties and the experts take a cautious view of the prospects of cleaning them. But, of course, I will bear the point in mind. My Department takes care of Government buildings in general, although Post Office buildings are exceptional in that the Post Office itself is responsible for them. However, the Post Office has expressed a wish to co-operate with us in this general approach.
Sir E. Boyle: Is the right hon. Gentleman aware that one of the most encouraging passages in his statement referred to the encouragement he intends to give to local authorities to co-operate in this work? Has he consulted any of the local authority associations—for example, the A.M.C.? Will he work closely with the Minister of Housing and Local Government in giving every encouragement to local authorities to make their contribution?
Mr. Prentice: Yes, Sir, but I would not want to take the attitude that the Government are to a too great extent telling local authorities what to do. It may well be, however, that some consultations would be useful with the A.M.C. and other bodies. I think that, on the whole, the local authorities want to take their own initiative on this. I remind the House that we are trying to promote economy in both Government and local authority spending, but I have found that this work forms a very small proportion of maintenance costs. The

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programme I have announced means that we are increasing the proportion occupied by cleaning in our building maintenance from one-eighth of 1 per cent. to three-eighths of 1 per cent. Therefore, my statement is not inconsistent with the general policy of economy in public spending.

TRAINING OF TEACHERS (REGULATIONS)
Mr. Speaker: Before I call the first Order of the Day, it might help those wishing to take part in the debate if I point out that these are largely consolidation Regulations, so that it will be in order to discuss whether the items which are to be consolidated shall be consolidated; but there also are some amendments to the Regulations and it will be in order to discuss them.
Sir Edward Boyle: On a point of order, Mr. Speaker. As I understand it, these Regulations to be consolidated, together with amendments, relate to the training of teachers. Without going into too much detail, can we not, in these circumstances, use this opportunity to ask the Government for a progress report on teacher training, since we are here consolidating all the main Regulations for such training?
Mr. Speaker: That is a fair point. I must allow it to be followed however with some discretion.
10.19 a.m.
Sir E. Boyle: I am grateful, Mr. Speaker. I beg to move,
That an humble Address be presented to Her Majesty, praying that the Training of Teachers Regulations 1967 (S.1., 1967, No. 792), dated 22nd May 1967, a copy of which was laid before this House on 5th June, be annulled.
I do not intend to speak at great length, but this is an important set of Regulations. It will set the pattern of grants for the training of teachers for a long time to come. Therefore, before we pass these Regulations, it is reasonable to ask the Government to give a certain amount of information on the general subject of teacher training.
We all agree on the great importance of teacher training, for three reasons. First, because of the dependence of the
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schools on an adequate supply of teachers; secondly, because the quality of the work in the schools is so greatly affected by the quality of the products of the colleges of education; thirdly, and perhaps no less important, because, when all is said and done, colleges of education are in their right important institutions of higher education. One thing which I think comes within our terms of reference today is Regulation 12, which includes the requirement:
"Every college shall be conducted in accordance with articles of government made with the approval of the Secretary of State."
Therefore, we could perhaps discuss matters relating to the Weaver Report on the Government of Colleges of Education.
In October 1965, the last year for which we have full figures, there were 199 training establishments, comprising 120 colleges of education, of which 90 were general colleges maintained by local education authorities, 50 were voluntary colleges and 29 were university training establishments. The total of students, which was about 28,000 in the later 1950s, rose to 78,000 by October 1965 and, in the present academic year, to nearly 90,000. In other words, the training of teachers has been one of the most rapidly expanding parts of our education system in the last ten years.
That should be recognised by the general public more than is always the case. We rightly hear a great deal about the continuing teacher shortage, but we should remember that in the last ten years the number of students has trebled and the annual expenditure on training has greatly increased. Perhaps the Minister of State could give us the figures for the annual cost and the prospective figure for 1970. At the start of the decade I believe it was about 14 million, and I estimate that it is already about £50 million.
The total number of students has risen, as has the number of full time teaching staff in the colleges. Last year, it was 4,000 men and 2,700 women, or more than 6,500. But although we should take considerable pleasure in this, successive Governments have given a high priority to teacher supply and the Government of which I was a member devoted £60 million to college building

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alone in the early 1960s—some aspects of the scene are less encouraging.
First, a matter for real concern is the declining number of graduate teachers in maths and science in our colleges of education. In 1962, there was one graduate maths teacher to about 117 students, but by 1964, the latest year for which we have figures, the proportion had declined to 1 to 190. The figure for graduate science teachers was 1 to 90 in 1962 and 1 to 120 in 1964. Perhaps the hon. Gentleman can tell us something about this.
Second is the disturbing fact that the Government have not so far succeeded in raising the proportion of men recruited for teacher-training to the planned 35 per cent. In an answer on 15th June this year to the hon. Member for Wandsworth, Central (Dr. David Kerr), the Minister of State said:
"The number of men entrants to the colleges of education has increased over the last four years from about 5.000 to 9,500, but with the rapid increase in total intakes the proportion of men in the entry has remained at about 28 per cent. We are taking a number of steps designed to ensure that boys in sixth forms are fully aware of what the colleges have to offer by way of both of higher education and preparation for a teaching careen"—[OFFICIAL REPORT, 15th June, 1967 Vol. 748, c. 105.]
I have never wanted to exaggerate this issue. We are still overwhelmingly dependent on the women output of the colleges for staffing infant schools, but we must always be disturbed about the wastage particularly of younger women teachers.
Perhaps the hon. Gentleman can give us the latest figure for the proportion of young women teachers and of men who leave within the first five years of their teaching career—
Mr. Speaker: Order. We are getting a little wide of the Regulations if we enter on the subject of wastage.
Sir E. Boyle: Perhaps I might put it like this, Mr. Speaker. We are concerned with the fact that the colleges, to which these Regulations refer, have stepped up their contribution of places for men in anticipation of the 35 per cent. being recruited and there are problems in turning over these places to women. I am perhaps therefore justified, in view of the Minister's answer last month, in asking what the Government's proposals are.
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As I mentioned the declining proportion of graduate maths and science teachers, perhaps I could point out that there was a definite decline in the number of applications from students to read maths and science in the colleges last year, and this is something which we should hear about.
One of the ways in which we hoped to ease the supply position was by a more liberal attitude towards nursery classes in existing buildings provided by local authorities, and I hope that the Minister of State will tell us something about the numbers of such classes provided to get married women back to school when their
Mr. Speaker: Order. The Chair has been very generous. I hope that the debate will not go too wide.
Sir E. Boyle: I appreciate that Mr. Speaker. We are dealing with Regulations which, in effect, commit large sums of public money, and I raised the question of nursery classes because I thought that a more liberal policy here by the Government was an important means of ensuring value for money.
One thing strictly within the Regulations is that the Secretary of State's 14 points speech, two years ago, mentioned two aspects on which we would like progress reports. First, what progress is being made with part-time teacher training, particularly for older people, and, second, what is the prospect of refresher courses for returning women, including married women graduates who want to take up teaching for the first time but cannot manage the full professional course?
I now turn to my second theme, the constitutional aspect of the government of colleges of education and the progress in implementing the Weaver Report. This is within the ambit of Regulation 12. We must have a satisfactory statement on the progress here because two and a half years ago the Government of the day took a very important decision not to implement the Robbins Report recommendation about the government of colleges of education which would, in effect, have meant removing them from the sphere of local authorities and linking them to the universities via the institutes. My right hon. Friend the Member for St. Marylebone (Mr. Hogg) said on that occasion that, although he recognised

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the disappointment of the colleges, if he had been Secretary of State he would have felt bound at that time to take the same course. I repeated those same words when I spoke in the House on 25th March, 1965.
I do not suggest—I recognise this would certainly not be in order—that the time has now come, so soon afterwards, to reverse that decision. However, I know that my hon. Friends—and, I hope, the Liberal Party—will agree that, having felt bound to take that step two and a half years ago, which was bound to be very disappointing to the colleges, it is all the more important that we should meet all the legitimate aspirations and concerns of the colleges regarding their internal self-government; in other words, implementing the Weaver Report becomes a matter of first importance.
It will not be news to the Minister of State that there is very considerable concern today about a number of matters in the colleges relating to the Weaver Report. Indeed, it is not too much to say that there is a certain amount of low morale within the colleges of which we must take notice.
I will mention one or two detailed matters on which, as I see it, the clear view of the Secretary of State is of the highest importance. There is real concern that some local authorities will not accept the proposal that the clerk to the governors should be the administrative officer for the college rather than the chief education officer. I hope that the Minister of State will make a statement on that point this morning.
There is also the question about academic representation. Weaver went on to propose staff representation on governing bodies. This is causing difficulty. Reluctantly most authorities are accepting the principle of staff representation, but there are suggestions that these staff representatives should not have full rights of membership. It is very important that the Government should speak clearly here, because in Circular No. 867 on the Polytechnics, the Secretary of State said that the clerk to the governors must be the chief administrative officer, and the Minister of State himself has said some pretty definite things about academic
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representation on governing bodies of polytechnics.
We cannot this morning debate the whole philosophy of what is sometimes called the "binary system". I am one of those who accepts that it would be wrong for us to plan for the whole of higher education to come within the autonomous university sector. However, while I take that view, I regard academic representation on governing bodies as of the very highest importance. It would be quite intolerable if in this respect colleges of education were given less favourable treatment than polytechnics. While it is feasible and right to have an autonomous sector and a non-autonomous sector, we on this side will fight to the death against making invidious discriminations within the non-autonomous sector. It would be wrong if conditions for academic representation were to be different within the colleges of education and the polytechnics; that is to say, if in the one case, the polytechnics, the clerk to the governors has to be the chief administrative officer, but local education authorities can drag their feet where colleges of education are concerned.
There are two other matters regarding the Weaver Report. One concerns financial discretion. One of the best features in recent years has been the greater financial discretion given by some local education authorities to their head teachers; but I hope we will not reach a situation in which financial discretion of a reasonable kind is given to head teachers and denied to college principals, because that obviously would be absurd.
Another matter on college government concerns student unions. I have said many times that we have to live with the fact today that the student body is a state of the Realm within higher education. We do not want colleges where the students' union is little more than a creature. The position of the students' union is a matter which we must take into account.
I would summarise my views in this way. The Government took what was a very important decision two and a half years ago which, as my right hon. Friend said, any Government would have felt bound to take; but, for goodness' sake, let us remember that it was bound to be a disappointing decision, and it is important that the colleges should feel that they

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have reasonable self-government. While I absolutely understand any local education authority which says, "The Government, having taken that decision, we must not now act as though it had taken the opposite decision", nonetheless it is reasonable that we should insist on fair play for colleges of education and that they should have all the reasonable academic freedoms which will enable them to make their full contribution as important institutions of higher education.
There is one last matter. When we are considering regulations for the training of teachers and the grants and the conditions of grants, we should bear in mind the great strain that there is on teaching and study space in the colleges. It is important, at the same time as we make adequate grants for students, to ensure that there is adequate provision of study space, particularly for those mature students whom the Government are trying to encourage and also for those living in lodgings.
We easily forget in the House how big a slice of the total education budget, rightly, goes to training teachers, just as I think we also forget—and no doubt my hon. Friend the Member for Wokingham (Mr. van Straubenzee) will have something to say about this—the big part played by the religious denominations in teacher training.
I regard the contribution of the church colleges of education as probably the most important contribution that the religious denominations make to education in Britain today. This is a major subject. It is highly important that we should show empathy for the colleges for their problems and what they are trying to achieve. These colleges are primarily first-class major institutions of professional training whose whole curriculum should be orientated towards the needs of children, but which are also getting a larger and larger number of highly qualified young people—more and more students gaining grants who overlap in their qualifications with university students. Let us, therefore, insist on study facilities, and an atmosphere of academic self respect such that all students within these colleges can complete their course feeling that they have received the training that they deserve and they have been encouraged to give of their best.
10.40 a.m.
Mr. W. R. van Straubenzee: Those who are not familiar with the procedures of the House will probably find it difficult to understand two things about the debate. The first is that, ostensibly at least, the Opposition are seeking to annul a set of Regulations which, as you have reminded us, Mr. Speaker, are partially consolidation and partially and very importantly new, whereas in point of fact this is merely a matter of formality, although, to avoid misunderstanding outside, it is as well that that is placed firmly on the record.
The second is that, quite properly, our rules of procedure limit what we are permitted to say about those aspects of these regulations which are consolidation measures. So that I may be strictly in order, I will start by gently pulling the Minister of State's leg about Regulation 32 and invite him, in the time which he will have before he replies, to read it and to see whether he can make sense of it, because I suspect that before we agree to its consolidation, it needs a fairly vital piece of punctuation. I am bound to say that I read it up and down with pleasure for some time before my limited brain managed to make sense of it, and I hope that before it goes out the Minister of State will have put in the vital comma.
Regulation 12, as my right hon. Friend has reminded us, is new and it is very important. It vests in the Secretary of State very extensive powers which, so far as I am aware, have been used so far by agreement, and I hope that that will continue. I hope that in exercising these powers the Secretary of State will pay particular regard to one of the most important matters which my right hon. Friend raised. Anybody who has had any kind of contact with the colleges of education, all kinds of colleges of education, will reckon that the most difficult problem facing them is the sheer problem of growing.
I am not altogether sure that we in the House appreciate the strains which we have placed on colleges of education in the kind of growth which, year by year, we ask them to assimilate. I should like to give some examples. For example, in the regulations the Secretary of State is taking a considerable new power to approve capital expenditure. The sort of problems which he

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will have to meet in exercising these new powers are, for example, the growing and chronic shortage of places for the practising of teaching. This is a major and growing problem in large areas of the country and we shall have to do some fairly extensive rethink about how this is to be apportioned between different colleges, particularly when a new college is founded in an area previously covered by an established college.
I should like to give another example. In exercising the new powers under these regulations, one of the matters with which the right hon. Gentleman will have to deal is the increasing tendency—and I think that it is the right tendency—for colleges previously dealing with men or with women only to become two-sexed colleges. This is a perfectly proper tendency, but I do not know that we always understand the very great pressures which it imposes, particularly on the staff, when there has to be grafted on to a college previously dealing with men or women alone the problem of the other sex coming in, with all the difficulties which that sometimes brings with it. That is a second example of the pressures on the staffs of these colleges.
A third example with which the Secretary of State will certainly have to deal under Regulation 14(2) has already been penetratingly commented upon by my right hon. Friend. This is the acute shortage of study places and spaces, and this is often very acute where the students concerned are out on teacher practice. I hope very much that, with particular reference to the more mature students, the Secretary of State will tell us something about how he proposes to exercise the new powers which he will have under this regulation.
I repeat without apology that I do not believe that we in the House, who are requiring this immense effort by the colleges, understand sufficiently the pressures upon those who are in charge of them and those who make up the staffs, and on rare occasions like this when we are able, even in part, to discuss their affairs, we should acknowledge that.
Regulation 30 is also new. A major power is vested in the Secretary of State—the power to make loans to voluntary colleges. I am very grateful to my right hon. Friend for his graceful reference and
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tribute to the part played by the Churches in this respect. Their colleges of education will clearly be those most affected by this new regulation. I am not sure that the nation appreciates what contribution is being made by the denominations in this respect. At this moment there are about 15,000 students in the Anglican colleges of education, of which there are 27. I speak of them and emphatically not for them only because I have some modest knowledge of them. These 27 colleges will come within the ambit of Regulation 14(2) and will be vitally interested in how the Secretary of State views their work and how he proposes to exercise the powers which we shall shortly be giving to him.
It is some measure of the contribution which they are making that in less than ten years the numbers in the Anglican colleges have risen two and a half times. The colleges have done no more, and would claim to have done no more, than play their part in the general work of the expansion of the colleges as a whole, but I am not sure that the financial strain which has been, willingly undertaken, has been sufficiently appreciated, or why we are therefore, interested in and will be watching Regulation 14(2) so particularly closely.
Since the war, the Church Assembly of the Church of England has provided £2,250,000 in capital works on these colleges, and the servicing of those loans now amounts to £190,000 a year. While this is small by comparison with those sums which we so often discuss here, it represents one-fifth of the total budget of the Church Assembly of the Church of England. That is why the power to make loans is of such great interest to these colleges. That is why I am entitled to point out the financial burden already being willingly borne by the Churches—and I have spoken of only one—in this vital work. It is generally estimated that about £4 million in all in capital works has been raised in this respect since the war.
Regulation 14(2) may assume even greater importance than is thought, for I have a feeling—and clearly I cannot explore this by more than the merest glancing reference this morning—that the time is coming when the Churches may well move out of education at primary and secondary level and concentrate on the training of teachers. That is why

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these Regulations are of such profound significance and importance.
I should like an assurance about Regulation 12 which, I think, to judge from inquiries which I have been able to make, the Minister of State will be able to give without difficulty. Regulation 12 gives very wide powers over the articles of government. The inquiries which I have made show that this has not caused any difficulty. In fact it is welcomed, but the Minister knows that there are one or two colleges run by religious orders—I have Middleton in mind—and I would like to be assured that they will retain their religious freedom. They present a special case, and I would like to be assured about that.
I turn from the point that I was making about the contribution made by the churches to ask the Secretary of State whether he is satisfied that these new provisions will not, or may not, be limiting in one regard. I have always had the feeling that we may be training our teachers in too cloistered an atmosphere. This is a delicate thing to express, and a word put wrongly may give a false impression. I want to be sure that these new Regulations, particularly Regulation 12, will not be used by the Secretary of State in a restrictive way.
Let me illustrate what I mean. Clearly the training of probation officers touches at a number of points the same sort of problems as we get in the training of teachers. Another class whom I single out are youth employment officers. Clearly their work, too—I cannot discuss it in detail—impinges at many points on the eventual work of a teacher, and their training, one assumes, impinges closely on it at various points.
I want to be sure that these new Regulations will not be used by the Secretary of State in too restrictive a way so as not to permit individual colleges exploring and experimenting if necessary. The Minister will be aware that in at least one case of which I know an experiment to bring the training of nurses into a college of education very nearly got off the ground. For various reasons, which are not germane to this discussion, it did not do so, but it struck me as an interesting experiment, and I would like to be assured, in the context of these regulations, that the Secretary of State's mind is not closed to proposals
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being put to him, and experiments being suggested, for wider courses for persons other than those who are strictly going to teach. I have given three examples of this—probation officers, youth employment officers, and nurses.
I would like to be assured also that the Secretary of State is watching organisationally—and we can only discuss the organisation this morning—tendencies which it seems to me are beginning to emerge in the degree of B.Ed. There are organisations with considerable differences building up throughout the country, and if the Minister felt able to tell us it would be helpful to know how he sees this in relation, for example, to Regulation 12.
Perhaps I might give an example of what I mean. In two closely related geographical areas the organisation for this is totally different. In Sheffield all the organisational arrangements are incorporated in the Institute of Education, whereas at Leeds the colleges are totally autonomous, and I think it would be helpful to know what is in the Secretary of State's mind about this very important matter, because we are at a very early stage in the B.Ed. problem. One has noticed a tendency to empire building in some colleges, and as the right hon. Gentleman will have extensive powers, it will be helpful to know a little about how his mind is working.
I am quite unashamed of being a rebel on the issue raised by my right hon. Friend the Member for Handsworth (Sir E. Boyle) which again we cannot discuss other than as strictly related to the colleges of education, namely, where the line should be drawn on binary education. I am a rebel in the sense that I believe both major parties drew the wrong line in relation to colleges of education, but I am a realist, and I understand that when setting up new organisational arrangements as he is by these Regulations we cannot expect him—or his successor, who will clearly come from this party—to alter the situation literally overnight. But I go firmly on record as saying that I believe one of the gravest problems facing us—I cannot do more than touch on this—is the morale of the teacher force, the people who will eventually be affected by these Regulations, and that one of the causes is that

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we appear by these Regulations to be setting up a second-class form of training. I am sure that a future Government will have to re-draw the line.
It is customary to look with a rather baleful eye at the products of some of the colleges which are the subject of these Regulations. The Minister will probably recall a recent distressing article by Mr. Brian Macarthur of The Times whose work for education is widely regarded on both sides of the House. He interviewed a set of young men and women at a college of education. I do not know where that was, but by a curious chance I spent the following weekend, or part of it, in precisely such a college, and I believe that, like so many other things—curates' eggs as well —colleges of education differ widely. I went to a first-class college, the work of which the Minister knows is widely admired, and where they still have more students anxious to get in than they have places to offer.
I think that it would be a great pity if the general feeling got round that in all the colleges there was this listlessness and lack of purpose which perhaps was perfectly fairly reported on in that article, but the House has to recognise there are some colleges and some staffs whose standards are unacceptably low. This is why we look at Regulations like these with such care. I hope that out of our discussions there will always go the call that teaching is one of the great callings for which a young man or woman can offer himself or herself, and what we are engaged on this morning is an exercise to arm the Secretary of State still further with Regulations by which he can enforce those standards and so add to statute of the great profession to which they refer.
10.58 a.m.
Mr. Richard Hornby: There is not a lot that I want to add to the points which have been made by my right hon. Friend the Member for Birmingham, Handsworth (Sir E. Boyle) and my hon. Friend the Member for Wokingham (Mr. van Straubenzee). I think that we are all looking at these Regulations to see in what ways they will or will not improve the numbers of those who are going in to the teaching
20
profession and who are so urgently needed, and, indeed, what effect they will have on the quality and morale of those taking up training and subsequently going into teaching.
We know the problems which the Secretary of State faced in drawing up these Regulations. We are all anxious to minimise the loss rate. We are all anxious to see recruitment from new areas, not just from the graduates emerging from the universities, or from those who are going to the colleges of education, but how these Regulations will affect the prospects of bringing people back for training once they have left the schools. We are looking also to see how these Regulations may be adaptable to those who have pursued other careers, or who might be willing to consider teaching as a career if the training can be on a part-time, and not only on a full-time basis.
The first things that I look at in these Regulations is to see how flexible they are for the varying needs of the different categories of people who might be persuaded to consider teaching as a career, and how flexible they are to meet the different needs of different geographical areas. I welcome what I have read of these Regulations, some of which consolidate previous regulations and others of which are new.
Regulation 2(2,b) concerns the constitution of governing bodies. We all welcome the inclusion of teachers themselves among those represented. I welcome this provision because, as my hon. Friend the Member for Wokingham said, one of the great problems for the colleges will concern the relationship which they strike up with the schools in their areas. Without representation of teachers on their governing bodies these problems will be greater rather than smaller. It is always a good thing for the consumer that the wares should be prominently displayed. I hope that the same thing will apply in respect of parents and governing bodies.
I should like to know whether the Minister can tell us what progress is being made with the part-time courses referred to in Regulation 6. The Regulation refers to:
"courses of initial training, which may include part-time courses".
There is a widespread feeling that the numbers of potential recruits could be

21
enlarged if more part-time training were made available. When addressing the National Union of Teachers' conference the Secretary of State expressed some doubt about the results that might ensue from these part-time courses. It would be interesting if the hon. Member could give any indication how these courses are developnig and what are the cost anxieties in respect of them—because I understand that it is with the question of cost that the Minister is most concerned.
Regulation 7 concerns shortened ccurses—for suitable individuals—which may be completed in less than three years but not less than two years. It would be interesting if the hon. Member could tell us what sort of numbers—at the discretion of the authorities—are enabled to take much reduced courses. Although I am aware of the sensibilities of teaching organisations about any suspicion of watering down courses I have a feeling that for many mature students the prospect of a full three-year course—provided the candidates seem to have adequate experience and comparable qualifications—would be a deterrent to their going into the profession.
We should welcome the flexibility which is apparent in Regulation 7 and should say so openly to the teachers' organisations which, in some of these matters —
Mr. Deputy Speaker (Mr. Sydney Irving): Order. These are mainly consolidation Regulations. The Regulation referred to by the hon. Member is a part of the consolidation and not an amendment. Therefore, despite the latitude which Mr. Speaker has allowed, I must warn the hon. Member that he is getting a little wide of order.
Mr. Hornby: I naturally accept your Ruling, Mr. Deputy Speaker. I shall refer to the other aspect of shortened courses in Regulation 7, which concerns those which may, at the discretion of the authorities, be completed in less than three years. As I understand it, the idea is that it might be for the convenience of an authority if a course could be completed in the spring—in April or May—rather than running on. I do not object to this type of flexibility, but I cannot understand how the time saved—two or three months—can be put to further good use. I could understand it if a year, or
22
nearly a year, was saved; it would then increase the through-put of students coming to the college. But with a matter of two or three months, when there is a specific age limitation and when it is not easy for students to come into the colleges at any time of the year, I wonder what the advantages of this provision are. Perhaps the Minister can enlighten us.
Regulation 14(2) sets a limit upon the discretion of authorities concerning expenditure on installation and equipment. I wonder whether this limit is not too restrictive, and whether it is not one of the very things that make for work, delay and additional administration costs in so many of the administrative practices in which local authorities are concerned. Surely, if the Ministry wants to know more, it would be better, rather than requiring approval for each item, for authorities to be required to inform the Department what they have done with the global sum given them. The procedure laid down invites delay and demands too much interference and time-consuming detailed work from the Ministry in its relations with local authorities.
On Regulation 28, I should like to know what information the hon. Gentleman has about differences in cost between residential and non-residential establishments. I suspect that there is a growing demand, from the new recruits that we are hoping to entice into the profession, for more non-residential establishments. The cost factors in this connection would be very interesting to know.
I should like to know what the thinking of the hon. Member and his right hon. Friend has been concerning the advice that they are to receive in the future. It is a long time since we heard of the demise of the National Advisory Council. Nothing has been set up in its place, and many people feel that if the Secretary of State does not want to revive the National Advisory Council he should set up an immediate inquiry into the whole practice affecting the recruitment and training of teachers. I hope that an announcement will be made on this subject very soon.
11.9 a.m.
Mr. Charles Morrison: Any Regulations concerning teachers—whether they affect salaries, conditions of work, standards, supply, or other aspects, such as those covered by these

23
Regulations—must be judged on the basis of their effect on the quality and quantity of teachers and teaching. In many spheres quality is often maintained by setting very high standards, thereby limiting the numbers of people concerned. In teacher-training colleges, if the quality is high, if the training is of the correct standard, and if the output is of a high quality, the prestige of the teachers and the training colleges is raised and, as a result, the quantity of people coming forward for training, and their quality, are also raised. The Regulations are helpful on criteria both of quality and of quantity, but one can only conjecture about their practical effect on teacher supply.
Regulations 12 and 14(2) are particularly relevant to supply of men students, which is of such paramount importance because of the higher wastage of women and the longer lasting return from investment on men. The number of male entrants over the last four years has increased from 5,000 to 9,500, but this is only 28 per cent. of the total, compared with a target of 35 per cent. Why is this percentage not higher? What is the Secretary of State doing to attract more men? I hope that he is constantly considering it. This is important, because 60 per cent. of women students leave the profession in the first five years, which is a considerable loss, and this wastage is synonomous with marriage. About 27 per cent. of men also leave in the same period—
Mr. Deputy Speaker: Order. The hon. Gentleman should know that his right hon. Friend was ruled out of order by Mr. Speaker in dealing with wastage, and I am afraid that the hon. Gentleman is out of order. He must deal with those matters which are for amendment or with the limited question of consolidation.
Mr. Morrison: I was about to ask how far this wastage is due to the training rather than marriage. We know that 27 per cent. of men also leave in the first six years, and it could be argued that 27 per cent. of women leave for the same reasons and only 33 per cent. for marriage. This means that between a quarter and a third of men and women leave for reasons other than marriage. What is being done to find out why this considerable proportion of young teachers
24
leaves, and how far can the loss be traced to some lack in their training?
Mr. Deputy Speaker: Order. I am sorry to remind the hon. Gentleman, but he is still out of order. The matters which can be dealt with and which are for amendment are concerned with the articles of government of colleges of education, the £1,000 limit, grants to colleges of education and the establishment of a minimum age. The hon. Gentleman's remarks are outside any of those amendments and are therefore out of order.
Mr. Morrison: May I make one quick reference to Schedule 2, Mr. Deputy Speaker, concerning the conditions of admission to training establishments? My right hon. Friend referred to a reply by the Minister of State on 15th June to the effect that colleges of education had much to offer as centres of higher education as well as of training, but if they were seen too often in this light a number of people could enter with no wish to become teachers but would join the profession for a short time and then leave, contributing to the 27 per cent. wastage. I will pursue this matter no further in case I stray again out of order.
I wonder to what extent morale is low in the colleges, which are centres of academic excellence and discussion of ideas, because a feeling of depression which is common throughout the country is emphasised there. These Regulations are helpful but could have been more so and could have been more more strongly supported if they had been drawn up after the Secretary of State had had discussions with a body like the National Advisory Council on the Training and Supply of Teachers. I hope that the Minister of State will deal with this.
11.18 a.m.
Mr. T. L. Iremonger: I listened carefully to Mr. Speaker's guidance on the matter of order and looked at my notes to reassure myself that I would not strain the patience of the Chair. It might be convenient if I state that I understand that we can have a "Second Reading" debate on Regulation 12, which is new, as opposed to a consolidating Regulation. It provides for the Secretary of State to determine the functions of certain persons and

25
bodies in relation to a college, which therefore raises the question whether these functions shall or shall not include the determination of syllabuses and content, with special reference to consolidation Regulations 16 and 5 dealing with content and method likewise.
Therefore, if my remarks are regarded u; in that line of thought, I hope that I am right in feeling that I shall be in order. I have not given the hon. Gentleman notice of these questions, but it is fair to assume that they would be on the surface of his mind, because he must hive asked them of himself.
First, who decides in practice under these Regulations, and will decide under the amended Regulations, what and how the teachers of the nation's children shall be taught? Secondly, what part does the Secretary of State himself and, therefore, vicariously this House, play in making this choice? Thirdly—and here I speak to how Regulation 12 may add to Regulitions 5 and 16 in relation to a practical e:tample—what ideas has the Secretary of State about social education, by which I mean the stimulation of children to form their own private moral values of social behaviour?
Mr. Deputy Speaker: Order. The hon. Gentleman is perfectly in order in suggesting that Regulation 12 is one of those for amendment but, when he goes into the contents of syllabuses and the determination of what shall be taught, he goes ft. further than the administrative functions set out in Regulation 12, which are for the government of colleges of education. I cannot permit a detailed debate on the lines in which the hon. Gentleman is now proceeding, which I understand to be concerned with the nature of education and the terms and contents of syllabuses and how they are determined.
Mr. Iremonger: I accept that ruling instantly, Mr. Deputy Speaker, although perhaps I might ask whether you have considered the possibility that it might be a function of one of the bodies or persons mentioned in Regulation 12, as laid down by the Secretary of State, to determine the shape, content and method of the teaching to be carried out in training establishments subject to the Regulations.
Mr. Deputy Speaker: I am sure that in detail members of the governing body of a college of education will have a vast
26
experience and considerable responsibility, but we cannot discuss in detail that responsibility or experience, which is what the hon. Gentleman is apparently seeking to do. In effect, he is trying to get a Second Reading debate on the whole range of the contents of education.
Mr. Iremonger: In that case, perhaps another occasion would be more appropriate in developing this theme, although I hope that the Minister of State will not feel that this is not far more important in the estimation of the House than the details, important as they are, of the administration and constitution of these colleges.
Mr. van Straubenzee: Has it occurred to my hon. Friend that we are vesting in the Secretary of State by these Regulations—although admittedly only in reference to voluntary colleges, which are nevertheless a most important sector—very wide powers to grant loans? It may be that my hon. Friend would want to know the attitude of mind of the Secretary of State before approving those loans?
Mr. Iremonger: My hon. Friend is extremely ingenious in the assistance he has offered me and perhaps, Mr. Deputy Speaker, you would be good enough to give me your guidance on that point. I reinforce the point made by my hon. Friend by pointing out that, under Regulation 16, which is a consolidating Regulation, the Secretary of State has power to provide that a voluntary college
"… shall… provide a course specified by him;"
In connection with what my hon. Friend has said, perhaps you could assist me to relate this to the Regulations by saying whether, if we are to approve the power to make grants to voluntary colleges—where the Secretary of State can require the provision of a specific course—we might discuss the attitude of mind which would lie behind it.
Mr. Deputy Speaker: The hon. Gentleman is experienced in the procedure of the House and will realise that the contents of courses or the provision of courses cannot be raised under Regulation 12.
Mr. Iremonger: We are in your hands, Mr. Deputy Speaker, and it is for us to

27
accept what you say. Perhaps in passing I might express regret at the extreme narrowness of the debate, but even so it is a pity that the Minister of State is supported by only one of his hon. Friends on the back benches. The Labour Party has held itself out in the past as being concerned with education, and surely this debate would have been a suitable occasion for hon. Members opposite to turn up at a morning's sitting to air their views.
I wanted to raise wider issues which are apparently not in order, so I merely say that I support the points made by my right hon. and hon. Friends and shall listen with great interest to the Minister of State. I hope that the hon. Gentleman will indicate what plans he has, since we are not proposing to annul these Regulations, to give us an opportunity to debate the whole philosophy and content and method of teacher training on a suitable occasion. This is not a subject that should properly be left to be dealt with in one or two individual speeches with a brief rejoinder by a Minister in a general debate. Perhaps the Government will provide us a half day debate on the subject of the supply and training of teachers rather than leave it to be dealt with in a general debate on education.
11.18 a.m.
Mr. John Pardoe: I find myself in some difficulty. Dorothy Parker once said that everything she liked was either illegal, immoral or fattening. This seems to be the case with what I hoped to say in this debate. I realise that we can only discuss in detail the Regulation you have mentioned, Mr. Deputy Speaker, but I would like to ask the Minister of State specific questions about others which are important.
Mr. Deputy Speaker: The hon. Gentleman can only ask them if they are related to the effectiveness of consolidation.
Mr. Pardoe: I know not whether they are in terms of this definition.
Mr. Deputy Speaker: If the hon. Gentleman wants to ask a question about the contents, the answer is clearly, "No."
Mr. Pardoe: In that case, most of my notes are out of order and I therefore merely add my plea to the Government to provide a half day debate at least in which we can discuss the whole question of the supply of teachers, because as we no longer have a national council this matter seems very much in limbo. The Secretary of State should have provided some substitute for the work of that body and we have had no opportunity in this House, for as long as I can remember at least, to discuss the large number of issues raised by other Regulations in this consolidation Measure.
11.30 a.m.
The Minister of State, Department of Education and Science (Mr. Goronwy Roberts): The right hon. Member for Birmingham, Handsworth (Sir E. Boyle) has initiated a wide-ranging debate and raised a number of important issues, many of which are currently under discussion and depending for their final outcome, as he knows, on appropriate consultations. He asked for a progress report and I will endeavour so far as possible, to take up many of the matters which he and other hon. Members raised and to provide the information for which I have been asked. I am sure that hon. Members will bear with me if I do not cover every inquiry which has been thrown at me, obviously often without notice. I have a sense of being within a pincer movement. On the one hand, there have been attempts to raise matters which, I gather, have not been strictly within order and, on the other hand, I may find myself traversing the bounds of order. Therefore, if the form in which I give the information asked for is a little diffuse and unrelated, I hope that the House will forgive me.
The right hon. Gentleman rightly stressed the extraordinary co-operation which successive Secretaries of State have received from the training colleges, the colleges of education, in the face of repeated requests to expand, to institute organisational change and physical changes, which have borne heavily on staff and students alike. I join with the right hon. Gentleman at once in most warmly thanking them once more for the spirit in which they have answered these challenges and the quite remarkable successes which they have made. As the right hon. Gentleman said, this is a

29
story of continued achievement and at some cost. The cost is rather more than £50 million a year and, according to the Estimates for 1966–67, is now £68 million.
I join with the right hon. Gentleman in reminding the general public of the amount of money and resources which the country is making available for the vital task of training suitable people to teach our children. This £68 million is a substantial sum of money. No one grudges a pound of it, but it is right on occasions of this kind to remind ourselves of the extent to which we are asking the general public to subscribe, through general taxation, to the cost of this vital exercise.
The right hon. Gentleman gave his own very near guess of 6,500 as the number of full-time staff in the colleges, but it is much nearer to 8,000. It has been increasing every term, so that the figure which the right hon. Gentleman gave has been overtaken in the last year of 18 months and is now 7,900. I spoke of resources. We are devoting not only money, but scarce and highly qualified manpower to this vital task.
The right hon. Gentleman spoke of the important need to attract more graduated mathematics and science teachers. This is a very difficult problem. The increase in university provision for science and mathematics is itself a factor tending to absorb honours graduates and leave fewer for teaching, but we are continuing to advertise and to draw the attention of final year students to the possibility of a teaching career. We distribute publicity material and we are currently preparing new material. The problem is among the matters now being studied by the Committee on Manpower Parameters for Scientific Growth, which is expected to report later this year, and my right hon. Friend will consider carefully what that Committee recommends.
In relation to recruitment, the right hon. Gentleman asked about the progress in providing nursery classes. We have endeavoured to encourage local educaticn authorities to set up nursery schools where they would enable a sufficient number of married women teachers to return to teaching. I agree that in many cases this may be a more economic way of increasing the number of teachers, and
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in some areas it certainly is. Between the summer of 1965 and January, 1967, about 90 such classes were started, producing probably between 200 and 300 teachers. We shall be looking further into this matter in connection with the recommendations of the Plowden Council on nursery provision on its own merits. Personally, I think that this is a field of action which we might be well advised to expand. The provision of nursery classes releases very valuable entrants into teaching.
The central theme of the right hon. Gentleman and others was the rate of expansion of the colleges of education. I will not detain the House with a long statement of the progress since 1958, when a very large programme for the physical expansion of the training system was launched. What the House will want to know is that in July, 1965, the Secretary of State asked all colleges of education to see what they could do, following the expansion in late 1960 and up to 1963, to seek yet further to increase their intake for initial training by making still more productive use of their teaching facilities, whether by some form of organisational change, or other arrangements of their own choice.
The national target then was an intake of 35,000 students by 1968, an increase of 20 per cent. on the previous target. Again the response of the colleges was extremely good and their plans promise to achieve if not surpass the stated target.
Mr. Deputy Speaker: I am loth to prevent the Minister from giving this information to the House, information which the House is anxious to have, but the hon. Gentleman is going rather wide of the Order.
Mr. Roberts: I was asked by the right hon. Gentleman and others to give certain information. I should like to give it in so far as it is proper for me to do so within the bounds of order.
Mr. Deputy Speaker: I am in some difficulty. I, and Mr. Speaker before me, prevented some hon. Members from dealing with matters with which they wished to deal. Those hon. Members might feel a little unhappy if the debate is now widened. I can allow the Minister to proceed unless any hon. Member feels that something should be done about it.
Mr. Roberts: I think that I can assist by saying that what hon. Members want to know is what is now the stated target. The target is now 111,000 teacher-training places, outside the universities, in England and Wales in 1973–74 and 100,000 by the end of this decade. I have already given the figures for the cost.
Sir E. Boyle: We are very grateful to you, Mr. Deputy Speaker, for your forbearance. The whole House will realise that the Minister's statement is of very considerable importance and I should, therefore, like to ask him what figure of annual intake is represented in the Government's mind by the target of 100,000? What corresponds to the 35,000, if I might put it in that way?
Mr. Roberts: The 35,000 would approximate to the target of 100,000, roughly one-third, with the obvious offsets about which the right hon. Gentleman and I are always worried.
A point made by a number of speakers was the need to attract more men entrants. The Regulations, covering as they do the operation of all forms of training establishments, are specifically designed to assist us in ensuring that we get proper courses and proper colleges with proper proportions of men and women. The increase in the proportion of men in the national intake to the colleges must depend on a significant increase in the number of suitable men applicants, and there is no easy way of achieving this.
We are trying by various means to ensure that boys in sixth forms are fully aware of the opportunities open to them in colleges of education, and we are examining what further publicity may be helpful to this end. The figures given by the right hon. Gentleman are absolutely right. Since 1962–63 there has been a marked increase in the number of men entrants —from 5,000 to about 9,500—but this has kept pace with an equal increase in the number of women entrants. The percentage of men entrants has therefore tended to stabilise at about 28 per cent., a figure that falls substantially short of the target of 35 per cent. that we have set ourselves.
I should like at this point to say that if any hon. or right hon. Member would care to suggest further ways of stimulating the interest of suitable boy sixth-formers in the teaching profession, I
32
should be very glad to talk over the subject with them. I have talked about this to headmasters and heads of schools, and though they themselves are very keen to see more of their boys choosing the teaching profession, they find it extremely difficult to persuade more than about the present proportion to do so.
A number of speakers referred to older students. The number of men and women aged 25 and over embarking on training more than trebled between 1962–63 and 1966–67 when, in the latter year, the number was 6,100. Here, again, I think that there is a consensus in the House about the utility of attracting more and more suitable older entrants into the colleges to train as teachers. It is part of the answer to the perennial problem of wastage, especially among the young women teachers.
I have visited a number of the outposts and annexes where special provision is made on the lines suggested by the right hon. Gentleman and, I think, by the hon. Member for Tonbridge (Mr. Hornby), to enable older students to go into the courses, and those students have struck me as being particularly and delightfully dedicated to the profession for which they now find it possible to train. There are a number of very strong arguments for expanding the intake of the older students into the profession.
That brings me to the point made by the hon. Member for Ilford, North (Mr. Iremonger), who found it difficult, Mr. Deputy Speaker, to launch a debate on the philosophy of education and the content of courses. I sympathise with him. I would agree generally that the House should have an opportunity to discuss these matters, and the Opposition might themselves consider at some time making available for this purpose part of their own time. Having said that, I add that I shall certainly report to my right hon. Friend this feeling which, I am sure, is shared on both sides of the House, that an opportunity should be given for a debate on the purposes and general objectives of education.
The hon. Gentleman also made a point about what one might call social education, which links with a suggestion made, I think, by the hon. Member for Wokingham (Mr. van Straubenzee), that we should not interpret these Regulations too narrowly, inhibiting colleges in certain

33
cases from introducing courses which, while not being strictly teacher-training courses, were cognate with them in a general social sense.
The Regulations are concerned only with the teacher-training courses, but there is no impediment to a particular college providing courses of a different kid under other arrangements. Already, a number of colleges are not solely teacher-training establishments. My own daughter attends a college of domestic science as an intending teacher—and, we hope, as an intending Bachelor of Education—but her friend is at the same college to study for the Institutional Management qualification. Similarly, there are other colleges where training for youth leadership is already provided within the ambit of the training college provision.
We shall continue to consider any application for the introduction of courses of this kind which, though not teacher-training courses, are nevertheless related to the central purpose of the education of children and young people. I must say, however, that for some time our overwhelming preoccupation must be with the need to expand the teaching force so as to man the primary and secondary schools.
I touched on the subject of wastage of teachers when I spoke about the need to attract more older students, but I should like to add something. Figures of wastage of young women teachers and men teachers are not available in any meaningful sense as yet. The information is in process of being collected and collated, and I hope that it will not be very long before we have up-to-date information on this very important question.
But we have just had occasion to study a question closely allied to this: how many students who successfully complete courses in the colleges actually take up duty as teachers? The returns supplied by local education authorities last October suggested that fewer students who had successfully completed college of education courses might be going into teaching than would normally be expected. An inquiry was made into this aspect. Many exaggerated figures had been quoted, and it had been widely assumed that there was evidence of general disaffection. The results show nothing of the kind, and I must say in relation to one or two things
34
said about the state of morale among students in colleges of education that I do not find this to be in any way generally true.
It was found that many of these students, pursuing further studies, were teaching temporarily abroad, fully intending to come back, or were engaged in voluntary service overseas and again, were fully intending to come back. The number who had left teaching was unlikely to have reached 3 per cent. of the whole, and was probably well below that figure. This is a figure which in any profession or industry is tolerable.
Mr. Pardoe: Does the 3 per cent. relate to all those who had come out of training colleges or to all those who came out of training colleges and went directly into education?
Mr. Roberts: It refers to the product of the colleges and what happened to it within the first year. While one would wish to see a figure lower, 3 per cent. is not on the whole alarming. We cannot afford to have any wastage at all, but these figures, which were bandied about earlier this year, were somewhat exaggerated and I thought that I would put the matter into fair perspective.
Among the other points of importance which were raised by the right hon. Gentleman and by the hon. Member for Tonbridge was the future of consultative machinery for teacher supply and training, about which I am glad to have heard the views of hon. Members. Clearly, it is a matter which both sides of the House must continue to study. My right hon. Friend agrees that there should be the closest possible consultation with authorities and teachers' associations and other educational bodies on the many difficult questions which arise in connection with the training and supply of teachers. He has, however, felt—I am sure that he is not alone in this—that the old council left a great deal to be desired.
The Secretary of State has more than once invited suggestions on the most appropriate form of consultative machinery and on 16th March last letters were sent to the bodies represented on the old council inviting their views. We have had suggestions from the majority of them, but a number have not yet expressed any views. I hope that this

35
debate will serve as a reminder to them so that we may soon have a full picture of educational opinion on this question.
A wide range of views has been expressed, and from those and from the views which we are still awaiting it will not be easy to reach a conclusion which will be universally acceptable. Some associations, for example, prefer to have a large body on which they would be represented in proportion to their size. Their members would, presumably, act as delegates and report back to the associations from which they came. Against this, it has been suggested that what we need is a small body consisting of people with appropriate experience chosen for the personal contribution which they can make but not answerable to any association.
It will be difficult to bring about a consensus within the wide spectrum of views which have already been made available to us and those which, no doubt, will be forthcoming. It is, however, a matter which we are watching closely and on which we are anxious to come to the House as soon as possible to indicate a reasonable method of procedure.
A second point which merited attention related to the important matter of the government of colleges. The Weaver Report has been generally welcomed. We have invited colleges of education to prepare schemes. We have provided models from which they can work. Schemes are coming forward to us. We are by no means inflexible or rigid in trying to lay down a uniform pattern. It is not intended to seek to impose any rigid uniformity in the articles of government. Authorities have, however, been provided, in the annex to Circular 2/67, with a pattern to assist the task of drafting and the task of scrutiny.
As to the voluntary colleges, I entirely agree with what has been said about the quality and the quantity of the contribution made by the denominational colleges. In relation to their government, a modern scheme of government for voluntary colleges has been agreed with the voluntary bodies and circulated to all colleges. They are now submitting their proposals for new schemes of government. The procedure is roughly similar in relation to the maintained colleges as for the volun-
36
tary colleges. The variation is traditional.
For more detailed consideration of college government, we might well await publication of the proposed legislation which we hope to introduce shortly. That will indicate the nature of the provision that the Government wish to make and give the House a full opportunity of discussing what from time to time the Chair was unable to allow us to go into this morning.
Sir E. Boyle: We are quite firmly within the ambit of Regulation 12. For the first time in his most helpful speech, the Minister of State has rather disturbed me by the small amount which he is able to say. Can he give the House a fairly clear undertaking that colleges of education in their relation to the Weave: Report will not be treated any more unfavourably than were the polytechnics in Circular 8/57—that is to say, concerning the position of the clerk to the governors and academic representation? Can the Minister give that assurance?
Mr. Roberts: We expect that both types of college will approximate in the levels of academic and, indeed, student autonomy which they attain in relation to the arrangements which are made for each type. There may be differences; they will not be differences which indicate a classification or a superiority of the one over the other in this matter. That is the assurance which I can give, that we hope that both will emerge with the fullest possible academic and student autonomy consonant with their nature and not with their position in the educational hierarchy.
I would not wish to be pressed on the question of the professional identity of the clerk to the governors. Our view is that he should not be the clerk of the authority. Certain education authorities and colleges take another view. When we publish the proposed legislation, there will be room within the bounds of order to go into the details of what is proposed and for the arguments for variation in this and in other matters to be put forward.
As you said, Mr. Deputy Speaker, this is a consolidating and simplifying measure. The principal changes are,

37
first, the requirement in Regulation 12 that colleges of education
"shall be conducted in accordance with articles of government made with the approval of the Secretary of State".
I have made clear the provision for voluntary colleges.
Secondly, there is the requirement that the Secretary of State's prior approval shall be obtained for certain expenditure on equipment and installations. I have noted what the hon. Member for Devizes (Mr. Charles Morrison) said about this. The Regulation provides for this control at that level. The hon. Gentleman said some reasonable things about the general question of financial control. I shall study what he said and discuss it with my right hon. Friend.
The third principal change is the power conferred by Regulation 30 to make loans to voluntary colleges of education. I think there is general agreement that this should be as it is set out. Finally, there is the prescribing of a minimum age of 18 years for admission to a college of education or department of education and the reduction from 25 to 24 in the minimum age of admission for a college of education (technical).
Apart from those and one or two very minor changes, these are consolidating arid simplifying Regulations. They take up two previous bodies of L.E.A. and grant regulations made in 1959 which hive since been overlaid by no fewer titan six amendments. Therefore, there is not much that is new in the Regulations, but the principal changes which I hive mentioned have received fairly general assent.
Sir E. Boyle: In asking leave to withdraw the Motion, may I, on behalf of the whole House, thank you, Mr. Deputy Speaker and Mr. Speaker for your forbearance with us during the last hour and a half. We realised the difficulty we were placed in with a set of Regulations partly consolidation and partly new. We thank you very much.
I found the answer of the Minister of Sate, who is always so courteous to the House, most helpful and satisfactory on those matters where we were rather skirting round the rules of order. I was quite a bit less happy with his answer on Regulation 12, which came firmly within the ambit of the debate. Having made that
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comment and having paid a sincere tribute to the Chair, I beg to ask leave to withdraw the Motion.
Motion, by leave, withdrawn.

CARCINOGENIC SUBSTANCES (REGULATIONS)
12.2 p.m.
Mrs. Joyce Butler: I beg to move,
That an humble Address be presented to Her Majesty, praying that the Carcinogenic Substances Regulations 1967 (S.I., 1967, No. 879). dated 8th June 1967, a copy of which was laid before this House on 16th June, be annulled.
I have very little time in which to go through quite a lot of material of a highly technical and important nature. I shall be as speedy as possible. My concern with the Regulations is that it is now in a position where we either have to accept or reject them, despite the fact that we waited three years after the circulation of the preliminary draft. The draft of the present Regulations was brought forward on 20th December last year.
Unfortunately, the Instrument which has been laid is exactly the same as the draft of last December, despite the fact that a number of recommendations were made by experts to my hon. Friend the Joint Parliamentary Secretary about certain additions and points of clarification which they regarded as necessary. I ask my hon. Friend to tell the House why no notice was taken of the recommendations and no change made in the draft.
There was not only criticism by individual experts. There was an article in the Lancet of 14th January setting out these points. There were also recommendations by the British Medical Association on the same points. I also understand that the draft Regulations were apparently never referred to the Advisory Committee as such. In view of the highly technical nature of this subject, which is very much a matter of specialist opinion, there being only a limited number of people with specialist knowledge, I would have thought that the Advisory Committee would have been the essential body to which to refer the draft. Why was this not done? We are learning all the time on this subject. It is important

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that in the light of new knowledge the Regulations should be as correct as possible.
These are the first Carcinogenic Substances Regulations to be made in this country. They are a real landmark in preventive medicine and must be regarded in that light. It is, therefore, important, as the various additions and points of clarification have not been added to the draft, that we get from the Ministry—
Mr. Deputy Speaker: Order. I hope that the hon. Lady will not emphasise that fact, because she is not in order in suggesting that things left out of the Regulations should be there.
Mrs. Butler: I take your point, Mr. Deputy Speaker. I am asking my right hon. Friend to say, in answer to questions I shall put to him, as much as he can so as to give definitive guidance to the medical profession and industry in the operation of these Regulations.
The Regulations ban the manufacture and use of certain substances which are no longer manufactured in this country. Some of them are still imported. I understand that Regulations in regard to the import of these substances are to follow. The Regulations also restrict the manufacture and use of certain other substances: these are to be rigidly controlled and are called "Controlled Substances". Further—this is breaking completely new ground—the Regulations provide for the medical examination of workers concerned with some of these substances.
I ask the Department to reconsider the exemption in Regulation 5(1, iii) which concerns the proportion by weight of water to benzidine hydrochloride. The purpose of adding water is to make the dust less dangerous, but it has been suggested to me that this is too high a proportion of water and that it would allow the benzidine to settle out.
Again, if a laboratory used Prohibited Substances and thus came within the Regulations, would the Regulations apply to men employed in the factory but well outside the laboratory and therefore not at risk?
Regulation 6 sets out the list of Controlled Substances. Does the list of chemical names in paragraph (1) of this Regulation apply only to the substances
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themselves, or does it apply to other substances which may contain these substances as additives or impurities. If they do thus apply, is there any limit to the amounts Of the substance contained as an additive or impurity? If the Regulations cover additives or impurities, why is it not feasible to specify a lower limit? This may be reasonable, but I would be grateful if my hon. Friend could explain this.
I turn briefly to deal with Regulation 8 which refers to medical examinations, because this is of major importance. The first part of the Regulation says:
"Every person who is or has been employed in any manufacture, process or work referred to in paragraph (1) of the last foregoing Regulation …"
It is not clear whether the Regulations will apply to persons who have been employed in such manufacture in the past in firms where such manufacture process or work has been abandoned before the Regulations come into force. If they will not, they will not cover men in the rubber and cable industries in which dangerous substances were used in the past, and in respect of which cases of bladder cancer are still arising, and are likely to arise at any time.
If the Regulations are to apply only to people using or manufacturing the Controlled Substances on the date they come into force, this will have serious repercussions for a large number of men who may develop bladder cancer. This situation does not seem to be in keeping with the Press statement which was made when the Regulations were laid, namely:
"Provision is made for the medical supervision of persons who are, or have at any time been, employed in the making or use of these substances."
Again if the Regulations are to apply only to firms using these materials on the date when they come into force, will this mean that only those persons who are, or have been, using these controlled substances on that date will be required to submit to a medical examination? I wonder whether my hon. Friend realises that if this is so many other employees who, in the past, have handled more dangerous prohibited substances will be under no obligation to undergo a medical examination? It is important to realise that in industrial situations both Prohibited and controlled substances are

41
closely related, and that they will have been handled in the same factory.
If minute traces of the controlled substances mentioned in Regulation 6 bring a factory under the Regulations, Regulation 8 would seem to require a large number of people such as gas workers, persons testing water at sewage works, and rodent operators who have handled Antu on premises to submit to urine screening for the rest of their time in employment at the factory concerned. These people are regarded as being at low risk, and most medical opinion agrees that they should not be unduly frightened by being made to submit to this kind of examination, particularly when men at much greater risk, those to whom I have referred earlier, such as rubber and cable workers, will not be brought within the Regulation.
The advice which is usually given is that such men should be asked to undergo urine screening only if they have heard of the possibility of risk and have become worried and asked for the test. Where there is a shortage of highly skilled pepole to do the screening, it is important to keep the number of people involved to the lowest level compatible with a reasonable degree of safety.
There is the further point that this Regulation applies to workers employed under the provisions of the Factories Acts. There will, therefore, be two classes of worker, those working under the Factories Acts, and those who are not, although they may be doing the same kind of work. One group will have screening, and the other will not.
I have dealt as quickly as I could with the main points. I understand that there is a possibility of Orders following the acceptance of these Regulations. I hope that it will be possible for an Order to be introduced to grant exemption to some of these lower risk cases. Perhaps the Minister would like to consider this further. He might also at his discretion like to introduce an Order bringing under the Regulations certain classes which have not hitherto been considered.
In all that I have said, I have been seeking clarification, and I hope that my hon. Friend will realise that this is the only way in which it can be done. A number of experts, and certainly a number of people in industry, will read
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what my hon. Friend says as a guide to making these Regulations more effective. They are a landmark in preventive medicine in this country, and, in fact, throughout the world.
12.17 p.m.
Mr. Nicholas Ridley: I do not want to be more than a few moments, because time is short, but I join the hon. Lady the Member for Wood Green (Mrs. Joyce Butler) in welcoming these Regulations, which, as she says, constitute an important advance in industrial preventive medicine.
I echo the hon. Lady's comment that the Government have not heeded the representations of some of the people concerned, and have not drafted the Regulations in accordance with some of the technical advice which I have been given.
There is one point which I would like to raise with the Minister. It concerns benzidine dihydrochloride. I understand that this is a very dangerous substance. Modern research indicates that it should be used in a mixture of which water should form between 23 and 35 per cent. of the total. As the Regulation is drafted, water is to form not less than one-third or 33 per cent. of the total. I understand that the Department has accepted that there is good logic for what I have just suggested.
I do not want to go into the merits, but I do not believe that it will be acceptable just to say that the Regulations will not be enforced in their present form. I understand that it has been accepted that to describe one-third as the minimum is the wrong way to deal with it. The Regulation should, therefore, be withdrawn, and another put in its place. It is no good saying, "We know that this is not the right way to do it, but we are going to carry on with the Regulation anyway and we will wink if anybody has the wrong proportion of water in his benzidine dihydrochloride".
I hope that the hon. Gentleman will do what I have suggested, and not take the sloppy way out of saying, "Very few people are concerned, and it does not matter very much. We will not prosecute anybody breaking the Regulation". As this Regulation is to be part of the law, it should be right, down to the last detail.

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Under subsection (iv) on the same page, the use of any quay or dock is prohibited except for exporting this substance, but much of it has to be imported, and this will be made legal, I understand, in a subsequent Order. I should like an undertaking that this later Order will be laid, as it would be wrong to prohibit the import of these materials without another allowing it, or this business would come to a halt. Otherwise we certainly welcome the Regulations, and will not impede their progress.
12.22 p.m.
The Parliamentary Secretary to the Ministry of Labour (Mr. E. Fernyhough): As a non-technical man, I cannot answer the first point of the hon. Member for Cirencester and Tewkesbury (Mr. Ridley), but I will see that he gets a reply. Nor can I give a definite assurance about future Regulations, but we will consider his point when those Regulations are being drafted—
Mr. Ridley: Those are very unsatisfactory assurances on two vital points. The hon. Gentleman has only to say that they will be taken firmly into consideration and met to get a willing nod from this side. But we cannot accept only that he will look at my point after the Regulations have gone through, as we might not be so keen to let them through if this is his attitude.
Mr. Fernyhough: The hon. Gentleman knows that that we must either accept these Regulations now or reject them. Now that I have advice from my experts, I can give an undertaking. The hon. Gentleman has known me long enough to know that I would not say "yes" knowing that tomorrow I would be in difficulty. If I say it, I want to mean it.
I congratulate my hon. Friend the Member for Wood Green (Mrs. Joyce Butler) on initiating this debate. I know her deep interest in this matter. I am sorry that she seemed to damn the Regulations with faint praise, but she will appreciate that they are a great step forward. They ban the manufacture and use of certain dangerous chemicals, unless the Chief Inspector of Factories has issued certificates of exemption, and his powers to do so are strictly limited. They also
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control the manufacture of chemicals which are slightly less dangerous.
The important thing is what the Regulations do to safeguard the health and well-being of workers who would and who have become victims of these substances. Only comparatively recently have we become aware of this problem. Because it was a new disease, it was not easy to bring in the Regulations. If they had been brought in as quickly as my hon. Friend wished, they would not have been so up to date. We are breaking fresh ground. Medical knowledge in this matter is becoming available almost week by week and we have tried to frame the Regulations to take into account all the latest information.
My hon. Friend was concerned that we did not consider some of the complaints about the Regulations, but we did. Those with responsibility for the final decision felt that the Regulations in this form met the position. We also consulted the advisory panel, which accepted them in this form.
The list applies not only to the substances themselves, but to others which might contain these as additives or impurities, but it is not intended that every substance which includes even the smallest amount of a controlled substance should come within Part III of the Regulations. Here, the principle of "the law is not concerned with trifles" will apply, and insignificant amounts will be ignored.
The Regulations apply to firms using any of these substances on the date that they come into force, or subsequently, but not to firms who used them in the past but no longer do so. There would be no power under the Act so to apply them. The workers who are required to have medical examinations will be in those factories which are now using these substances or which do so in future.
We have taken special steps to advise people who may in the past have been exposed of the importance and availability of medical screening. Over 50,000 cards were sent to former employees by firms in the rubber and cablemaking industry and in the dyestuffs and related industries. If any difficulties arise over screening persons exposed to these substances in the past but who are not

45
covered by the Regulations, the factory inspectors will use their good offices to remove them.
We have no information to suggest that gas workers have used controlled substances and the Regulations would not affect them. Among the other persons whom my hon. Friend mentioned, the number would not be large—
Mrs. Joyce Butler: On a point of order. I am sorry to intervene at this stage, but it is important, in spite of all that has been said, that the Regulations are made and I would, therefore, with the leave of the House, ask permission to withdraw my Motion.
Mr. Deputy Speaker (Mr. Sydney Irving): That is not a point of order, but I am sure that the Parliamentary Secretary has heard what the hon. Lady said.
Mr. Fernyhough: I hope that, before my hon. Friend does that, she will accept that these Regulations are a great advance, which put this country before any other civilised country in the protection of these workers. In health and welfare, we are leading industrially.
Mrs. Joyce Butler: I beg to ask leave to withdraw the Motion.
Motion, by leave, withdrawn.

COMMONWEALTH IMMIGRANTS ACT
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Charles R. Morris.]
12.29 p.m.
Mr. Anthony Grant: Whenever I have the good fortune to secure an Adjournment debate, I run up against the Under-Secretary of State for the Home Department. The last time I raised a case concerning the Commonwealth immigration law, I appealed—I regret to say unsuccessfully—to his well-known compassion, but this time I appeal to his equally well-known reason and common sense.
My constituents, Mr. and Mrs. Thomas, are a highly respectable young married couple. They have two children aged four and three. They live in a home which they own, and recently have had
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certain extensions to it carried out to give more accommodation.
Mr. Thomas is a British subject and works in a responsible job for a national newspaper. His wife comes from Mauritius and has been over here for a number of years. She is a qualified State registered nurse, and, I understand, was the first girl from Mauritius to acquire that qualification at the Charing Cross Hospital, where she subsequently worked.
In addition, Mrs. Thomas is a teacher, at the moment working part time, and the reason why she works only part time is that she has the small children to look after. But she is doing very well as a part-time teacher and desires to become a full-time teacher, and to acquire the appropriate qualification she has been selected to take a three-year course at the Newlands Park College of Education, which is specifically designed for the encouragement of married women to go back into full-time teaching. It is highly commendable that, with her other responsibilities, she should be prepared to take the course. If Mrs. Thomas passes the course and becomes fully qualified, she has a post as a full-time teacher waiting for her at a Roman Catholic school at Harrow-on-the-Hill, in my constituency. I am sure that we all appreciate the need for teachers, none more so than the people of Harrow.
Mrs. Thomas's children have been admitted as pupils at the school where she will teach full-time if she passes the course. Her problem at the moment is how to undertake this two-year course of further education to enable her to get a qualification unless she has someone to look after the children. After she has taken the course and is employed at the school the dilemma will not arise because her children will be there and can go along and return with their mother.
In Mauritius, there lives a Mrs. Perrine, Mrs. Thomas's aunt, a widow, aged 55, in perfectly good health and living on a small pension and small savings. She is a very responsible and perfectly fit old lady who has always had very close associations with Mrs. Thomas. The idea entered the minds of Mr. and Mrs. Thomas that the most sensible solution to their problem would be to bring Mrs. Perrine to this country and live with them and look after the two children

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while Mrs. Thomas is earning a new qualification.
Attempts have been made to obtain a work permit under the Commonwealth immigration laws for this purpose, but they have proved abortive, I regret to say, mainly because the Mauritius authorities, like a number of newly-developing countries, tend to allocate the available work permits to young people who will come here to learn a skill or qualification, such as in nursing, engineering or the law, so that when they go back they will be able to contribute more fully to the activities of their country. We believe that Mrs. Perrine has been refused a work permit for that reason. Various rather desultory correspondence has taken place with the authorities, which has got us nowhere.
So Mr. Thomas conce another idea. He thought that he might get Mrs. Perrine over here merely on a visitor's permit, though he would like it to be extended for the two years to cover the period of Mrs. Thomas's course. Again, correspondence has taken place with the Home Office. I think that, possibly because he does not appreciate all the facts which I hope now to outline, the Under-Secretary has formed the view that this might be a device to get Mrs. Perrine here permanently. I assure the House that this is certainly not the case and that we are concerned here with perfectly respectable and responsible people who would give any guarantee that was required which would assure the authorities that Mrs. Perrine would return to Mauritius at the completion of her niece's course.
I can understand the Minister being suspicious of possible evasions of the Commonwealth immigration laws. On too many occasions this sort of thing arises—"phoney" passports, and all sorts of undesirable people managing to get into this country someone who should not be here. It might be said that it is only because my constituents are reputable people that they are not engaging in this rather sinister device. They want to do this in a sensible and responsible manner. There is no reason to suppose from any of the correspondence or from any of the circumstances surrounding the case that my constituents are trying to evade the Commonwealth immigration laws.
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An absurd situation arises. If Mrs. Perrine, instead of being 55, were aged 60 she could come here provided that Mr. Thomas guaranteed that she would not work and also guaranteed her welfare while she was here. If that situation applied, she could stay here almost permanently, but as it is they want her, bona fide and overtly, to come and work for them for the period of the course. So Mr. and Mrs. Thomas have either to abandon the chance of Mrs. Thomas acquiring a further qualification and going back to teaching full-time or they must bring in an au pair girl or a series of au pair girls, unknown quantities, while Mrs. Thomas is taking the course. From the point of view of common sense it is rd that an elderly relative known to the family and who would look after the children should be kept out and that a succession of completely unknown au pair girls from Europe should be allowed to come in. So I appeal to the reason and common sense of the Under-Secretary.
The Commonwealth immigration laws are designed to avoid racial troubles arising because of over-pressure on our housing or health, welfare or education system. None of these points applies in this case. There is no question of pressure on housing, because Mr. and Mrs. Thomas have a home of their own and have built an extension to it to enable Mrs. Perrine to live with them. There will be no pressure on the health system, I am informed, because at the age of 55 Mrs. Perrine is perfectly healthy and will not be any burden during the two years when she is here. She would be no financial burden on the welfare system, because Mr. Thomas would take care of her and would pay her if she desired it.
Thus, so far from her being a burden on the welfare services, the opposite would be the case. Far from bringing in lots of children which would help increase the strain on our school programme, her coming would have the direct effect of supplying another full-time qualified teacher to British education. The Commonwealth Immigrants Act was never intended to be so rigid in application. Nor was it the desire to prevent people with perfectly genuine cases from coming. I appreciate the need to prevent evasion, but that does not apply in this case.

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I submit that this is a genuine request and that, if the hon. Gentleman accedes to it, he will not be breaching the immigration laws in any way. He will not only be helping my constituent out of a dilemma, but helping Britain by enabling a married woman to improve her qualifications and, therefore, render full-time service to the education of British children. I hope the hon. Gentleman will show his well-known reason as well as compassion and either accede to the request or at least agree to look at it again and listen to any further representations we have to make.
12.41 p.m.
Mr. James Johnston: I wish to intervene not out of sentiment, but out of sympathy with the case put by the hon. Member for Harrow, Central (Mr. Grant). I know Mauritius well. I was there a few weeks ago on May Day. Whatever one may say about some segments of the Commonwealth, the Mauritians are literate, intelligent and adaptable people. Any Mauritian who comes here will fit into our society and do a first-class job.
I know that we have to act on the quota, but I am sympathetic to this appeal and I hope that my hon. Friend the Under-Secretary of State will not lightly dismiss it. I believe that we should be getting a bargain here. I make no comment on au pair girls, but this lady is almost 60 years old and she would fit into the family fabric. We should get a bargain in that we would get a new teacher in the United Kingdom. Even if, as some people do occasionally, these immigrants "did a fiddle" and went back to Mauritius, it would still mean that a qualified teacher would be able to help in the developing society of Mauritius. Either way, both countries would benefit.
What is the number of work permits allocated to Mauritius? It cannot be many in view of the size of the country. I am sure that the quota system does not apply to students. One would hope that students come in over and above this sort of application for a work permit and that, having gained technical qualifications, they go back to Mauritius. I know the Minister's difficulties, but I hope that he will look at this again and give a favourable answer.
12.44 p.m.
The Under-Secretary of State for the Home Department (Mr. David Ennals): The hon. Member for Harrow, Central (Mr. Grant) has brought forward a genuine case once more and I am also grateful to my hon. Friend the Member for Kingston upon Hull, West (Mr. James Johnson) for speaking as he has done on a number of occasions on behalf of Mauritius and I agree with what he has said.
Perhaps I can immediately reply to the question he put concerning the allocation of labour permits. There is no one set figure for each individual country. There is the stipulation, however, that no country shall have more than 15 per cent. of the total number allocated. There is no set figure within which the Mauritian Government have to operate. My hon. Friend is also right in assuming that students who come over for studies do not need labour permits, but, of course, that situation does not apply in this case.
Before I deal with the case of Mrs. Perrine, I should briefly explain the practical working of the Commonwealth immigration control, so that we can see this in perspective. The Commonwealth Immigrants Act, 1962, which provides authority for the exercise of the control, confers a legal right of entry on certain categories of Commonwealth citizens. But in this, my right hon. Friend the Home Secretary can exercise his discretion to admit certain other categories and some people are admitted subject to conditions that require them to leave the country within a specified period. Some of these may, in addition, have their freedom to take employment restricted.
Immigration officers at the ports exercise the control in accordance with instructions which have been laid down and United Kingdom officers stationed abroad who have the job of issuing entry certificates to Commonwealth citizens have the same sort of instructions, set out and published in the Instructions to Immigration Officers, published in August, 1966, as Cmnd. Paper 3064.
Commonwealth citizens who show that they wish to come here only temporarily—for example, as students or for holidays—are freely admitted for the period of their visits. The Government, however, like their predecessors since 1962,

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when the Act was passed, consider it necessary to limit the number of those who are admitted to settle here or to take permanent employment, and the means by which this flow is regulated is by requiring each person who wishes to settle in work here to obtain a Ministry of Labour voucher before coming. My right hon. Friend the Minister of Labour issues these vouchers at a rate fixed by the Government from time to time and at present it is on the basis of 8,500 a year. That figure has not been set forever. The Government can adjust it.
Of course, it is much lower than the number of Commonwealth citizens who want to come here and obtain employment and a new applicant will often have to wait a considerable period before he can expect a voucher. It is also true that they are normally issued to younger people rather than to persons of the sort of age referred to in this case.
It is not, therefore, surprising that many people seek other ways of entering the United Kingdom, and we find ourselves under constant pressure to absolve people from the voucher requirement so that they can come here without delay. I would not suggest that all those who seek to come in by different means are trying to evade. That is much too harsh an interpretation. Certainly, it would not apply to the case of Mrs. Perrine.
A wide variety of reasons are advanced to justify these requests for exceptional treatment. The hon. Gentleman will appreciate that we cannot afford to weaken the system of control by granting dispensations too freely and that in considering requests we must apply fair and consistent standards.
I am grateful to the hon. Gentleman for inferring that he believes that this is all done on the basis of reason and compassion. My right hon. Friend's regulations are not inflexible. If they were, my job would be easier. Under the instructions I have mentioned, provision can be made for special cases—for instance, where there are compassionate circumstances—in which entry can be granted. Many Commonwealth citizens are admitted in consequence who would not otherwise qualify to come here. I assure the hon. Gentleman that a great deal of my time at the Home Office is
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spent in dealing with these special cases in which there may be compassionate circumstances that should lead to admission.
In the case raised by the hon. Gentleman, we are asked to grant a dispensation from the ordinary rules. The hon. Gentleman recognises that and, therefore, we have to look at the facts, which are not in conflict between us. Mrs. Thomas has an aunt, Mrs. Perrine, who is 56 and lives in Mauritius. Unfortunately, Mrs. Perrine lost her husband in 1965 and since then has been living with a brother-in-law and sister who are the parents of Mrs. Thomas. Mrs. Perrine has other relatives in Mauritius. She has two brothers, one married and the father of a child, and the other single. Both are working.
In September last year Mrs. Perrine applied in Mauritius for an entry certificate so that she could come to the United Kingdom to live permanently with her neice. Whether at that stage she asked for a labour permit I am not certain, but it is not immediately relevant.
Mrs. Thomas wrote to the entry certificate officer to support the application of Mrs. Perrine, but, after examining it in the light of the considerations which I have outlined, the entry certificate officer decided that Mrs. Perrine did not qualify to settle here and he turned the application down. Mrs. Perrine had not formerly been a member of Mrs. Thomas's immediate household and there was no suggestion that she was suffering hardship.
I think that I should refer at this stage to one section of the instructions to immigration officers dealing with the point raised by the hon. Gentleman that, had she been 60, she could easily have obtained admission. This is not so. The instructions now are:
"Near relatives (i.e., grandparents, brothers and sisters, aunts and uncles) who are no longer of working age may be admitted if relatives here are able and willing to support them and if (a) they have long formed part of a family unit whose other members are in the United Kingdom"—
that does not apply here—
"or (b) they are in need of care and attention and have no relatives in their own countries to whom to turn."
It is true—and this was pointed out by Mrs. Thomas in her approach—that her aunt would have been better off in this

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country than in Mauritius where she may not have been able to find work. There is nothing exceptional in that and it is not in itself sufficient cause for us to waive the rules. It is true of the vast majority of those who wish to come here that they would be better off by coming to Britain. This is why they want to come and it is their main reason for applying to come.
In January, Mrs. Thomas wrote again to the entry certificate officer saying that she wanted to employ her aunt to look after her children and would both house and pay her for her services. Mrs. Thomas, who is a part-time teacher and will be taking this course, was then employing a child minder who was expected to leave her shortly and in replacement should would have preferred her aunt to a stranger.
However, during the following month Mrs. Perrine made a second request for an entry certificate in Mauritius, and on this occasion she declared that she wanted it so as to be able to spend a fortnight with her niece here before going on to spend a month's holiday in France. This time the, entry certificate officer referred her application to the Home Office for a decision. In view of what had gone before, we thought it probable that Mrs. Perrine still intended to settle here and that it would not be realistic to regard her as no more than a visitor. Therefore, she was again refused an entry certificate.
Following on this, Mrs. Thomas approached the Home Office direct seeking permission to bring over her aunt to work for her as a mother's help for a period of two years so that she could take this teacher's training course. This was the third request for the admission of Mrs. Perrine and the grounds for seeking entry varied substantially on each occasion. In saying this I draw no inference concerning the genuine nature of the appeal that was made or the genuine nature of the appeal made by the hon. Gentleman himself.
I have given the House a brief account of the way in which we limit the number of workers entering the United Kingdom from the Commonwealth. What was now contemplated for Mrs. Perrine was employment of a type for which a Ministry of Labour voucher is ordinarily required. We had, therefore, to tell Mrs. Thomas that her aunt could only be admitted for
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the purpose she had in mind if a voucher was first obtained.
There is no provision for admitting people for employment for a particular period of time. In any case, the only powers available to the Home Secretary for enforcing a timed period of entry—for example, for a holiday as a visitor—is deportation. There is no provision for accepting guarantees, as suggested by the hon. Gentleman. Were there such provision, it would be extremely difficult for us, for entry certificate officers, immigration officers or my right hon. Friend himself to decide, as between one offer of a guarantee and another, what could be accepted, and the guarantee is not enforceable.
The argument has been advanced that Mrs. Perrine's presence here, by allowing her niece to pursue her training, would be of benefit to the community because she would be able to take her course and return as a teacher. I certainly see the force of the argument, but it does not follow that in the absence of the aunt's presence Mrs. Thomas would not be able to take her course. I hope that she will be able to take her course and I congratulate her on gaining entry.
As the hon. Gentleman said, she has before employed a child minder and there is no reason to suppose she would not be able to do so again. The suggestion was made that she might obtain an au pair girl. I have in my own family an excellent and helpful au pair girl. This is a readily available system of which she could take advantage. However, I understand the force of the other side of the argument.
Mr. Grant: Whatever one may think of au pair girls, members of one's own family are obviously better.
Mr. Ennals: I fully see the second part of the argument, that Mrs. Thomas would prefer to have a relative here, but this is not unique. There are many other Commonwealth citizens living here who could make an equally strong, or even stronger, case for bringing relatives from abroad to help in looking after their families. I personally have had to deal with many such cases.
We could hardly accede to the request on behalf of Mrs. Perrine without according to many others the same privilege. This is really the nub of the problem.

55
We are not just dealing with an individual case, however genuine it may be. To accept the arguments put forward by the hon. Gentleman would be to create virtually a new category of immigrant outside the agreed terms of the Commonwealth Immigrants Act. If this application were to be granted and we were to be fair to other applicants, there would be an enormous number of people in this country, with relatives abroad and whom they would like to have here to look after their children, who would apply to come.
It is, therefore, not just a question of this worthy case alone, because I agree with the hon. Gentleman that her presence would be helpful. The fact is that
56
we must maintain control over the immigration of Commonwealth citizens. This means that a great many admirable people—and I am certain Mrs. Perrine is one—who would like to come here must wait their turn or not be able to come. This is inevitable when one has immigration control. I am very sorry that Mrs. Thomas's aunt should be among those affected by our control, but I can see no compassionate circumstances or any other special considerations which would warrant my granting her a dispensation from the normal requirements of the control.
The debate have been concluded, Mr. DEPUTY SPEAKER suspended the Sitting until half-past Two o'clock, pursuant to Order.
Sitting resumed at 2.30 p.m.

ORAL ANSWERS TO QUESTIONS
  MINISTRY OF LABOUR

    Selective Employment Payments Act
    Mr. Fletcher-Cookeasked the Minister of Labour whether he is aware of the anomalies which have arisen over the operation of the Selective Employment Payments Act in the paper-making and rag-making industry; and if he will introduce amending legislation.
    The Joint Parliamentary Secretary to the Ministry of Labour (Mr. Roy Hattersley): The Government are aware of representations made at various times by the industry and by individual employers, and are keeping these and other questions of S.E.T. classification under review.
    Mr. Fletcher-Cooke: Is the hon. Gentleman aware that the tribunal set up for the purpose of hearing appeals has given various decisions which are almost conflicting? Is he aware that he ought again to consider the terms of reference and the quality of the tribunal if it is to command the respect which it ought to have?
    Mr. Hattersley: I know that that is the view of a firm in the hon. and learned Gentleman's constituency, but if he looks at the report of the tribunal which considered this case he will see that the distinction which is made between the firm in which he is, quite properly, interested and other firms is genuine and legitimate.
    Mr. Dalyell: Is my hon. Friend aware that it is not only in the constituency of the hon. and learned Gentleman that firms are concerned? As one who represents the paper industry, may I ask for decisions fairly quickly?
    Mr. Hattersley: I cannot promise any dates of decisions, but I can reaffirm that the entire matter of S.E.T. classification is under constant review and when my right hon. Friend feels that any revision is necessary, a revision will be made.
    Mr. Higginsasked the Minister of Labour, if he will make a statement on his further examination of matters con-
    58
    nected with the order freezing the incomes of certain Longbridge vehicle delivery drivers; and if he now proposes to submit evidence to Mr. Attorney-General under Section 16(4) of the Prices and Incomes Act, 1966, concerning action taken with a view to influencing the employers affected by Statutory Instrument, 1967, No. 515, to implement settlements forbidden by that Instrument.
    Mr. Hattersley: Following discussions with the employers and the union concerned I have asked the employers covered by the Order to supply the detailed information necessary for consideration of the productivity aspects of the agreements between these firms and the Transport and General Workers' Union, and also information on the pay and conditions of trade plate drivers. I am keeping my right hon. and learned Friend the Attorney-General informed of the position.
    Mr. Higgins: Can the right hon. Gentleman say how much longer this discussion is to go on before we get a decision from the Government? Do they regard the arrangements concerning return journeys, and using season tickets as reasons for productivity agreements?
    Mr. Hattersley: The discussion must go on until some adequate evidence is presented to us. When this is at our disposal, the Government will be able to make a decision. Until the evidence is forthcoming, the Government have no decision facing them which they can make on the basis of fact and on the basis of information.
    Mr. Peter Millsasked the Minister of Labour what are the latest available unemployment percentages for workers who last worked in manufacturing industries and service industries, respectively.
    Mr. Hattersley: At 12th June, 1967, the percentage rates of persons registered as wholly unemployed in Great Britain who last worked in manufacturing industries and service industries were 1·6 and 1·5 respectively. With the inclusion of persons temporarily stopped in these industries the percentage rates were 2·0 and 1·5 respectively.
    Mr. Mills: Does not this show that S.E.T. has failed miserably and completely to shift people from service industries into manufacturing industries?

    59
    What are the Government going to do about it?
    Mr. Hattersley: Only a small part of the period in respect of which the hon. Gentleman asked his question was a period when S.E.T. was in operation. I am sure that he will agree, on reflection, that six months is certainly too short a time to operate in order to understand the virtues and advantages of S.E.T.
    Mr. Kenneth Lewisasked the Minister of Labour how many companies have appealed against their industrial classification for selective employment tax; and how many companies have had their classifications changed as a result of such an appeal.
    Mr. Hattersley: Up to 6th July, 1967, there had been 1,027 appeals to industrial tribunals against the refusal of the appropriate Minister to register an establishment as qualifying for premium or refund; 513 had been heard, of which 142 had been decided against the Minister concerned.
    Mr. Lewis: Does the hon. Gentleman not agree that this is a fantastic number of appeals, and that in administering this tax he is organising chaos? This is a burden upon industry which is not justified. As there are no jobs in the growth industries, as he announced in his previous Answers, what is the point of this tax, which is supposed to squeeze people out of the service industries into jobs which are no longer available?
    Mr. Hattersley: I agree that it is a fantastic figure, and I hope that when the hon. Gentleman considers the number of industrial establishments to which the S.E.T. applies, he will agree that, out of 1,000 appeals, the total of 142 which have been decided against the Government is a fantastically small figure.
    Mr. Lubbock: Is the hon. Gentleman aware of cases of salesmen employed by companies and who were formerly paid from an office, now being transferred—some have been transferred—by employers to the manufacturing establishment, placing them on the books of that branch and thereby escaping the effect of the tax altogether? Is he not therefore encouraging people to spend time and energy on something which is totally non-productive?
    Mr. Hattersley: Since that is clearly a different Question, the hon. Gentleman should put it down.
    Mr. Scottasked the Minister of Labour what percentage of all employed persons are in service industries and manufacturing industries, respectively; and how this compares with the figure one year ago.
    Mr. Hattersley: The annual employment estimates for June, 1967 will not be available until early in 1968.
    At June, 1966, employees in service industries and manufacturing industries formed 48·4 and 38·1 per cent., respectively, of employees in all industries and services. The corresponding percentages at June, 1965, were 48·1 and 38·2.
    Mr. Scott: While thanking the hon. Gentleman for a meaningless Answer, may I ask him whether he can produce a shred of evidence that either the Selective Employment Tax or the Government's economic policies have led to a more purposive use of labour?
    Mr. Hattersley: I am not sure what "a more purposive use of labour" is. While I have heard the word used, I have not heard it used in that context. I assure the hon. Gentleman that the first two objectives of the S.E.T. have certainly been achieved. Evidence is mounting which will enable us in the near future to say that the third object has been achieved as well.
    Mr. R. Carr: But since the whole object, so we were told, of the economic agonies through which we are going was to get a redeployment of labour, should not the Government take measures to get statistics to show whether the tax is having the desired effect?
    Mr. Hattersley: Very many statistics are available. I have conceded to the right hon. Gentleman on many occasions that statistical improvement is necessary and have promised him that statistical revisions are going on. The only figures which are not available are those concerned with the results of the S.E.T. I can only repeat that it would be unreasonable to assume that a final answer about the virtues and advantages of the S.E.T. could be given less than a year after it was first put into operation.
    Mr. Crouchasked the Minister of Labour what has been the drop in numbers employed in manufacturing industries between July, 1966 and the latest convenient date.
    Mr. Hattersley: It is provisionally estimated that between July, 1966, and May, 1967, the numbers fell by 339,000.
    Mr. Crouch: In view of that very distressing figure, can the Joint Parliamentary Secretary give some idea when the rundown of manufacturing industry will cease and the build-up begin again?
    Mr. Hattersley: The hon. Gentleman is now asking me to make the sort of forecast which my right hon. Friend rightly refused to make. I must join my right hon. Friend in the refusal.
    Mr. Ridley: Is the hon. Gentleman aware that the figure which he has given is 29,000 more than the figure for the corresponding period last month? Is he happy with employment in manufacturing industry declining by 29,000 a month in the middle of the summer?
    Mr. Hattersley: I understand very well the problem to which the hon. Gentleman refers. However, I hope that he understands that the sort of measures which produce that figure were necessary for the economic long-term health of the country.
    Mr. Frank Allaun: On a point of order. We have reached Question No. 39. Since we began Questions, there have been 14 interventions by the three Opposition Front Bench speakers. Is not that an abuse of the House?
    Mr. Speaker: I should like to hear points of order at half-past three.
    Sir J. Rodgersasked the Minister of Labour, in view of the recent representations by the Economic Development Committee for the Distributive Trades about the arrangement whereby manufacturers receive the premium for transport drivers under the Selective Employment Payments Act whereas independent wholesalers do not, if he will introduce legislation to remove this anomaly and grant the premium to wholesale establishments in distribution.
    Mr. Hattersley: The Government are keeping questions of S.E.T. classification
    62
    under review and these representations will be among those considered.
    Sir J. Rodgers: Has the hon. Gentleman had any representations from the Transport and General Workers' Union about this anomaly? Would not he agree that these anomalies show that the tax was an ill-thought-out measure and should be abandoned as quickly as possible?
    Mr. Hattersley: I do not even automatically agree that it is an anomaly.
    Mr. James Davidsonasked the Minister of Labour (1) why he does not put fitters and mechanics employed by agricultural machinery and tractor dealers in the same classification for purposes of regional employment premiums and Selective Employment Tax as fitters and mechanics employed by manufacturing industry;
    (2) why he does not exempt agricultural machinery and tractor dealers, who employ fitters and mechanics for assembly, preparation and maintenance work, from payment of Selective Employment Tax on employees in these categories.
    Mr. Hattersley: The eligibility of an establishment for selective employment premium or refund depends on its activities and not on the occupations of its employees. Agricultural machinery and tractor dealers are classified to a heading of the Standard Industrial Classification which does not qualify for premium or refund. I see no reason to treat them differently from other employers in the distributive trades.
    Mr. Davidson: That Answer is extremely unsatisfactory. Would the Parliamentary Secretary explain why mechanics and fitters should be regarded any differently when they are doing work of extreme importance for agricultural retailers and suppliers—work such as assembly, preparation and maintenance, which is every bit as important as the work done in manufacturing industries —from the S.E.T. point of view? Is he aware of the tremendous contribution made by the agricultural industry to our balance of payments and the need for there to be an efficient service industry to look after this equipment?
    Mr. Hattersley: Of course, I accept that the agricultural industry makes an enormous contribution to our balance of payments position. However, the hon. Gentleman must accept that the entire basis of S.E.T., which makes it work in the way it does work, is that the calculation should be made on establishments rather than on individuals. The premium or refund is received not in accordance with the work a man does but in accordance with the nature of the establishment in which he works. To change that principle would be to change the tax out of all recognition.
    Mr. Arthur Lewis: Is not it ridiculous to say that a man who is making one-armed bandits and jukeboxes is the subject of premium, which is paid to his firm, while workers engaged in making bread, milk production and other essentials are not so subject, and their firms must pay the tax on them? This situation cannot be right.
    Mr. Hattersley: The principle is that a firm engaged in manufacturing activities gets the premium while a firm engaged in service activities does not. While even my hon. Friend can find examples on the margin which appear to him to throw some doubt on the whole validity of the tax, the principle, which distinguishes between manufacturing and service industries, remains good.

    Equal Pay (Working Party's Report)
    Dr. Summerskillasked the Minister of Labour whether he has received the report of the Working Party on Equal Pay for Women; and if he will make a statement.
    The Minister of Labour (Mr. R. J. Gunter): I have received the report of the working group of officials of the Confederation of British Industry, the Trades Union Congress, and of my Department who have been looking at certain of the technical problems associated with the introduction of equal pay. I have sent copies of the report to the Confederation and to the Trades Union Congress, and I shall shortly be inviting leaders of these two organisations to discuss its contents with me.
    Dr. Summerskill: Would not my right hon. Friend agree that as the majority of
    64
    the lowest-paid workers are women, a fair and just incomes policy should include immediate legislation to enable them to receive the rate for the job?
    Mr. Gunter: We are all dedicated to the last part of the proposition put forward by my hon. Friend, but, as she knows very well, there are difficulties, first in relating this to the prices and incomes policy in our present economic state, and, secondly, the apparent failure of both sides of industry to tell us what they mean by "equal pay".

    Lower-Paid Workers
    Mr. Winnickasked the Minister of Labour how many full-time workers earn under £15 basic wage; and if he will give separate figures for men and women.
    Mr. Hattersley: Information is not available in the form requested. Estimates have been made on the basis of an hourly rate of 7s. 6d. for any hours worked up to 40 hours per week and 11 s. 3d. (time and a half) for hours worked beyond 40 per week. Data collected in the Family Expenditure Survey suggest that at the present time some 10 million adults, of whom 6 million are working 40 hours a week or longer—and a large proportion of the rest are not working full-time—are receiving pay at less than these hourly rates of earnings. These totals include respectively 6 million and 2¼ million women. Actual earnings will, of course, often exceed £15 per week for many of the 10 million.
    Mr. Winnick: Is my hon. Friend aware of the recent Ministry of Social Security Report which shows the acute hardship and poverty in these families, including those families where the husband is in full-time employment? What is the Ministry of Labour doing to increase the wages of people earning far below £15 a week? Does my hon. Friend consider this to be a matter of some priority?
    Mr. Hattersley: The initial question must be not what the Ministry of Labour is doing, but what others are doing. My hon. Friend will know that my right hon. Friend is answering a Question about part of that aspect of this problem later today. Clearly, the Ministry of Labour regards it as important that every working man should have a living wage,

    65
    but the problem is that proper definitions of "living wage" are not easy to come by.
    Mr. Ridsdale: Much as everyone wants those in the lower wage groups to be helped, is it not a fact that unless the Government are able to pay the international net rate for technicians and skilled people people to create more wealth, we shall not be able to pay more to those in the lower wage groups?
    Mr. Hattersley: I have a certain sympathy with what the hon. Gentleman says, but I am sure that he knows as well as I do that it does not arise out of this Question.

    Physically Handicapped Persons (Ilford)
    Mr. Arnold Shawasked the Minister of Labour what provisions for employment in Ilford there are for physically handicapped persons who have reached the age of 18 years.
    The Joint Parliamentary Secretary to the Ministry of Labour (Mr. E. Fernyhough): Disabled persons capable of remunerative work under ordinary conditions are helped to find suitable jobs by the Disablement Resettlement Officer at the Ilford Employment Exchange. Where appropriate, courses of industrial rehabilitation or vocational training can be arranged. For residents of Ilford the nearest Industrial Rehabilitation Unit and Government Training Centre are at Perivale. For those severely disabled people who need employment under special conditions there is a Remploy factory at Barking.
    Mr. Shaw: I appreciate that answer. However, is my hon. Friend aware of the anxiety of a number of parents in the borough particularly for the future of their children on leaving the shelter of the Youth Employment Service? Can he make available within the area some form of sheltered occupation for workers of this kind?
    Mr. Fernyhough: I am happy to be able to tell my hon. Friend that two occupational centres are planned for the new London Borough of Redbridge, which includes Ilford. One is for 90 places, 40 for the mentally handicapped
    66
    and 50 for the physically hanidcapped, and is expected to open in 12 months. The other is for the physically handicapped only and is expected to open in three years. The number of places which this will provide has not yet been decided. There is a social and diversionary centre operated by the Redbridge and Havering Spastics Association.

    University Manual and Domestic Staffs (Negotiating Machinery)
    Mr. Moyleasked the Minister of Labour whether he has yet fixed a date for the holding of a conference between the vice-chancellors of the universities and the unions concerned to create national negotiating machinery for university manual and domestic staffs.
    Mr. Gunter: I understand that the T.U.C. are considering my suggestion that they and the unions concerned might have direct discussions with the Committee of Vice-Chancellors about the arrangements for negotiating the pay and conditions of these workers.
    Mr. Moyle: Is my right hon. Friend aware that the staffs and the unions concerned are grateful for what he is doing, but will he undertake to do his utmost to secure a certain amount of emotional engagement with this problem on behalf of the vice-chancellors whose attitude has been likened to a spectator watching the Tiller Girls dancing in trousers?
    Mr. Gunter: I do not think that I can guarantee the emotional entanglement of the vice-chancellors, but the T.U.C. has accepted my suggestion.

    Redundant Miners
    Mr. G. Campbellasked the Minister of Labour what measures the Government are now taking to assist the retraining and re-employment of miners who become redundant.
    Mr. Hattersley: My Departments employment services make every effort to find alternative employment for redundant miners. Redeployment can be assisted by the Ministry's industrial rehabilitation service, which is establishing four new units in areas of pit closures. Redundant miners who want and are suitable for training for skill may attend any of the 33 Government training centres.
    Mr. Campbell: Does the hon. Gentleman recognise that this subject requires the special attention of his Ministry and that a change of occupation is difficult for some of the older men who had expected to spend a lifetime in the coal industry?
    Mr. Hattersley: I certain agree with and endorse all that. That is why more than a year ago my right hon. Friend, who was then the Minister of Power, announced the setting up of four additional industrial rehabilitation centres specifically to help miners in areas of pit closures.
    Mr. Dalyell: Is my hon. Friend aware that some of us from the central Scotland coalfields would pay tribute to the work which is done by his Ministry and the Industrial Rehabilitation Service which, in our view, does an excellent job?

    Unemployment
    Mr. Gwilym Robertsasked the Minister of Labour what figures are available for the number unemployed in each

    TOTAL NUMBERS REGISTERED AS UNEMPLOYED IN STANDARD REGIONS AT 12TH JUNE, 1967

    Men

    Boys

    Women

    Girls

    Total

    South East

    …

    …

    97,777

    2,629

    15,723

    1,379

    117,508

    East Anglia

    …

    …

    8,469

    241

    1,796

    220

    10,726

    South Western

    …

    …

    21,959

    594

    4,464

    467

    27,484

    West Midlands

    …

    …

    40,053

    1,172

    8,366

    907

    50,498

    East Midlands

    …

    …

    18,152

    495

    4,129

    469

    23,245

    Yorks and Humberside

    …

    …

    31,772

    1,086

    5,908

    806

    39,572

    North-Western

    …

    …

    51,698

    1,747

    14,441

    1,062

    68,948

    Northern

    …

    …

    38,645

    1,597

    7,525

    922

    48,689

    Scotland

    …

    …

    55,564

    2,077

    18,023

    1,318

    76,982

    Wales

    …

    …

    26,604

    1,315

    6,998

    1,242

    36,159

    Mr. Ridleyasked the Minister of Labour what estimate he has made of the peak level of unemployment next winter.
    Mr. Gunter: I am not prepared to give forecasts of the future level of unemployment.
    Mr. Ridley: In view of the fact that last month the percentage of unemployment, seasonally adjusted, again rose, and that the Treasury, in Economic Trends, expressed the belief that it will continue to rise, does not the right hon. Gentleman think that in order to allay fears for the coming winter some estimate should be made, because the situation appears to he extremely menacing at present?
    Mr. Gunter: I am in no doubt as to the seriousness of the unemployment
    68
    of the standard regions; and what estimates have been produced for the hidden unemployment in the South-East represented by the drift back of workers to the development areas.
    Mr. Gunter: As the answer to the first part of the Question consists of a table of figures, I will with permission circulate it in the OFFICIAL REPORT.
    The answer to the second part is that no such estimates have been made.
    Mr. Roberts: Would not my right hon. Friend agree that to consider unemployment and development help in different regions of this type is useless and meaningless? Would he accept that what is needed is to consider each locality from the point of view both of its employment problems and its contribution to economic growth?
    Mr. Gunter: I am sure that there is much virtue in that, but I am asked to supply the figures of the number of unemployed in each of the standard regions.
    Following is the information:
    figures, seasonally adjusted, but I must stand by what I told the House before, namely, that I would not wish to assume the role of a prophet.
    Mr. R. Carr: Will not the right hon. Gentleman give this matter further consideration? Does not he realise that with the seasonal trend moving as it is at the moment there is bound to be great concern? Does not he recall that my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod), when Minister of Labour, helped to allay concern by making such a forecast, which proved approximately correct?
    Mr. Gunter: I have always been puzzled by that prophecy of the right hon. Gentleman. He was so accurate that it

    69
    must have been an accident. I do not wish to run into that sort of accident.
    Mr. Frank Allaun: Will my right hon. Friend ask his Cabinet colleagues to remove the deflationary measures in order that this trend shall not continue any longer?
    Mr. Gunter: That consideration is ever present in the mind of my right hon. Friend the Chancellor of the Exchequer.

    Redundancy Payments
    Mr. Gwilym Robertsasked the Minister of Labour if he will take steps to, introduce a sliding scale of redundancy payments to cover workers who are made redundant after employment for a period of less than two years.
    Mr. Gunter: No, Sir.
    Mr. Roberts: Would not my right hon. Friend agree, however, that the present demarcation system tends to produce a pool of labour which drifts from one job to another in times of recession? Is he aware that one A.E.U. branch in Luton has told me that it has had members made redundant as many as eight times in the last couple of years?
    Mr. Gunter: I am not aware of the circumstances which my hon. Friend has outlined, but he will know that there were great arguments about the length of period for redundancy payments at the time of the legislation. Certain employers' associations wanted it to be five years and I remember the great arguments of the party opposite for making it three years. We decided that it should be two years, and I think that that is the proper length of time.

    C.B.R. Jersey Mills, Brighton
    Mr. Hobdenasked the Minister of Labour what progress is being made to obtain the reinstatement of the 18 employees locked-out from C.B.R. Jersey Mills of Brighton.
    Mr. Gunter: My officers held a joint meeting on 11th May, and have since had many separate discussions with the parties. It has not been possible, so far, to find a basis for settlement of this dispute. I shall continue to keep in close touch with developments.
    Mr. Hobden: Does not my right hon. Friend think that the working conditions at this firm, under which an employee is required to work a basic 72 hours a week, denote a serious deficiency in our factory legislation? Would it not be correct to say that the actions of this employer should be reported to the Royal Commission on Trade Unions and Employers' Associations?
    Mr. Gunter: I am sure that the trade union involved will avail itself of that opportunity if it so desires. I would not like to comment on the conditions outlined by my hon. Friend as prevailing at these works. It seems that attitudes are being taken by both sides, and that it is rather difficult to get them together.

    West Calder Employment Exchange
    Mr. Eadieasked the Minister of Labour what progress he has to report on finding alternative accommodation for West Calder Employment Exchange.
    Mr. Fernyhough: Alternative accommodation has been obtained for the West Calder Employment Exchange in the former West Calder High School building. Some alterations to the building will be needed, but I expect that it will be ready for occupation in October, 1967.
    Mr. Eadie: I thank my hon. Friend for that Answer. Is he aware that the accommodation in the present building is becoming more unsatisfactory with the passage of time both for the staff and public alike?
    Mr. Fernyhough: We have been aware of this. This is why we made a diligent search to find a site for a new building. I hope that we will be able to get a site within the next two or three years, but, in the meantime, I am sure my hon. Friend will agree that this is a change for the better.

    Lingerwood Colliery Midlothian (Closure)
    Mr. Eadieasked the Minister of Labour how many miners have been registered as unemployed as a consequence of the closure of Lingerwood Colliery, Midlothian.
    Mr. Fernyhough: Twenty miners from Lingerwood Colliery have registered as

    71
    unemployed since the start of the closure on 8th April, 1967.
    Mr. Eadie: is my hon. Friend aware that with the expected pit closures in this area there will be a serious problem in finding alternative employment for some of these miners in particular age groups, especially as there is very little alternative industry there?
    Mr. Fernyhough: I am aware of the position, but I am sure my hon. Friend will be pleased to know that all but 19 of the men involved in this closure have been found employment. Unfortunately, these 19 are over 62, and it may be difficult to find alternative employment for them.
    Mr. G. Campbell: Will the hon. Gentleman make sure that some of the measures which he mentioned in reply to my Question No. 6 are applied in this case?
    Mr. Fernyhough: The hon. Gentleman knows that Scotland, excluding Edinburgh, is a development area, and that all the facilities in the way of separate payments which will start in September, investment grants, building grants, and so on, are available to the whole of the territory.

    Racial Discrimination
    Mr. Huntasked the Minister of Labour whether he will make a statement on his recent discussions with representatives of the Trades Union Congress, the Confederation of British Industries and the nationalised industries regarding racial discrimination in employment.
    Mr. Gunter: The purpose of these meetings was to discuss the best means of promoting racial integration in employment. I can make no further statement at this stage.
    Mr. Hunt: Is the right hon. Gentleman aware that that statement is very disappointing and will do nothing to dispel the widespread impression that his Department is dragging its feet on this issue? Will he please realise that the longer discrimination in employment is allowed to continue, the greater will be the sense of frustration and resentment among those who are affected by it? What positive steps is he going to take
    72
    now to deal with this potentially explosive situation?
    Mr. Gunter: I do not think that my Ministry is dragging its feet at all. We had to have discussions with industry. We have now almost completed those discussions. There are various points of view on how to deal with discrimination in employment, and the matter is now receiving consideration both by my right hon. Friend the Home Secretary and myself.
    Mr. Winnick: In view of the evidence which has come to light recently of discrimination in employment, would not my right hon. Friend agree that it is essential to extend the Act to cover employment, apart from anything else?
    Mr. Gunter: I said in my original Answer that I would make no further statement at this stage.
    Mr. Maclennan: In view of the growing evidence of racial discrimination in industry, will my right hon. Friend instil some sense of urgency into his dealings with this problem?
    Mr. Gunter: My hon. Friend will realise that legislation, if there is to be any, is a matter for my right hon. Friend the Home Secretary. I repeat that it is now receiving deep consideration.

    Foreman and Staff Mutual Benefit Society (Conditions)
    Mr. Bishopasked the Minister of Labour what representations have been made to him regarding the anti-trade union conditions in the rules of the Foremen and Staff Mutual Benefit Society which some categories of workers are required by their employers to join, such conditions being in contravention of Conventions 87 and 98 of the International Labour Organisation and ratified by the United Kingdom; and what action he proposes to take.
    Mr. Gunter: Representations have been made by a number of trade unions about this Society. The question of discrimination against membership of trade unions is being considered by the Royal Commission on Trade Unions and Employers' Associations, and I propose to await the Commission's report.
    Mr. Bishop: Is my right hon. Friend aware that in view of the enormous number of representations and the amount of stuff that he has referred to the Commission, this will take a long time, and that this blatant anti-trade union legislation ought to be dealt with by Parliament forthwith?
    Mr. Gunter: One of the unions involved, A.S.S.E.T., has submitted evidence to the Royal Commission which has invoked a reply in terms of evidence from the Society. I think that it would be as well if Lord Donovan had a look at it.
    Mr. Edward M. Taylor: Is the right hon. Gentleman aware that the Foremen and Staff Mutual Benefit Society is a voluntary organisation, which nobody is obliged to join?

    Self-Employment
    Mr. Bishopasked the Minister of Labour what consideration he has now given to the representations made to him regarding the abuses of so-called self-employment in industry where there may be evasion of the social or industrial obligations of legislation such as the Contracts of Employment Act, the Redundancy Payments Act, the Industrial Training Act, and tax and National Insurance avoidance; what action he has taken; and what further action is proposed, in view of the concern of trade unions and ether organisations.
    Mr. Gunter: My Department's examination of the scope for more effective enforcement of existing policy and legislation, in consultation with other Departments concerned, is continuing. The results and any action taken will in due course be made known to the Phelps brown Committee.
    Mr. Bishop: I first made representations about this in January, 1966. I accept that there are genuine forms of self-employment, but would not my right hon. Friend agree that the bogus forms undermine the industrial and social legislation fussed on behalf of workers, and fiat he ought to act on this in the immediate future and not leave it until later on?
    Mr. Gunter: My hon. Friend will recall that I was pressed by the trade
    74
    unions, who are very concerned about certain implications of self-employment, to have an inquiry. We are having one, and I think that we had better leave it now and see what happens.
    Mr. Kenneth Lewis: Will the right hon. Gentleman recognise, nevertheless, that it is the right of every worker to sell his labour in the best way he can? Will he ensure that there is no interference with that right?
    Mr. Gunter: I can only say that Professor Phelps Brown will take into consideration all that the hon. Gentleman has to say, but some of the activities of self-employment can hardly be called social in character.

    Industrial Plant and Equipment
    Mr. Archerasked the Minister of Labour what steps Her Majesty's Government take to ensure that industrial plant and equipment is designed with a view to the safety, comfort and physical capacity of employees.
    Mr. Gunter: Safety requirements relating to industrial plant and equipment are contained in the Factories Act and Regulations which are enforced by Her Majesty's Factory Inspectorate. In addition, the Inspectorate maintains close contact with manufacturers with a view to achieving the highest possible built-in safety standards.
    Mr. Archer: Is my right hon. Friend aware that equipment is still produced which seems to be designed for human freaks, and that accidents are still happening through sheer physical tiredness in using unsuitable equipment, which could be avoided?
    Mr. Gunter: I am aware of that fact.

    Employers (Personal Injury Liability)
    Mr. Archerasked the Minister of Labour whether, in view of the situation disclosed in the case of Donoghey v. Boulton and Paul Limited, he will introduce legislation to compel every employer to insure against possible liability in respect of personal injury to employees.
    Mr. Gunter: No, Sir.
    Mr. Archer: Can my right hon. Friend suggest any distinction in principle between a motorist who has to insure against liability through negligence, and an employer of labour who may cause equally tragic injuries?
    Mr. Gunter: I think that my hon. Friend must bear in mind that if a compulsory insurance scheme were introduced the enforcement problems would be very considerable, and that a large increase in staff would be required by the Ministry of Labour. I have taken the best advice that I can on this matter. All the evidence suggests that complex legislation would be needed, and, as I have said, the cost of the enforcement machinery would be out of all proportion to the benefits achieved.

    Industrial Training
    Mr. Richard Wainwrightasked the Minister of Labour what arrangements he has made to ensure continuous coordination between industrial training boards and Government training centres.
    Mr. Hattersley: My officers are in close touch with the boards on all training matters, including the co-ordination of their activities and those of the Government training centres.
    Mr. Wainwright: I thank the hon. Member for his reply, which suggests that the arrangements are somewhat of an ad hoc nature, but does he agree that there should be provision for permanent and comprehensive co-ordination between these two bodies?
    Mr. Hattersley: The arrangements certainly exist. Assessors from my Ministry are in constant and formal touch with each board and are able to facilitate the passage of the information that the hon. Member rightly says is necessary.
    Mr. Richard Wainwrightasked the Minister of Labour how many industrial training boards have carried out a comprehensive examination of the nature and volume of retraining likely to be required in the foreseeable future.
    Mr. Hattersley: The need for retraining is examined as part of a board's assessment of the future manpower and training requirements of its industry. Some of the longer-established boards are now
    76
    carrying out studies and they will be assisted by the work of the Ministry's Manpower Research Unit in this field.
    Mr. Wainwright: Can the hon. Gentleman give an assurance that in carrying out this constant examination and reexamination consideration will be given to the need for transferable skills as between one industry and another?
    Mr. Hattersley: I can certainly give that assurance. The sort of advice that the Ministry's Manpower Research Unit will give to each board, as to the way in which these inquiries should be carried out, is aimed to cover this sort of point.
    Sir J. Rodgersasked the Minister of Labour if he will give details of those areas where he has been unable to secure trade union co-operation for the acceptance of retrained workers.
    Mr. Gunter: At national level I have the co-operation of all the unions concerned in the acceptance of men trained at Government training centres. There are long-standing difficulties over some trades in Manchester, on Tyneside and in Scotland. Temporary difficulties occasionally arise in other areas.
    Sir J. Rodgers: Can the right hon. Gentleman say that he has the full co-operation of all the printing unions? If so, I shall be glad to hear it. Does not he think that the time has come to abandon persuasion and pious hopes and give publicity to areas which are not co-operating so that the country can judge whether these unions are acting in the national interest?
    Mr. Gunter: As the hon. Gentleman knows, I have given publicity to the worst spot in the country. It has not had much effect. I am not so sure that a lot of wider publicity will have a greater effect. The hon. Gentleman will understand that my powers are very limited in this matter. Once I have passed from the stage of exhortation and rowing and cursing them, there is not much left that I can do.
    Mr. Tinn: Would my right hon. Friend agree that it might be more helpful to give more publicity to the much greater number of areas in which full cooperation has been obtained? Is he aware that when I have contacted the

    77
    Ministry of Labour officers in my constituency I have been assured of full co-operation and full placing of these men?
    Mr. Gunter: I welcome my hon. Friend's comment. It is true that cooperation has been forthcoming over the vast areas of British industry. But it would be very helpful to me if the other areas would have a look at the whole situation.

    Gas, Electricity and Water Industries
    Mr. Ridleyasked the Minister of Labour what has been the increase in the numbers employed in the gas, electricity and water industries between July, 1966, and the latest convenient date.
    Mr. Hattersley: It is provisionally estimated that between July, 1966, and April, 1967, there was an increase of about 4,000.
    Mr. Ridley: Is the hon. Member aware that this is the only group of trades in which the numbers in employment appear to have risen in this period? What sort of shake-out is it when people are shaken out from exporting industries into non-exporting nationalised concerns?
    Mr. Hattersley: I am bewildered by the apparent assumption of the hon. Member that the production of gas, electricity, and coal, and the provision of water supplies, does not make a contribution to exports.

    Employers (Notification of Vacancies)
    Mr. James Johnsonasked the Minister of Labour what plans he has for legislation to ensure that employers notify employment exchanges of all their vacancies.
    Mr. Watkinsasked the Minister of Labour what plans he now has for ensuring that employers notify all their vacancies to labour exchanges.
    Mr. Bob Brownasked the Minister of Labour what plans he has for legislation to make it compulsory for employers to notify all vacancies to an employment exchange; and if he will make a statement.
    Mr. James Johnson: On a point of order. May I point out a slight error in the printing of my constituency in the Question as it appears on the Order Paper? The City of Kingston upon Hull, unlike Kingston-upon-Thames, has no hyphens.
    Mr. Speaker: That point should be made at half-past Three.
    Mr. Gunter: I have nothing to add to the statement on this subject which I made in the House on 30th November.—[Vol. 737, c. 466–71.]
    Mr. James Johnson: Will my right hon. Friend accept that if we had more and better statistics it would make for better national planning? Is it not also a fact that if more vacancies were known, there would be more chance for workers who are out of jobs knowing what jobs were to be had?
    Mr. Gunter: I agree with the first part of my hon. Friend's supplementary question. We certainly need a lot more statistics—but if we had more statistics we would have to take on a lot more staff, and then there would be the general cry about increasing the Civil Service. The advantages are not as clear as all that in this matter. I am still considering it. The Notification of Vacancies Order, 1952 lasted for four or five years only, because it was felt that it was not achieving the purpose for which it was introduced. I can assure my hon. Friend, however, that the book is not closed.
    Mr. Watkins: Will my right hon. Friend kindly consider the suggestion that Government Departments, at least, should notify any vacancies—especially the Ministry of Public Building and Works and the Ministry of Defence—in respect of the Army?
    Mr. Gunter: Yes, Sir.
    Mr. R. Carr: Does not the Minister agree, in the light of experience, that the compulsory notification of vacancies is of use only when one is following some form of control of engagements?
    Mr. Gunter: That is one of the great dangers—that such notification would be considered a precursor to that control.

    Chemical and Allied Industries
    Mr. Peter Millsasked the Minister of Labour what has been the drop in numbers employed in chemicals and allied industries between July, 1966 and the latest convenient date.
    Mr. Fernyhough: It is provisionally estimated that between July, 1966 and May, 1967 the numbers employed in Order IV of the Standard Industrial Classification (Chemicals and Allied Industries) fell by about 14,000.
    Mr. Mills: Does not this show that these industries—the chemical and allied industries—have been hit more by the freeze than have the nationalised industries? Is this really the policy of the Government and the Ministry?
    Mr. Fernyhough: The chemical industry has been hit less hard than the general body of manufacturing industry.
    Mr. R. Carr: In view of the decline in the numbers employed in these industries, how do we account for the need for an increase in the gas and electricity industries, referred to a little while ago?
    Mr. Fernyhough: If the hon. Member thinks that we are going to stay in this trough for ever he will probably be very happy—but I assure him that we are not going to.
    Sir D. Gloverasked the Minister of Labour what was the total number of vacancies in the chemical and allied trades in April, 1967 and April, 1963.
    Mr. Fernyhough: The numbers of notified vacancies remaining unfilled in Order IV of the Standard Industrial Classification (Chemicals and Allied Industries) were 4,276 in April, 1967, and 2,120 in April, 1963.
    Sir D. Glover: Is the hon. Gentleman aware that these figures are also disturbing? As these are important manufacturing industries, on which we rely for our exports, is he satisfied that unemployment in them should be heavily up while employment in the Civil Service and service industries is increasing? Would not he agree that this trend shows that the S.E.T. system is not working and that it should be rescinded?
    Mr. Fernyhough: Since there are double the vacancies in this respect than there were in 1963—the sort of situation which, surely, workers want—what is the hon. Gentleman complaining about? I would have thought that an unemployed man would much prefer the present situation, in which there more employers wanting labour than was the case in 1963.

    South-Western Region
    Mr. Mawbyasked the Minister of Labour what is the latest figure in total numbers and percentages for unemployment in the South-Western Region; and how this compares with the corresponding month in 1962.
    Mr. Fernyhough: The figures were 27,484 and 2·0 per cent. in June, 1967 and 17,244 and 1·4 per cent. in June, 1962.
    Mr. Mawby: Is the hon. Member going to keep those figures written on his heart, to make certain that at least we in the South-West are given a fair crack of the whip if, at some time in the future, there is an upturn in employment?
    Mr. Fernyhough: As the hon. Member knows, since August, 1966, most of Devon and Cornwall have been included as a development area.
    Mr. Peter Mills: No.
    Mr. Fernyhough: They have been included as a development area. We are hoping that the benefits available to development areas will help the South-West.
    Mr. Ridley: Since the Selective Employment Tax hits the South-West harder than any other area, and since the figures of unemployment in the South-West are worse than they have ever been, cannot the Minister draw the obvious conclusion that he should amend the Selective Employment Tax?
    Mr. Fernyhough: If the hon. Member wants an answer to that question he knows to which Minister he should put it —the Chancellor of the Exchequer.

    Devon and Cornwall (Training Centres)
    Mr. Mawbyasked the Minister of Labour what plans he has for building further Government training centres in Devon and Cornwall.
    Mr. Hattersley: None at present. The new centre at Plymouth is likely to be able to meet most of the training needs of the area for some time to come. People living in Devon and Cornwall beyond daily travelling reach of Plymouth could be found places there, or at other centres, and lodgings could be arranged for them.
    Mr. Mawby: Is not the hon. Member aware that the Selective Employment Tax hits the South-West probably more than it does any other part of the country, and that if there is a desire to have people moved out of the service industries into manufacturing industries there will be a greater demand for training facilities? Will the Minister bear this point in mind continuously when there is a possibility of building another training centre?
    Mr. Hattersley: I welcome the hon. Member's confirmation that S.E.T. is moving people from service trades into manufacturing. The intention of my answer was to explain that demands for places in Government training centres in the South-West are being met as reasonably realistically as possible at the present time.
    Dr. John Dunwoody: Would my hon. Friend not agree that there is a possibility of a problem because there are areas of high unemployment in the South-West in which many people live too far from Plymouth to attend the training centre? If there is to be an expansion in the area, would he consider siting a new centre in the far South-West, in the West of Cornwall?
    Mr. Hattersley: The problem is one of balancing the needs of men who live too far away to travel to Plymouth with those of having the centre in an area which would not justify keeping it permanently full. The way to meet the problem is by assisting men who want to find places in the centres and who are prepared to travel and to live in lodgings to find those places. That assistance is certainly forthcoming.

    Skilled Workers
    Mr. John Pageasked the Minister of Labour what is the latest number of vacancies for skilled men; and what is the annual output of Government training centres at present.
    Mr. Hattersley: On 3rd May the number of unfilled vacancies for men in skilled trades at employment exchanges was 18,942 in engineering and allied occupations and 6,733 in the construction industry. At the present time Government training centres have an annual rate of output of about 12,000 trained men, including some 6,500 in engineering and allied occupations and 4,500 in construction trades, but these figures are rising month by month as the capacity of the centres increases.
    Mr. Page: Does the hon. Gentleman realise that these figures show that the Government are only just scratching the surface of the problem and that no one in engineering or construction thinks that they are seriously interested in expanding the output of their G.T.C.s? Is he having discussions with private industry on the further use by the Government of the facilities of private industry—training, equipment and so on—which is not possible at present, as they are fully used?
    Mr. Hattersley: I totally reject the claim that private industry believes that the Government are not committed to expanding training. The answer to the hon. Gentleman's final point is that, of course, consultations are going on with private industry but they are properly going on, under the aegis of the industrial training board which was set up for that purpose. I hope that the hon. Gentleman will recall that a substantial expansion programme for the G.T.C.s has been announced, and that by the spring of 1969 there will be 17,000 places there each year—a substantial increase over the last two years.

    Engineering and Electrical Industries
    Mr. Edward M. Taylorasked the Minister of Labour what has been the drop in numbers employed in engineering and electrical industries between July, 1966, and the latest convenient date.
    Mr. Fernyhough: It is provisionally estimated that between July, 1966, and May, 1967, the numbers employed in Order VI of the Standard Industrial Classification (Engineering and Electrical Goods) fell by approximately 63,000.
    Mr. Taylor: Is the hon. Gentleman not thoroughly ashamed of Government economic policies which have resulted in a

    83
    reduction of 63,000 employees in these vital growth industries, with increases in the nationalised industries and the Civil Service? When will he change these policies?
    Mr. Fernyhough: The hon. Gentleman knows that the reason for much of this lies with the benches opposite. It was they who left the country sick, economically, and it is we who have had to do the surgical work to begin to put it on its feet.
    Mr. Ridley: How is it that the engineering industry, with 63,000 fewer people, requires 4,000 more people in gas, electricity, and water to service it?
    Mr. Fernyhough: That question is unworthy of the hon. Gentleman. He knows that this year we shall build 400,000 houses and they will need electricity, water and gas. To pretend that all the consumption of these services is taken by industry is childish. The hon. Gentleman knows that we must expand these industries not only to meet what I would call civil needs but also to prepare for the expansion in production which will take place some day.
    Mr. William Hamilton: Does my hon. Friend confirm this figure of a drop of 63,000? Is it not the case that in 1964 the numbers employed in this engineering and electrical goods sector were 166,900 and in 1966 181,500, a substantial increase over the last year of the last Conservative Government? Surely the figure of 63,000 is a gross exaggeration?
    Mr. Fernyhough: I would much prefer my hon. Friend's figures to those of hon. Gentlemen opposite.
    Mr. Michael Shawasked the Minister of Labour what was the ratio of vacancies to unemployed among electrical and electronic workers in April, 1967 and April, 1963, respectively.
    Mr. Fernyhough: Analyses of unfilled vacancies and registered unemployed, which identify this group of occupations, are made quarterly. At 13th March, 1967, the latest date for which this information is available, the number of notified vacancies remaining unfilled to every 100 persons wholly unemployed was 85·5. In March, 1963, the number was 36·7.
    Mr. Shaw: Do not these figures mean that when re-expansion begins again, we
    84
    will be in a worse position than we were to assist this re-expansion, particularly in this important sphere?
    Mr. Fernyhough: I do not understand the logic of that question. Perhaps the hon. Gentleman will explain it to me after Question time.
    Mr. R. Carr: Is not the Parliamentary Secretary aware that these figures show that there is an even more acute shortage of skilled workers and that, without these workers, expansion will be more difficult to get going?
    Mr. Fernyhough: I do not accept that at all.
    Mr. Gowerasked the Minister of Labour what was the ratio of vacancies to unemployed in the engineering and allied trades in April, 1967 and April, 1963, respectively.
    Mr. Fernyhough: Analyses of unfilled vacancies and registered unemployed, which identify this group of occupations, are made quarterly. At 13th March, 1967, the latest date for which this information is available, the number of notified vacancies remaining unfilled to every 100 persons wholly unemployed was 82. In March, 1963, the number was 33.
    Mr. Gower: As was the case in regard to the last Question, will it not be more difficult to arrive at a solutioit than it was a few years ago?
    Mr. Fernyhough: Can I take it that the hon. Gentleman would like there to be fewer vacancies than there are?

    Scotland
    Mr. Edward M. Taylorasked the Minister of Labour what is the latest figure in total numbers and percentages for unemployment in Scotland; and how this compares with the corresponding month in 1962.
    Mr. Fernyhough: The figures were 76,982 and 3·5 per cent. in June, 1967 and 72,124 and 3·3 per cent. in June, 1962.
    Mr. Taylor: Do not these figures underline the seriousness of the position? Is the hon. Gentleman aware that there are now more than four unemployed people in Scotland for every vacant job?

    85
    Is it not time that we had some replacements?
    Mr. Fernyhough: I am as concerned about this figure as is the hon. Gentleman, and we will do more about it than did our predecessors. In 1963, a year later than the year for which he asked for figures, unemployment in Scotland was over 94,000 and the rate was 4·3 per cent.
    Mr. Rankin: Would my hon. Friend confirm that in the winter of 1962, the unemployment total in Scotland was 136,000. under the previous Government ·a figure bigger than any which even the Old Man of Hoy can recollect.
    Mr. R. Carr: But does the hon. Gentleman not yet realise, even by now, that the comparable year for comparison of economic measures is not 1963 but 1962? If he is going to quote 1963, will he give a forecast of the 1968 position?
    Mr. Fernyhough: No, just as the right hon. Gentleman would not have given it in 1963 for 1964.
    Mr. Maclennan: Would my hon. Friend place in the Library a copy of the memorandum issued last Monday by the Scottish Council for Development and

    TOTAL REGISTERED UNEMPLOYED, AND WHOLLY UNEMPLOYED (EXCLUDING SCHOOL-LEAVERS) SHOWING ACTUAL NUMBERS AND NUMBERS ADJUSTED FOR NORMAL SEASONAL VARIATIONS

    (Thousands)

    Great Britain

    Total registered unemployed

    Wholly unemployed (excluding school-leavers)

    Actual

    Adjusted

    Mid-June each year

    Number

    Per cent.

    Number

    Number

    Per cent.

    1946

    …

    …

    …

    …

    376

    2·5

    —

    —

    —

    1947

    …

    …

    …

    …

    272

    1·8

    —

    —

    —

    1948

    …

    …

    …

    …

    274

    1·8

    —

    —

    —

    1949

    …

    …

    …

    …

    264

    1·3

    255

    294

    1·4

    1950

    …

    …

    …

    …

    282

    1·4

    271

    311

    1·5

    1951

    …

    …

    …

    …

    191

    0·9

    183

    214

    1·0

    1952

    …

    …

    …

    …

    440

    2·1

    295

    337

    1·6

    1953

    …

    …

    …

    …

    298

    1·4

    275

    315

    1·5

    1954

    …

    …

    …

    …

    240

    1·1

    225

    261

    1·2

    1955

    …

    …

    …

    …

    211

    1·0

    180

    210

    1·0

    1956

    …

    …

    …

    …

    223

    1·0

    189

    220

    1·0

    1957

    …

    …

    …

    …

    265

    1·2

    246

    283

    1·3

    1958

    …

    …

    …

    …

    429

    2·0

    366

    416

    1·9

    1959

    …

    …

    …

    …

    413

    1·9

    383

    435

    2·0

    1960

    …

    …

    …

    …

    305

    1·4

    295

    338

    1·5

    1961

    …

    …

    …

    …

    266

    1·2

    254

    292

    1·3

    1962

    …

    …

    …

    …

    397

    1·7

    368

    419

    1·8

    1963

    …

    …

    …

    …

    480

    2·1

    454

    513

    2·2

    1964

    …

    …

    …

    …

    322

    1·4

    315

    360

    1·6

    1965

    …

    …

    …

    …

    276

    1·2

    269

    309

    1·3

    1966

    …

    …

    …

    …

    261

    1·1

    252

    290

    1·2

    1967

    …

    …

    …

    …

    500

    2·1

    464

    524

    2·2

    Industry, which shows how encouraging is the progress in laying the foundations for the industrial expansion which Scotland expects in the next three years?
    Mr. Fernyhough: I would be very happy to do that.
    Mr. Bruce-Gardyneasked the Minister of Labour what was the number of unemployed on an unadjusted and a seasonally adjusted basis at the June count for Great Britain and for Scotland, respectively, in each year since the war.
    Mr. Gunter: As the reply consists of a table of figures, I will, with permission, circulate it in the OFFICIAL REPORT. The figures for the earlier years before the introduction of the comprehensive National Insurance Scheme are not directly comparable with those for 1949 and later years.
    Mr. Bruce-Gardyne: Could the right hon. Gentleman tell us the last occasion on which unemployment reached million in midsummer?
    Mr. Gunter: I could not offhand. I should have to look at the figures.
    Following is the information:

    (Thousands)

    Scotland

    Total registered unemployed

    Wholly unemployed (excluding school-leavers)

    Actual

    Adjusted

    Mid-June each year

    Number

    Per cent.

    Number

    Number

    Per cent.

    1946

    …

    …

    …

    …

    75

    4·6

    —

    —

    —

    1947

    …

    …

    …

    …

    55

    3·3

    —

    —

    —

    1948

    …

    …

    …

    …

    49

    3·0

    —

    —

    —

    1949

    …

    …

    …

    …

    53

    2·5

    50

    57

    2·7

    1950

    …

    …

    …

    …

    59

    2·8

    56

    63

    3·0

    1951

    …

    …

    …

    …

    42

    2·0

    40

    47

    2·2

    1952

    …

    …

    …

    …

    69

    3·2

    55

    62

    2·9

    1953

    …

    …

    …

    …

    57

    2·7

    52

    59

    2·8

    1954

    …

    …

    …

    …

    51

    2·4

    48

    55

    2·6

    1955

    …

    …

    …

    …

    47

    2·2

    42

    49

    2·3

    1956

    …

    …

    …

    …

    46

    2·1

    41

    47

    2·2

    1957

    …

    …

    …

    …

    49

    2·3

    45

    52

    2·4

    1958

    …

    …

    …

    …

    76

    3·5

    67

    74

    3·5

    1959

    …

    …

    …

    …

    85

    3·9

    79

    87

    4·0

    60

    …

    …

    …

    …

    70

    3·2

    66

    74

    3·4

    1961

    …

    …

    …

    …

    60

    2·8

    56

    63

    2·9

    1962

    …

    …

    …

    …

    72

    3·3

    67

    75

    3·4

    1963

    …

    …

    …

    …

    95

    4·3

    90

    98

    4·5

    1964

    …

    …

    …

    …

    71

    3·2

    69

    77

    3·5

    1965

    …

    …

    …

    …

    56

    2·6

    54

    61

    2·8

    1966

    …

    …

    …

    …

    52

    2·4

    50

    57

    2·6

    1967

    …

    …

    …

    …

    77

    3·5

    74

    82

    3·7

    Central and Local Government Service (Vacancies)
    Mr. Scottasked the Minister of Labour what was the total number of vacancies in central and local government service in April, 1967, and April, 1963.
    Mr. Gunter: the numbers notified to my Department were 13,814 and 8,068, respectively. These represent notified vacancies remaining unfilled in Order XXIV of the Standard Industrial Classification only and do not purport to measure all vacancies in central and local government service.
    Mr. Scott: As the numbers employed since right hon. Members opposite took office have risen by over 200,000, and as this great increase in the number of vacancies shows that there is an absolutely insatiable demand in this sector, should we not have a shake-out here rather than from the growth industries?
    Mr. Gunter: That is always a very popular doctrine until hon. Members opposite want some great social improvement, improved local government services and a host of other things. Then the price has to be paid.

    Asbestos Regulations
    Dr. Ernest A. Daviesasked the Minister of Labour whether he is satisfied wih the Asbestos Industry Regula-
    88
    tions prescribed in 1931; whether he has in mind the making of new regulations; and when he expects that these regulations will be published.
    Mrs. Joyce Butlerasked the Minister of Labour what progress he has made in the preparation of new Asbestos Regulations; and if he will make a statement.
    Mr. Gunter: A draft of revised Asbestos Regulations has been circulated to the main organisations concerned. Their comments are now coming in and are being discussed with them.
    The new Regulations are designed to cover all the industries and processes in which asbestos is used, including occupations such as lagging and delagging, thermal and sound insulation and brake-lining manufacture.
    I am not at present able to say when the new Regulations will become law.
    Dr. Davies: That reply will give a great deal of satisfaction to the people involved. Nevertheless, will my right hon. Friend bear in mind that those of us who have in our constituency workers involved in this industry will want to see new regulations in practice as soon as a careful study of the problem permits?
    Mr. Gunter: I am as anxious as my hon. Friend is to get these regulations.

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    We are taking steps as far as lies within my power to short-circuit the long procedures which are involved.
    Mrs. Butler: Would my right hon. Friend give special attention to the representations made to him that it might be better to secure a maximum allowable concentration of asbestos dust rather than introduce outright prohibition, and make some provision so that the exhaust of asbestos is not vented to the outside air because of the danger to people living in the neighbourhood of asbestos factories?
    Mr. Gunter: Those are the sort of matters now under discussion in the preparation of the Order.

    Northern Region
    Mr. Michael Shawasked the Minister of Labour what is the latest figure in total numbers and percentages for unemployment in the Northern Region; and how this compares with the corresponding month of 1962.
    Mr. Fernyhough: The figures were 48,689 and 3·6 per cent. in June, 1967, and 42,143 and 3·2 per cent. in June, 1962.
    Mr. Shaw: Does not that Answer indicate that the concern that has been expressed, even as recently as today, about the likely unemployment figures—in this coming winter, for example—is fully justified? Moreover, does not the Answer make complete nonsense of the Prime Minister's statement, in which he referred to ironing out the inequalities that exist between the regions in respect of unemployment rates?
    Mr. Fernyhough: It does not make nonsense of my right hon. Friend's statement. For example, the development areas have felt the impact of unemployment less, on a percentage basis, compared with other parts of the country generally. I would like the hon. Gentleman to understand that we were not hearing much from him and his colleagues in June, 1963, when the figure v as 56,000 and the percentage 4·3.
    Mr. Edwin Wainwright: Will my hon. Friend bear in mind that in some areas the migration of labour is easing the problem far too much? Is he aware
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    that in, for example, the Yorkshire and Humberside areas, the migration level is rather too great; and will he do all he can to prevent this loss of labour from this and other areas?
    Mr. FernyhoughI have every sympathy with my hon. Friend in that respect. No area has suffered more from this problem than my constituency.

    Wales
    Mr. Gowerasked the Minister of Labour what is the latest figure in total numbers and percentages for unemployment in Wales; and how this compares with the corresponding month in 1962.
    Mr. Gunter: The figures were 36,159 and 3·6 per cent. in June, 1967, and 25,402 and 2·6 per cent. in June, 1962.
    Mr. Gower: Does the right hon. Gentleman feel that this position is likely to deteriorate still further, or does he hope that the worst has now been seen?
    Mr. Gunter: The hon. Gentleman must not ask me to prophesy in this matter. The position in South Wales, in particular, in the next three or four years, in terms of job availability, will, we hope, show a considerable improvement. As the hon. Gentleman knows, virtually the whole of Wales is now a development area; and from 4th September it will be attracting the regional employment premium.

    North-Western Region
    Sir D. Gloverasked the Minister of Labour what is the latest figure in total numbers and percentages for unemployment in the North-Western Region; and how this compares with the corresponding month in 1962.
    Mr. Gunter: The figures were 68,948 and 2·3 per cent. in June, 1967, and 69,449 and 2·3 per cent. in June, 1962.
    Sir D. Glover: Is not the right hon. Gentleman disturbed by the fact that the same trend has been shown in all the Answers to these sorts of Questions today? Is he aware that now, in the middle of the summer, unemployment is rising when, from the seasonal point of view, this state of affairs should not exist? What is his Department going to do about it?
    Mr. Gunter: The mid-summer figures for June, 1962, were just about the same. I should have thought that the hon. Gentleman would have taken some comfort from the figures I have quoted.

    Redeployment
    Mr. R. Carrasked the Minister of Labour when the period of redeployment, which has been the policy of Her Majesty's Government over the past year, will be completed.
    Mr. Gunter: Redeployment in the interests of efficiency is necessary as a continuing process at all times.
    Mr. Carr: Is the right hon. Gentleman aware that I am referring in this Question to the redeployment specifically mentioned by the Prime Minister? Since only a short while ago the Government produced a National Plan, which went into this subject in some detail, are they now saying that all that planning is nonsense? If so, what is their present policy in this matter?
    Mr. Gunter: I recall the words of my right hon. Friend the Prime Minister. He emphasised that there would have to be continuing redeployment in the interests of efficiency. The right hon. Gentleman knows, and appreciates as well as I do, that there must be continuing redeployment for efficiency. This is the nub of our major problem and a part of the agony of the past 12 months has been to get the efficient use of manpower.

    LEGAL AID (MAINTENANCE ORDERS)
    Mr. Graham Pageasked the Attorney-General when he will initiate legislation to permit legal aid to be granted in respect of an application to a magistrates' court for variation of a maintenance order registered in such a court, under the Maintenance Orders Act, 1958, but made in the High Court.
    The Attorney-General (Sir Elwyn Jones): This proposal is among the matters referred to the Legal Aid Advisory Committee by my noble Friend the Lord Chancellor in asking it to consider what the priorities should be when financial circumstances permit further development of the Legal Aid Scheme.
    Mr. Page: Will the right hon. and learned Gentleman ensure that good priority is given to this matter to relieve the hardship falling on a number of separated wives? While we are awaiting legislation, would he consider asking the Minister of Social Security whether National Assistance grants can be made available for this purpose of taking proceedings for the variation of maintenance orders because wives may become a charge on National Assistance if they are unable to take proceedings?
    The Attorney-General: Certainly the matter will be given sympathetic consideration. I will refer the hon. Gentleman's point to my noble Friend.

    D NOTICES
    Mr. Arthur Lewisasked the Attorney-General on how many occasions during the past six months editors and/or journalists and newspaper proprietors have been prosecuted for evading D Notices.
    The Attorney-General: None.
    Mr. Lewis: That is a surprising reply. What happened to the Daily Express, Mr. Chapman Pincher and company? Surely some action should have been taken against them if they were so seriously guilty of dereliction of their duty to the public?
    The Attorney-General: I suspect that my hon. Friend knew the answer to his Question, but that did not deter him from persisting in tabling it. There was no evidence of a criminal offence and, therefore, there was no prosecution.

    QUESTIONS TO MINISTERS
    Mr. Speaker: Mr. Allaun. On a point of order.
    Mr. Allaun: I am grateful to you, Mr. Speaker. I realise that this puts you in a very difficult position, but there have been 17 interventions by the three very attractive, good-looking and altogether very pleasant Front Bench members of the Opposition, and it seems to us rather unfair to you that if a Front Bench Opposition speaker gets up you are in some difficulty in avoiding calling him. Would

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    you not think it possible, for the guidance of others, that 17 was rather overdoing it?
    Sir A. V. Harvey: Further to that point of order, Mr. Speaker. Before you reply, perhaps I may say that although the hon. Member for Salford, East (Mr. Frank Allaun) is well intentioned in his question to you, he has taken into account the original Questions of my right hon. and hon Friends, and their supplementaries, which are included in that figure of 17.
    Mr. Speaker: I am grateful to the hon. Member for Salford, East (Mr. Frank Allaun) for putting his point of order in such a charming and disarming way. The Chair is never embarrassed, for the Chair must never take sides, and that is quite axiomatic.
    The hon. Member for Macclesfield (Sir A. V. Harvey) has partly answered the point of order. It is only the leaders on the Opposition Front Bench who do not have the privilege of putting down Questions. The lesser members, if I may say so without any disrespect, of the "shadow" Front Bench have the right and privilege of putting down Questions, so that the total that the hon. Member for Salford, East gave included the Questions they put in their own capacity as back bench Members of Parliament, and the interventions they made, powerfully, on behalf of their Front Bench.
    I should like to make the general observation that too many interventions from the Front Bench deprive back benchers of the right to take part in the cut and thrust of debate, but this is a point that the Front Bencher must weigh up for himself. It is his job to see whether, in the Question and Answer that has arisen, there is not an opportunity for a major Front Bench intervention. That question one must leave to the conscience and political wisdom of the "shadow" front-benchers.

HONG KONG (BORDER INCIDENTS)
Lord Balniel Lord Balniel (by Private Notice) asked the Secretary of State for Commonwealth Affairs if he will make a statement about the border incidents in Hong Kong on Saturday and Sunday, 8th and 9th July.
The Secretary of State for Commonwealth Affairs (Mr. Herbert W. Bowden): The incident began when several hundred demonstrators crossed the frontier at Sha Tau Kok at about 11.00 hours on Saturday, 8th July, and attacked the police post there. The demonstrators included members of the People's Militia, a fact which has since been confirmed by the Communist Press in Hong Kong.
The police used teargas and riot guns firing wooden projectiles to disperse the crowd. They then came under fire from several points, including automatic fire from Chinese territory. Five police were killed and 11 wounded. Troops were brought in later to relieve the post and completed this operation successfully without opening fire.
Her Majesty's Chargé d'Affaires in Peking has strongly protested to the Chinese Ministry of Foreign Affairs about this incident, and has made it clear that the Hong Kong authorities, with the full support of Her Majesty's Government, will take all necessary measures to maintain peace and security of Hong Kong.
Lord Balniel: We from these benches would like to express our sympathy with the relatives of those who have been killed in the course of duty in maintaining law and order. Would the right hon. Gentleman agree that this incident really has added a new dimension of gravity to an already exceedingly difficult situation? Would it not be a considerable reassurance to the people of Hong Kong if he could clearly state that it is the Government's intention to maintain the status quo and the integrity of the New Territories?
I should like to ask the Secretary of State a further question on an aspect which he did not mention. Can he say something about water supplies? In view of the fact that supplies to the Hong Kong Colony have been cut off, can we have an assurance that alternative supplies will be made available by the Government?
Mr. Bowden: I am grateful to the hon. Member for his kind words of sympathy for the relatives and friends of people who died in Hong Kong.
The position is a slightly changed one, as he rightly says, in that, for the first time, demonstrators from over the border have been supported by Chinese militia—

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if not, in fact, the Chinese Army—and one machine gun was used. The Hong Kong police were for a short while forced to stay within their barracks, where they were fired on, but with the arrival of the battalion, which had no need to fire a shot at all, the position was quietened. The dead and wounded were removed.
Continued representations are being made to the Chinese Government for the water to be turned on. As the noble Lord may be aware, this is a notice that has to be given in a certain period of time—I think, four weeks. Adequate notice has been given, but the water has not yet been turned on.
Mr. Rankin: Is my right hon. Friend aware that it would help towards the peace and security which all of us want to see in Hong Kong if he were to instruct the Hong Kong Government now to proceed more speedily with the granting of the new increased wage rates that have been promised to the underpaid textile workers in Hong Kong?
Mr. Bowden: I think that my hon. Friend should not mix two things here—
Mr. Rankin: I am not mixing two things.
Mr. Bowden: One is the genuine desire on the part of workers in Hong Kong, particularly the women and children, to work fewer hours. The Minister of State has already made a statement about this in the House, and Her Majesty's Governor is working on new legislation in this direction. I would not like my hon. Friend or anyone else to assume that these incidents are all based on bad labour relations. They are not. This is Communist activity, either instigated or supported by China, but certainly of a very much bigger nature than is likely to arise from labour disturbances.
Mr. Dodds-Parker: Will the Commonwealth Secretary answer the question put straight to him by my noble Friend the Member for Hertford (Lord Balniel), and give a categorical assurance that we will maintain the status quo in Hong Kong, and ensure the people there a supply of water and food—not only
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those born there, but those who have sought refuge there?
Mr. Bowden: The food position is very much better. The water position is not good, but we are dealing with it at the present time. I myself had a meeting this morning about it, and the possibilities are that we can meet the emergency water situation until the rains come, which will considerably relieve it. It is then anticipated that we will get the water turned on from the mainland.
We have said on a number of occasions in recent weeks from this Dispatch Box that the Hong Kong Government have our full and complete support in the measures they are taking to maintain public order and their authority there. We are convinced that we must fulfil our full responsibilities and obligations in Hong Kong.
Mr. Dalyell: Are the Government reasonably convinced that there is a direct connection between Peking and the People's Militia?
Mr. Bowden: It is one of the difficulties that one is not able to be absolutely sure about it. I do not want to exacerbate the position. The fact is that on this occasion, while not actually engaged in activities, there was evidence of the Chinese Army in the background which would lead one to believe that if the incident was not instigated from the other side of the border those on the other side were certainly in support of it.
Mr. Fletcher-Cooke: Will the right hon. Gentleman answer directly the question put to him by my noble Friend the Member for Hereford (Lord Balniel)? Will he give a firm assurance that we intend to stay for the full length of our lease, and preserve our status quo there?
Mr. Bowden: I do not think that a reply to a question of that sort at this stage would be at all helpful. We have made it clear on a number of occasions that we will accept our full responsibilities in Hong Kong. We want the Colony to settle down, to live in peace, to get on with its normal trading, and to see an end to these incidents. I do not want to say anything that would make the situation more difficult, because everyone in the House realises that, if there is difficulty

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of the kind we have seen this weekend in any great measure from the other side of the border, it could be very serious indeed.
Mr. James Davidson: Has the Secretary of State received, or does he expect to receive, a reply to the Government's note to the Communist Chinese Government in Peking?
Mr. Bowden: No, we have not had a reply as yet. We are, however, in touch with our Chargé d'Affaires in Peking and expect within a matter of a day or two, although this is a matter for the Foreign Office rather than for me, to have a reply. But, of course, I cannot anticipate that.
Mr. Paget: To what extent does my right hon. Friend feel that this is action on behalf of the Chinese Government in giving notice to us that they intend to take over Hong Kong? If that is so, how far is it affected by the use of Hong Kong by the Americans, particularly for maintenance purposes and for what, I believe, is their largest consular staff in the world?
Mr. Bowden: I have already said that there is no real evidence that these incidents are instigated from Peking. But, of course, Peking propaganda has been extremely inflamatory for a very long time and it has been in support of the incidents which have occurred in Hong Kong, the island itself and in Kowloon. As to the visits by American naval personnel, it has been said a number of times previously that they go to Hong Kong purely for relaxation and for no other purpose.
Mr. Paget: What about the consular staff?
Mr. Speaker: Order. Mr. Wall. Private Notice Question.

KENYA (EXPULSIONS)
Mr. Wall Mr. Wall (by Private Notice) asked the Secretary of State for Commonwealth Affairs what action he proposes to take to safeguard the families and property of British farmers recently expelled from Kenya, and if he will make a statement.
The Secretary of State for Commonwealth Affairs (Mr. Herbert W. Bowden): On the evening of 5th July our High
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Commissioner was informed by the Kenya Government that they had decided to expel at 24 hours' notice 12 persons said to be United Kingdom citizens, of whom five were Europeans and seven Asians.
The High Commissioner immediately approached the Vice-President of Kenya asking for the names of those concerned, and the reasons for the expulsions, and asked for an extension of time. As a result of his representations immediate relatives and representatives of the High Commission were given access to those under expulsion orders.
Although the Kenya Government undertook to give 24 hours' notice, those expelled were arrested during the course of the night of 5th/6th July and taken to Nairobi, where they were kept under armed guard until their departure.
While we recognise the right of the Kenya Government to decide who should be allowed to live in their country, we feel the deepest concern at the lack of consideration shown in carrying out the expulsion orders. On instructions, the High Commissioner has seen President Kenyatta and made strong representations about this. I am asking the Kenya High Commissioner here to call today to hear our views on this.
The safeguarding of lives and property is, of course, the responsibility of the Kenya Government and we naturally
look to them to meet this responsibility in respect of all persons in Kenya. The British High Commission is helping with the affairs of the families of those expelled and will, of course, continue to do so.
Mr. Wall: Is the Secretary of State aware that in view of President Kenyatta's well-known desire to preserve good race relations, this action will come as a particular shock? Is he further aware that many of these men have been prominently advocating fair compensation terms under resettlement agreements, which are paid for by the British taxpayer? As it now seems that protests by the British Government in Africa have no value, will the right hon. Gentleman think of taking retaliatory action?
Mr. Bowden: I agree with the first part of the hon. Member's question that

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since the independence of Kenya President Kenyatta has always done everything possible for the peaceful settlement and living together of Europeans, Asians and Africans in Kenya.
With regard to the farmers who have been deported, I have arranged to place in the Library a statement of the reasons given by the Kenya Government. I would, however, point out that concerning the acquisition of their farms there is no such thing as compulsory purchase of farms. This is on the basis of a willing seller and a willing buyer. If any farmer wished not to sell his farm at the price offered, he would refuse to do so. One should not assume that the one aspect is related to the other.
Mr. John Lee: While disregarding the rather unfortunate observations on the question of compensation, may I assure my right hon. Friend that many on this side of the House feel that the treatment of these people was very bad indeed? Will my right hon. Friend see that British subjects are not treated to the kind of humiliation and, it seems, brutality which was meted out to some of these people on this occasion?
Mr. Bowden: I said in my original statement that despite the reason for deportation the treatment of the deportees leaves a lot to be desired. We have made strong representations about this and will continue to do so.
Mr. David Steel: Will the Secretary of State make it clear to the High Commissioner this afternoon that those of us in this House who have always admired and supported the Kenya Government in all their difficulties object strongly to the treatment which has been meted out and to their departure from normal standards in the treatment of these 12 citizens?
Mr. Bowden: I have already said so.
Mr. Woodburn: Would not my right hon. Friend regard it as wise not to start uttering condemnations or prejudgments until we know the facts? My experience in Kenya was that race relations there were as good as anywhere in the world. It would be a great pity if anything that we were to do disturbed them until we know the facts.
Mr. Bowden: I accept that the relationships between the races in Kenya are an example to the whole of Africa and I would not wish to say anything to disturb them. I must, however, protest about the treatment which has been meted out to these deportees. As for the reason for it, perhaps we had better await the paper which I propose to place in the Library.
Lord Balniel: While not wishing to prejudge in any way the merits of any individual in this case, may I ask whether the Secretary of State is aware that the House is becoming increasingly concerned about the treatment which is being meted out to British subjects in many countries, where it is thought that this bad treatment can be undertaken with absolute impunity?
Can the right hon. Gentleman say—I did not understand it from his Answer—whether he accepts the merits of the expulsion order?
Mr. Bowden: I have already said that the reason for expulsion is a matter for the Kenya Government. They, like every other country, are free to deport people if they so wish. What I object to is the method used in deportation, the shortness of notice, and so on. As to the merits of whether this was justified, every right hon. and hon. Member can judge for himself when he sees the document. But the right to deport must obviously rest with the Kenya Government.
Mr. Paget: Would my right hon. Friend consider suggesting to the Kenya Government that there should be some form of commission to advise the President that in the matter of expulsion people who have been there all their life should have a right of hearing and of hearing the charges against them, otherwise there is great danger of action simply upon informers without answer?
Mr. Bowden: This, again, is a matter for the Kenya Government, as it would be for ourselves to decide the machinery which we would use before coming to a decision whether to deport.
Mr. Burden: Would not the Secretary of State agree that if these expulsions are of a harsh and unfair nature, he should take into consideration any sums which might be paid as grants or aid to the

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Kenya Government and that this should apply not only to the Government of Kenya, but to other African governments who might receive aid from us and who treat our citizens in this way?
Mr. Bowden: No, Sir, I would not like to think that our aid to Kenya or to any other African Government was based upon what is undoubtedly the right of every independent country to deport people whom they regard as being undesirable.
Mr. Whitaker: Is my right hon. Friend a ware that those of us who deplored the expulsion without trial by the Rhodesian régime equally must regret this one? Will he ask President Kenyatta to consider the procedure recently followed by the President of Zambia, when he had a proper independent, judicial inquiry prior to deportation?
Mr. Bowden: The High Commissioner is again, I think, seeing the Vice-President of Kenya and this point could be made to him. Of course, the decision is one which the Kenya Government alone must take.
Several Hon. Members Several Hon. Members rose—
Mr. Speaker: Order. We must get on.

ORDERS OF THE DAY

  PRICES AND INCOMES (NO. 2) BILL
  As amended (in the Standing Committee), considered.
  Clause 1.—(POWER TO EXTEND PERIODS OF STANDSTILL UNDER PART II OF PRICES AND INCOMES ACT, 1966.)
  3.50 p.m.
  Mr. John Nott: I beg to move Amendment No. 2, in page 1, line 8, after 'prices' to insert 'other than retail prices'.
  When the dangers of cost-push inflation first became a serious topic of study, in the 1950s, a proposal was developed to introduce a policy of productivity, prices and incomes. In this form, with the emphasis on productivity, the policy was, on the whole, a constructive one.
  During the past two years, under the Labour Government's administration, the whole prices and incomes policy has become more and more negative and is now concentrated almost wholly on controlling prices and restraining incomes rather than on encouraging productivity. Month by month we see examples of the Government's proliferating controls and interference and of their becoming more and more dictatorial about prices and incomes; so much so that the whole of the market mechanism is beginning to break down.
  Proposals are now being put out by the Government for commando teams led by Mr. Aubrey Jones to investigate price increases in the shops. The Amendment, which relates to retail prices only, draws attention to a matter where the Government are getting increasingly into deep water and where it is possible and easy to show that control of retail prices through the National Board for Prices and Incomes is not only unnecessary, but is also unworkable, impractical and undesirable.
  Although I am personally violently opposed to a policy of retail price control, I fully appreciate and understand why the unions have been demanding it. The unions, which have suffered from Government interference in the free bargaining of wages and which have had

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  contracts entered into between employers and employees forcibly severed as a result of the Government's prices and incomes policy, have rightly and understandably demanded as a quid pro quo that there should be a peg on prices as well.
  The fact that the unions have demanded a policy for prices is not in any way to be held against them, but prices are the only way in which demand can be kept in balance with supply. If the Government believe that they, by interfering in the price mechanism, and, in particular, with retail prices, are able to improve upon the market and the means by which it can keep demand in balance with supply through the flexibility of prices, the policy has reached a most remarkable stage of stupidity.
  The first thing to be said about retail prices and their control is that this type of reference to the Board is unnecessary. The retail trade is fiercely competitive and, with the abolition of resale price maintenance, is becoming more so. The scope for retailers to raise prices unreasonably is very limited indeed. In no field are the sanctions and benefits of a competitive free market more obviously to be seen than in retail prices.
  The extent of the competition in the retail trade is evidenced by the figures produced by the Department of Economic Affairs in its June progress report. The report shows that, of the 2½ per cent. rise in retail prices which took place between July, 1966, and April, 1967, 1 per cent. was purely the result of Government action in increasing Purchase Tax, in imposing Selective Employment Tax, and in increasing postal charges. A further 1 per cent. was accounted for by seasonal price increases. Therefore, a large proportion of the 2½ per cent. rise in retail prices which took place was due to increased taxation by the Government. Another large proportion of it was due to seasonal price increases. Only ½ per cent. of the 2½ per cent. could be attributed to price increases to improve retail margins.
  During the same period of July to June average earnings rose by 1·5 per cent., against retail prices which rose by ½ per cent. if one takes purely those aspects of retail prices which could be attributed
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  to increased margins on the part of retailers. Likewise, from April, 1963, to April, 1966, retail prices rose by 11½, per cent., whereas average earnings rose by 25 per cent.
  Earlier this year the Minister of Agriculture said that he had
  "no evidence that retailers are in general working to excessive margins and"—
  that he did not—
  "propose to introduce legislation."—[OFFICIAL. REPORT, 10th May, 1967; Vol. 746, c. 242.]
  This was a perfectly fair statement, because the rise in prices had come about predominantly through increases in Government taxation and through seasonal fluctuations and not through profiteering on the part of retailers.
  I take a department store as an example of how difficult it will be to introduce any kind of enforcement of retail price control. A department store may sell 300,000 individual items. Its pricing must be related to its costs. It is virtually impossible in such a store to isolate individual items, as, clearly, would have to be done if a retail price were referred to the Board. Only now is it becoming possible to say that during last year retail margins were stable. How will it be possible to refer a particular retail price to Mr. Aubrey Jones's Board and for him to report within one month that that price is unfair when it is only now becoming evident, some six months after the end of the year, that retail margins were stable last year?
  The fact that the Jones Board is expected to make an investigation and, within one month, denounce a price as being unfair—presumably it will be entitled to denounce a price as being unfair, even though the price is competitive—is evidence enough that the whole idea of referring retail price increases to the Board is thoroughly impracticable. Day by day retailers are making adjustments to prices to accord with adjustments in their suppliers' margins, to accord with seasonal adjustments, and also to hold their own stores margins which come about to cover their own costs. It would be impracticable and unworkable for any board consisting of 20 men to pronounce on retail prices as being fair or unfair or reasonable.
  What happens if the Board sets a price limit to a commodity which is being sold

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  at 10 separate shops down the high street? The suggestion that this should be done is one of the most remarkable aspects of the Government's policy that we have yet seen.
  Why are the Government attempting to do so? I fear that it is because the First Secretary invited housewives to write to him about price increases, as a result of which I believe that he has had about 18,000 letters complaining about price rises in the shops. I do not think that there has ever been a clear statement to show how many of these price increases have been attributable to a rise in retailers' margins. In view of the figures published by the D.E.A., I doubt whether many of the increases have been attributable to increased retailers' margins.
  It is because the First Secretary is now bombarded with complaints on price increases that he is suggesting that retail prices should continue to be referred to the Board. This is the way in which he is trying to convince the country that he can do something to hold prices in check.
  Finally, we on this side are well aware that there are many families, particularly pensioners, who are unable to bear a further increase in prices. Hon. Members must be aware of this from their constituency correspondents. Surely the way to tackle the problem is to revise the Welfare State so that it becomes more selective and so that those families who are living in poverty, and pensioners in need, are helped and are able to pay the prices they are being asked for in the shops. The way to do this is not to impose controls and to refer retail prices to a Board which cannot possibly be more effective than the market mechanism.
  The Government's whole policy on prices and incomes is an absolute mess. They have not tackled the really important questions which remain unanswered. Some of the unresolved questions about which we should like to hear are these: how does one measure an increase in productivity—
  Mr. Speaker: Order. The unresolved questions the hon. Gentleman must raise on other Amendments, not on this.
  Mr. Nott: I conclude by saying, then, that the Government's proposals to refer
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  retail prices to the Prices and Incomes Board are unworkable. They involve an unwarranted interference with the market mechanism. The suggestion that there should be a team going about to investigate rises in retail prices is impractical. The only way by which retail prices can be held down is by increasing productivity in the retail trade, and that can come about through greater competition.
  4.0 p.m.
  Mr. John Peyton: I support the excellent speech made in moving this Amendment by my hon. Friend the Member for St. Ives (Mr. Nott). When the right hon. Gentleman, some time ago, requested that the public should report to his Department any price increase which they thought unreasonable, he was asking for trouble. I believe that he got it. He well deserved it, because that request was merely the futile fruit of an even more puerile policy.
  We are running into the serious danger of attributing to the comparatively innocent Mr. Aubrey Jones and his colleagues an ability to be everywhere and to know everything. I do not believe that Mr. Jones would accept the attribution. Nevertheless, I think it dangerous that a board of this kind, with rather loose powers of supervision, at least at first, should be called upon to conduct an operation of this sort. As my hon. Friend said, the Government's prices and incomes policy is a mess, and now to engage in an exercise of interference on a massive scale to deal with any complaint which is made, and to have a commando—I think that that was the expression used at one time—to examine increases in retail prices is to undertake an exercise which simply cannot be performed and should not be performed in a free society.
  When the first Prices and Incomes Bill was introduced by the right hon. Gentleman who is now Foreign Secretary I said that the Government were taking a step down a wrong road and that, being human—one must concede that to all Governments—they would, when they found that they were wrong, merely take another step down the same road. The proposal before us now is a good instance of the truth of that observation. The Government are being led, in pursuit of an absurd policy, into ludicrous

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  measures. I very much hope that they will think again before they further discredit themselves and the whole machinery of Government by taking on a load which no Government can or should discharge. My hon. Friend was absolutely right in all he said, and I support him with enthusiasm.
  Mr. R. T. Paget: What I find a little odd about the Government's proposal to control retail prices is that they have been so enthusiastic in destroying the only method yet devised which did effectively control retail prices, namely, retail price maintenance agreements. When one had manufacturers concerned for the repute of their products and deeply concerned as to the prices at which they were passed on to the consumer, one had an effective level of prices, and it did not always work only one way. One remembers the tremendous effort put in after the war by the motor car manufacturers to prevent the exploitation of the shortage by the retailers. That worked very effectively. I cannot believe that anyone other than the manufacturer can police a system of this sort.
  If we want to control retail prices, we shall have to get over our prejudice against retail price maintenance, because that is the only way we shall do it effectively. If we can, working through the manufacturer and, perhaps, through the Jones Board, work out a basis for fair prices at the various levels, we can have an enforceable system.
  I speak on this question largely because, a good many years ago, I did a lot of work on it on what was called the Lucas Committee, which considered how to control retail prices of agricultural and garden produce. The proposal which we then put up was that the system should be worked entirely through the market, that, if one controlled the wholesale market, then the write-ups on the wholesale market price could be controlled within a maximum.
  I do not believe that, unless we control the wholesale link, it will be remotely possible to control the retail price when we come to that end. It just is not a policeable method. It reminds one a bit of speed limits on the road. We have not got the machinery to make
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  them effective. Unfortunately, although there is no direct profitability in exceeding the speed limit, there is every profitability in exceeding a controlled price. Therefore, we shall have even more mischievous results in the shops than we have already on the roads.
  Mr. Geoffrey Wilson: I support the Amendment. When it was first proposed that there should be commandos and the rest for the examination of retail prices I expected to receive a number of complaints from my constituents about this and that retail price. In fact, I have had none. I receive a good many complaints about the nationalised industries, about coal, gas, postage stamps, and so on. I do not believe that the general public are in any position to judge whether a retail price is reasonable or unreasonable, or whether an increase is fair or unfair. It seems to me that, at best, it will be very much a hit and miss business.
  Mr. J. J. Mendelson: The hon. Gentleman says that he has had no correspondence. I have had over 100 letters complaining about increases in retail prices. My constituents are perfectly capable of judging a price after it has been increased, and I am certain that the hon. Gentleman's constituents are equally capable of doing it.
  Mr. Wilson: I can only repeat that I have had no complaints. Perhaps there are people in the hon. Gentleman's constituency who are taking more interest in this matter. As I say, I think that it will be very much a hit and miss affair as to whether any complaint is made or not. I greatly doubt that the Government's proposals are satisfactory or workable, and for that reason alone I support the Amendment.
  Mr. Mendelson: This Amendment gives me the first opportunity to intervene in the debate on this important Bill. I think that I speak for a good many of my hon. Friends who are in the same position, seeing that many hon. Members on these benches who expressed strong criticism of the Bill were not on the Standing Committee. I begin by making that point and saying that, at least so far as some of my hon. Friends and I are concerned, there will be no repetition of what we were not able to say in the Standing Committee.

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  The point of the hon. Member for Truro (Mr. Geoffrey Wilson) is of capital importance. He said that the public are not capable of judging whether increases are justified. If he put this point to public meetings, the response would be a rough one. Hon. Members know that, during recent weeks, the main subject of discussion with constituents, regardless of party, has been retail price increases.
  In fairness to my right hon. Friend, he has never denied that there have been some increases. He would not think of doing so, in the face of the facts. He has argued that there has been a more limited increase than would have been the case under previous Administrations, or in different circumstances, and that, as there was a heavy increase in earnings just before the introduction of the Prices and Incomes Act—
  Mr. Speaker: Order. With respect, that point must come some other time. The hon. Gentleman must confine his remarks now to this Amendment.
  Mr. Mendelson: With respect, Mr. Speaker, the Amendment deals with retail prices and my right hon. Friend has recently made statements dealing with them. The reasons for increases must be part of the subject of the debate. I made only a passing reference to it, but I had to make it.
  My right hon. Friend said that, as there had been considerable increases in earnings before the Act came into force, it was to be expected that there would be—
  Mr. Speaker: Order. I hope that the hon. Gentleman will take note of what I say. The Amendment seeks to exclude retail prices from those which are controlled. The hon. Gentleman will have opportunity to talk about the general issue of prices at some other stage.
  Mr. Mendelson: I see the issue as the possibility of controlling retail prices and the hon. Member for St. Ives (Mr. Nott) —it is rare that I seek to challenge your Rulings, Mr. Speaker—is trying to exempt all retail prices.
  To use Parliamentary language, this Amendment would completely emasculate 50 per cent. of the Bill, and this crucial Amendment must be discussed. Our experience of retail price increases is
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  that a one-sided position has been created, as many of us predicted. Under this Bill, which will continue some of the Government's policies and the previous legislation, we will have the same experience. This is not incomes and prices legislation, but legislation heavily concentrated on the control of wages—
  Mr. Speaker: Order. The hon. Gentleman must take note of the previous observations of the Chair. These points might be made on Third Reading, but not on this Amendment.
  4.15 p.m.
  Mr. Mendelson: The exemption of all retail prices means that the Government would have no power to control retail prices. In considering the Amendment, it is crucial to judge whether the retention of what the hon. Gentleman wishes to remove would give an effective price control policy. Without such a consideration, no one can make a case on the effectiveness of the proposed legislation. If the hon. Member has his way, there will be no control of retail prices, and the Government have been arguing that this is a prices and incomes policy.
  Although I would oppose the hon. Gentleman's attempt to emasculate the Bill on the prices front, and to prevent my right hon. Friend having any powers, I would like my right hon. Friend to tell us how he sees his opportunities under the current legislation, if the House rejects the Amendment, for effectively controlling prices. The House would make it too easy for my right hon. Friend—I have no intention of doing this, as this is of paramount importance to my constituents and to people in general and will be for many months to come—if we merely accepted his advice to resist the Amendment. If the Government merely argued that they should retain the powers in the Bill, it would be too easy.
  I am putting the kernel of the argument. Given that the appeal which he will make to reject the Amendment succeeds, what detailed proposals has he, under these powers, to control prices effectively? I did not want to stray out of order, but I cannot put this point with any force unless I make my complaint, which is that of many people throughout

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  the country, that the powers so far have been completely ineffective in controlling prices. He must tell us how he intends to proceed in future and whether he hopes for more success than in the past.
  Mr. Michael Alison: The hon. Member for Penistone (Mr. Mendelson) was concerned with whether, the Amendment were accepted, the Government would not have enough control over retail prices, but he mised the burden of the argument, not only that the vast proportion of retail price increases are within the Government's power to control but that recent increases have been largely due to Government action. The Government are resorting in the proposal to examine retail prices and the way that this has been brought to the public's notice, to the kind of doubtful "leaked" stories similar to the D Notice story in the Daily Express.
  This could be called the "L.S.D." story with the news of the shock "commando" scrutinising individual prices. This is the worst sort of intimidation, and uncertain shadow Government by innuendo to which we are becoming accustomed under present Ministers, and it will not do.
  The First Secretary has emphasised the so-called voluntary principle, but my understanding of "voluntary", dating from Army experience of the voluntary church parade, is that it implies the opportunity to opt out, and this is what the Government seem to be disallowing. They have the other conception of volunteering, which in the Army was symbolised by, "You, you and you". Do they really believe in the voluntary principle—
  Mr. Speaker: Order. That is a general question which might come on another occasion, but not on this one. The hon. Gentleman must address his remarks to whether retail prices shall be included or not.
  Mr. Alison: I come back to the point, that the Government are taking quite unnecessary powers. They already have the main responsibility for increases which have taken place in retail prices recently. Judging by the leaked reports in the Daily Express, and our suspicion that they will seek to reject the Amend-
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  ment, the Government appear to be trying to shift the odium for retail price increases from where it belongs, which is in their own court, on to the unfortunate shopkeeper who is the last soldier in the rank in respect of all the pressures which built up earlier in the line as a result of increased prices.
  As my hon. Friend the Member for St. Ives (Mr. Nott) pointed out, over half of the 2½ per cent. increase in the Index should be laid at the door of the Government as a result of Purchase Tax, Selective Employment Tax and the recent increase in petrol prices, and the 2s. in the pound increase in electricity charges will also be passed on. How will the right hon. Gentleman disentangle all these things when he examines retail prices? All he is doing is shifting the odium on to the retailer, who has to digest the varied increases which the Government generate. How will blame and praise be apportioned? Once an unfortunate retailer is to be examined by the "ghost squad", his reputation will be lost.
  Mr. Peyton: I wonder whether my hon. Friend has any evidence for supposing that the squad will be a ghost squad? I should wholly welcome that.
  Mr. Alison: The "ghost squad" is an effective arm of Scotland Yard. If that connotation is to apply, the squad will probably be only too effective if it is used by the Government. As I say, odium will be cast on the unfortunate retailer, and this will be largely the responsibility of the Government.
  Mr. Laurence Pavitt: Is the hon. Gentleman saying that the one person at whom the Government must not look to keep prices down is the retailer?
  Mr. Alison: No, I am saying that they must not adopt this system of the ghost squad, the connotation which they apparently leaked to the Press, as the system which they propose to introduce to discharge the so-called voluntary aspect of prices and incomes. Apparently they are to send people round to scrutinise prices in the shops and hold them up to public scrutiny. This is not in the White Paper, but it has been publicly leaked to the Press by the Government. It is monstrously unfair.

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  The extra cost of electricity may be a factor which may be allowed under the recent White Paper as a legitimate reason for increased prices, but one thing is not clear. The proposed increases in electricity charges will come into effect in September and will amount to 2s. in the pound, and they will have an immediate effect on retailers already hard hit by Selective Employment Tax. But electricity authorities are apparently to be allowed to increase their charges because of a back-log.
  According to the Financial Times of 30th June, the Minister of Power, apparently in a private address to a meeting of the Parliamentary Labour Party, said:
  "The Government had already delayed earlier price increases—"
  for electricity—
  "because of the incomes policy and now charges had to take account of the back-log."
  Mr. Speaker: The hon. Gentleman cannot, on this Amendment, discuss the merits of the electricity charges. He can mention them, as he has done, but he cannot argue about them.
  Mr. Alison: I will not argue about them, Mr. Speaker, but I should like to know whether the principle of taking up the back-log of increases in prices, which has been adduced by the Minister of Power to justify the price increases, will be allowed to ordinary retailers. If so, how will the Government decide where blame and praise really lie?
  In this idea of an unofficial body going round snooping we see the danger of the reputations of individuals, firms and so on being tarnished through being selected for special treatment. They will be held out to the disapproval of the public because the Government are trying to shift the odium on to a section of the public which should not bear it. The greater part of the responsibility lies with the Government. The increases in retail prices are sometimes directly and in many cases indirectly the result of the Government's policies.
  I have already mentioned the Selective Employment Tax and the increase in the cost of petrol, and so on. What about the increase in Purchase Tax for motor cars sending up the prices of secondhand motor vehicles or the secondhand market
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  generally suffering increases in prices as a result of squeezes in other directions? Is this held to be undesirable? What about the price mechanism in housing? It may well be that the level of rents, particularly council house rents, can best be kept down by allowing increases in certain sectors.
  Mr. Speaker: Order. The hon. Gentleman must not let his enthusiasm carry him away. We cannot discuss the whole of the Government's policy on this Amendment.
  Mr. Alison: My enthusiasm, Mr. Speaker, is entirely for the Amendment and in no way for the Government's proposals in the Bill.
  The First Secretary has done what appears to me to be an ungenerous and uncharacteristic trick in putting forward in the newspapers the idea of a ghost squad. I hope that he will come clean about this and recognise that the greater part of the price increases which we have suffered is his own responsibility and will stop the policy of snooping and innuendo, which seems to be such a part of the Government's policies.
  The Chancellor of the Duchy of Lancaster (Mr. Frederick Lee): The hon. Member for Barkston Ash (Mr. Alison) was apparently very worried about the Government accepting odium. His argument about the effect on prices of Government policies has always been accepted on these benches. Indeed, we have been sneered at from the other side for accepting what he calls odium. It is true that of the very small increases which have taken place in the retail index a considerable part is due to policies of the Government which were necessary because of the critical situation in July. We do not in any way disagree that we were responsible for a goodly portion of the 2½ per cent. increase in the retail index which has taken place in the last nine months.
  So that we may put the matter in its correct perspective, let us take another critical nine-month period, that to which was given the term "the Selwyn Lloyd freeze", when retail prices increased by 4½ per cent. instead of 2½ per cent. Perhaps by this means we can get the relative accomplishments of the two parties in their right perspective.

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  Under Part II of the 1966 Act, a temporary standstill under Section 7 (3,b) or Section 8(2) can be imposed on increases in manufacturers', wholesalers', or retailers' prices. If we accepted the Amendment it would mean that retail prices would be completely excluded from our purview.
  I was asked questions by a number of hon. Gentlemen about ghosts or commandos and matters of that sort. I, too, read in the newspapers that the Government were thinking in terms of getting together a squad of people to investigate retail prices over a wide area. It is entirely untrue that the Government have made any such arrangements. What we have discussed is that, when there is a concentration of complaints about a particular price increase—when we are receiving well over the average number of complaints—we would think it right to have a close look at that price.
  That is a very different matter from what the hon. Member for Yeovil (Mr. Peyton) was talking about. We appreciate that, in a nation in which there are 2 or 3 million price movements a year, one cannot possibly have a huge squad of people going round supervising every price. Nor would the Government attempt such a thing.
  4.30 p.m.
  Mr. Peyton: I want to get the record straight. I did not initiate the reference to a "ghost squad". It was my hon. Friend the Member for Barkston Ash (Mr. Alison) who referred to it for the first time. I expressed the pious hope that it would consist only of ghosts because disembodied spooks would do less harm whereas a heavy-footed squad sent round by the Government would cause a lot of alarm and confusion.
  Mr. Lee: There will be neither heavy-footed gentlemen sent round by my right hon. Friend or by me nor the ghosts of Christmas past, present or future. I have explained what it is we have discussed and it is not the grandiose statement which appeared in the Press.
  This debate has been interesting. The hon. Member for St. Ives (Mr. Nott) told us that there had been a remarkable stabilisation of retail prices—he suggested that it was such a great success story that there was no need for us to have any
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  kind of control at all. That was a true chronicle from the Conservative Party of the events of the last 12 months and I accept it entirely.
  My hon. Friend the Member for Penistone (Mr. Mendelson) rightly asked whether we believe that, arising from this new legislation, we could achieve success similar to that which, quite rightly, the hon. Member for St. Ives congratulated the Government on achieving during the last 12 months.
  Mr. Mendelson: As my right hon. Friend is enjoying himself, I ask him to remember that if he goes on for years to come to use the praise of hon. Members opposite, but fails to get ours, it might put him in a queer position one day.
  Mr. Lee: I am speaking in the knowledge that the vast majority of my right hon. and hon. Friends support me, even if two or three do not, on this point, find themselves able to do so. The same apparently obtains on the benches opposite.
  We are fortified by our success and now that we have proved our case by facts and figures we believe that we can bring about not what hon. Members opposite have described as further restrictions—an odd choice of phrase, since the Bill is much less restrictive—but something far more constructive in its approach to the prices and incomes policy. I do not think that we should be too despondent and talk in terms of restriction rather than of a constructive approach.
  If we continue as we intend to continue, supervising manufacture and wholesale prices—which, in any case, is a responsibility of Government Departments quite apart from the prices and incomes policy—and achieve success, gaining improvements in manufacturing and wholesaling methods, it would be unfair if retailers were able to cream off the results of improvements in efficiency of manufacturers and wholesalers.
  There has been one occasion on which the Government asked the Prices and Incomes Board to look at a retail price and I would have thought that, on a day like this, it would commend itself to hon. Members. In its Report on Costs, Prices and Profits in the Brewing Industry—

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  Command Paper No. 2965—the Board made recommendations about the retail price of beer charged in public bars and recommended that, with some exceptions, there should be a standstill of from six to nine months. Surely that was an achievement worth having. It may well be that we shall require on future occasions specific power to look at retail margins and it would be wrong for us to rob ourselves of the ability to do so.
  My hon. and learned Friend the Member for Northampton (Mr. Paget) argued that we should retain resale price maintenance. It was not the Labour Party which introduced the Resale Prices Act although, in fairness, I should say I believe that we are now beginning to benefit from it. I believe that, in some directions, there is, in the retail trade, more competition than there would have been without the Act.
  Mr. Deputy Speaker (Mr. Sydney Irving): Order. I understand that Mr. Speaker intervened to keep the debate to the Amendment, which is that retail prices should be exempt from any standstill after the pause. I find it difficult to believe that the Resale Prices Act comes within the provisions of the Amendment.
  Mr. Lee: With respect, Mr. Deputy Speaker, I would have thought that I was no, far off. I was arguing that the Act had had a beneficial effect on retail prices. However, I shall not continue that line.
  Mr. Paget: On a point of order, Mr. Deputy Speaker. It was I who raised this subject when Mr. Speaker was in the Chair. The argument I was putting then was that one would never successfully control prices except through the manufacturer or supplier and that one could only do that through some form of price agreement between the manufacturer and the retailer. I thought that that was in order and I think that Mr. Speaker also thought it was.
  Mr. Deputy Speaker: I would not be too happy to pronounce upon that now because my feeling is that the argument is, nevertheless, a little wide of the Amendment. However, as the Chancellor of the Duchy of Lancaster is going on to some other subject, I will not press the point.
  Mr. Lee: I have practically finished the argument I wish to deploy, Mr. Deputy Speaker.
  I believe that it is essential to retain these powers. The debate has been helpful in informing the country of the success we have achieved. I know that some of my hon. Friends still believe that greater success could have been achieved in some other way. I have said that this is a huge operation and that no Government in a democratic society ever could hope to set up a mechanism which could control every retail price movement. Nor would we attempt to do so.
  I have argued that other events have brought extraordinary pressures to bear and the stability of the retail price index, in spite of these pressures, has shown that our policies are succeeding. This is not now a matter of theoretical argument about what may or may not happen a few years from now: we have already achieved great success in this respect. Especially among low-paid people the steadying influence of our policies on the cost of living have been of great value. When one looks at the backlog of other issues which produced the pressures which we had to counterbalance by our legislation, I believe that we are entitled to expect that the House will support us in retaining the powers which we now have.
  Mr. Iain Macleod: If the Chancellor of the Duchy believes his peroration, he will believe anything.
  I was disappointed that the right hon. Gentleman rose so early in the debate—we have hardly started it yet. It is only in the interests of tidy debate that I follow him, although I hope that other Members will continue this most important point.
  The Chancellor of the Duchy went on to move a vote of thanks to my hon. Friend the Member for St. Ives (Mr. Nott) because, whatever alliances may be formed in the course of the evening, or night, he has succeeded in uniting the other side on an issue concerning prices and incomes—a very remarkable achievement indeed.
  I would like to support the Amendment by an illustration from the particular before I move to the general. My

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  experience of constituents has been somewhere between that of the hon. Member for Penistone (Mr. Mendelson) and that of my hon. Friend the Member for Truro (Mr. Geoffrey Wilson). I have not had anything like 100 letters, but I have had some. I agree with the hon. Member for Penistone, on the issue of retail prices, that the public can judge, but I go on to draw the conclusion that because that is so we do not need the provision that is in the Bill and we should support the Amendment.
  The particular instance that I give—I dare say other Members could match it from their own correspondence, but it illustrates the deep waters that we are in when we try to contemplate power over retail prices—came to me from a woman constituent who is obviously extremely intelligent and persistent. The facts are that after a period of severe restraint a world-famous brand name on a toilet preparation changed from a plastic to a glass container, and to pay for the additional cost it reduced the amount from 35 grammes to 25 grammes. The retail cost remained the same, but there was a substantial increase in price because of the reduction in content, leaving aside the merits about whether the container is or is not an improvement.
  My constituent wrote to me, to the Consumer Council, to the firm and to the Board of Trade. To the firm she said that she preferred the old plastic container to the glass, because it was easier for travelling, and that the cost, taking into account the reduction in content, was too much and that she would no longer buy that particular brand. That action by her was exactly right, because that is the operation of the market. If her opinion is the right opinion on this particular retail price and if all the other people in the country who buy this preparation took the same action, the firm would "go broke". That again is the operation of the market.
  However, there is the other side. The firm does not make these changes because there is an "r" in the month or to have fun. In this case, the firm went in for extensive market research and its view was that the container and the new improved system, which we are so used to hearing on television, was an improve-
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  ment. If the firm is right then people will buy it and the firm will prosper and that is as it should be.
  In other words, on this particular retail price—and hon. Members could no doubt duplicate this from their own correspondence over and over again—the position of my constituent in complaining and refusing to buy the product is absolutely right. The action of the firm is for the future, because this is a matter of supply and demand and the way the market works. The firm thinks it is right and my constituent thinks it is wrong. No doubt we shall see.
  4.45 p.m.
  But it is nothing to do with the Board of Trade to whom this matter was in due course referred, and because we do not believe that these matters have anything to do with a Government Department we seek to move the Amendment and take retail prices out of the Bill.
  As a consequence of this short episode that I have related, my constituent is very indignant. Think of it in terms of any other retail price. Suppose that she goes to buy a dress. If she finds that the length of the skirt, the material of the dress and the cut of the dress are prescribed by a Government Department, she would be very angry. Such things are only tolerable in wartime, if at all, but there is no essential difference between the two. In neither case has a Government Department any standing in the matter. This is a real difference between the two sides of the House.
  I said on Second Reading that in relation to prices the back bench supporters of the Government were being conned—I believe that is the right word—and some of them liked it. Some of them want to feel that this power is there, even though they and the Chancellor of the Duchy and the First Secretary and the rest of the Front Bench know perfectly well that it is a bluff. It is not possible to control prices, whether you try and do it by diktat or by reference to Aubrey Jones or in any other way.
  This is party because what emerges as a retail price, perhaps in the food sector, the most important of all, is affected more than anything else by the weather, and even Governments cannot prescribe that. In all the other range of retail prices such matters as design,

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  fashion and packing an a hundred other things come in all the time. It is, therefore, impossible—and if the Press reports are right, this has been put by Mr. George Woodcock and others to meetings of the party opposite—to contemplate a Government having any serious impact on the issue of retail prices.
  We have in the White Paper on Prices and Incomes Policy After 30th June, 1967, the philosophy of the Government which leads them to say that they need this particular power. In paragraph 2—this is a contradiction which was referred to in Committee by the hon. Member for Worthing (Mr. Higgins)—they say that the July measures
  "have eliminated the excess pressure of demand…".
  In paragraph 6 they say:
  "…the aim must be to avoid any widespread and unjustifiable increases in prices due to pressures which may have been building up…".
  Whether paragraph 2 or paragraph 6 is right, they cannot be right together. The Chancellor of the Duchy made no attempt in his rather light hearted comment on what had happened since last July to justify this point.
  The aim in relation to prices is at the end of paragraph 7,
  "…the aim will he to concentrate on those prices which are of economic significance, including those of importance in the cost of living."
  I do not understand, and the Chancellor of the Duchy did not explain, what prices are of economic significance. The only example on which the Government have moved is laundry prices. We know why they did that. They had about 300 letters and they panicked and brought in an Order. I think that the Director-General of the C.B.I. said that industrialists felt betrayed by what had happened. Since then we have heard no more about it.
  The answer which the Chancellor of the Duchy was touching on and which the First Secretary gave in Committee was that one must not measure the success—that was the word—of this policy by the number of Orders. The Chancellor of the Duchy said that he had been fortified by the success of the policy since last July. What success in relation to retail prices? The Chancellor
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  of the Duchy of Lancaster produced one year, and he saw me looking at him and quickly passed over that example. I know how Ministers get briefed—it took a long time to find that year.
  It is perfectly true that there is another, but in the record of the last 10 years on seven occasions the retail price index went up by less, so that the Government's performance is worse than in those years, whereas in two years, one of which has been quoted, it is better. That is all that the Government can claim in 10 years. One example was quoted; no doubt the other will be quoted to us in due course.
  Mr. Frederick Lee: Does not the right hon. Gentleman recall that his hon. Friend the Member for Yeovil (Mr. Peyton) informed him that from April, 1963 to 1966 the retail price index went up 11½ per cent. and incomes 25 per cent.?
  Mr. Macleod: That does not alter my argument in the least. As the right hon. Gentleman will remember, the average amount of 22 per cent., in a period which is seasonally favourable all the time, compares very badly with almost every Tory year, with the two exceptions which I have given.
  There has been no success whatever with retail prices since last July. The Chancellor of the Duchy gave the lie, as it were, to what my hon. Friends have been saying about the commando squads. These were reported in the Daily Express of Wednesday, 5th July as being squads to do on-the-spot prices checks. It was the main story and I should have thought that it was a bit late to deny it now. If it were untrue, a denial should have been issued straightaway. After all, the Leader of the House has just issued a denial this afternoon of the speech which he made last Saturday and which I have not the slightest doubt was accurately reported by the Press Association. Perhaps in the course of the night another opportunity will occur to come back to that.
  There is no doubt that the word used by my hon. Friend the Member for Yeovil (Mr. Peyton) and others was right and that this policy is a mess. There can be no doubt that the Government have had no success with retail prices. There

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  can be no doubt that they do not intend to make a move about retail prices, except from time to time to hurl a bone to the wolves when the wolves behind them begin to snap a little too near the Government's sledge.
  The right thing to do, therefore, is to accept the Amendment and to leave retail prices out of the operation of Clause 1. We should join together and free retail prices from interference by the Government, because that interference is bound to be ineffective if tried and has been shown to be ineffective every time it has been tried.
  Mr. Pavitt: The right hon. Member for Enfield, West (Mr. Iain Macleod) began his speech by agreeing with my hon. Friend the Member for Penistone (Mr. Mendelson). I am pleased to be able to tell the House that I agree with the opening remarks of both speeches. However, I notice that the right hon Gentleman quickly parted company from my hon. Friend and drew a very different conclusion from the same facts. That is not the first time that that has happened in the House.
  The right hon. Gentleman made much of the fact that our constituents are knowledgeable about retail prices. Housewives, naturally, know more about retail prices than most male hon. Members do, but it is precisely because of the inability to do much about it that the Government need powers to lend support when and where that is necessary. That is precisely the purpose of the Clause which the right hon. Gentleman and his hon. Friends seek to amend.
  It is somewhat 19th-century economics to think that the consumer has sovereign control over retail prices because of his ability to buy or not to buy. What happens these days, as everyone knows, is that the consumer is on the sticky end of the wicket of large-scale promotion. It is promotion and production and the way in which things are sold which produce the market, and it is, therefore, essential that the Government should have some say if our constituents are to be protected.
  The right hon. Gentleman gave a classic example and almost destroyed his own case in the next sentence. He spoke of
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  a proprietary preparation whose quantity and container had been changed. Unless the Government are able to keep charge of that kind of thing, the consumer is unable to do so. It was the right hon. Gentleman's party which brought in legislation dealing with retail prices and it was the Leader of the Opposition himself, against a good deal of advice from his colleagues, who tried to end resale price maintenance.
  The right hon. Gentleman said that Government Departments could not interfere, but it was right hon. Gentlemen opposite who introduced the Weights and Measures (No. 1) Bill, about which we had much discussion before it fell, and which they followed with the Weights and Measures (No. 2) Bill, which dealt with retail prices of various kinds of commodities so that consumers could be protected. The right hon. Gentleman is usually logical and clear, but on this occasion he was a little ambiguous and I found him destroying his own argument in his own speech.
  Mr. Iain Macleod: I do not mind what the hon. Gentleman says about my speech, but will he make his own a little clearer? Does he suggest that the Government—and this is the only conclusion one can draw from what the hon. Gentleman is saying—should have powers to lay down what shape, size and material a container should be made of?
  Mr. Pavitt: I am too old a bird to be caught by that one. The right hon. Gentleman is trying to draw me far wide of the Amendment and the Clause. I should be out of order if I started to say how far the Government should use its influence in these respects, and the right hon. Gentleman knows that as well as I do.
  It is a classic red herring to argue that it is regimentation if it is provided that the retail price of biscuits, for example, shall be based on an 8 oz. packet and not on a 6¾ oz. packet. Most people would sooner be able to buy a clear package which was clearly understood with its contents printed on it in large and not small print so that they could know precisely what kind of retail price they were paying.
  It is absolute nonsense to think that we can do anything about prices if we

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  differentiate between prices of production, prices of wholesaling and retail prices. We cannot deal with prices as though they are three separate items, which is what the Amendment seeks to do. We have to recognise that what hon. Gentlemen opposite are saying is that they do riot like the Clause at all, which is honest enough, but the Amendment does nothing to protect the consumer which, I hope, is the desire of hon. Members opposite.
  Mr. David Webster: Is not the hon. Gentleman aware that on page 13 of the Prices and Incomes Board Report No. 13 on the Brewing Industry, that industry is divided between production, distribution and retailing, and that each is treated completely separately?
  Mr. Pavitt: I should be very surprised if the Ministry concerned—the Department of Economic Affairs, the Board of Trade or the Ministry of Agriculture —which would have a wide interest in each was not able to apply an interest to each. Surely that is the whole purpose of the Bill.
  The only way in which we can show that we want to make sense of prices, productivity and income is to take power to deal with prices. I agree with my hon. Friend the Member for Penistone that prices are more or less the key to a number of the other problems which we face. If we are to deal with prices, we must include the tail end, which is the retail price the consumer has to pay. The right hon. Gentleman said that this is a bluff, that we cannot do everything about the 3,000 different prices, and that every price increase cannot be looked at. I accept this, but what the Government have been doing over the last 12 months, and what they are doing now, is to show that by using their influence appropriately from time to time they can keep the lid on the runaway of prices which occurred during the 10 years before the change of Government in 1964.
  I hope that the House will reject the Amendment, because if it were accepted it would make nonsense of the Clause. I am sure that hon. Gentlemen opposite are as keen as anybody else to protect consumers, in spite of the fact that the hon. Member for Barkston Ash (Mr. Alison) was more concerned with the shopkeeper than with shoppers.
  5.0 p.m.
  Mr. David Howell: May I, as a member of the Committee which considered the Bill upstairs, extend a welcome to the hon. Member for Penistone (Mr. Mendelson) and his hon. Friends to our deliberations at this stage. They were, at times, sorely missed.
  I must break the harmony which seems to be growing between us on the question of retail prices, because the hon. Member for Penistone asserted that housewives were capable of judging when prices had moved upwards. I straight away disagree with that statement by asserting that this is not always so. In fact, in many cases it is not so, and the reason for this is that very often the price does not move. A housewife does not know when she is paying the same amount for less.
  We have just heard the hon. Member for Willesden, West (Mr. Pavitt) saying, in effect, that these changes in quality or content should somehow be policed. He wants observations of a detailed kind, not merely for prices—which admittedly one constituent of my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) was quick enough to spot, a change from plastic to glass, and a change in content—but changes in packaging or content which many housewives do not spot as they hurry through the supermarkets.
  I have the support of no less a person than the Chairman of the Institute of Weights and Measures Administration who is reported as saying at the end of June that there were 492 varieties of biscuits produced by 23 manufacturers, and that these packages were being changed all the time. He went on to ask, according to the newspaper report:
  "How can the purchasing public compare values and prices when this practice is adopted?"
  The hon. Member for Willesden, West would like a team of people out on the job checking these 492 varieties and 23 manufacturers' operations weekly, or as often as they changed their packages. This is the kind of price control which he would like to see. It would be extremely costly in manpower. I suppose that it would be possible, but at the end of the time I am sure that many of the people would never look another biscuit in the face. This is the kind of

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  variety and price change that is going on all the time.
  That leads me to the central question which my right hon. Friend the Member for Enfield, West raised, namely, if a proper system of retail price control is to to be operated how is one to take account of quality? The number of price movements concealed in quality and packaging changes is legion. These are price movements which affect housewives in many ways, and which will not be controlled by these powers, or by any other measures which the Government bring in. It is only when the housewife gets back home that she realises that her money has not gone as far as it did previously. These are concealed price increases, and the Government's power to control retail prices do not affect these. I come back to the Chairman of the Institute of Weights and Measures Administration, who reportedly said that there was an even more bewildering picture in soap powders, liquid and powdered detergents, and a whole range of packaged goods in the supermarkets and groceries.
  This picture is wildly different from the picture of success painted by the Chancellor of the Duchy of Lancaster, who, a short while ago, was in a mood to take a lot of credit for the success which had been achieved. I thought that he was going to take so much credit that he would overburden himself.
  The right hon. Gentleman said that my hon. Friend the Member for St. Ives (Mr. Nott) had congratulated the Government. I listened to my hon. Friend's speech, and I heard nothing of congratulation in it. What I heard my hon. Friend argue was that during the last year, when unemployment had risen, when there had been the most vicious credit squeeze for many years, when there had been strict credit restrictions, and when we had begun to see the effects of the Measure passed by my right hon. Friend the Member for Bexley (Mr. Heath) for the abolition of resale price maintenance—the discussion of which has been ruled out of order, but it has had some effect in keeping down prices—and when there had been a favourable move in commodity prices, retail prices had nevertheless risen by 2½ per cent. This is the fantastic figure which requires no congratulations, and
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  certainly provides no excuse for taking any kind of credit.
  It means that over the measurable area of retail prices, prices have increased, as any housewife can tell the right hon. Gentleman, and that over the vast area where the price itself has not moved, but the quality has,—there is one less biscuit in the pack, or half an ounce less detergent in the pack—here, too, real price increases have taken place. This is where the Government have no control, and this is why their policies for price control have not worked, are not working, and will not work, and why other, more sensible, and effective measures are needed.
  Mr. Norman Atkinson: I am sorry that the right hon. Member for Enfield, West (Mr. Iain Macleod) has disappeared, because I wanted to talk to him, and to one or two other hon. Members as well. I am sorry, too, that the right hon. Gentleman has got mixed up in the rather squalid grocers' revolt which seems to be going on on the benches opposite, because he is something of a giant among the many intellectual pygmies that there seem to be in the Conservative Central Office when it comes to dealing with economic affairs.
  The interesting thing about the debate is not what has been said about the whole question of retail prices, but that for the first time we have had a Front Bench spokesman from the party opposite asserting very clearly, in his support for the Amendment, that his party does not support the idea of controlling retail prices. They have said on other occasions that they cannot support the idea of industrial price control, so if we put the two together they are on record for the first time as saying that price control is not only impossible, but undesirable.
  Mr. David Howell: Before he reads that conclusion into his personal record, may I tell him that simply because the Government's present methods have failed to keep down prices are wrong, this does not mean that we do not advocate—and past Conservative Administrations have advocated—legislation to affect the level of prices. The abolition of resale price maintenance is a classic example of this, for which credit is being claimed by the Chancellor of the Duchy of Lancaster.
  Mr. Atkinson: I am grateful for that intervention, because it illustrates the problems of the party opposite. I am not quoting the minnows of the Conservative Party, but the right hon. Member for Enfield, West, who said quite categorically this afternoon that retail price controls are impossible and undesirable, and he supports the Amendment. It has been submitted to the House because the party opposite is arguing that retail price control is impossible.
  Mr. Terence L. Higgins: In the absence of my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod), I would like to make it clear that we are not saying that it is impossible to control the general level of prices, but that it is the individual price which we feel it is impossible to control.
  Mr. Atkinson: That is a rather curious statement. I am trying to clarify the situation. I can understand the view of the party opposite, because once we start to interfere with the price mechanism of organisations, we start to interfere with those who sponsor the membership or hon. Gentlemen opposite—[HON. MEMBERS: "Rubbish"] It is true. Not long ago the Chancellor of the Exchequer said that when he looked at hon. Gentlemen opposite he saw vacant faces, but he also saw the interests of X Y and Z represented by those vacant faces.
  Mr. Kenneth Lewis: Is the hon. Gentleman prepared to bet that there are fewer hon. Members on this side sponsored by any organisation, least of all by retail organisations, than there are Members on the benches opposite sponsored by the co-operative society?
  Mr. Deputy Speaker: Order. Both hon. Members are getting wide of the Amendment.
  Mr. Atkinson: We must get this clear. I noticed from the nods of my right hon. Friends on the Front Bench that it was in their own hearing that a responsible spokesman of the party opposite said that retail price control was not possible or desirable and, therefore, that hon. Members opposite were supporting the Amendment to remove retail price con-
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  trol from the Bill. That is a fair assessment of the situation.
  It is important to get the record right. The party opposite has shown itself to be clearly opposed to the idea of price controls. It was a pity that, over the weekend—between the squalls of yachting experience—the Leader of the Opposition could not have fitted into his statement of policy the argument that one of the facets of Tory policy in respect of economic management must be that retail price controls and industrial price controls are impossible.
  That was the case made by the hon. Member for St. Ives (Mr. Nott). He seeks to delete certain words because, he says, the whole theory of price regulation is an impossibility. Many of my hon. Friends have advanced the case for a price regulation or price licensing system. I do not want to stray beyond the guide lines of order. I shall stick strictly to the question of retail prices.
  Together with some of my hon. Friends I have argued that a policy to control retail prices can be successfully carried out by licensing retail outlets. That is the whole case for the policy of wage restraint and wage freeze. We have said that it is possible—with our curious mixed economy—to have a system of price licensing if retail outlets are licensed. We have based our case upon our experience with similar retail outlets which are licensed, or where there is some degree of control, as in the case of the Post Office and the licensing trade. It is possible for the Government to license all the retail outlets. The hon. Member for St. Ives is not correct in saying that retail price licensing is not possible.
  That is not to say that my right hon. Friend and the Government have been desirous of carrying out price control, because they have not made any attempt They have decided that economic management can best be carried out by allowing some increase in retail prices. Therefore, they have not wanted seriously to intervene to keep prices down. They have deliberately stimulated price increases to bring about a degree of deflation, and that has caused some criticism from this side of the House.
  I want to take up one point made by the Chancellor of the Duchy of Lancaster.

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  He claimed that we did have price control in the licensing trade. I do not know whether it is commonly known, but that is a bogus claim, because the only price regulation that the Government have is in respect of bar prices. Only in the public bar is any control possible. The publican or manager of a licensed house can charge what he likes anywhere but in the public bar.
  That is what has generally been done, and that has been the cause of hundreds of letters being sent to hon. Members on this side of the House by constituents who complain that prices have risen in hotels and public houses because the manager or tenant is allowed to charge whatever price he likes other than in the public bar. In these days the public bar is often about the size of a telephone kiosk. The licensing trade has not been placed in much difficulty in this matter.
  For some time there has been a system of price regulation under which merchants must inform the Government of any intention to impose a price increase on any item that is sold. He is obliged to inform the Government that the price of jam, for example, will rise by 1½d. next week, and he is then barred from imposing that increase for 30 days, unless permission is forthcoming.
  All that my hon. Friends and I are arguing is that every retail outlet, of whatever kind, should be licensed. Just in the case of a dog licence, if firms do not conform to the needs of the time they should lose their licence. We must have some such system of licensing. I do not disagree about the impracticability of controlling every luxury commodity. We have no quarrel on that score. It is possible to regulate prices in this detailed way. Our general thesis is that it is possible to have a licensing system such as that which applies to the Post Office and other licensed retail outlets.
  Far from shying from the question of intervention, we hope that the Government will come to grips with the problem, not only in resisting the Amendment but in going much further by pursuing a policy which enables us to have some price control, therefore encouraging the T.U.C. and other people to attempt voluntarily to carry out a wages policy.
  5.15 p.m.
  Sir Douglas Glover: The hon. Member for Tottenham (Mr. Atkinson) talked about this form of licensing being like a dog licence, and said that a firm might have to lose its licence because it made a large profit through efficiency or made a loss through being inefficient. It is not the case that the firm which makes the smallest profit, on a footage basis, is less efficient than a smaller firm selling at higher prices and so making a higher profit, and working within the Government system.
  Mr. Atkinson: I argued in this way because it has been suggested by hon. Members opposite that we wanted teams of snoopers going round the country looking for price increases. It is nothing of the kind. We have said that the onus rests upon the retail supplier to notify the Government. Apart from that, the people themselves would test the case for the continuance of the licence, and would judge whether the retailer had trespassed beyond the prices which they had considered to be reasonable.
  Mr. Deputy Speaker: Just as I had to intervene on the question of retail price maintenance, I must intervene now to point out that we cannot have a detailed discussion about alternatives. That is what we are in danger of doing on this question of licensing.
  Sir D. Glover: As the hon. Member for Tottenham has taken about five minutes over his intervention, perhaps I may reply. What he has suggested is completely unworkable. It would be a bonus for inefficiency and not for efficiency. Not even the Chancellor of the Duchy of Lancaster would be very enarmoured of his hon. Friend's argument.
  It is on the question of retail prices and not manufacturing prices that I maintain, after a lifetime's experience, that the Government's suggestion is completely unworkable. For many years, I have run retail shops and been in the wholesale business and I am familiar with many commodities. I do not say that a retailer might not sometimes make an exorbitant profit on some commodities, makes losses on other commodities, and so would be a fool if he did not. If he makes a good buy, he will make a

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  profit, but with a bad one it will be a loss and he has to balance the two. An enormous amount of trade is done on prices which they know that the public want to pay.
  My clothing business had an enormous reputation for the best value in a jumper at £1, or 19s. 11d. This had to cover an enormous number of price increases. If the price of wool went up, the weight of the garment was reduced, but if it went down, we gave better value. At that price, we covered an enormous amount of reductions in the quality of the garment. We offered manufacturers a large contract. If the wool market was unfavourable or wages rose, we had to consider that, but we want to give the best value at £1 and we succeeded.
  Suppose there were statutory control or retail prices in the clothing business. In one year, men's cardigans are 22 in. long, and in the next might be 24, and the price rises because there is another 2 oz. of wool in the garment—
  Mr. Frederick Lee: Would the hon. Gentleman not agree that skirts nowadays should cost about 6d. each on that theory?
  Sir D. Glover: I agree, and women's dresses today are far cheaper than five years ago. If dress prices are controlled statutorily next year and fashions change and girls wear about four and a half yards of material, those calculations will be round the bend, and will be worked out only when the fashions change, because it will take months—
  Mr. Webster: In one of the best sections of the London export business, how would my hon. Friend envisage these controls in Carnaby Street, for instance?
  Sir D. Glover: Exactly. No sensible group of people could decide on the price of half the things in Carnaby Street. They have recently been selling secondhand guardsmen's tunics which they probably bought for a shilling each and of which they put up the price when they discovered the enormous demand. After all, there were only so many such tunics available, and they made a good profit out of what was available. Next year, it may be something else, but it will take the Board of Trade 12 months to work out these things and they will be behind the times all the time.
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  The same applies to food. The average greengrocer knows that, in June, he will sell X pounds of tomatoes. If there is bad weather, and tomatoes are scarce, he will sell about the same quantity, provided that they do not exceed a certain price. If there is a glut, he sells roughly the same quantity, because each household cannot eat three times as many just because they are cheap. When the price is low, his margin is higher and vice versa. That seems a contradiction in terms, but he must get so much profit per pound because his sale is much more static on the number of pounds he sells than on the cash turnover. When the price is low, he wants a big mark up, and when it is high he does not need such a high one.
  When a market changes almost hourly, how could any Government work out a price control system? This applies not only to tomatoes and greengrocery, but to meat and to anything baked. Hon. Members who, like me, shop at the weekend for their families know that the price of scones cannot be regulated. Would every one have to be weighed? Every housewife knows that they are only pinches of dough put into an oven, and even machine-made scones must vary in weight by up to 20 per cent. There is an enormous give and take in much retail distribution and there is bound to be.
  If someone has a bad tomato in a pound bag, that is not a deliberate Machiavellian act by the retailer, who only picked out half a dozen. I might be the next customer and get five good ones in my bag. Hon. Members opposite seem to have forgotten that we are talking about controlling retail prices and not about the electricity increases, which the right hon. Gentleman did not mention, although his constituency and mine will face 15 per cent. increase. This is something which the Government should inquire into, because it is the production end.
  On the retail end, a long lifetime of experience convinces me that it would be impossible, without laying down standards like those of the utility scheme during the war, that only certain things should be made if prices are to be controlled. Do hon. Members opposite, in a growing modern economy, want to start

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  stipulating what will be made or sold? There is always a changing of fashion, habits and tastes. Even a biscuit manufacturer, with all his vast variety, tries a new biscuit or a new make-up of biscuits. No doubt he first sells it cheaply because he is trying to tempt the public to buy. He may, therefore, be selling at cost. or below cost.
  5.30 p.m.
  But suppose that the biscuit becomes popular. If the manufacturer is to have a large amount of his manufacturing turnover in the biscuit, it is essential that he should get a proper profit on it. Perhaps in the first lot of biscuits there were seven in a packet. But having established the biscuit on the market he has to put it on the same level as all the other biscuits and, therefore, he puts six in a packet. One could say that one was being robbed, but a far better way of looking at the matter would be to think that previously one was being tempted with an extra biscuit to buy the biscuits and that this was the bonus. Now one is paying the proper price for it.
  Even with all the vast amalgamations, there is still fierce competition in selling goods in the high streets of the country. Far more than Government exhortation or Government control, the thing which made me—and I am sure that this applies to every efficient retailer—study the question of sales was the competition from somebody across the road who was fighting me tooth and nail for my trade. There is no law of the Medes and Persians which says that a retailer stays in business if he does not provide what the public want. I do not accept that the public do not know what they are up to. Most people know perfectly well when the wool is being pulled over their eyes. They deliberately accept it in most cases.
  Take the question of cosmetics. We have all got wives, daughters and girlfriends. Therefore, there is not one of us who has not heard a great deal of conversation about this matter. Women like articles to be wrapped in attractive packages. They may be told that one package does not contain as much as another package, but it may be a lot more attractive and look much nicer on the dressing table or when she takes it out of her handbag. She is perfectly well
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  aware that the more attractive bottle does not contain as much scent or powder, but it looks very much nicer when she takes it out in front of the hon. Member for Tottenham (Mr. Atkinson).
  There is very little about which the British woman does not know when she goes shopping. She is prepared to buy vegetables in a shop which she thinks is more reliable than another, although its prices may be higher. She realises that she will pay more in one shop than in another, but she knows that it is a more reliable shop and that its reliability outweighs any 1d. or 2d. which she might save by going elsewhere. Other people want to buy in the keenest possible market and they are not interested about service. Therefore, they go to a different shop.
  Will those two shops have to sell their products at the same price? If so, we shall be depriving the public, first, of a great deal of satisfaction in shopping and, secondly, of their chance to get better quality and better service even if they have to pay more for it. A woman who buys a dress in a shop where there are bare wooden floors or linoleum expects to get a cheaper dress than the woman who goes to Harrods and walks on thick carpet. The woman who goes to Harrods expects that Harrods will have to work on a bigger margin.
  Do both establishments, selling exactly the same merchandise, have to sell it at exactly the same price? If so, it will not be long before Harrods closes. If it did, would it be a good thing for the nation? That would remove a great deal of dignity from the nation. Not many overseas visitors would come here if many of the big stores closed. They cannot possibly compete purely on price. They compete on price, service, environment and all the other things which go to make up shopping.
  To talk about statutory control of retail prices is a nonsense which should be opposed. In a free society, it is an impossibility.
  Mr. David Winnick: The Conservative Party has consistently opposed intervention in the price mechanism and, therefore, this Amendment was to be expected. However, there is a contradiction in the argument of the

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  Opposition. We have been preached at for the last hour or so about how wrong ii is to intervene in the price mechanism and we have been told that the Government should not consider it their responsibility to meddle in such matters. But hon. Members opposite have spoken about items which have risen in price in the last six months or year. Therefore, logically we should be arguing for tighter controls and not less control.
  I see no reason to adopt this 19th century attitude, as my hon. Friend the Member for Willesden, West (Mr. Pavitt) described it, whereby one does not intervene in cases in which it is considered wrong to intervene. One of the reasons why I was willing to support and vote for the prices and incomes policy last year, with a great deal of hesitation, was that the Government said that it was not just a question of pegging incomes because of the economic situation but also of doing something about prices.
  When I abstained last October, again with hesitation—no one likes abstaining against one's own Government—I did so because I felt that the Government had not taken enough action over prices. I should find it impossible to support any incomes policy if the Government were not willing to take the necessary action ever prices. That is absolutely essential.
  One can make out a strong case for saying that, because of the economic situation and the economic difficulties, the Government must have these reserve powers for another year; but they must be combined with reserve powers on prices. If hon. Members opposite say that we have not been willing to use these powers very effectively on prices, I hope that my right hon. Friends on the Front Bench will take heed of those words and will recognise that there is a need for strong, effective action over prices and not just over incomes.
  Time and again during the last few months my constituents, and, no doubt, the constituents of other hon. Members, have said that prices are going up. Rightly or wrongly, they thought that last year, as a result of the July measures, not only incomes but prices would be frozen. Perhaps this explains to a certain extent some of the reverses which we suffered earlier this year. I see no reason why we should not be perfectly frank about
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  that. I have never said, and the Government have never said, that all prices would be frozen.
  Sir D. Glover: The Selective Employment Tax alone will increase prices by 5 per cent. on what I would call the weekly shopping basket.
  Mr. Winnick: I know about the problem of the Selective Employment Tax. The picture is not as one-sided as it is sometimes made out.
  I had hoped that over the last year the Government would be more militant over prices. It is a disappointment that we have not had a success story on prices. But that does not mean that we should take out, as the Opposition would like us to do, any reference to retail prices in the Bill. We should be just as firm over prices as we are over incomes.
  In a recent report published by the Ministry of Social Security, attention is drawn to the number of families living in great poverty and hardship. I raised this matter at Question Time today. A number of these families have husbands in full-time employment and it is obvious that many of these, who are earning low wages, will be adversely affected by the reserve powers in our incomes legislation.
  One can argue that, because of the economic situation, it is necessary for the Government to take these reserve powers. However, what is to be the plight of these people, many of whom are earning less than £l5 a week, if they find that it is more difficult for them to get wage increases in the coming 12 months, but if prices continue to rise? I put this question to my hon. Friend the Parliamentary Secretary to the Ministry of Labour earlier. I now ask it of hon. Gentlemen opposite who support the Amendment, because if they are willing to delete this provision referring to retail prices, those who are living on very small incomes will be even worse off. On the one hand they will find it difficult to get a wage increase while, on the other, there will be no restraint over prices. This proves that the Amendment is a policy of sheer madness. If the Government are to be given reserve powers—and I appreciate that some of my hon. Friends are not agreed about that; I support the move because, rightly or wrongly, there is little alternative—it is essential that prices are included. Not only must we

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  reject the Amendment—and I assure hon. Gentlemen opposite that, Left or Right wing, my hon. Friends and I are united over this one—I implore the Government to see, in the coming 12 months, that effective action is taken over prices. If we do not we will be penalising the very section of the community which sent us here and which the Labour Party came into existence to defend.
  Mr. Webster: It is clear that there is a division between the two sides on this issue. The hon. Member for Tottenham (Mr. Atkinson) described supporters of the Amendment as being concerned in a "squalid grocers' revolt". He has a short political memory, although he was not here when we debated the resale price maintenance legislation. There was certainly nothing like a squalid grocers' revolt on that occasion. The remarks of hon. Gentlemen opposite on this issue show the clear division that exists between the parties on this subject.
  My hon. Friends and I take the view that prices can be kept down by free competition and activities in the market place. Hon. Gentlemen opposite, on the other hand, want to control prices generally—and the hon. Member for Willesden, West (Mr. Pavitt) went so far as to show that he would control every aspect of prices, even to the extent of the wrappings, contents and quality of the articles inside, say, a box of cosmetics. This is rigid control going mad.
  Mr. Pavitt: The hon. Gentleman is taking my remarks too far. He has put up a bogey merely to knock it down. I said the whole sphere of legislation needed looking into and required control, and I was referring to legislation passed by the present and former Governments.
  Mr. Webster: It was only at the last moment of his remarks that the hon. Gentleman realised the full implications of what he had said. When my hon. Friends challenged him about his remarks, he tried to say "Oops!"—as though he had almost said, or perhaps had said, something that he should not have said. But it was too late. If attention had not been drawn to what he had said it might have been necessary for my hon. Friends to have gone through the OFFICIAL REPORT to ensure that there
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  was nothing in his record which could be used as ammunition for the Conservative Party.
  5.45 p.m.
  In any case, I wish that the hon. Member for Tottenham would not use the word "squalid". He should be more generous to his political opponents. He should not refer to my hon. Friends and I being here at the beck and call of the producers of these articles. I hope that he was not implying that. I have taken the precaution of looking up the hon. Member for Tottenham in Dod's Parliamentary Companion—
  Mr. Atkinson: Really?
  Mr. Webster: Really, and I said "Dod's" and not "dogs". I was not going into any of the Prime Minister's statements about his supporters. I gather that the hon. Member for Tottenham is a sponsored trade union member of the A.E.U. I hope, therefore, that he will not accuse my hon. Friends of always having vested interests. I have no vested interest to declare on this subject.
  Mr. Atkinson: I undoubtedly have a vested interest. It is on behalf of the working-class. I am a sponsored Member and I openly carry a banner to that effect. I want hon. Gentlemen opposite to declare their squalid interests.
  Mr. Webster: The hon. Gentleman must not judge others so low. I assure him that there are others who are not as low as his imagination might lead him to believe.
  I have no interest whatever in retailing and I am sure that my hon. Friend the Member for Ormskirk (Sir D. Glover), who gave us a fascinating insight into his vast knowledge of departmental stores and supermarkets, has no interest to declare, except a vast knowledge of the retailing section of the community. The activities of this section have done more to reduce prices for the housewife than any other section since 1951.
  My hon. Friend the Member for Ormskirk showed what a great deal has been done by this section of retailing from the point of view of price and quality. He also spoke about Carnaby Street. I had hoped that, with his knowledge of military uniforms, he would have given us a little more than that fascinating

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  vignette of the activities of Carnaby Street which, however frivolous they may be thought to be by hon. Gentlemen opposite, are bringing a great deal of foreign currency to this country.
  Mr. Dan Jones: I, too, listened with great interest to the remarks of the hon. Member for Ormskirk (Sir D. Glover). I noticed that, despite the great strides made by the section of retailing to which he was referring, prices have not been prevented from rising since 1951.
  Mr. Webster: If the hon. Gentleman studies the retail price indexes of the large multiple stores and supermarkets he, will see that, in those establishments where retailing has been taken to its most sophisticated point, price rises have been a great deal less than in other sections of the community. He will note the difference between their activities and those of the co-operative society, which did not see the development of the supermarket and the 4,000 square feet-type of store and which did not develop itself along those lines, no doubt because it operates by committee. It has not been able to pass on price reductions to its customers to the same extent as the large private retailer has been able to do.
  Mr. Deputy Speaker: Order. I have tried not to interrupt the hon. Gentleman, but he is getting rather wide of the the Amendment.
  Mr. Webster: I apologise, Mr. Deputy Speaker. I was doing my best to answer hen. Gentlemen opposite and, in my enthusiasm, rather got carried away.
  My hon. Friend the Member for Ormskirk spoke at length about quality. It must be remembered that one can talk about petrol or chemical derivatives. One can discuss aromatics and make a distinction between various products. One can say, "These are new soapsuds" or, "This is a new petrol fluid". By saying that something is a new product, one can say that the price should be increased. That being so, who will check on these statements? Perhaps one might concentrate on the octane rating of petrol, though even this is subject to much doubt as between different octanes in Britain and the United States.
  The hon. Member for Willesden, West said that it was not possible to differen-
  142
  tiate between production and distribution, on the one hand, and between the various aspects of retailing, on the other. Has he read Report No. 13 of the Prices and Incomes Board, in which such a differentiation was made? He will see that the subject is divided right down the centre, in one case applying to the retail outlet and in the other checking on all other aspects.
  My hon. Friend the Member for Yeovil (Mr. Peyton) talked about "spooky snoopers" who would have to check every aspect of this. This will cost the community more than it is likely to save. My right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) asked whether we had climate or weather. I have the honour to represent the finest strawberry-producing area in Britain. Cheddar strawberries are the finest to come to London, Birmingham, or elsewhere. I know perfectly well that this year the Cheddar strawberry growers—
  Sir D. Glover: On a point of order, Mr. Deputy Speaker. Is an hon. Member allowed to advertise?
  Mr. Webster: I will not follow my hon. Friend into the path of advertisement, but I hope that he will not join the hon. Member for Swindon (Mr. Francis Noel-Baker) in his disapproval of anything that is advertising and at the same time gives people pleasure.
  The Cheddar strawberry growers were terrified in April that they would have a very bad year, and again in May, when the rain continued. Not only would there be a loss because of the reduced crop, but had they not been able to pass on an increase in prices through the retailing outlet the position would have been quite disastrous. Many of these people go in for direct selling. They sell these magnificent strawberries at the side of the road. This is carried out throughout the whole of the perishable foodstuffs side of the economy, and it shows the nonsense of what is being attempted now—
  Mr. Pavitt: In talking of the retail price of strawberries, the hon. Gentleman will doubtless recall it was his Government that introduced sale by the punnet or by the lb, so the regulation of strawberry sales was introduced by a Conservative Government.
  Mr. Webster: And a lot of strawberry growers very much welcome that fact, because they were known to be reputable and to be maintaining an adequate standard of quality. Let us maintain an adequate standard of quality but leave the price mechanism to operate for itself.
  All these retailers have had a terrific battering since the present Prices and Incomes Act was passed twelve months ago. We are not allowed at this stage to talk at length of the Selective Employment Tax but it represents a very considerable amount of oncost. In addition, we have the abolition of investment allowances, a vast increase in the costs of distribution, a vast increase in the rate burden as a result of Government action, and the 15 per cent. increase in electricity charges. The hon. Member for Tottenham speaks of a squalid grocers' revolt, but he probably has in his constituency grocers who are very much in revolt, and shopkeepers who have made the economy efficient are getting very fed up. I hope that the Amendment will be carried.
  Mr. F. A. Burden: I listened with great interest to my hon. Friend the Member for Ormskirk (Sir D. Glover), who has a very considerable amount of experience of the retail side of trade. I, too, may claim to have a certain amount of experience. I am chairman of a group of wholesale textile companies, and we rely for our business on the activities of retailers. I am amazed at the Government's attitude. I do not think that they know what they are taking on. They do not have a clue. If they had, the First Secretary would be a very worried man.
  I want to refer for a moment to the speech of the hon. Member for Croydon, South (Mr. Winnick), who said that the Conservative Party had, during the last year, very vigorously contested certain increases in prices. He admitted that price rises had taken place, but the position is that when we have a nationalised corporation controlling a certain section of the economy it is extremely easy to intervene on the subject of price.
  It is the easiest thing in the world for the Government to intervene, to question, to check and to refer to the Prices and Incomes Board suggestions of increased electricity prices. It would be the easiest
  144
  thing in the world for the Government to refer to the same Board increases in various railway prices and increases by other nationalised industries. But they do nothing of the sort. When it has been a question of nationalised industries asking for increases, the increases have been given straight away. There has been no question of referring those to the Prices and Incomes Board.
  The Government say that there would be difficulty, but there is no real difficulty if there is the desire to act in that way. On the other hand, there is now the desire to impose price control over a vast number of retail articles, but the possibility of doing so will be enormously difficult—
  Mr. Paget: This is an Amendment to take away a power that the Government have not used. They would not use it if they could, and they could not use it if they would. The real objection is that giving up these powers would be awkward because of trade union negotiations. Let us get down to reality.
  Mr. Burden: I am reminded that in one area of the retail trade one member of the Government has condoned increased prices, during the last year. Let us take as an example the case of selling meals in railway hotels. I sent to the right hon. Lady the Minister of Transport a bill from the North-Eastern Railway Hotel which had been sent to me by one of my constituents because, at the bottom of the bill, was shown a levy of 2s. 6d. for Selective Employment Tax. The Minister wrote back to me and said, "It is perfectly all right. They have every right to pass this on."
  That illustrates some of the difficulty in which the Government will find themselves, because if the railway hotels which sell food retail have the right to pass on to the public increased costs brought about by S.E.T., which is Government action, so, presumably, will the same caterers' prices reflect increases in electricity and other charges. I suggest that if the Minister is honest in saying that he intends to peg those prices, he will have one devil of a job in deciding how to do it.
  Those of us in the retail or wholesale trade know only too well that many of the retailers have had a very difficult

  145
  year, and that many of the smaller firms are on the brink of bankruptcy. I should like to ask the right hon. Gentleman, who talks of controlling retail prices, just how many bankruptcies of retail shops have taken place in the last year, and how many in the previous three, four or five years. He would be rather alarmed, I think, by the number. Does this indicate that they are doing extremely well out of the prices they are now charging?
  Another difficulty is that of controlling the price, not of one article produced by one industry but a tremendous number of articles. My own firm wholesales at least 4,000 items. Let us take the case of a large store selling, perhaps, 20,000 articles, and let us suppose that there is another store along the street selling the same number. How does the right hon. Gentleman propose to act? Does he intend to send someone into the one store and check every price from time to time in that store, and then do the same in the other in order to see that one does net charge more than its rival, and that they do not increase their prices?
  What about the supermarket that puts in a loss leader and sells it at a cut price? Is that cut price to be the standard price, the yardstick by which every price in the area is to be judged? What about the shop, cited by my hon. Friend the Member for Ormskirk, that is prepared to sell without frills? One firm I know in London has 66 shops which sell at the lowest possible level. Many of the other shops round about sell the same articles at a slightly higher price because they give greater facilities and greater service. What will the Government do? Will they say that everybody must sell at what happens to be the lowest retail price? This is an enormous problem.
  If the Government are serious in keeping down prices and saying that there shall be no increases, they should not come to the House and be so hypocritical as to allow price increases in nationalised industries whenever and wherever they may come almost without question and then introduce a Bill like this to pillory the retailer, who is in constant competition, not only with shops in other parts of the country, but with others around him, who will undersell him if they possibly can.
  6.0 p.m.
  Mr. Stanley R. McMaster: I support the Amendment which has been so ably moved by my hon. Friend the Member for St. Ives (Mr. Nott), who made one of the best speeches which we have heard during the passage of the Bill. I support all that my hon. Friend the Member for Gillingham (Mr. Burden) has said. He has spoken with great depth of knowledge and has developed the argument put forward by my hon. Friend the Member for Ormskirk (Sir D. Glover).
  Is it not ridiculous that a shop in London which, perhaps, gives credit for three months and delivers the goods to one's door should be forced to sell its goods at the same price as another shop in which one has to pay cash and carry the goods away?
  Mr. Burden: What about the position of the credit draper, who sells from door to door and has to charge more for the credit service which he gives, which often amounts to a year's credit?
  Mr. McMaster: This brings home to the House how totally misconceived is the Bill and the Clause. This part of the Bill, dealing with retail prices, is, perhaps, the most sinister part of it. It interferes in the fundamental law of our economy that the price of goods shall be determined by the relationship between supply and demand. If we interfere with prices and artificially keep them down, the supply will not increase because it increases only when the price rises.
  Mr. Mendelson: The hon. Member is suffering from the severe disadvantage of not having heard the speech of his right hon. Friend the Member for Enfield, West (Mr. Iain Macleod), who speaks for his party in these matters and who tried to prove conclusively that it is a matter of make-believe. The hon. Member is trying to blame the Government for all the misdeeds in which his right hon. Friend does not believe.
  Mr. McMaster: I firmly believe that the Bill is misconceived and could not have very much effect on the market. My worry is that it is the tip of an iceberg an initial step which might later be broadened. It is a very bad precedent to have

  147
  on the Statute Book and it could well be extended. I am dealing with what will happen if it is extended.
  The strength of the country as a trading nation depends on the flexibility of our economy and our ability to produce goods which the world needs. We will produce goods in a free economy only when the price rises, because that is the bait to the entrepreneur and the industrialist to produce the goods which are needed. Unless the price is allowed to move freely and flexibly, manufacturers will not produce the goods that the country needs and, therefore, by their not being produced for home consumption, none will be available for export. Japan has not become a great trading nation since the war by applying policies such as those.
  I wanted briefly to make the point of the inequity between various retailers, some giving good service and others bad, and, secondly, to underline the point that in a virile and changing economy we must allow prices to move freely to enable the economy to move flexibly and to meet world demand for Britain's goods.
  Mr. Higgins: The point which emerges from this important debate is that the Government's proposals for controlling retail prices are humbug. To use them would create impossible nonsense. If the debate has been somewhat lighthearted, it is clearly because of some of the ludicrous proposals which have been made from the other side of the House about how retail prices might be controlled.
  I want particularly to take up a point made by the hon. Member for Tottenham (Mr. Atkinson) in referring to the speech of my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod). Our position on this side of the House is abundantly clear. We believe that it is a vitally important function of the Government to control the level of prices, because if we do not do so, the effect on those with fixed incomes and on our balance of payments would be severe and important. It is, however, absolute nonsense for the Government to try to control individual prices.
  That comes out clearly in the Government's White Paper which now
  148
  forms Schedule 2 to the 1966 Act. The Government said in paragraph 7 of the White Paper:
  "It would not be in the interests of economic efficiency to seek to operate the policy in a rigid form involving a very widespread and detailed supervision of individual prices."
  That answers the point made by the hon. Member for Tottenham when he suggested the adoption of a system of licences.
  We want to know from the Government Front Bench what is the position concerning the banner headlines which appeared in the Daily Express. Are we to understand that the Government propose to establish a group of inspectors, as one might call them, or snoopers who will go round looking at individual retail prices? I hope that we shall have either a denial or a clear statement of intent about this from the Government Front Bench. We want to know what is their position concerning retail prices.
  Reference has been made in earlier speeches to the correspondence which right hon. and hon. Members, on both sides, have had. The vast majority of the letters which I have had about price increases have been concerned with increases by the nationalised industries. We are firmly convinced that that is something for which the Government have responsibility.
  Mr. Paget: May I remark how much we on this side welcome the enthusiasm on the benches opposite for increased subsidies to nationalised industries, which is what the rejection of price increases would mean?
  Mr. Higgins: Not at all. As the hon. and learned Member well knows, it depends also on the standard of efficiency in the industry and the arrangements which are made for raising capital.
  My hon. Friend the Member for St. Ives (Mr. Nott), who admirably proposed the Amendment, certainly did not, as the Chancellor of the Duchy of Lancaster suggested, congratulate the Government on the way that they control prices. On the contrary, he condemned them out of hand. It is only one or two gullible individuals on the back benches opposite who can believe that they were right to vote for this policy last year because the Government would succeed

  149
  in controlling prices as well as incomes and would continue to do so this year. The time span over which we must judge their performance in controlling the general level of prices is not merely from the date of last July's heavy deflationary measures to this July, but the two-year period extending to next July.
  The hon. Member for Willesden, West (Mr. Pavitt) said that because there was mass advertising, and manufacturers were trying to persuade people to buy one thing or another, we should not accept the Amendment. That mass advertising in no way reflects directly on the retail margin. Indeed, some retailers seek to offset it by introducing own label brands, and so on. The hon. Gentleman was off the point there.
  What was much more to the point was the brilliant speech of my hon. Friend the Member for Ormskirk (Sir D. Glover) who spoke with great experience and who stressed that, in allowing for individual retail price changes, allowance must be made for the fact that the price of some items will be decreased by the forces of the market and the retailer will make a loss and that in other cases it will be necessary for the retailer to increase the price so as to make a profit on a particular item when the demand for that item has increased.
  That brings me to the heart of the matter. I well recall, I think at the 1959 General Election, speaking at a street corner opposite the right hon. Member for Battersea, North (Mr. Jay). I spoke in Battersea Market. I got a question from the audience in the market asking me, "Why do you not control the price of goods sold at this market at the weekends?".
  This brings us to the heart of the problem. If an attempt is made to control individual retail prices, one is inevitably forced either into the position of rationing, because it will be found that more people will want to buy at the lower controlled price—the price below the competitive level—than there are goods to supply them with, or there is the problem of a black market.
  If the Government seek to control retail prices at a level which they regard as fair, as against one which is competitive, this is the kind of position which will inevitably arise. In view of the
  150
  White Paper, I cannot believe that they would be so stupid as that. On the other hand, we need to know very clearly what the Government's proposals are here. I hope that we shall have a reply from the First Secretary.
  I turn now to the question of what will happen about retail prices. Are we to understand that these are now to be included in the voluntary notification scheme? If so, this raises some administrative difficulties of enormous magnitude. Or are we to understand that retailers do not have to volunteer and notify increases hut, instead, Government snoopers will go round and pick on individual retailers, who will then be referred to the Prices and Incomes Board—in other words, "You need not volunteer under this part of the system, but our inspectors will go round chasing you up"?
  Mr. Burden: If there are to be Government snoopers, will the Government say how many snoopers will be required to cover the whole of the United Kingdom in the way that it should be covered?
  Mr. Higgins: I hope that we shall get an answer to that point if the First Secretary's answer to my questionis in the affirmative.
  The point here is: are we to have a system where individual retail prices, as a result of Government inspectors going round, will be referred to the National Board? If so, it raises some fascinating questions. The powers which the Government are taking under the Clause and which we seek to amend are primarily delaying powers. They enable the Government to control price increases for a maximum of seven months.
  In fact, many of the increases which will be discovered by those going round will immediately be reversed, almost before the inspectors have had a chance to report to the Government, let alone before the Government have had a chance to refer the increase to the Board or the Board has had a chance to make its report and the Government have taken any action. As we are concerned here purely with delaying powers, we want to have some idea of what situation the Government envisage these delaying powers might be used in.
  If an inspector going round the country has decided to refer an increase to the

  151
  Board, what allowance will be made for the question of consumer choice, a point which was raised by a number of hon. Members on both sides of the House? The service which is provided clearly makes a very big difference on the price which is to be charged. Are we to understand that the Government will control retail prices in such a way that no allowance is made for service? If an allowance is to be made for service, how is it to be measured? Are shops which give service and which, in spite of the abolition of resale price maintenance, continue to operate on a profitable basis, to be put out of business by Government price control? Will it be the case that, instead of shops continuing to give service, everyone must buy from supermarkets, where the customer wanders round and serves himself?
  6.15 p.m.
  It seems clear that the proposals the Government have in mind are very foolish indeed. We on this side do not believe that the proposals which the Government have put forward are practical. In fact, it is abundantly clear that the vast mass of the criteria set out in the Government White Paper, which now forms Schedule 2 to the 1966 Act—"vast mass" is an overstatement; there are in fact only eight—seem largely irrelevant to the retail trade.
  For that reason, my right hon. and hon. Friends and I think that the right criteria for retail prices is to rely on the forces of the market and is to rely on competition; competition, not only amongst retailers, but amongst those buying the things which retailers sell, because we believe that in this way it will be much more likely that individual consumers will get goods with reasonable service and at a reasonable price than otherwise.
  Mr. Atkinson: The hon. Gentleman has repeated that it is the Tory Party's policy to rely on the market forces. He has also said that it is the Tory Party's policy to control price levels generally, but not in any way to control individual prices or groups of prices. Can he tell us how this contradiction can be balanced?
  Mr. Higgins: I agree with everything that the hon. Gentleman has said. I
  152
  believe that there is no contradiction whatsoever. Therefore, I hope that not only my right hon. and hon. Friends, but hon. Members opposite, also, will support my hon. Friend the Member for St. Ives on the Amendment, which makes it abundantly clear that the Government will not propose to engage in a very foolish detailed price control or an extension of the discrimination and intimidation which they have so far restricted only to the wages field. I hope that we shall have a clear statement on what the Government's policy is on retail prices.
  The First Secretary of State and Secretary of State for Economic Affairs (Mr. Michael Stewart): I will reply very briefly, though my right hon. Friend the Chancellor of the Duchy of Lancaster has already explained what the Government have in mind and why hon. Members should not take too seriously the stories about commandos and ghosts with which some hon. Members who are not now here have regaled us.
  Much of the argument in favour of the Amendment was conducted on the entirely wrong assumption that what the Government intend to do is to try to control every and any retail price, whereas the boot is on the other foot. If the Amendment were carried, it would not be possible for the Government, under any circumstances, to take any action on any retail price. Hon. Members opposite, if they are thinking of voting for the Amendment, should think twice about it, because I do not think that this would be a reasonable proposition to put forward.
  Nothing that the Government have said, nothing that they have done in the use of their powers during the last 12 onths, suggests that they will attempt—
  Mr. Burden Mr. Burden rose—
  Mr. Stewart: I will not give way. We have had a long debate. I listened carefully to the hon. Gentleman. He can now listen to me. He has not been here during the whole debate, as I have.
  Nothing that the Government have said and no use that they have made of their powers during the past 12 months suggests that they will be likely to attempt any of the fantastic things that some hon. Members opposite have amused themselves by imagining. It cannot be put

  153
  forward as a reasonable proposition that the Government should be left with no powers over retail prices.
  My hon. Friend the Member for Tottenham (Mr. Atkinson) quoted the case of the control of the price of beer in the public bar. The argument was that that was, by itself an ineffective measure. I assure him that, by and large, that has by no means been so. It has been a partial measure, it is true, but it has been a valuable measure. If the Amendment were carried, it would not be possible to take even as limited a step as that. True, the powers were not used in that instance, but, if they had not been there, that limitation on prices could not have occurred.
  That is the issue before the House. There is no proposal to set up the totally unworkable chimeras with which hon. Members opposite have amused themselves. The issue on which the House will vote can be put in this way. Anyone voting for the Amendment will be saying that this is a Bill to prolong certain Government powers, but they must not in any circumstances include power over the retail price of anything. I do not believe that the House will assent to that proposition.
  Mr. Nott: If I may have the leave of the House, I wish to comment on the speeches of both Ministers. The Chancellor of the Duchy of Lancaster said that I had congratulated the Government on their policy. That was a thoroughly inaccurate statement. He knows that I made no such suggestion. One of the most unfortunate things that could be said of any member of the Tory Party is that he had congratulated the Government on their prices and incomes policy, a policy which is getting into more and more of a mess.
  Mr. Peyton: Perhaps that statement of the Chancellor of the Duchy could be attributed to a natural misunderstanding on his part. The right hon. Gentleman treated my hon. Friend's speech as an apology, if not as one congratulating the Government, and he may have taken
  that view because, if one addresses remarks to him merely with civility, the right hon. Gentleman is so unused to civility that he takes it as congratulation.
  Mr. Nott: He may have taken it in that way.
  Mr. Paget: On a point of order, Mr. Speaker. This is the Report stage. Has not the hon. Member for St. Ives (Mr. Nott) already addressed the House?
  Mr. Speaker: Order. First, the hon. Gentleman asked leave. Second, he did not need to ask leave. We are on Report, and the mover of an Amendment, if the Bill has been to a standing Committee, may speak again without even asking for leave.
  Mr. Nott: In winding up the debate on the Amendment, the First Secretary of State said that the power to control prices had not yet been used, and he cited the instance of beer prices saying, in effect, that no compulsory action had been taken. If that is so, why is it necessary to prolong this type of control over retail prices? The right hon. Gentleman has admited that it is not intended to send out any teams such as those to which certain of my hon. Friends referred.
  We on this side have never claimed, so far as I know, that it is impossible to control the trend of prices generally by economic management. At a time of rising unemployment such as we now have, with falling disposable incomes and the most severe credit squeeze since the war, these elements of the Government's policy have had, of course, some effect on prices. Control over the general level of demand must have some side effect on prices. The burden of our argument is that control over individual prices by the Prices and Incomes Board cannot possibly work. I am glad that my right hon. and hon. Friends intend to divide the House on the Amendment.
  Question put, That those words be there inserted in the Bill:—
  The House divided: Ayes 132, Noes 185.

  Division No. 428.]

  AYES

  [6.25 p.m.

  Allson, Michael (Barkaton Ash)

  Beamish, Col. Sir Tufton

  Bromley-Davenport.Lt.-Col. Sir Walter

  Allason, James (Hemel Hempstead)

  Bennett, Dr. Reginald (Gos. & Fhm)

  Brown, Sir Edward (Bath)

  Aster, John

  Biggs-Davison, John

  Bruce-Gardyne, J.

  Awdry, Daniel

  Blaker, Peter

  Bullus, Sir Eric

  Balniel, Lord

  Boyd-Carpenter, Rt. Hn. John

  Burden, F. A.

  Barber, Rt. Hn. Anthony

  Boyle, Rt. Hn. Sir Edward

  Carlisle, Mark

  Carr, Rt. Hn. Robert

  Hogg, Rt. Hn. Quintin

  Pardoe, John

  Cary, Sir Robert

  Holland, Philip

  Peel, John

  Channon, H. P. G.

  Hooson, Emlyn

  Percival, Ian

  Chichester-Clark, R.

  Hordern, Peter

  Peyton, John

  Clegg, Walter

  Howell, David (Guildford)

  Pink, R. Bonner

  Cooper-Key, Sir Neill

  Hunt, John

  Prior, J. M. L.

  Costain, A. P.

  Iremonger, T. L.

  Pym, Francis

  Craddock, Sir Beresford (Spelthorne)

  Irvine, Bryant Godman (Rye)

  Ramsden, Rt. Hn. James

  Crosthwaite-Eyre, Sir Oliver

  Jenkin, Patrick (Woodford)

  Rees-Davies, W. R.

  Crouch, David

  Jennings, J. C. (Burton)

  Renton, Rt. Hn. Sir David

  Dance, James

  Johnson Smith, G. (E. Grinstead)

  Ridley, Hn. Nicholas

  Deedes, Rt. Hn. W. F. (Ashford)

  Jopling, Michael

  Royle, Anthony

  Dodds-Parker, Douglas

  Kershaw, Anthony

  Russell, Sir Ronald

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

  Kimball, Marcus

  Scott, Nicholas

  Emery, Peter

  King, Evelyn (Dorset, S.)

  Sharples, Richard

  Errington, Sir Eric

  Kirk, Peter

  Shaw, Michael (Sc'b'gh & Whitby)

  Fisher, Nigel

  Kitson, Timothy

  Sinclair, Sir George

  Fletcher-Cooke, Charles

  Knight, Mrs. Jill

  Smith, John

  Fortescue, Tim

  Lambton, Viscount

  Stoddart-Scott, Col. Sir M. (Ripon)

  Foster, Sir John

  Lewis, Kenneth (Rutland)

  Summers, Sir Spencer

  Fraser,Rt.Hn.Hugh(St'fford & Stone)

  Loveys, W. H.

  Taylor, Sir Charles (Eastbourne)

  Glover. Sir Douglas

  Lubbock, Eric

  Taylor, Edward M.(G'gow,Cathcart)

  Glyn, Sir Richard

  McAdden, Sir Stephen

  Temple, John M.

  Goodhart, Philip

  MacArthur, Ian

  Thatcher, Mrs. Margaret

  Goodhew, Victor

  Macleod, Rt. Hn. Iain

  Tilney, John

  Gower, Raymond

  McMaster, Stanley

  Turton, Rt. Hn. R. H.

  Grant, Anthony

  Marten, Nell

  van Straubenzee, W. R.

  Grant-Ferris, R.

  Maxwell-Hyslop, R. J.

  Vickers, Dame Joan

  Griffiths, Eldon (Bury St. Edmunds)

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

  Wainwright, Richard (Colne Valley)

  Grimond, Rt. Hn. J.

  Mills, Peter (Torrington)

  Walker-Smith, Rt. Hn. Sir Derek

  Hamilton, Marquess of (Fermanagh)

  Miscampbell, Norman

  Walters, Dennis

  Harris, Frederic (Croydon, N.W.)

  More, Jasper

  Ward, Dame Irene

  Harvey, Sir Arthur Vere

  Morgan, Geraint (Denbigh)

  Webster, David

  Hawkins, Paul

  Morrison, Charles (Devizes)

  Whitelaw, Rt. Hn. William

  Heald, Rt. Hn. Sir Lionel

  Munro-Lucas-Tooth, sir Hugh

  Wilts, Sir Gerald (Bridgwater)

  Higgins, Terence L.

  Noble, Rt. Hn. Michael

  Wilson, Geoffrey (Truro)

  Hiley, Joseph

  Onslow, Cranley

  Hill, J. E. B.

  Page, Graham (Crosby)

  TELLERS FOR THE AYES:

  Hirst, Geoffrey

  Page, John (Harrow, W.)

  Mr. David Mitchell and

  Mr. Bernard Weatberill.

  NOES

  Abse, Leo

  Dewar, Donald

  Howie, W.

  Allaun, Frank (Salford, E.)

  Diamond, Rt. Hn. John

  Hughes, Emrys (Ayrshire, S.)

  Alldritt, Walter

  Driberg, Tom

  Hughes, Hector (Aberdeen, N.)

  Armstrong, Ernest

  Dunn, James A.

  Hughes, Roy (Newport)

  Ashley, Jack

  Dunwoody, Mrs. Gwyneth (Exeter)

  Hynd, John

  Atkins, Ronald (Preston, N.)

  Dunwoody, Dr. John (F'th & C'b'e)

  Jackson, Peter M. (High Peak)

  Atkinson, Norman (Tottenham)

  Eadie, Alex

  Jay, Rt. Hn. Douglas

  Bacon, Rt. Hn. Alice

  Edwards, Robert (Bilston)

  Jeger, Mrs.Lena(H'b'n&St.P'cras,S.)

  Bagier, Gordon A. T.

  Ellis, John

  Jenkins, Hugh (Putney)

  Barnes, Michael

  English, Michael

  Johnson, Carol (Lewisham, S.)

  Beaney, Alan

  Ennals, David

  Johnson, James (K'ston-on-Hull, W.)

  Bence, Cyril

  Ensor, David

  Jones, Dan (Burnley)

  Bidwell, Sydney

  Evans, Albert (Islington, S.W.)

  Jones, Rt.Hn.Sir Elwyn(W.Ham,S.)

  Bishop, E. S.

  Evans, loan L. (Birm'h'm, Yardley)

  Judd, Frank

  Blackburn, F.

  Fernyhough, E.

  Kelley, Richard

  Bowden, Rt. Hn. Herbert

  Fletcher, Ted (Darlington)

  Kerr, Russell (Feltham)

  Braddock, Mrs. E. M.

  Foot, Michael (Ebbw Vale)

  Leadbitter, Ted

  Brooks, Edwin

  Fowler, Gerry

  Lee, Rt. Hn. Frederick (Newton)

  Brown, Rt. Hn. George (Belper)

  Fraser, John (Norwood)

  Lee, Rt. Hn. Jennie (Cannock)

  Brown, Bob(N'c'tle-upon-Tyne, W.)

  Fraser, Rt. Hn. Tom (Hamilton)

  Lee, John (Reading)

  Brown, R. W. (Shoreditch & F'bury)

  Freeson, Reginald

  Lewis, Ron (Carlisle)

  Buchan, Norman

  Gordon Walker, Rt. Hn. P. C.

  Lipton, Marcus

  Butler, Herbert (Hackney, C.)

  Gray, Dr. Hugh (Yarmouth)

  Lomas, Kenneth

  Carmichael, Neil

  Greenwood, Rt. Hn. Anthony

  Loughlin, Charles

  Coe, Denis

  Gregory, Arnold

  McBride, Nell

  Coleman, Donald

  Griffiths, Will (Exchange)

  MacCoH, James

  Conlan, Bernard

  Hamilton, James (Bothwell)

  MacDemtot, Niall

  Craddock, George (Bradford, S.)

  Hamling, William

  McGuire, Michael

  Crawshaw, Richard

  Hannan, William

  Mackie, John

  Crosland, Rt. Hn. Anthony

  Harper, Joseph

  Mackintosh, John P.

  Crossman, Rt. Hn. Richard

  Harrison, Walter (Wakefield)

  Maclennan, Robert

  Dalyell, Tam

  Haseldine, Norman

  MacPherson, Malcolm

  Darling Rt. Hn. George

  Hattersley, Roy

  Mahon, Peter (Preston, S.)

  Davidson, Arthur (Accrington)

  Hazell, Bert

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

  Davies, Dr. Ernest (Stratford)

  Heffer, Eric S.

  Manuel, Archie

  Davies, G. Elfed (Rhondda, E.)

  Henig, Stanley

  Mapp, Charles

  Davies, Harold (Leak)

  Herbison, Rt. Hn. Margaret

  Maxwell, Robert

  Davies, Ifor (Gower)

  Hooley, Frank

  Mellish, Robert

  Davies, S. O. (Merthyr)

  Houghton, Rt. Hn. Douglas

  Mendelson, J. J.

  Delargy, Hugh

  Howarth, Harry (Wellingborough)

  Milne, Edward (Blyth)

  Dell, Edmund

  Howarth, Robert (Bolton, E.)

  Morris, Alfred (Wythenshawe)

  156

  157

  Morris, Charles R. (Openshaw)

  Price, Thomas (Westhoughton)

  Tuck, Raphael

  Morris, John (Aberavon)

  Rees Merlyn

  Urwin, T. W.

  Murray, Albert

  Roberts, Albert (Normanton)

  Wainwright, Edwin (Dearne Valley)

  Newens, Stan

  Roberts, Gwilym (Bedfordshire, S.)

  Walker, Harold (Doncaster)

  Noel-Baker, Rt.Hn.Philip(Derby,S.)

  Robinson, W. O. J. (Walth'stow, E.)

  Watkins, David (Consett)

  Oakes, Gordon

  Roebuck, Roy

  Watkins, Tudor (Brecon & Radnor)

  Ogden, Eric

  Rose, Paul

  Wellbeloved, James

  O'Malley, Brian

  Shaw, Arnold (Ilford, S.)

  Whitaker, Ben

  Orbach, Maurice

  Shore, Peter (Stepney)

  White, Mrs. Eirene

  Orme, Stanley

  Short, Rt.Hn.Edward(N'c'tle-u-Tyne)

  Whitlock, William

  Owen, Dr. David (Plymouth, S'tn)

  Short, Mrs. Renée(W'hampton,N.E.)

  Willley, Rt. Hn. Frederick

  Owen, Will (Morpeth)

  Silkin, Rt. Hn. John (Deptford)

  Williams, Alan (Swansea, W.)

  Page, Derek (King's Lynn)

  Silverman, Julius (Aston)

  Williams, Alan Lee (Hornchurch)

  Paget, R. T.

  Slater, Joseph

  Williams, W. T. (Warrington)

  Pannell, Rt. Hn. Charles

  Small, William

  Willis, George (Edinburgh, E.)

  Parker, John (Dagenham)

  Snow, Jullan

  Wilson, William (Coventry, S.)

  Parkyn, Brian (Bedford)

  Spriggs, Leslle

  Winterbottom, R. E.

  Pavitt, Laurence

  Stewart, Rt. Hn. Michael

  Woof, Robert

  Pearson, Arthur (Pontypridd)

  Summerskill, Hn. Dr. Shirley

  Peart, Rt. Hn. Fred

  Taverne, Dick

  TELLERS FOR THE NOES:

  Pentland, Norman

  Thomas, George (Cardiff, W.)

  Mr. Charles Grey and

  Perry, George H. (Nottingham, S.)

  Tinn, James

  Mr. John McCann.

  Mr. Higgins: I beg to move Amendment No. 4, in page 1, line 14, to leave out from 'recommendation' to first 'the' in line 15 and insert 'against'.
  Mr. Speaker: With this Amendment we can also take Amendment No. 23, in page 3, line 9, leave out from 'recommendation' to 'an' and insert 'against'.
  Mr. Higgins: The drafting of the Bill is not the simplest thing in the world, and this Amendment is not very simple, either. Briefly, I will explain its intention. It will be seen that Clause I says that where, by reference to the National Board for Prices and Incomes under Section 2(1) or (3) of the Prices and Incomes Act, either an increase in prices or an increase in a wage settlement is forbidden then,
  "… before it ceases to be so forbidden, a report of the Board on the reference is published with the recommendations adverse in any respect to the increase of the prices or charges …"
  and the Government may take action.
  This Amendment is similar to one which we debated in Committee, when we sought to remove the words "in any respect." It seemed to us that the use of these words was extremely ambiguous. Ambiguity has been one of the features of the Government's Prices and Incomes Bills the ambiguity of the drafting last year, and the Government's refusal to alter it subsequently, has been responsible for a very high percentage of the Prices and Incomes Orders which have passed through the House being annulled, either by the decision of the court, or by the subsequent decision of the Government. It has been very difficult to clarify precisely what this expression means.
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  To do so, we propose this Amendment, which is to delete words as set out on the Notice Paper and insert the word "against", so that the Government will only take action if the report of the Board on price or wage increases is clearly against that increase.
  If the Amendment is not accepted it may be that the Government would have to take action, even though only a very small proportion of the total report of the Board was against the increase. The extraordinary thing was that in Committee, the Chairman had to use his casting vote to ensure that the Amendment which we were then proposing was not accepted. We divided the Ayes and the Noes equally and the Chairman then said:
  "This is where I use my casting vote. I think that it would be fair that I should vote for the Bill as it stands to enable Members to have another opportunity to discuss the Amendment later. I therefore give my casting vote to the Ayes, and the Ayes have it"—[OFFICIAL REPORT, Standing Committee A, Tuesday, 27th June, 1967; c. 109.]
  The Amendment that we are now discussing is similar in intent, although, I think, somewhat better drafted than the Amendment we were then discussing. It is quite remarkable that such a situation should arise in Standing Committee. The Government should have had their full majority because none of those Members who had abstained on the Government's policy on the Floor of the House were on the Committee.
  The point that we wish to make is that we want wording which will ensure that the balance of the Prices and Incomes Report shall be against the increase of the wage or the price concerned. By inserting the word "against"

  159
  this clearly implies that, on balance, the report would have to be adverse. The First Secretary said, on the Second Reading of the Prices and Incomes Bill:
  "In all cases—and this is an essential principle of the Bill—the Government will not be able to act in a manner more hostile to a proposed increase than is the report of the Board."—[OFFICIAL REPORT, 13th June, 1967; Vol. 748, c. 330.]
  Unless this Amendment is accepted there is an inconsistency in the Government's approach to what they put forward as an important point of principle on Second Reading. They were arguing that the Government would not be more hostile than the Board, so, clearly, if they can take action even though a small part of the report is contrary to the increase, they are acting inconsistently with the principle enunciated on Second Reading. Unless the Amendment is accepted there will be a basic and fundamental inconsistency in their policy.
  From that broad outline, I want to turn to one or two specific examples to show the kind of difficulty which might arise if this Amendment is not accepted. The Report of the National Board for Prices and Incomes on the Prices of Compound Fertilisers, page 18, which is headed "Our Conclusions", says:
  "We have no doubt that in the long-term an increase in the rate of return"—
  that is, of those making compound fertilizers—
  "is desirable."
  Are we to understand that this is an unfavourable or adverse comment by the Board? If one looks at the particular context in which that quotation arises, it is still by no means clear whether that should be regarded as favourable or unfavourable.
  The Board's Report No. 13, on Costs, Prices and Profits in the Brewing Industry, which has already been referred to, says in paragraph 52, on page 13:
  "Examination of the level of profits shows that in absolute terms the return on capital employed in brewing was higher than that in general manufacturing and distribution in 1962 and 1963, but lower in 1964."
  Are we to understand, within the terms of the Bill, that this is an adverse comment in any respect? Would this particular phrase enable the Government to take action under this Clause which we
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  are now debating? The term "adverse in any respect" is so nebulous as to be utterly meaningless, and it is for this reason that we move the Amendment. I hope that it will at least do something to clarify the situation or to bring from the Government some indication of what they feel the right interpretation is.
  It may be that they intend to refer only to the actual conclusions of the Prices and Incomes Board in any particular report. But even that is not clear. If the Board made a statement at some point in a report before its conclusions or recommendations, it is not clear whether that would be regarded as sufficient basis for the Government to take action. Perhaps the Joint Parliamentary Secretary to the Ministry of Labour will say whether this is intended to be restricted to the conclusions or recommendations of the Board, and if that is not so, in what respects the phrase is limited. The drafting does not make the matter clear.
  Finally, we want to be clear whether the expression "in any respect" refers to the short term or the long term. In many of its Reports the Board says that it "takes a view" that such-and-such a price or wage change would eventually be desirable, but is not desirable in the period of the freeze. What is the position in the period when the Government are taking stronger delaying powers than they were originally going to take under Part II? Are we to understand that they are now to take the matter, on balance, over the long term or concern themselves still only with short-run considerations?
  I think that I have said sufficient to make the point that the wording of the Bill on this point is extremely ambiguous and inconsistent with the statement made by the First Secretary on Second Reading.
  6.45 p.m.
  Mr. Peyton: I gladly give my support to my hon. Friend the Member for Worthing (Mr. Higgins), who has moved this verly sensible Amendment with commendable brevity. In considering it, we must have in mind the kind of animal that the Prices and Incomes Board is. Our experience with it does not leave us to believe that it is particularly modest in its approach to its terms of reference. It has performed some fairly drastic surgical operations on what has been put before it in the past. Either the terms

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  of reference have been exceedingly liberally construed or they have been more deliberately widened.
  By means of the Amendment we might wed put upon the Board the onus of coining down one way or the other. When hon. Members are asked to vote, they vote for or against. The Opposition are very well acquainted with the endearing habit of hon. Members opposite who speak very strongly for a policy during a debate and then oppose it—
  Mr. Speaker: Order. The hon. Member is just out of order at the moment.
  Mr. Peyton: I am sorry, Mr. Speaker. I was giving the briefest and most rapid of illustrations of the point that I am making, which is highly germane to the issue.
  But I will approach it the other way round and say that we think that the Board should be called upon to follow the examples of procedures here and come down one way or the other—for or against. If the Board's judgment in a matter were to be based on the criterion suggested here—namely, if it were "in any respect" adverse—we might take the examples of speeches made in the House by many hon. Members who could frequently be said to be in many respects adverse in their judgment to Government policy and yet they immediately vote for it. We wish to avoid this happening, and. I think that the Government Front Bench would be well advised to accept the very modest Amendment so wisely and sensibly proposed by my hon. Friend.
  I do not believe that to add loose verbiage to an Act is any help. It has become a very tiresome habit of modern times—I have complained about it on many occasions—never to use one word where a great many more will do. Here we have a further example. There is the perfectly simple word "against" that could be used. I would willingly stop the argument now if the Joint Parliamentary Secretary, sitting between what I suppose can be termed his two supporters on the Government Front Bench, would set up, like Moses, between them, and tell us that he was prepared to accept the Amendment. However, we on this side need a good deal of satisfying that the Amendment is not a perfectly
  162
  reasonable one to make. We should like the simple word "against" inserted in place of the highly misleading phrase in this already rather discreditable and untidy Bill.
  Sir D. Glover: I did not have the honour and privilege of being a member of the Standing Committee, but from what my hon. Friend the Member for Worthing (Mr. Higgins) said I am surprised that the Government have not brought the Amendment forward under their own name. It seems to me—I agree with my hon. Friend the Member for Yeovil (Mr. Peyton)—that we ought to try to have words which mean something and to use one simple, forthright word to express the Government's intention instead of half-a-dozen words. Incidentally, I think that my hon. Friend the Member for Yeovil might have referred to the two supporters of the Joint Parliamentary Secretary on the Government Front Bench as "lions couchant."
  I agree with what has been said about the Prices and Incomes Board. It is not a very modest, wilting flower. It comes forward with some outrageous recommendations, and it ought to be asked to be forthright in those recommendations. It ought to be either for or against. When we divide in this House we do it not because we are "adverse", but because we are "against". If that is the sort of thing that we require here, then it is the sort of thing that ought to appear in the Bill.
  I cannot imagine what argument the Joint Parliamentary Secretary will raise against the Amendment. I emphasise that if the Board makes a recommendation on something referred to it it ought to be either for or against. Something in this field might be taken to a court of law. I am sure that our Amendment would be supported by the judges, who say that far too often this House passes weak and woolly legislation and so the courts have to make their own interpretation of it. In the case before us it is clear that if we deleted the words that we propose to delete and inserted "against" there would be a clear and consistent body of law on which one could build and on which decisions would be taken.
  I hope that the Joint Parliamentary Secretary will bear in mind the history

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  of the Amendment. In Committee, the Chairman gave his casting vote for the Bill as it stood, but it must be remembered that it is a long-standing rule of the House and of Committees that the Chairman always votes for the status qua. Therefore, it does not in any way express the Chairman's views on the rights of the arguments on an Amendment in Committee. In Committee, the Government were, therefore, defeated, and I think that they were sensibly defeated. There is no actual party division in our Amendment. It is simply an Amendment which would make the Clause very much clearer than it was. I hope that the Government will be able to accept it. If not, I hope that my right hon. and hon. Friends will divide the House, because the Government are, as usual, producing nonsense.
  Mr. Paget: Is there not the objection to this Amendment that it is not grammar? The Opposition are asking to make an adverb qualify a noun. If they wish to make this change, they would also have to change "recommendation" to "recommend against". One cannot have a recommendation against because it is an adverb.
  Mr. John Pardoe: I am no grammarian and I support this eminently sensible Amendment. It is extraordinary that the Government have not thought fit to put it in the Bill themselves. Whether the Amendment is good or bad grammar, the Bill as it stands is extraordinarily vague.
  When I moved a similar Amendment during the Report stage of the 1966 Act—an Amendment which the Government have accepted for this Clause—I envisaged the situation in which the Board could report wholeheartedly against an increase, in which case we would be left in the ridiculous situation in which the increase could go ahead on the very day that the report was published.
  At that time, I did not go into the considerable difficulties that could arise when the Board reported and no firm decision was reached. One could arrive at a situation where it rather sat on the fence. It would be a poor Government who could not find something which could be termed "adverse" in some respect. In the present drafting, the Gov-
  164
  ernment are being left with far too much discretion of interpretation. They could take a broadly favourable report and find something in it which could be brought under this vague phraseology.
  The Joint Parliamentary Secretary to the Ministry of Labour (Mr. Roy Hattersley): The hon. Member for Worthing (Mr. Higgins) rightly said that the Amendment was in many ways parallel with one moved in Committee. But, if I may say so, his objections to the Clause in Committee were more succintly and positively put than his objections today. In Committee he told us that he hoped to ensure that
  "the Government did not abuse a report of the Board."
  He wanted to ensure that
  "we used it in a balanced and sensible way."
  He feared that the Government would
  "pick on one small adverse point in a fundamentally favourable report and impose the full powers of the Clause."
  I hope to be able to convince the hon. Gentleman that such a state of affairs could never come about but, before doing so, I want to deal with the need to avoid ambiguity, to which he referred. It does not seem to me that, by deleting the words proposed and substituting the word "against", ambiguity would be avoided. The hon. Gentleman will have to explain how a court would be able to decide whether a standstill could be imposed if a report from the Board was entirely against, on balance against, substantially but not comprehensively against, or specifically against one part.
  In a speech devoted to the virtues of avoiding ambiguity, the hon. Gentleman began by talking about a report being "clearly against" and he ended with a report that might be "on balance against". If he asks us to insert an Amendment partly to make the provisions of the Bill more comprehensive and to be more precise legally, he must do rather better than this. The Amendment would not make the Bill more clearly able to be implemented or its operation more precise. It would make it open to a good deal more dispute and argument. I am glad to see that I receive some support from hon. Members opposite on that point. However, the main argument against the Amendment is not the ambiguity to which it would give rise.
  Mr. Peyton: Can the hon. Gentleman tell us whether in putting this argument he has the support of the Solicitor-General? If he has, this would weigh with us a great deal—although I am not saying which way.
  Mr. Hattersley: I am sure that the hon. Gentleman knows that the nature of common responsibility means that, unfortunately, my right hon. and learned Friend the Solicitor-General at the moment has to accept the judgment I am putting forward. I am sure the hon. Gentleman understands equally well that, had I not a firm basis for making this posit, I would not have the temerity to make it to the House—certainly not to a House in which he was sitting.
  Mr. Higgins: If the Board were to say, "We are against this increase", would not this present no verbal problem?
  Mr. Hattersley: Indeed, but when the Board says, "We have reservations about this increase; part of it is admirable but part deplorable", the Amendment goes no way to meeting that sort of verbal problem. But, as I have said, this should not be the main complaint against the Amendment. Were we to feel that there were substance in the argument for the Amendment, our obligation would be to redraft the Amendment to make it appropriate.
  The substance of our argument is that the fears the hon. Gentleman expressed in Committee and has repeated today are groundless, for the reasons that he himself touched on but did not develop. Paragraph 2(1) of the Schedule to this Bill refers the Government to Schedule 2 of the Prices and Incomes Act, 1966, which specifies and stipulates the Government's attitude towards prices and in-conies matters. Schedule 2 of the Act, to which this Clause and the Amendment refer, lays down for the Board the nature of its considerations and its obligations and the things it must consider. Paragraph 2(1) also makes it clear how the Government must react to the conclusions to which the Board has come. It says that the Government:
  "… shall not preclude an increase in prices or charges or the implementation of an award or settlement in any respect in which the National Board for Prices and Incomes … recommend that it should not be precluded …"
  166
  I will give a clear example, because I think that hypotheses in this situation are potentially dangerous. The hon. Gentleman will recall the case of the Crown Bedding Company, where the Government decided that a major wage increase that the Company was contemplating did not conform with the requirements of the prices and incomes policy but considered that a reduction in the working week for the drivers from 42½ to 41 hours did so conform.
  Within the powers vested in my right hon. Friend the First Secretary of State, an order was made against the major increase but a letter of consent was provided which enabled the minor increase to go ahead. What Paragraph 2(1) of the Schedule to the Bill means is that, if a report of that sort came from the Board saying that a major pay award was unacceptable but that a minor alteration in remuneration, a minor reduction in hours or a minor increase for some of the men was possible, my right hon. Friend would be precluded from preventing that part of the award which was not referred to adversely from going ahead.
  By allowing the Clause to remain as it is, and by not amending it as the hon. Gentleman suggests, we have a great deal more opportunity for flexibility, for reasonableness, for exercising the sort of discrimination which I am sure we all want and expect. But we do not have an opportunity to exercise discrimination and flexibility which is in any way more detrimental to the parties than any part of the Board's report recommends. Our discretion can be exercised only in their favour. That is why the hon. Gentleman was wrong to say in Committee that the need for the Amendment was exemplified by the fact that this was an all or nothing situation. He said that the phrase used in the Bill could either be accepted or abandoned and that there were no half measures.
  7.0 p.m.
  It is not an all or nothing situation. It is a situation in which my right hon. Friend, the First Secretary, may on occasion rightly wish to choose one element of the Board's report and say, "This can go on", but choose another in regard to which the Board has specifically said that the increase is not within the terms of the policy and not in line with

  167
  the national interest and say, "This cannot go on". I am sure that the House wants to give him that opportunity to discriminate. It does not want to impose upon the Prices and Incomes Board an obligation to come formally and firmly and definitely down on one side or the other. The hon. Gentleman the Member for Worthing did not advance the argument that it should, but his hon. Friend the Member for Yeovil (Mr. Peyton) and the hon. Member for Ormskirk (Sir D. Glover) suggested that this was the rôle that the N.B.P.I. could occupy. I believe that this is a fatuous rôle to expect the Board to perform. Its job is to look with some sort of objectivity and intellectual understanding, and with the best information at its disposal, at an award and to make a judgment on it; if it has many aspects, to make a judgment upon the aspects; and, if it has many different details, to make judgments upon the details. To ask it to raise its hand or nod its head and say that an award is altogether good or altogether had misunderstands the rôle of the N.B.P.I. and misunderstands the interests of the incomes policy. In consequence I must ask my hon. Friends to resist the Amendment.
  Mr. Higgins: The Joint Parliamentary Secretary's speech, delivered with his usual fluency and charm, sounded very plausible, but I suspect that when one reads it it will sound a great deal less plausible.
  I will put forward one or two reasons why I think this is likely to be so. While there might be some legal difficulty if the Board did not come out clearly one way or the other, none the less there should be no difficulty in drafting an Amendment in such a way that the wording of the Bill was consistent with the speech which the First Secretary made on Second Reading. I do not think it is consistent. It is quite possible under this Clause for the Government to take action which is more severe than the recommendation which is in the Board's report.
  If this were not so and if the right hon. Gentleman wanted to make sure it were so, clearly he ought to have inserted in the original draft of the Bill that the Government would take action only if a recommendation was adverse in any particular instance. In that situation the
  168
  Government could not go further than the report of the Prices and Incomes Board. Unless he narrows it down—no doubt he could have done so either when the Bill was drafted or during Committee stage or now—and says that the Government shall take action only with regard to the respects in which the Prices and Incomes Board reports unfavourably, then he is being inconsistent with the speech which he made on Second Reading. It is clearly a badly drafted Bill and I would report adversely on it in that respect.
  Mr. Hattersley: May I clarify the position in terms of the wording of Clause 2(1) of the Schedule. It simply says that my right hon. Friend
  "… shall not preclude an increase of prices or charges or the implementation of an award or settlement in any respect in which the National Board for Prices and Incomes in the relevant report recommend that it should not be precluded …"
  That final part of the sentence which refers to "it",
  "recommend that it should not be precluded",
  firmly and clearly and precisely limits the power of my right hon. Friend in judging parts of a report, parts of an issue, and limits it to judging it in the way I have explained. Those final words make it clear that my right hon. Friend cannot possibly be more repressive and cannot implement a report in a way in which the Prices and Incomes Board has not specifically recommended.
  Mr. Higgins: I am grateful to the hon. Gentleman. We shall read HANSARD with interest and we shall judge his action during the period of the Bill accordingly and we may have cause to return to the matter anon.
  The point that he has just made about the way in which the Prices and Incomes Board is therefore circumventing Government action, if he is right on the drafting, raises some other important points to which we shall return perhaps on the next Amendment.
  The Parliamentary Secretary should perhaps take up some of the points which he made during the Committee stage. He said that I seemed to expound the points more simply than I did today. This is because the complexities of the situation are becoming clearer. The hon. Gentleman this afternoon said that he

  169
  did not wish to hypothesise; he wanted to take a specific case. In Committee he said that he did not want to hypothesise about possible references to the Board without giving hypothetical examples, and he then produced a hypothetical situation in which he referred to a series of related prices or a group of related wage claims. He has not put forward that argument this afternoon. Are we to understand that this argument no longer applies or are we to understand that this is still the purpose of this aspect of the Clause? This is not clear from the debate we have had so far. I hope that we shall have a statement from the hon. Gentleman clarifying whether the multi-argument still applies, because this will seriously affect some of the other Amendments which we come to later.
  Mr. R. Carr: I do not want to delay the House, but my hon. Friend the Member for Worthing (Mr. Higgins) asked the Parliamentary Secretary, or a spokesman of the Government, to clear up the point which he was making, which was the main case on which the Parliamentary Secretary rested his opposition to our Amendment in Committee. It was very noticeable in his speech today that he did not use that argument. I, therefore, ask the Government to reply to the point which has just been made.
  Mr. Hattersley: With the leave of the House: I was even more careful not to hypothesise today. In Committee I did mention what I rather inelegantly referred to as a multi-reference. Today I made reference to one group of people whose wages had already been considered in the House and about whom the Government had to make a decision concerning
  the two aspects of increased remuneration, namely, hours and the rate of pay. The argument remains valid in the same way. If—and here I fear that I do hypothesise—a reference is made to the Board which concerns a group of related workers or a group of related prices, and examines every aspect of their wages and remuneration, my right hon. Friend would want to have the opportunity and would want to keep the option open of implementing the standstill in respect of those related parts of the report.
  I do not think that the hon. Gentleman understands, but I am sure that he will on reflection, that the distinctions between a report about one group of men and two different aspects of their increase in remuneration, and a report which concerns related groups of men with rather different remuneration patterns is not very fundamental. We are making provision for a situation in which the Board may want to make a report which contains a number of elements. I do not think it matters how the elements are brought about. We want to reserve the right to operate on each element as the Board suggests and not necessarily look at the report as all black or all white.
  Mr. Higgins: I am grateful to the hon. Gentleman, but does that not mean that the point which he made on Committee Stage is not covered by the expression "adverse in any respect"? Should it not read, "with regard to certain people within the group who have been referred to the Board"?
  Question put, That the words proposed to be left out stand part of the Bill:—
  The House divided: Ayes 190. Noes 127.

  Division No. 429.]

  AYES

  [7.9 p.m.

  Abse, Leo

  Braddock, Mrs. E. M.

  Dalyell, Tam

  Alldritt, Walter

  Brown, Rt. Hn. George (Belpar)

  Davidson, Arthur (Accrington)

  Archer, Peter

  Brown,Bob(N'c'tle-upon-Tyne,W.)

  Davies, G. Elfed (Rhondda, E.)

  Ashley, Jack

  Brown, R. W. (Shoreditch & F'bury)

  Davies, Harold (Leek)

  Atkins, Ronald (Preston, N.)

  Buchan, Norman

  Davies, Ifor (Gower)

  Atkinson Norman (Tottenham)

  Butler, Herbert (Hackney, C.)

  Davies, S. O. (Merthyr)

  Bacon, Rt. Hn, Alice

  Callaghan, Rt. Hn. James

  Delargy, Hugh

  Bagier, Gordon A. T.

  Carmichael, Neil

  Dell, Edmund

  Barnes, Michael

  Coe, Denis

  Dempsey, James

  Baxter, William

  Coleman, Donald

  Dewar, Donald

  Beaney, Alan

  Conlan Bernard

  Diamond, Rt. Hn. John

  Bence, Cyril

  Craddock, George (Bradford, S.)

  Doig, Peter

  Benn, Rt. Hn. Anthony Wedgwood

  Crawshaw, Richard

  Driberg, Tom

  Bidwell, Sidney

  Cronin, John

  Dunn, James A.

  Bishop, E. S.

  Crosland, Rt. Hn. Anthony

  Dunwoody, Mrs. Gwyneth (Exeter)

  Boardman, H.

  Crossman, Rt. Hn. Richard

  Dunwoody, Dr. John (F'th & C'b'e)

  Bowden, Rt. Hn. Herbert

  Cullen, Mrs. Alice

  Eadie, Alex

  Ellis, John

  Jones, Dan (Burnley)

  Pearson, Arthur (Pontypridd)

  English, Michael

  Jones, Rt.Hn.Sir Elwyn(W.Ham,S.)

  Peart, Rt. Hn. Fred

  Ennals, David

  Judd, Frank

  Pentiand, Norman

  Ensor, David

  Kerr, Russell (Feltham)

  Perry, George H. (Nottingham, S.)

  Evans, Albert (Islington, S.W.)

  Lawson, George

  Price, Thomas (Westhoughton)

  Evans, loan L. (Birm'h'm, Yardley)

  Leadbitter, Ted

  Bees, Merlyn

  Fernyhough, E.

  Lee, Rt. Hn. Frederick (Newton)

  Roberts, Gwilym (Bedfordshire, S.)

  Fletcher, Ted (Darlington)

  Lee, John (Reading)

  Robinson, W. O. J. (Walth'stow, E.)

  Foot, Michael (Ebbw Vale)

  Lewis, Ron (Carlisle)

  Roebuck, Roy

  Fowler, Gerry

  Lipton, Marcus

  Rose, Paul

  Fraser, John (Norwood)

  Lomas, Kenneth

  Shaw, Arnold (Ilford, S.)

  Fraser, Rt. Hn. Tom (Hamilton)

  Loughlin, Charles

  Short,Rt.Hn.Edward(N'C'tle-u-Tyne)

  Freeson, Reginald

  Lyon, Alexander W. (York)

  Short, Mrs. Renée(W'hampton,N.E.)

  Garrett, W. E.

  McBride, Neil

  Silkin, Rt. Hn. John (Deptford)

  Ginsburg, David

  McCann, John

  Silverman, Julius (Aston)

  Gordon Walker, Rt. Hn. P. C.

  MacColl, James

  Slater, Joseph

  Gray, Dr. Hugh (Yarmouth)

  MacDermot, Niall

  Small, William

  Greenwood, Rt. Hn. Anthony

  McGuire, Michael

  Snow, Julian

  Gregory, Arnold

  Mackie, John

  Spriggs, Leslie

  Grey, Charles (Durham)

  Mackintosh, John P.

  Steele, Thomas (Dunbartonshire, W.)

  Griffiths, Will (Exchange)

  Maclennan, Robert

  Stewart, Rt. Hn. Michael

  Hamilton, James (Bothwell)

  MacPherson, Malcolm

  Summerskill, Hn. Dr. Shirley

  Hamilton, William (Fife, W.)

  Mahon, Peter (Preston, S.)

  Thomas, George (Cardiff, W.)

  Hamling, William

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

  Tinn, James

  Hannan, William

  Manuel, Archie

  Tuck, Raphael

  Harper, Joseph

  Mapp, Charles

  Urwin, T. W.

  Hart, Mrs. Judith

  Mellish, Robert

  Wainwright, Edwin (Dearne Valley)

  Haseldine, Norman

  Mendelson, J. J.

  Walker, Harold (Doncaster)

  Hattersley, Roy

  Miller, Dr. M. S.

  Watkins, David (Consett)

  Hazell, Bert

  Milne, Edward (Blyth)

  Watkins, Tudor (Brecon & Radnor)

  Heffer, Eric S.

  Morris, Alfred (Wythenshawe)

  Wellbeloved, James

  Henig, Stanley

  Morris, Charles R. (Openshaw)

  Whitaker, Ben

  Herbison, Rt. Hn. Margaret

  Morris, John (Aberavon)

  White, Mrs. Eirene

  Hooley, Frank

  Murray, Albert

  Whitlock, William

  Houghton, Rt. Hn. Douglas

  Newens, Stan

  Willey, Rt. Hn. Frederick

  Howarth, Harry (Wellingborough)

  Noel-Baker, Rt.Hn.Philip(Derby,S.)

  Williams, Alan (Swansea, W.)

  Howarth, Robert (Bolton, E.)

  Ogden, Eric

  Williams, Alan Lee (Hornchurch)

  Howie, W.

  O'Malley, Brian

  Williams, W. T. (Warrington)

  Hoy, James

  Orbach, Maurice

  Willis, George (Edinburgh, E.)

  Hughes, Emrys (Ayrshire, S.)

  Orme, Stanley

  Wilson, Rt. Hn. Harold (Huyton)

  Hughes, Hector (Aberdeen, N.)

  Owen, Dr. David (Plymouth, S'tn)

  Wilson, William (Coventry, S.)

  Hynd, John

  Owen, Will (Morpeth)

  Winterbottom, R. E.

  Jackson, Colin (B'h'se & Spenb'gh)

  Page, Derek (King's Lynn)

  Woof, Robert

  Jackson, Peter M. (High Peak)

  Paget, R. T.

  Jay, Rt. Hn. Douglas

  Pannell, Rt. Hn. Charles

  TELLERS FOR THE AYES:

  Jeger, Mrs.Lena(H'b'n&St.P'cras,S.)

  Parker, John (Dagenham)

  Mr. Walter Harrison and

  Jenkins, Hugh (Putney)

  Parkyn, Brian (Bedford)

  Mr. Ernest Armstrong.

  Johnson, James (K'ston-on-Hull, W.)

  Pavitt, Laurence

  NOES

  Alison, Michael (Barkston Ash)

  Fletcher-Cooke, Charles

  Lambton, Viscount

  Allason, James (Hemel Hempstead)

  Fortescue, Tim

  Lewis, Kenneth (Rutland)

  Astor, John

  Glover, Sir Douglas

  Loveys, W. H.

  Barber, Rt. Hn. Anthony

  Glyn, Sir Richard

  Lubbock, Eric

  Beamish, Col. Sir Tufton

  Goodhew, Victor

  McAdden, Sir Stephen

  Bennett, Dr. Reginald (Gos. & Fhm)

  Gower, Raymond

  MacArthur, Ian

  Biggs-Davison, John

  Grant, Anthony

  Macleod, Rt. Hn. Iain

  Boyd-Carpenter, Rt. Hn. John

  Griffiths, Eldon (Bury St. Edmunds)

  McMaster, Stanley

  Boyle, Rt. Hn. Sir Edward

  Gurden, Harold

  Maude, Angus

  Bromley-Davenport, Lt.-Col. Sir Walter

  Harris, Frederic (Croydon, N.W.)

  Maxwell-Hyslop, R. J.

  Brown, Sir Edward (Bath)

  Harris, Reader (Heston)

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

  Bruce-Gardyne, J.

  Hawkins, Paul

  Mills, Peter (Torrington)

  Bullus, Sir Eric

  Heald, Rt. Hn. Sir Lionel

  Miscamphell, Norman

  Burden, F. A.

  Higgins, Terence L.

  Mitchell, David (Basingstoke)

  Carlisle, Mark

  Hiley, Joseph

  More, Jasper

  Carr, Rt. Hn. Robert

  Hill, J. E. B.

  Morgan, Geraint (Denbigh)

  Channon, H. P. G.

  Hirst, Geoffrey

  Morrison, Charles (Devizes)

  Chichester-Clark, R.

  Hogg, Rt. Hn. Quintin

  Mott-Radclyffe, Sir Charles

  Clegg, Walter

  Holland, Philip

  Munro-Lucas-Tooth, Sir Hugh

  Cooper-Key, Sir Neill

  Hooson, Emlyn

  Noble, Rt. Hn. Michael

  Corfield, F. V.

  Hordern, Peter

  Onslow, Cranley

  Costain, A. P.

  Howell, David (Guildford)

  Page, Graham (Crosby)

  Craddock, Sir Beresford (Spelthorne)

  Hunt, John

  Page, John (Harrow, W.)

  Crosthwaite-Eyre, Sir Oliver

  Iremonger, T. L.

  Pardoe, John

  Crouch, David

  Irvine, Bryant Godman (Rye)

  Peel, John

  Dance, James

  Jenkin, Patrick (Woodford)

  Percival, Ian

  Davidson, James (Aberdeenshire, W.)

  Jennings, J. c. (Burton)

  Peyton, John

  Deedes, Rt. Hn. W. F. (Ashford)

  Johnson Smith, G. (E. Grinstead)

  Pink, R. Bonner

  Dodds-Parker, Douglas

  Jopling, Michael

  Prior, J. M. L.

  Emery, Peter

  Kimball, Marcus

  Pym, Francis

  Errington, Sir Eric

  King, Evelyn (Dorset, S.)

  Ramsden, Rt. Hn. James

  Eyre, Reginald

  Kirk, Peter

  Rees-Davies, W, R.

  Fisher, Nigel

  Knight, Mrs. Jill

  Renton, Rt. Hn. Sir David

  172

  173

  Ridley, Hn. Nicholas

  Taylor, Sir Charles (Eastbourne)

  Webster, David

  Royle, Anthony

  Taylor, Edward M.(G'gow,Cathcart)

  Whitelaw, Rt. Hn. William

  Russell, Sir Ronald

  Taylor, Frank (Moss Side)

  Wills, Sir Gerald (Bridgwater)

  Scott, Nicholas

  Temple, John M.

  Wilson, Geoffrey (Truro)

  Sharples, Richard

  Thatcher, Mrs. Margaret

  Wolrige-Gordon, Patrick

  Shaw, Michael (Sc'b'gh & Whitby)

  Tilney, John

  Wylie, N. R.

  Sinclair, Sir George

  Turton, Rt. Hn. R. H.

  Smith, John

  Wainwright, Richard (Coins Valley)

  TELLERS FOR THE NOES:

  Stell, David (Roxburgh)

  Walker-Smith, Rt. Hn. Sir Derek

  Mr. R. W. Elliott and

  Stoddart-Scott, Col. Sir M. (Ripon)

  Walters, Dennis

  Mr. Timothy Kitson.

  Summers, Sir Spencer

  Ward, Dame Irene

  Mr. David Howell: I beg to move Amendment No. 7, in page 1, line 16, after 'settlement', to insert:
  'and that recommendation arises from the terms of reference originally given to the Board'.
  The purpose of moving this Amendment is to make the Government and those concerned with implementing the Bill stop to ask themselves at this stage, as they plunge on into the more and more tortuous complexities of this legislation, what the National Board for Prices and Incomes is, what it is supposed to be doing and what is required of it.
  As we have debated this legislation it has become clear that the Board is regarded as the pivotal instrument in the Government's carrying out of policies, not merely as an instrument in this legislation, but also as part of the long-term development of a prices and incomes policy as a permanent element in our national life, in the way in which the First Secretary is reported to have been talking about it in rather Utopian terms over the weekend. At this stage, therefore, we must ask ourselves very carefully what rôle the Board has in relation to its original terms of reference. In addition, if we read the weekend Press, we see that the Government think that there should be a permament kind of wages legislation, and no doubt there will be a rôle for the Board in this as well, so here again is a reason why we should look closely at it.
  Another reason is that the Chairman of the Board, a very able man, Mr. Aubrey Jones, is one of the great managers of state who make the policy decisions in a modern Government, and who, as other managers of state in the complex which makes up our Government, has too little contact with, and no accountability to, this House. Because of this, too, it seems that it is important to look closely into the Board's terms of reference, and at the limits within which
  174
  the policy influence of Mr. Aubrey Jones is to be exerted.
  We on this side of the House, or some of us, have made it clear that the Board has a place in a long-term policy for prices and incomes, in a long-term view by the Government of how they should operate on prices and incomes. We have argued, and I argue now, that there is a case for any agency of this kind to operate on restrictive practices, to peer into industries, to do jobs which ought to have been done by the economic development committees, but which have not always been done, in making the market work in these industries, and ensuring that competitive forces operate. This is the kind of term and form in which we have argued, that in the long-term a Prices and Incomes Board should have this rôle.
  That is one view that one can take of the Board, that it should have a place in a long-term policy, and, as I understand it from what Government spokesmen have said inside and outside the House from time to time, this is one view which they hold. It should be said, too, that that view was reflected when it was decided to ask the Board to study productivity agreements and it produced its excellent Report No. 36. This was a case of the Board being seen as an agency for a long-term improvement in competition in various industries, and not as an immediate instrument of short-term policy.
  The other view of the Board is the one that we seem to have before us in the Bill, and the one which we are querying in the Amendment, namely, that it should be a sort of clearing house, almost like a daily newspaper office, checking the movement of prices, not we are told, by sending out forces across the land to study prices and watch movements at first hand, but by operating on prices and wage movements in the short-term, and being seen as part of a short-term effort

  175
  to control the level of prices to beat inflation as part of the Government's short-term strategy. This is a rôle which, the more we examine it, the more we think the Government should reconsider it, and the more we doubt whether the Board can play it.
  First, it has to be asked whether the Board has the physical capacity to carry out this kind of rôle—
  Mr. Speaker: Order. The hon. Member must keep to the Amendment, which is whether recommendation should be within the terms of reference as laid down in the parent Act.
  Mr. Howell: As I tried to explain at the beginning of my speech the purpose of the Amendment is to make those who have to implement the Bill when it becomes an Act ask themselves whether the terms of reference which were originally laid down in Part I of the Prices and Incomes Act, the parent Act, are the ones to which they would like the Board to adhere, to which the Board is adhering, and to which it is to adhere if it is to do its job efficiently. It is against this background that I am trying to distinguish between the long-term rôle of a Board for Prices and Incomes in a long-term incomes policy, and the immediate short-term tasks which apparently are being shoved on to this Board, and to query whether they are within the terms of reference when the Board makes its reports.
  The terms of reference, as originally set out in Part I of the parent Act, are:
  "The Secretary of State, or the Secretary of State and any Minister acting jointly, may refer to the Board any question … relating to a proposal to increase any prices for the sale of goods or any charges for the performance of services, including charges for the application of any process to goods, or"—
  and then we come to the paragraph dealing with wages—
  "relating to any pay claims or other claims relating to terms and conditions of employment, or any awards and settlements relating to terms and conditions of employment."
  There then follow other terms of reference, and the final one is:
  "The Board shall examine any question referred to them under this section and report to the Minister or Ministers who referred the question to the Board."
  176
  The thought in the minds of many hon. Members, and I believe of many observers outside, is whether, in making its reports, in making recommendations on a settlement, the Board has been answering the question put to it. The terms of reference say that it should answer the original question put to it when it makes a report on a settlement.
  On looking at the reports from the Board it seems that we have seen an attempt to try to cover both the rôles which I have described, an attempt to try to cover the long-term rôle of being an instrument for promoting productivity, of which I approve, and, at the same time, an attempt to be a short-term spy master, a short-term controller and checker of price and wage movements, a rôle for which I think it is ill-equipped, and which it will never effectively be able to play.
  In other words, we believe that although the Board should answer questions, what will happen as a result of this Clause and what we seek to challenge by way of the Amendment, is that the Board will be asked the wrong questions, and as a result will produce reports which in some aspects will promote understanding, and even, in due course, have a beneficial effect on the competitive structure of various industries, but in other cases will waste time and raise more difficult questions about what rôle the Board should have in implementing the Government's policies. As the Government go from Bill to Bill, from legislation to legislation, and from Clause to Clause, the Board will have piled on it all sorts of vague responsibilities which I contend have not been thought out.
  One of the things which the Government's supporters hoped for when they came to office was that the Government would rethink the structure and rôle of agencies of Government, including agencies of this kind, and what they should be doing when they reported. This hope has been confounded, because agencies have had larger responsibilities piled on them. The duties which they are supposed to perform have grown like Topsy. This has left the Board in an ambiguous position when it comes to judging the kind of reports that it should

  177
  give. It has left it in an ambiguous position when it comes to judging whether it is within its terms of reference in making recommendations. This has tied up, unfortunately ineffectively, the capacity of many able men, which could be concentrated more usefully in reaching the goal of promoting productivity rather than in restraining earnings.
  Mr. Charles Fletcher-Cooke: I should have thought that the Government would welcome the Amendment. All independent bodies, tribunals, commissions, and things of that sort, are apt to stray very widely outside their terms of reference. Indeed, only the other day we heard the Lord Chancellor in another place complaining that the Radcliffe Committee had not been asked to judge on the accuracy or otherwise of the Prime Ministers statement on the D Notice question, and yet it had chosen to do so.
  I refer to that only in passing, as an example of the way in which independent commissions, with the best will in the world, are apt to rove generally around their subjects, and as they get into their stride to expand their activities beyond the desires of the Government, and perhaps away from the public interest, but certainly the former.
  The Amendment is designed to help the Government. I am not sure that we are wise to do that. There is a great temptation to try to improve the Bill, and it is one that perhaps we ought to resist. But I cannot see what harm there can be in accepting the Amendment, which the Government may later find very valuable.
  7.30 p.m.
  Let us suppose, as time goes on, that the Prices and Incomes Board takes the bit between its teeth and issues a report denouncing a certain proposal left, right and centre—something which the Government do not particularly want it to do: how will the Government be able to treat the question of the subsequent Order? In view of the authority that they have been seeking to give the Board it will be difficult for the Government not to accept those denunciations. They will he placed in a difficult political position, whereas if the Amendment is accepted they will not, because they will be able to say that they have no option to go outside the strict terms of reference that
  178
  they gave the Board; that in the case in question he Board has strayed outside those terms of reference, and in that case the Government not only may not but cannot act.
  Surely this is a shield which the Government should welcome. Surely they must feel that there are dangers in these great independent governmental agencies, from which there is no appeal and which are without any sort of control. The Government may find themselves in a very delicate and difficult situation if they come into conflict with the Board in respect of one of its reports.
  As my hon. Friend the Member for Guildford (Mr. David Howell) said, there have been signs that the Board—I make no complaint about it; it is in the nature of such an animal—has been straying outside its terms of reference, especially in respect of its report on the banks. That was an interesting report, and perhaps a very good one, but it went far outside the Board's terms of reference. If the Board has begun to do that already it is likely to go the way of all flesh in this matter and do it again.
  Surely any Government must protect themselves against that. Unless they insert these words, which cannot do any harm, the Government will find themselves in the embarrassing position, sooner or later, of having to reject certain findings of the Board—and they will not want to do that. What conceivable objection could there be to these innocuous words? Surely the Government do not propose to act on a recommendation that is outside the Board's terms of reference. If that is the case, what is wrong with the Amendment?
  Mr. Edward M. Taylor: My hon. and learned Friend the Member for Darwen (Mr. Fletcher Cooke) said, in the course of his penetrating remarks, that he thought that the Amendment could do no harm. It is precisely on that point that I want to hear the observations of the Government, and in that connection there are three specific points that I wish to make.
  My hon. Friend the Member for Guildford (Mr. David Howell), by saying that he thought there was a place for the Prices and Incomes Board, clearly expressed the feeling of many hon. Members on this side of the House. We are

  179
  not sure whether a Board, as such, is a good thing, or whether the free disciplines of our economy provide a better way of achieving fixed wages, but it is clear, if we are to have such a Bill as this, that there are different points of view as to the extent to which the Board should be restricted. The Amendment deals with the extent of that restriction.
  I was greatly impressed by the arguments of my hon. Friend the Member for Guildford, but if we are to ask the Board to investigate various wide-ranging matters we ought to appreciate that there could be danger in unduly restricting the exercise of its powers. Several of my hon. Friends and I have been very impressed at the quality of some of the Board's reports. On the other hand, it is clear that in some cases it has ranged widely beyond the specific points which it has been asked to investigate.
  I now come to my three points. First, if the Amendment were accepted would it necessarily restrict any consequential recommendation which the Board might make? Let us suppose that the Board were asked to look into the wages of the boilermakers on Clydeside. Would the Amendment prevent the Board making a specific recommendation about the wages, say, of apprentice boilermakers? If that is the case it would be unfortunate. I do not think that the Amendment would restrict such a recommendation, but I should like it made clear.
  The obvious thing to do would be to make the terms of reference adequate, but in existing circumstances the terms of reference might not be wide enough and the Board would be prevented from making appropriate consequential recommendations.
  Secondly, would the Amendment in any way remove the liability of the Government to implement consequential recommendations not directly associated with the specific proposals put to the Board? I can give a specific example. Prices and Incomes Report No. 9 dealt with gas and electricity prices. I recall a specific recommendation made by the Board that the increase of 13 per cent. recommended for the price of gas in Scotland should be made only on the assumption that equal financial disciplines would be introduced
  180
  for the electricity and the gas boards in Scotland. In Scotland the Electricity Board is organised by the Secretary of State for Scotland, under his general jurisdiction, whereas the Gas Board is under the jurisdiction of the Minister of Power.
  Thirdly, if the Amendment is accepted, together with all the restrictions that may stem from it, does it mean that the Board would not be permitted to make recommendations about consequential increases within the same field of activities? In the Clyde shipyards, where I worked before coming to this House, there were maintenance electricians and maintenance engineers. Always, when there was an adjustment in the wages of the maintenance electricians, there was a similar automatic alteration in the wages of the maintenance engineers.
  If the Board were asked to look into the wages of the maintenance electricians on Clydeside and, having done so, it took the view that although the electricians should get the increase there should not be a similar increase—because of the special circumstances of the time—in the wages of maintenance engineers, would the Amendment prevent the Board's making any such recommendation?
  Mr. Fletcher-Cooke: The Amendment does not preclude the Board from making any recommendations it chooses. All it does is to preclude the Government from acting on any recommendation which is ultra vires the Board's terms of reference.
  Mr. Taylor: I understand that the Board can recommend what it likes, but this is a question of restricting the actions of the Government. It would be a little unfortunate if, for example, as in the case that I have quoted in respect of maintenance engineers and electricians, the Government, because of a specific recommendation of the Board, allowed an increase in the wages of maintenance electricians but were not prepared to go ahead and make at the same time a similar increase in the case of the engineers.
  My hon. Friend may take the view that the Government should not have power to stop wage increases which had not been considered at the time of instituting the investigation, but the terms of reference—sometimes because they were too wide and sometimes because they were too

  181
  narrow—might make nonsense of everyday practices in industry if the Government did not have a little scope for carrying out various proposals.
  It would be unfortunate if we restricted the Board's activities. I have been very impressed by the quality of its reports and would like to think that this roving band of "whizz kids" would move around not only private industry but the nationalised sector and public service where there is scope for more inquiry. The figures given at Question Time today about the substantial drop in the numbers employed in electrical manufacture and engineering and a substantial rise in the nationalised industries and the Civil Service show the need for this.
  Although I have been greatly impressed by my hon. Friend's arguments, I hope that the Amendment will not have this effect and that the Government can give me sufficient assurances to vote against it.
  Mr. Peyton: It is seldom and with great reluctance that I differ from my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor), but today is one of those exceptions. It is all very well for him to welcome a roving band of "whizz kids" buzzing around and pontificating, but what happens to whizz kids when they grow up? I do not like to think how the Board may develop when it reaches adult status.
  7.45 p.m.
  The Amendment is profundly helpful to the Government, relieving them of possible embarrassments. If they refuse it, I can only attribute that to obstinacy and dangerous short-sightedness—qualities which I would attribute only reluctantly to the Chancellor of the Duchy. My hon. Friend the Member for Guildford (Mr. David Howell) was quite right to ask what the Board is and what its role is. He adduced a strong reason why its decisions should be confined to the issues covered by its terms of reference. It is not an elected body, or even governed by Civil Service rules. Its members can make speeches, appear at public meetings and on television and do other things which are not the rôle of the Civil Service.
  I believe that, as a matter of practice, it delegates some duties, and I should be obliged to know what rules govern its
  182
  powers of delegation. To what extent can it appoint others to carry out its duties, and how far is it right, proper or desirable to appoint consultants—
  Mr. Frederick Lee: On a number of references, the Board employs consultants who are specialised in a given field.
  Mr. Peyton: This is the issue which I wish to stress, as it is important. I do not say that it is wrong in all circumstances for the Board to appoint consultants, but Ministers, even in this Government, are nominally responsible to Parliament and civil servants to Ministers, as is the Board, to a lesser extent, but if it regularly establishes a chain of consultant operations, responsibility to Parliament and connection with the people's elected representatives will disappear.
  We should also consider the parallel of the courts, which are bound by clear rules of procedure and evidence, with carefully defined issues before them. The opinions expressed by judges learned in the law, so far as they are not directly connected with the matter in issue, are of only minor importance. This would be the effect of the Amendment. It would relegate to only minor importance opinions expressed by the Board on matters which the Government apparently never intended it to consider.
  An elected assembly should look with grave suspicion on bodies like this, whose powers are loosely defined and whose chain of responsibility is hard to trace. I cast no reflection on Mr. Aubrey Jones personally, but any body of this kind is bound to suffer from its full share of human weaknesses, and when its powers are not fettered, it is apt to grow into a fair conceipt.
  This is an important issue and Parliament should say clearly that the opinions of the Board, so far as they are not directly related to its terms of reference, will carry no weight, as otherwise it will not be bound by rules but will have great power and be able to pontificate on every kind of issue, flattered enormously and unreasonably by the tribute of omniscience and ubiquity. It is wrong to attribute to such a body the detailed knowledge which we are now apparently taking for granted that it possesses.

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  In their own interests, I hope that, as my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) said in a cogent speech, the Government take the Amendment seriously. It is a sad train of events, leading one through the same experience again and again, when a Government are confronted with cold reason and an element of restraint and modesty and tend away from a course which these virtues direct. I had hoped that both right hon. Gentlemen would have vied with each other to say how ready they were to accept these reasonable and modest arguments, based upon prudence and a lively concern about what further disasters will happen to Parliament if power passes to such remote bodies as this.
  Sir D. Glover: I support the Amendment. I am sorry that I do not agree with my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor) because this is a very important Amendment. I have no criticism to make of Mr. Aubrey Jones, who was a very distinguished Member of the House for very many years and a personal friend of mine. But in legislation we are not dealing with individuals.
  Many of us feel that a great danger which confronts our society is the development of the corporate state in which Parliament has very little power. Such bodies as the Prices and Incomes Board and the Monopolies Commission, collectively forming their own rules and developing untrammelled very largely by Parliamentary control, could become a great danger to our society.
  Although I have no criticism at the moment, I am disturbed when I hear that some reports of the Prices and Incomes Board are produced by an outside body of consultants. While I am sure that, with the present chairmanship of the Board, any outside body of consultants would be chosen with the utmost care, we must accept that such bodies or business efficiency experts work in the commercial field and, therefore, have interests outside the report which they are being asked to produce. It would be only too easy for a firm of consultants, either by design or by accident, to be appointed which had interests which were inimical to the report which it was being asked to produce.
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  There is, therefore, a danger—I do not put it higher—in the way in which matters could develop. There is no sign of it at the moment—
  Mr. Stewart: It could not happen.
  Sir D. Glover: It could happen.
  Mr. Stewart: The hon. Gentleman said that reports are produced by outside firms of consultants. Would he give an example?
  Sir D. Glover: I am reliably informed—if I am wrong—
  Mr. Stewart: Then the hon. Gentleman should not say it.
  Sir D. Glover: I apologise if I am wrong.
  Mr. Deputy Speaker (Sir Eric Fletcher): There is nothing in the Amendment about outside consultants.
  Sir D. Glover: This is what I have been told. If I have been wrongly informed, I willingly and happily withdraw.
  The Amendment refers to a recommendation which
  "arises from the terms of reference originally given to the Board".
  When a firm or organisation or group of firms is being investigated by the Board, we and the people concerned know what are the Board's terms of reference. If I know anything about human relations, the people who are being investigated will, rightly, try to produce an answer to what might arise as a result of the investigation. If, however, the Board exceeds its terms of reference and produces a report which is critical of the organisation concerned but which is outside the terms of reference, inevitably the people investigated will be asked to answer a case which they never expected to have to answer.
  The Government, therefore, would be well advised to accept the Amendment because the matter would then be kept within Parliamentary control and everybody would know the terms of reference given by the Government, the report will be within those terms and the people concerned will have to answer to the Minister. There is a safeguard in the Amendment which there would not be if it were not accepted. However, we may look upon the matter in the House, people

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  are under the impression that they are under a form of attack when a matter is referred to the Board. Therefore, they have a right to know that the report to the Government will be within the terms of reference given to the Board by the Government.
  If the Government accepted the Amendment, the people concerned would know the case which they had to answer before the Government took a decision. If the Government allowed the Board to go beyond its terms of reference, a great sense of injustice would be created among the firms and organisations investigated. The Amendment is a safeguard not only or the power of the Government and Parliament but, perhaps more important, of the sense of justice of the people who are investigated. I hope that the Minister will accept the Amendment.
  Mr. Higgins: I support what has been said by my hon. Friends and, in particular, by my hon. Friend the Member for Guildford (Mr. David Howell), who drew a very important distinction between the task of the National Board for Prices and Incomes concerning short run increases in wages or prices and its task concerning long run developments and the examination of long run trends.
  Comment has been made about the reference of bank charges to the Prices and Incomes Board. There is no doubt that in that instance the Government took greater care in framing the terms of reference than they took in other cases. It s said on page 3 of the Board's Report No. 34 on Bank Charges that
  "… it is, in the Government's view, desirable in the public interest that the system and level of charging customers should be reviewed by the National Board for Prices and Incomes in the light of the banks' profit and dividend record."
  Then it adds another sentence:
  "It is not intended that the Board should concern itself with questions of monetary policy such as Bank Rate and the general level of interest rates."
  Yet in its Report the Board stated in paragraph 3:
  "The references stated explicitly:
  'It is rot intended that the Board should concern itself with questions of monetary policy such as Bank Rate and the general level of interest rates.'
  We have interpreted this as meaning that we should not comment on the way in which monetary policy has been conducted or on
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  the general level at which Bank Rate has been held."
  It would have been very surprising if it had done.
  The Board continues:
  "Nor do we consider that we should comment on aspects of monetary policy that touch only remotely and indirectly on interest rates charged by the clearing banks, e.g., certain aspects of debt management. In so far, however, as we recommend changes in the system of bank charges, such changes are likely to have considerable implications for the techniques of monetary control. We have accordingly thought it consistent with our terms of reference to indicate what these implications might be and what possibilities by way of offsetting action might be open to the authorities."
  It seems clear from that that the Board not only went beyond its terms of reference but was clear in its mind that it was doing so. It not only made recommendations but examined the much broader implications of those recommendations. The House is right to be jealous of this in considering the Amendment. There is no objection which the Government could legitimately have to the Amendment.
  The position of the Opposition concerning the Prices and Incomes Board was clearly expressed by my right hon. Friend the Leader of the Opposition in a speech only last weekend when he said:
  "Some restrictive practices would remain untouched by"
  the measures which he mentioned earlier. He went on:
  "These we will attack by adapting the instrument of the Aubrey Jones Board for that specific purpose. We will also use the power of Government spending to eradicate restrictive practices from the firms and industries which gain from public contracts".
  The Prices and Incomes Board has grown without any clear restraints on the form in which it should develop. For that reason it is important that the House should be jealous of its powers and should not delegate them to other quasi-judicial bodies such as this without considering and writing into legislation very carefully exactly what its powers should be.
  8.0 p.m.
  On the two previous occasions when the House decided to delegate powers in restrictive practices to outside bodies, a major Bill was introduced and debated

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  in greatest detail and very severe restraints were placed on those two bodies. I refer to the Monopolies Commission and the Restrictive Practices Court. In debates on the Monopolies Commission—when it was first set up and when it has been changed in successive legislation—it has been made clear that the powers of the Commission are substantially less than those of the Jones Board. We were told when discussing an earlier Amendment that the Jones Board's references would restrict the extent to which the Government could take action in a particular case. The Monopolies Commission does not even have that power to limit the Government's control and it has been hemmed around with such severe restraints as the House has considered it right to put on the Commission.
  Similarly with the Restrictive Practices Court. Lengthy debates took place on exactly the subject of the powers which the Court should have and the extent to which it could judge maters which were not essentially judicial but were considered to have elements of public policy in them. In that case the House not only imposed rigorous controls, but said that certain practices might be against the public interest unless they could go through some specified gateway.
  In this case, on the other hand, the National Board for Prices and Incomes has very little control over its operations. Apparently it is not even being tied down to its terms of reference. I hope, therefore, that the Government will accept the Amendment.
  Some anxiety was expressed earlier about the Board employing consultants. It seems clear that the Board's terms of reference may not only be extended by the Board itself—as they were, apparently, in this case—but in some cases may even be extended by its consultants. The First Secretary asked my hon. Friends to give an example of a case where one of the Board's reports was produced not by the Board but by its consultants. Obviously we cannot give such an example. We appreciate that, in formal terms, its reports are produced by the Board. However, we have no means of telling how those reports diverge from the advice the Board has received from its consultants.
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  The First Secretary went on to say that we could be sure that none of the consultants had any particular interest which might enable him to be biased in his views. But the House cannot be sure of that. We do not know who the consultants are, or even their nationality—that is, unless an hon. Member tables a Question and learns this information in a Parliamentary Answer. It is not sufficient for the First Secretary to say, "This is a straightforward procedure. We know exactly what happens". The House has been given remarkably little information about what happens either about the working of the Board or its consultants. We need to be sure that they are tied down to their terms of reference.
  We do not even have a clear idea of the terms of reference affecting the operation of the Board. In the other two cases to which I referred we know exactly what is happening. There are clear procedural recommendations applying to the Monopolies Commission and any case to be answered is clearly set out for those who are called upon to give information. They have a clear idea of the case that must be answered and they can put forward their evidence accordingly.
  It is not clear that those being investigated by the Board have an equal right of reply. There is no public hearing to correspond with that of the Monopolies Commission, and the Restrictive Practices Court has an even more rigid procedure which protects the interests of those who are being investigated—certainly far more than people appearing before the Prices and Incomes Board are protected.
  I take issue with my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor), who expressed the hope that the Board's operations would not be too closely restricted. The essential element is that the Board's terms of reference should be specified in such a way that it can reasonably investigate the matter in hand and spread its net as wide as the Government feel that it ought. However, it is unreasonable that the Government should give the Board one set of terms of reference and that the Board should go on to decide whether or not it should go beyond them.
  In these circumstances, as in the banking case, the right course would be

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  for the Board to say to the Government, "We feel it necessary to examine other matters"—of the kind mentioned by my hon. Friend the Member for Cathcart—"and presumably you will revise our terms of reference accordingly". But, instead, the Government have been remarkably loose in framing the Board's terms of reference, and this reflects the Government's general woolly thinking.
  I will give two instances of this. Report No. 31, on the Distribution Costs of Fresh Fruit and Vegetables, states that the Government had reason to refer the matter to the Board and, accordingly, the Board was asked to examine
  "… the question of the costs and profit margins of the wholesale and retail fruit and vegetable trades."
  The Government should also have said that the demand for those goods, the way it fluctuates daily, seasonal aspects and other problems, should be looked into. Then the Board would have known where it was. Instead, the Government specified one aspect of the matter and left ii to the Board to do the work which the Government should have done themselves.
  Time and again the reference given to the Board has been nebulous, and when the Government have given a specific reference the Board has often gone beyond it. Consider the case of laundry and dry cleaning charges, the only case where an Order has been issued. The Government considered it desirable
  "… in the national interest that the justification for increases in charges from the middle of 1964 should be investigated by the National Board for Prices and Incomes."
  The Board went far beyond that and made recommendations on which the Government imposed an Order. If that is what the Government wanted, they should have said clearly to the Board what was desired and asked for specific recommendations. This has a strong bearing on the last Amendment we were discussing.
  The Government are anxious to leave the whole thing as woolly and nebulous as possible, with the Board's terms of reference being so ill-defined that nobody can make head or tail of them. The Government then hope that the Board will come up with something that they can either reject or accept, as they think
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  fit. This is not a matter of little consequence. The House of Commons should not be treated in this way. In the other two instances the House went to immense trouble to define the powers of such quasi-judicial bodies. I trust that the Government will now accept the Amendment because there is clearly a case for defining the Board's whole operation, its structure, consultants and the basis on which its activities are conducted.
  Mr. Frederick Lee: This has been a wide-ranging debate in which hon. Gentlemen opposite have expressed views about the way in which the National Board for Prices and Incomes interprets its terms of reference. I am not absolutely clear how this subject comes within the terms of the Amendment, or, indeed, of the Bill. After all, the Bill merely gives the Government powers to extend standstills and does not in any way, shape or form or discuss the terms of reference of the Board or give the Board power to go outside the terms of reference given it in the 1966 Act, which were explicit.
  Hon. Gentlemen opposite will see that we are not in any way widening the Board's terms of reference. We are merely extending the time factor for delay, if the Board so recommends. The anxieties expressed by hon. Gentlemen opposite appear to be misplaced. Hon. Gentlemen opposite have contrasted a general reference, with fairly wide terms of reference, with more specific issues and have suggested that the Board might go wide in interpreting its terms of reference on the more general issues.
  I would remind the House that we are discussing Clause 1. We know that it confers on the Government discretion to extend by Order, temporarily, a standstill of a price or pay increase beyond the three or four months provided for in Part II of the Act in cases where the Board have so recommended. The hon. Member for Worthing said that we were being woolly and nebulous, and were giving the Board powers that it could use too widely; that the Government was not limiting the Board. I will try to deal specifically with one or two items, because I want to disabuse the hon. Member of that idea.

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  By virtue of paragraph 2 of the Schedule the Government cannot take action which is more restrictive than that which the Board recommends. Whether the existing standstill has been imposed directly under Part II of the Act or by virtue of Clause 2 of the Bill it will operate in relation to the Board's reference on the particular price or pay increase in question.
  We have been told that this Amendment is designed to ensure that a standstill cannot be extended by virtue of the Clause unless the Board's Report contains a recommendation that is adverse to the increase in price or charge, or the settlement, and which
  "… arises from the terms of reference originally given to the Board".
  The hon. and learned Member for Darwen (Mr. Fletcher-Cooke), and other hon. Members, said that surely the Government could accept the Amendment, as it would do no harm in any event. I do not argue that the content of the Amendment is in any way harmful. The fact is that it is quite unnecessary. The point is covered time and again in the 1966 Act and in the Bill.
  The Schedule makes it clear that the Government cannot impose anything wider than that which the Board recommends, whether it is done under Part II of the Act or Clause 2 of the Bill. That which the Board can recommend must relate to the specific reference given to it. Part II, or Clause 2 of the present Bill, can be effective only in relation to increases in prices or charges, awards or settlements to which the relevant reference to the Board applies.
  Sections 7 and 14 deal with cases involving statutory notification of proposed increases in prices or pay. Sections 7(3) and 14(6) provide respectively for the reference to the Board of the notice of intention to increase the prices or charges, awards or settlements in question, as a prerequisite to the maintenance of the standstill. Again, Section 8(1) limits the application of the standstill to prices or charges and
  "… matters to which the reference relates."
  Section 15(1) limits the application of a standstill to the award or settlement that has been referred to the Board.
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  It is pretty difficult in such circumstances to appreciate why hon. Members opposite believe that on specific references—the kinds of things that we discuss in Clause 1—the Board can rove far and wide outside the terms of reference. Indeed, the standstill powers contained in Clauses 1 and 3, like those in Part II of the 1966 Act, can be applied only to price increases and pay settlements referred to the Board, and only where the price increases or groups of workers are directly covered by the reference.
  The hon. Member for Cathcart (Mr. Edward M. Taylor) was not far off the mark when he indicated that there could be certain limitations—
  Mr. Frederic Harris: But my hon. Friends have, time and again, given very definite cases where the Board has roved widely.
  8.15 p.m.
  Mr. Lee: I have emphasised that this Bill as a whole does nothing to widen the powers of the Board; it merely extends the time factor.
  The reference can only be directly either to a given price increase or to a specific group of workers, but this does not of itself stop the Board from making recommendations on related matters. The hon. Member for Cathcart indicated one or two such related matters. He talked in terms of relative rates for apprentices, or for one kind of craftsman when another kind of craftsman has received an increase. The hon. Gentleman is quite right—these things generally do run together. But no matter what the Board might say on issues like that, we could not use the powers to implement a recommendation that went wider than the actual group of workers to whom the reference related.
  Therefore, it is not the case that in these specific references under Clause 1 the Board would go wider in its recommendations than its terms of reference unless, afterwards, we gave it a further reference to deal with other types of worker who were not under surveillance in the original terms of reference—
  Mr. Peyton: The right hon. Gentleman now seems to envisage a rather messy postscript being given to the reference, but what we on this side have been

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  concerned with—and he has just handed the case to us—is that a reference is made and the Board comes back with a recommendation which covers people who are not within the terms of reference. That recommendation would be very embarrassing to the Government. That was my hon. Friend's point.
  Mr. Lee: The hon. Gentleman mistook reference for recommendation. I am talking, as was the hon. Member for Cathcart, in terms of a number of craftsmen working in a shipyard, engineering workshop, or the like, where there may have been a reference to one section—let us say, some kind of engineering job. By practice, movements of income as between those people and other comparable workers are generally kept in line. It tray well be that the reference merely relates narrowly to the one group of people to whom I have referred. Whilst in its Report, the Board could say that this rather got the thing out of balance, it would not be a recommendation on which we could act. If, however, the Board said that this got all the relativities out of balance we could make a further reference dealing with the specific people to whom the Board had made some reference in its report. To those of us not unused to that sort of thing in industry, there is nothing new or original in it, nor is there anything startling about it; in fact, it would he rather startling if there were not something like that.
  I therefore hope that the apprehensions felt by such a wide number of hon. Members opposite will be assuaged when they read what I have said. I have given them some references both to the 1966 Act and to the Bill, including the Schedule to the Bill, in order to show them that it is not likely in these references under either Clause 1 or Clause 3 for the Board's recommendation to go outside their specific terms of reference; that, if it did so, the recommendation would carry no statutory weight whatever, and that before we could widen a standstill or an increase or anything else there would have to be a further reference to deal with other people outside those concerned in the original reference to the Board.
  Mr. Iain Macleod: My hon. Friend the Mmber for Guildford (Mr. David Howell) moved this important Amendment with
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  his usual clarity, but the clarity somewhat disappeared during the speech of the Chancellor of the Duchy of Lancaster to which we have just listened. The right hon. Gentleman seemed to have got hold of a remarkable brief, on one or two points of which I would like to comment.
  The right hon. Gentleman began by casting doubt on whether the speeches were relevant to the Bill. I remind him that subsection (1) of Clause 1 begins by saying:
  "Where by virtue of a reference to the National Board …"
  Clearly, therefore, the questions of the reference and how much of it is intra vires and how much of it is ultra vires are of the greatest importance. My hon. Friends were distinctly worried—I certainly was—as the right hon. Gentleman's explanation went on—
  Mr. Frederick Lee: The right hon. Gentleman began to quote from subsection (1). Will he finish it?
  Mr. Macleod: Of course—
  "Where by virtue of a reference to the National Board for Prices and Incomes under section 2(1) or (3) of the Prices and Incomes Act 1966 …"
  [Interruption.] I can read the whole Bill if the First Secretary does not know it, but I suspect that he does, and he knows that I know it. Perhaps we can leave it at that. It is by virtue of a reference.
  I join the alliance against my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor). I do not see the Board as a roving band of "whizz-kids". Some of the Members of the Board are distinguished people. Mr. Hilary Marquand, for instance, is difficult to envisage in that guise. This is in no sense an attack on the Board. I admire much of the work that it does and I have considerable regard in particular for the chairman, Mr. Aubrey Jones. The question is whether there should be, either at first or at second hand, a true measure of Parliamentary control—my hon. Friend the Member for Ormskirk (Sir D. Glover) put his finger on this—over the question of what is in a reference.
  By far the most startling example was the one which was first referred to by my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) and also by my hon. Friend the Member for

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  Worthing (Mr. T. Higgins)—that is, the the report on bank charges. I know of no evidence that there was widespread objection by the public to the level of servicing charges, but we can leave that aside for the moment. The key sentence for the reference was that published profits and dividends had increased substantially in recent years.
  The report tries to justify that by showing that over the 13 years from 1951 to 1964, net profits and net dividends paid out increased by 3·7 and 3·9 times, respectively. All that arises out of the reference, and one can have no objection to it. The Board could, and, in my view, should, have gone on to say that in 1951, which it took as its base year, the Bank Rate was 2 per cent. and, therefore, the percentage of advances was subnormal. It should have said that for 20 years before then, from 1931 to 1951, dividends had been frozen, in some cases at levels made during the 1931 slump. At least, that was the Board's assignment and nobody can complain about that.
  The Board could, on that point alone, have produced a quite short report had it adhered to its terms of reference. It makes clear in Chapter 6 of its report that 42 per cent. of private accounts pay no charges and that the overall average charge, remarkably enough—it surprised me very much—is only 44s. a year, which is scarcely an important item in most people's cost of living.
  The Board could, and, in my judgment, should, have stopped, I will not necessarily say there, but either there or there-abouts. If anything, it had discharged fully the terms of reference given to it and it had found that the commission charges were subsidised from other profits and were being provided by the banks at less than cost. That could, hand should, have been the end of the matter.
  Now comes the point which causes us concern. My hon. Friend the Member for Worthing quoted the key sentence from page 3 of the report. It is clear that what the Board went on to do was absurdly distant and different from its terms of reference. In paragraph 176 it stated that
  "the Government was inviting us in effect to judge whether the depositor and the borrower had been equitably dealt with vis-à-vis the shareholder."
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  I do not believe that the Government were doing any such thing. It is an extraordinary interpretation of the terms of reference.
  At that point in his speech, the Chancellor of the Duchy argued that the Board cannot go outside its terms of reference. The short answer is that it goes outside them over and over again. We are picking only on the most obvious and the most recent of a number of examples. The Chancellor of the Duchy then said that no further action could be taken by the Government if the Board went outside its terms of reference because it was stopped from doing so by one of the provisions in the Schedule to the Bill.
  I should like to ask this question. If the First Secretary is not thinking of replying to the debate, perhaps he can reply in one word. When the Board went, in my view, outwith its terms of reference, did it ask the Government whether it could do this, or was the Board simply interpreting to its own satisfaction the terms of reference which had been given to it? Was the First Secretary asked by the Board, "Can we go wider than these terms of reference", or was the Board, in the exercise of its private initiative, simply extending, in our view at least, the terms of reference which had been laid down for it by the Secretary of State? Would the First Secretary like to deal with this by intervention now or later?
  Mr. M. Stewart: Later.
  Mr. Macleod: Very well. In my view, it is beyond argument that had the Board wanted to do that, it should have come back to the Secretary of State and said—this is not uncommon; we all have experience of this, those of us who have held ministerial office and, indeed, those who have not—"Should we go beyond the immediate terms of reference?" It is on this point that the question of the authority of Parliament, which my hon. Friend the Member for Ormskirk raised, is of real importance. We should be jealous of our position in this matter.
  The Chancellor of the Duchy of Lancaster said that if the report of the Board went beyond its original terms of reference, there was no action that the Government should take in the matter. Perhaps the First Secretary will explain

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  this point. I have not got the reference with me, but it is clearly in my mind that the First Secretary welcomed the full report on the banking industry when it was issued, which seems to me to be in considerable contrast with the attitude of the Chancellor of the Duchy of Lancaster, who has said, in effect, that the Board was wasting its time by going beyond the terms of reference given to it by the First Secretary.
  Mr. Frederick Lee: I was old-fashioned enough to be arguing an Amendment to Clause 1. Clause 1 gives the power to extend periods of standstill. I was therefore saying that the terms of reference are very different from the kind of thing the right hon. Gentleman is discussing.
  8.30 p.m.
  Mr. Macleod: I have got that. I left that point about a quarter of an hour ago. I entirely accept what the right hon. Gentleman says, but all of Clause 1 is governed by the opening words:
  "Where by virtue of a reference"
  and then we go on with this matter.
  The Chancellor of the Duchy of Lancaster claimed at the end that the Amendment was unnecessary. He knows tie standard answer to that, which I dare say he leas given me in his time. If it is unnecessary, why not put it in, because at least this side of the House would be satisfied, a vote would be saved, and we should be a good deal clearer on a matter which touches on the heart of the Bill?
  The terms of reference which the First Secretary gives will, as he knows full well, in some cases at least have the effect of putting a firm or an industry, or even conceivably an individual, although this has not happened so far, in the dock. It has to explain all sorts of things. It may be, and often is, extremely dissatisfied with the result. In the same way as anyone who has to face any sort of charge or investigation into his affairs—business affairs or other affairs, as the case may be—is always told specifically what the charges are against him and what will be investigated, so we seek to write into the Clause words which we think would have that effect. Of course the First Secretary would be able to continue to make references by virtue of the 1966 Act and the standstill in due course, when Parliament has finished discussing this, will no doubt be extended by the Clause.
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  We regard this as one of the most important points in the Bill. We regard it as very important indeed that the Board should not charge all over the countryside on all sorts of matters which may conceivably seem to it to arise at first or second or tenth hand from the reference which has been given to it by the First Secretary. We therefore seek deliberately to narrow the Board's reports to matters which arise
  "from the terms of reference originally given to the Board".
  We naturally think that this is a bad Bill. We think that the parent Act is a bad one, too. We think that an important change would be made for the better if the First Secretary were to accept the Amendment.
  Mr. M. Stewart: I will try to explain to the right hon. Gentleman not only why the Amendment is unnecessary but why its acceptance would make the Bill a worse Bill. The hon. Member for Guildford (Mr. David Howell) was much interested in what has sometimes been called general references to the Board. He instanced productivity agreements and restrictive practices. The hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor), as one of the limited number of trade unionists on the Opposition benches, may have noticed the zeal amongst his colleagues for having restrictive practices investigated by the Board and the great alarm that possibly a banker might be upset by something the Board had said. He will notice this kind of thing more and more as he remains on those benches.
  I come to the important point about the fondness of the hon. Member for Guildford—it is a fondness which I share—for general references of important questions to the Board. I think we must accept that, long term, this will be an important part of the Board's work—not just to be asked, "Ought this group of workers to have so many shillings per week more?" but to consider wider questions. It is common ground that the Board ought to have general as well as particular references. It could never do a useful job such as that which it has done on productivity agreements if an attempt were made to tie down its terms of reference as narrowly as the hon. Gentleman tried to tie down what the hon. Gentleman the Member for Worthing

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  thought the terms of the fruit and vegetable reference should have been. A study of the report of his speech in HANSARD and of the way in which he said that we should have pegged down the reference about fruit and vegetables will show that it would have left the Board with nothing to do. The Government would have told the Board not only what they wanted done but exactly, at every stage, how they thought it should be done.
  Mr. Higgins: No, not at every stage how they thought it should be done. All the Government should be doing is giving the Board clear terms of reference. The right hon. Gentleman is now saying that the Government are incapable of giving clear terms of reference.
  Mr. Stewart: No. If the hon. Gentleman reads what he said, he will see that that would be treating the Board like a child, giving it terms of reference nailed down in that way. If we did that, the Board would never do the kind of job which the hon. Member for Guildford rightly wants to see it do. I make that general point with regard to terms of reference given to the Board.
  I come now to some of the accusations made against the Board. I expect that the hon. Gentleman the Member for Ormskirk (Sir D. Glover) has from time to time in his Parliamentary work asked someone not in the House but with special knowledge to give him advice before he made a speech on some matter. Has he never done that? What would he say if it were then alleged that his speech was produced by outside advisers? That is the sort of accusation which he was making against the Board, without a shadow of evidence.
  Sir D. Glover: The right hon. Gentleman is taking this too far. I gave a very generous apology. The right hon. Gentleman said that there was no truth in my allegation. Since then, he and his right hon. Friend have told me that there was a good deal of truth in my allegation and, in fact, specialists were consulted. There is not much point in consulting if one takes no notice of the people consulted.
  Mr. Stewart: The hon. Gentleman is trying to have it both ways. No one
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  disputes that the Board takes advice, as, occasionally, I imagine, the hon. Gentleman does, but that is not to say that its reports are produced for it by someone else. That accusation ought not to have been made, yet the hon. Gentleman is now trying to repeat it through the back door. I mention those matters since this general argument about the Board has been brought up.
  If hon. Members opposite want to pursue this interesting and important question of how references to the Board should be drafted and the two kinds of work of the Board are to be undertaken, the particular reference and the general question—I think that it has to do both—they will need to devote a little more thought to the matter than they have shown by their contributions tonight, and they will have to be a little less influenced by purely malicious attacks on the Board.
  Mr. David Howell Mr. David Howell rose—
  Mr. Stewart: No. I think that I need say no more about that because none of it has anything to do with the Amendment before us. Even if every accusation made against the Board in this debate, with or without evidence, were true, there is nothing in the Amendment which would reduce the Board's power to do any of the things complained of. The hon. Member for Worthing thought that the Board went outside its terms of reference in regard to the banks. He said that that was the view on his side of the House. It is not everyone's view. It is a matter about which, on the words of the reference, different opinions can be held. But even if he is right, even if the Board did go outside its terms of reference, there is nothing in the Amendment which would prevent it doing so again. The Amendment is not directed to that problem at all.
  What is the Amendment supposed to do? The right hon. Member for Enfield, West (Mr. Iain Macleod) recommended the Amendment to us as one which would stop what he would regard as a dangerous abuse of the rights of Parliament. The Amendment would do nothing of the kind. It does not bear on that problem at all. What would it do? It would provide that, if the Board went beyond its terms of reference, the Minister could not make an order on any

  201
  matter on which it had gone outside its terms of reference. I agree that that is a proper provision to have in the Bill. It is there already. The Bill is concerned with prolonging standstills provided for under the 1966 Act, and those standstills can arise only out of a particular reference to the Board.
  If the Amendment were carried, therefore, the Board's powers to interpret its terms of reference as it judged best would remain where they are. The Minister's incapacity to make Orders about things which are not in the terms of reference to the Board would remain as it is. If this is meant to be an Amendment disciplining the Board, it quite clearly fails in its objective. If it is intended to limit the powers of Ministers, it is unnecessary and it has this further peculiar result that the words:
  "… the terms of reference originally given to the Board"
  might leave the courts wondering what would be the position if, under the Prices and Incomes Act, 1966, the reference was given to the Board and later on was varied. As the first reference is known as the original reference, the courts might be genuinely left wondering whether, if that happened, the Board could only report, and the Government only act on the original terms of reference, and not the original reference as varied.
  A large part of the argument for this Amendment has been directed to a matter with which the Amendment does not deal. It is an Amendment which is said to be due to a fear of excessive powers of Ministers, yet it does not limit those powers. They are already limited. It has the final disadvantage that it might leave the courts in some doubt as to what it meant. The House will be well advised rot to accept it.
  Mr. Higgins: On the second point that the right hon. Gentleman was making, that the Amendment does not limit the Government, are we to understand that what he is now saying is that the Governmen would not be able to take any action under this Clause at all, unless they were acting in precisely the terms specified in the terms of reference of the Board?
  Mr. Stewart: The Goverment's powers are to prolong a standstill, of either prices or wages. They can only do that
  202
  on proposals about prices or wages which have been referred to the Board. This kind of reference would be a particular reference, about particular prices or wages. It would not be possible for the Government to go beyond that. The Board might choose—and it might be right to choose in my judgment—to include in its report certain opinions about main matters, but that would not enlarge the powers of the Government.
  Mr. Iain Macleod: Leaving on one side the question whether the courts will be in some doubt, the right hon. Gentleman might like to recall the recent decision of the Court of Appeal in this matter, which shows fairly clearly that the Government are wrong in their legal views in these cases. I asked the right hon. Gentleman one specific question which he promised to answer. Did the Board come back to him?
  Mr. Stewart: The right hon. Gentleman knows that the decision of the Court of Appeal is not in the least connected with this Amendment. I am merely pointing out that the words in this Amendment would only create further ambiguity for the courts.
  The answer to the right hon. Gentleman's question is, "No". It does not, and I cannot see why it is necessary to do so. If hon. Members look at the wording of the terms of reference, the Board could quite properly hold that its report was within the terms of reference. Interesting as it is, this question has no bearing on the Amendment.
  Mr. Frederic Harris: I have listened to every part of this very interesting debate and I am tempted to make a few comments because every time I listen to the First Secretary he comes out with some offensive and irritating remark. In this case the Chancellor of the Duchy of Lancaster made a strong and rather complicated argument, but said clearly that it was in order to accept the Amendment, that there was no difficulty about it, but that it was felt to be unnecessary.
  On the other hand, the First Secretary gets up and gives us a long-drawn-out story as to why the Amendment cannot be accepted under any circumstances. An ordinary layman, trying to understand

  203
  Amendments to a most complex Bill such as this, should be able, at least, to expect that the two main Ministers concerned would have made up their minds as to what they would do about this. These are the facts and they cannot be denied. I strongly recommend the two Ministers to get together before we go on to the rest of the Amendments and come to some understanding about what they are recommending to the House. Whose advice do we take?
  8.45 p.m.
  My right hon. Friend the Member for Enfield, West (Mr. Iain Macleod), when he intervened, said exactly what I was going to say in very much better language, and the House will be pleased to know that I am now going to sit down and leave it to the Division.
  Question put: That those words be there inserted in the Bill:—
  The House divided: Ayes 143, Noes 209.

  Division No. 430.]

  AYES

  [8.46 p.m.

  Alison, Michael (Barkston Ash)

  Gurden, Harold

  Murton, Oscar

  Allason, James (Hemel Hempstead)

  Harris, Frederic (Croydon, N.W.)

  Noble, Rt. Hn. Michael

  Astor, John

  Harris, Reader (Heston)

  Page, Graham (Crosby)

  Atkins, Humphrey (M't'n & M'd'n)

  Harvie Anderson, Miss

  Page, John (Harrow, W.)

  Barber, Rt. Hn. Anthony

  Hawkins, Paul

  Pardoe, John

  Beamish, Col. Sir Tufton

  Heald, Rt. Hn. Sir Lionel

  Peel, John

  Biffen, John

  Heseltine, Michael

  Percival, Ian

  Boyle, Rt. Hn. Sir Edward

  Higgins, Terence L.

  Peyton, John

  Braine, Bernard

  Hiley, Joseph

  Pink, R. Bonner

  Brewis, John

  Hirst, Geoffrey

  Prior, J. M. L.

  Bromley-Davenport, Lt.-Col. Sir Walter

  Hogg, Rt. Hn. Quintin

  Pym, Francis

  Brown, Sir Edward (Bath)

  Holland, Philip

  Ramsden, Rt. Hn. James

  Bruce-Gardyne, J.

  Hooson, Emlyn

  Renton, Rt. Hn. Sir David

  Bullus, Sir Eric

  Hordern, Peter

  Ridley, Hn. Nicholas

  Burden, F. A.

  Hornby, Richard

  Royle, Anthony

  Campbell, Gordon

  Howell, David (Guildford)

  Russell, Sir Ronald

  Carlisle, Mark

  Hunt, John

  Scott, Nicholas

  Carr, Rt. Hn. Robert

  Hutchison, Michael Clark

  Sharples, Richard

  Chichester-Clark, R.

  Iremonger, T. L.

  Shaw, Michael (Sc'b'gh & Whitby)

  Clegg, Walter

  Irvine, Bryant Godman (Rye)

  Sinclair, Sir George

  Cooper-Key, Sir Neill

  Jenkin, Patrick (Woodford)

  Steel, David (Roxburgh)

  Corfield, F. V.

  Jennings, J. C. (Burton)

  Stoddart-Scott, Col. Sir M. (Ripon)

  Costain, A. P.

  Johnson Smith, G. (E. Grinstead)

  Summers, Sir Spencer

  Craddock, Sir Beresford (Spelthorne)

  Jopling, Michael

  Tapsell, Peter

  Crosthwaite-Eyre, Sir Oliver

  Kaberry, Sir Donald

  Taylor, Sir Charles (Eastbourne)

  Crouch, David

  Kimball, Marcus

  Taylor, Edward M.(G'gow, Cathcart)

  Dance, James

  King, Evelyn (Dorset, S.)

  Taylor, Frank (Moss Side)

  Davidson, James(Aberdeenshire, W.)

  Kirk, Peter

  Temple, John M.

  Dean, Paul (Somerset, N.)

  Knight, Mrs. Jill

  Thatcher, Mrs. Margaret

  Deedes, Rt. Hn. W. F. (Ashford)

  Lambton, Viscount

  Tilney, John

  Dodds-Parker, Douglas

  Leadbitter, Ted

  Turton, Rt. Hn. R. H.

  Eden, Sir John

  Lewis, Kenneth (Rutland)

  van Straubenzee, W. R.

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

  Loveys, W. H.

  Wainwright, Richard (Colne Valley)

  Emery, Peter

  Lubbock, Eric

  Walker-Smith, Rt. Hn. Sir Derek

  Errington, Sir Eric

  McAdden, Sir Stephen

  Walters, Dennis

  Eyre, Reginald

  MacArthur, Ian

  Ward, Dame Irene

  Fisher, Nigel

  Macleod, Rt. Hn. Iain

  Weatherill, Bernard

  Fletcher-Cooke, Charles

  McMaster, Stanley

  Webster, David

  Fortescue, Tim

  Maude, Angus

  Whitelaw, Rt. Hn. William

  Fraser, Rt. Hn. Hugh(St'fford & Stone)

  Mawby, Ray

  Wills, Sir Gerald (Bridgwater)

  Galbraith, Hon. T. G.

  Maxwell-Hyslop, R. J.

  Wilson, Geoffrey (Truro)

  Gilmour, Sir John (Fife, E.)

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

  Wolrige-Gordon, Patrick

  Glover, Sir Douglas

  Mills, Peter (Torrington)

  Wood, Rt. Hn. Richard

  Glyn, Sir Richard

  Miscampbell, Norman

  Wright, Esmond

  Gower, Raymond

  Mitchell, David (Basingstoke)

  Wylie, N. R.

  Grant, Anthony

  Morgan, Geraint (Denbigh)

  Grant-Ferris, R.

  Morrison, Charles (Devizes)

  TELLERS FOR THE AYES:

  Griffiths, Eldon (Bury St. Edmunds)

  Mott-Radclyffe, Sir Charles

  Mr. Jasper More and

  Grimond, Rt. Hn. J.

  Munro-Lucas-Tooth, Sir Hugh

  Mr. Timothy Kitson.

  NOES

  Abse, Leo

  Beaney, Alan

  Bradley, Tom

  Alldritt, Walter

  Bence, Cyril

  Bray, Dr. Jeremy

  Ashley, Jack

  Benn, Rt. Hn. Anthony Wedgwood

  Brooks, Edwin

  Atkins, Ronald (Preston, N.)

  Bidwell, Sydney

  Brown, Bob(N'c'tle-upon-Tyne, W.)

  Atkinson, Norman (Tottenham)

  Bishop, E. S.

  Brown, R. W. (Shoreditch & F'bury)

  Bacon, Rt. Hn. Alice

  Blackburn, F.

  Buchan, Norman

  Bagier, Gordon A. T.

  Boardman, H.

  Buchanan, Richard (G'gow, Sp'burn)

  Barnes, Michael

  Bowden, Rt. Hn. Herbert

  Butler, Herbert (Hackney, C.)

  Baxter, William

  Braddock, Mrs. E. M.

  Callaghan, Rt. Hn. James

  Carmichael Neil

  Henig, Stanley

  Oakes, Gordon

  Castle, Rt. Hn. Barbara

  Herbison, Rt. Hn. Margaret

  Ogden, Eric

  Coe, Denis

  Hooley, Frank

  O'Malley, Brian

  Coleman, Donald

  Houghton, Rt. Hn. Douglas

  Orbach, Maurice

  Conlan, Bernard

  Howarth, Harry (Wellingborough)

  Orme, Stanley

  Craddock, George (Bradford, S.)

  Howarth, Robert (Bolton, E.)

  Owen, Dr. David (Plymouth, S'tn)

  Crawshaw, Richard

  Howell, Denis (Small Heath)

  Owen, Will (Morpeth)

  Cronin, John

  Howie, W.

  Page, Derek (King's Lynn)

  Crosland, Rt. Hn. Anthony

  Hoy, James

  Pannell, Rt. Hn. Charles

  Crossman, Rt. Hn. Richard

  Huckfield, L.

  Parker, John (Dagenham)

  Cullen, Mrs. Alice

  Hughes, Hector (Aberdeen, N.)

  Parkyn, Brian (Bedford)

  Dalyell, Tam

  Hughes, Roy (Newport)

  Pavitt, Laurence

  Davidson, Arthur (Accrington)

  Hunter, Adam

  Pearson, Arthur (Pontypridd)

  Davies, G. Elfed (Rhondda, E.)

  Hynd, John

  Peart, Rt. Hn. Fred

  Davies, Harold (Leek)

  Jackson, Colin (B'h'se & Spenb'gh)

  Pentland, Norman

  Davies, Ifor (Gower)

  Jay, Rt. Hn, Douglas

  Perry, George H. (Nottingham, S.)

  Davies, S. O. (Merthyr)

  Jeger, Mrs. Lena(H'b'n&St.P'cras, S.)

  Price, Thomas (Westhoughton)

  de Freitas, Rt. Hon. Sir Geoffrey

  Jenkins, Hugh (Putney)

  Rankin, John

  Delargy, Hugh

  Johnson, James (K'ston-on-Hull, W.)

  Rees, Merlyn

  Dell, Edmund

  Jones, Dan (Burnley)

  Roberts, Gwilym (Bedfordshire, S.)

  Dempsey, James

  Jones, Rt. Hn. SirElwyn(W. Ham, S.)

  Robinson, W. O. J. (Walth'stow, E.)

  Dewar, Donald

  Jones, T. Alec (Rhondda, West)

  Roebuck, Roy

  Diamond, Rt. Hn. John

  Judd, Frank

  Rose, Paul

  Doig, Peter

  Kelley, Richard

  Shaw, Arnold (Ilford, S.)

  Dunn, James A.

  Kerr, Russell (Feltham)

  Short, Rt. Hn. Edward(N'c'tle-u-Tyne)

  Dunwoody, Mrs. Gwyneth (Exeter)

  Lawson, George

  Short, Mrs. Renée(W'hampton, N.E.)

  Dunwoody, Dr. John (F'th & C'b'e)

  Leadbitter, Ted

  Silkin, Rt. Hn. John (Deptford)

  Eadie, Alex

  Ledger, Ron

  Silverman, Julius (Aston)

  Edwards, Robert (Bilston)

  Lee, Rt. Hn. Frederick (Newton)

  Slater, Joseph

  Ellis, John

  Lee, John (Reading)

  Small, William

  English, Michael

  Lewis, Ron (Carlisle)

  Snow, Julian

  Ennals, David

  Lipton, Marcus

  Spriggs, Leslie

  Ensor, David

  Lomas, Kenneth

  Steele, Thomas (Dunbartonshire, W.)

  Evans, Albert (Islington, S.W.)

  Loughlin, Charles

  Stewart, Rt. Hn. Michael

  Evans, Ioan L. (Birm'h'm, Yardley)

  Lyon, Alexander W. (York)

  Summerskill, Hn. Dr. Shirley

  Fernyhough, E.

  Lyons, Edward (Bradford, E.)

  Swingler, Stephen

  Fletcher, Raymond (Ilkeston)

  McBride, Neil

  Thomas, George (Cardiff, W.)

  Fletcher, Ted (Darlington)

  McCann, John

  Tinn, James

  Foot, Michael (Ebbw Vale)

  MacColl, James

  Urwin, T. W.

  Forrester, John

  MacDermot, Niall

  Wainwright, Edwin (Dearne Valley)

  Fowler, Gerry

  Mackenzie, Gregor (Rutherglen)

  Walker, Harold (Doncaster)

  Fraser, John (Norwood)

  Mackintosh, John P.

  Watkins, David (Consett)

  Fraser, Rt. Hn. Tom (Hamilton)

  Maclennan, Robert

  Watkins, Tudor (Brecon & Radnor)

  Freeson, Reginald

  McMillan, Tom (Glasgow, C.)

  Wellbeloved, James

  Ginsburg, David

  McNamara, J. Kevin

  Wells, William (Walsall, N.)

  Gordon Walker, Rt. Hon. P. C.

  MacPherson, Malcolm

  White, Mrs. Eirene

  Gourlay, Harry

  Mahon, Peter (Preston S.)

  Whitlock, William

  Gray, Dr. Hugh (Yarmouth)

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

  Willey, Rt. Hn. Frederick

  Gregory, Arnold

  Manuel, Archie

  Williams, Alan (Swansea, W.)

  Grey, Charles (Durham)

  Mapp, Charles

  Williams, Alan Lee (Hornchurch)

  Griffiths, Will (Exchange)

  Marquand, David

  Williams, Mrs. Shirley (Hitchln)

  Hamilton, James (Bothwell)

  Mason, Roy

  Williams, W. T. (Warrington)

  Hamilton, William (Fife, W.)

  Mellish, Robert

  Willis, George (Edinburgh, E.)

  Hamling, William

  Mendelson, J. J.

  Wilson, Rt. Hn. Harold (Huyton)

  Hannan, William

  Millan, Bruce

  Wilson, William (Coventry, S.)

  Harper, Joseph

  Miller, Dr. M. S.

  Winterbottom, R. E.

  Harrison, Walter (Wakefield)

  Milne, Edward (Blyth)

  Woodburn, Rt. Hn. A.

  Hart, Mrs. Judith

  Morris, Charles R. (Openshaw)

  Woof, Robert

  Haseldine, Norman

  Morris, John (Aberavon)

  TELLERS FOR THE NOES:

  Hattersley, Roy

  Murray, Albert

  Mr. Alan Fitch and

  Hazell, Bert

  Newene, Stan

  Mr. Ernest Armstrong.

  Heffer, Eric S.

  Noel-Baker, Rt. Hn. Philip(Derby, S.)

  Mr. Iain Macleod: I beg to move Amendment No. 11, in page 2, line 9, at the end to insert:
  'or until 11th August 1968 whichever is the earlier'.
  The side heading of the Clause, on which we have had some discussion recently, is, "Power to extend periods of standstill under Part II of Prices and Incomes Act 1966."
  Part II is not yet in operation, but it will be presumably when an Order on the Notice Paper is approved, if it is, by Parliament. It therefore follows that we
  206
  are doubly against the Clause, against the original 1966 Act, and against the power that Clause 1 takes to extend it.
  Subsection (2,a) of Clause I allows the standstill provision to continue
  "… for a period ending ten days after the date of publication of the Board's report …".
  Subsection (2,b), to which we seek to add words, lays down that if notice is so given then the Secretary of State can direct by Order for a period up to six months. We wish to cut off this period at the date of 11th August, 1968, a year from the expiry of Part IV.

  207
  One of the main reasons why we seek to do this is that we have become more and more convinced—and there is a great deal of mounting evidence—that the Government have no intention of relinquishing powers in the real sense of the word this August, next August or any other August. What they do will vary. Part IV will come to an end, but, as I prophesied many months ago, something almost equally unattractive—the extended Part take its place. It is true—and this matter was exhaustively discussed in Committee—that this Bill will expire, but the original powers available to the Government under the permanent legislation of 1966 will go on.
  I dare say that we will have another schoolmasterly lecture from the First Secretary of State, as on the last occasion, either about drafting or about the meaning of the words. My reference to the courts was not that I thought it directly related to the last Amendment, but simply to suggest to the First Secretary of State that he is not the best person to talk about dubiety in the courts in relation to the Prices and Incomes Act, because the Court of Appeal has found, as we warned it would long ago, that the main provision of Section 29 does not mean what he and presumably the Attorney-General, who no doubt advised him, thought it meant.
  We have no reason to put any confidence in the words of the Government. The first reason for this is a statement made by the Prime Minister, which has been quoted on a number of occasions, when he was asked on B.B.C.1 on the programme "24-Hours"
  "When the powers of the Act come to an end in August, Prime Minister, won't there have to be a continuation of them?",
  to which the Prime Minister replied,
  "In terms of legislative powers, no."
  It is clear that the Bill extends the legislative powers with regard to the control of prices and that it goes far beyond the period of Part IV, which, we were assured, was to be a temporary measure, and there is no assurance that this so-called temporary measure will not be extended again and again and again until this Parliament in due course comes to an end. The Prime Minister
  208
  has gone back on what he clearly said to the nation in that quotation which I have just given.
  9.0 p.m.
  My second point—I distinguish my first and my third; the second relates to the First Secretary and is in no sense an accusation of breach of faith as the first certainly is—relates to a matter which I should now like to clear up. The First Secretary will remember making a statement on powers on 17th April and he will remember a number of questions which I put to him designed to elicit from him an admission that these powers were really not for 12 but for 18 months. I said:
  "Secondly, it is now quite clear that this is an extension not for 12 months, but for 18 months."
  That is to say, on the last day or so of a year to which the proposals relate, the First Secretary could make as many references as he wished. The First Secretary replied:
  "When the right hon. Gentleman says 18 months I think that he is adding together two things which are not in the same category."
  He went on to say:
  "The purpose of the arrangement that the Order can continue after the powers have lapsed is to see that the six months' power of delay does not operate unequally in one case or another."—[OFFICIAL REPORT, 17th April, 1967; Vol. 745, c. 94–5.]
  I should be grateful if the right hon. Gentleman would clear that up.
  I do not think that I put together two matters which were not in the same category. In any case, is the point I made valid or not? Is it possible for the First Secretary to make as many Orders as he wishes within weeks, or days, or hours, of the expiry of the Bill? Could such Orders go on for a further six months? If so, is it not abundantly clear that in fact the powers which are here being taken are not for 12, but for 18 months, and that the House ought to judge them accordingly?
  Mr. Eric S. Heffer: Will the right hon. Gentleman explain something? In his earlier statement he was talking about prices. Am I to assume that if this proposal applied only to prices, he would oppose it, but that if it applied to wages, he would be quite happy about it?
  Mr. Macleod: I am against these powers both for wages and prices. I do not understand the hon. Gentleman and I will gladly give way if he wants to intervene again. However, that was the subject of an earlier debate and is not now the issue before us. In short, I am against everything in the Bill.
  The third matter is the speech, to which we must refer, which was made by the Loader of the House over the weekend. It surprised people very much, because it was exactly the point of the Amendment. Can we trust the Government to bring these powers to an end in due course, as they say they will? I know of one statement issued today by the Labour Party and purporting to correct the account of the speech of the Leader of the House. I am told that another pigeon is on its way, or on the tape, which I have not seen. I can deal only with the first correction.
  The first correction says:
  "Nowhere in the speech did Mr. Crossman either say or imply that the Government is contemplating a return to compulsory wage restraint under any circumstances whatever.
  On the contrary, his theme was the temporary character of July, 1966, measures and the Government's recognition of the need to make the voluntary system work …".
  The Press Association, who reported this speech—the correspondent was Mr. Binnersley, a reporter of the highest repute—has published his full shorthand note of what the Leader of the House said, and perhaps I might quote this sentence:
  "Now we have Part IV coming off and, if they fail to do it voluntarily, then exactly the same thing will happen again. This is hard, economic fact."
  I do not see how the Leader of the House can for a second pretend that he was saying anything other than that if the T.U.C., the C.B.I., and the rest of us do not behave ourselves Part IV is coming back. This is the only conceivable meaning of his speech, and it is for this reason that we distrust the Government so much. It is for this reason that when we hear these speeches made and reported over the weekend we do not believe that the Government intend to give up the powers which they have, or, rather, if they give those up, that they will not take something equally unpleasant in their place.
  210
  I have one more quotation from the right hon. Gentleman's speech:
  "We never want to let things get to the plight they got to last time, when we had wages soaring ahead and productivity dragging behind.
  We have to face the fact that if it happens again and economic forces reassert themselves, the same sort of medicine would have to be given to the people."
  What on earth does that mean, except that Part IV is coming back in certain circumstances, and all the assurances given by the Prime Minister and everybody else are worthless? Either that, or the speech of the Leader of the House is worthless, and the First Secretary will no doubt select which of those interpretations he wishes to offer to the House in due course.
  Mr. Atkinson: I hope that we can have the Leader of the House present in a moment to clear up this question. According to the tape, the denial which the Leader of the House has made is that his words did not apply to Part IV, but to the word "unemployment" and he has asked the nation to believe that it should read "unemployment" for the term "Part IV".
  Mr. Macleod: This is very interesting. I think that the Leader of the House ought to come here. I have been Leader of the House. There are means of conveying this message, and I would be grateful if it was conveyed to the Leader of the House that both sides of the House, with the exception of the Government Front Bench, desire his presence for this debate.
  I take up the point raised by the hon. Member for Tottenham (Mr. Atkinson) about whether the Leader of the House did, or did not, mean Part IV. All that I can do is to quote the sentence again from the shorthand note of the right hon. Gentleman's speech:
  "Now we have Part IV coming off and, if they fail to do it voluntarily, then exactly the same thing will happen again."
  It is not a question of my reading the words "Part IV" into his speech. They are there, and they were taken down by a shorthand writer of the very highest repute. The right hon. Gentleman really must explain this matter.
  Our case about the Bill is that it has been an unrelieved failure from the beginning and the sooner the curtain comes

  211
  down on it the better. It has had very little effect indeed on prices, and, as we showed in an earlier debate, the record since last July is on the whole worse than the annual record over the last ten years. Its effect on wages during the period of the freeze itself was fairly dramatic. But even on the evidence given, or the prophesies made, by the Government Front Bench we can expect that the increase in wages will be at least as high as that in the previous cycle over which my right hon. and learned Friend the Member for Wirral (Mr. Selwyn Lloyd) presided.
  Some of these matters are perhaps more appropriate to go into on Third Reading, and in due course we shall vote against that. At the moment we are on the special point of the Amendment. We would like to bring the Bill and this subsection to an end as soon as we reasonably can. I think that I have shown that we—and not only we but the House as a whole and the country as a whole—have little reason to believe the statements of intent made by at least some of Her Majesty's Ministers. We have no reason to believe that when this new Part II disappears, as no doubt it will, it will not come back again.
  We have had words in the clearest terms from the Leader of the House, which I have just quoted and which he owes a duty to the House to explain in the House and not by a series of different messages on the tape, which I gather is what is now happening.
  I have moved this Amendment. There is another Amendment which has not been selected and which would equally have the effect of shortening the period which we are considering. We should like to insert words into the Bill which, in itself, gives power to extend the period of standstill under Part II of the principal Act, and we take the view that under no circumstances should these powers continue beyond 11th August, 1968.
  Mr. Stanley Orme: Many hon. Members on this side of the House are extremely concerned about when and how these Measures will terminate. From the statements made by the Government it seems that we are now in a transitional stage between the
  212
  first Measure and the voluntary system, in terms of this Bill, and that as Part IV of the principal Act comes to an end on 11th August we shall be in a completely voluntary era.
  Much of the Government's case has been based on this assumption. I have had the advantage of listening to George Woodcock and other responsible leaders of the T.U.C., and it is apparent that their interpretation of Government policy is that this Measure merely allows the Government to have a long-stop—although some of us will give it another name. It is a let-out for the Government's change of policy, but it is a welcome change away from compulsion to the voluntary system.
  Unfortunately, whenever we seem to be going along that road something happens to cause consternation. The right hon. Member for Enfield, West (Mr. Iain Macleod) has referred to the speech made by my right hon. Friend the Leader of the House, and I also wish to refer to it. I have notified my right hon. Friend that I intended to raise the question. Many of us are concerned that, at a time when we are trying to achieve a general acceptance of the voluntary system, threats are made of administering the same sort of medicine as before, and the use of compulsory powers and a return to something akin to Part IV, of which we now hope to see the end.
  9.15 p.m.
  I have not seen the statement on the tape, but, during the passage of the Bill, the Leader of the House owes us a clarification of his statement. If he has been badly misreported, it is here that he should make his position clear. This statement can only cause consternation and problems with the trade union movement and queries about whether Government statements of their stand on compulsion mean anything and can be relied upon.
  I object to the fact that we are told that compulsion is out and we are moving into a voluntary period, as I do not know how that is possible with compulsion overhead. But this seems to be the way the Government are working. The statement by the Leader of the House is retrogressive in relation to the Bill, and the extension provisions and the Amendment would lay down clearly that the Bill

  213
  would end on that date and could not be extended without a fresh Bill—
  Sir Edward Brown: We who were on the Committee put this as a direct question to the First Secretary, whether a policy document would be published before or after 11th August, and he never gave a clear reply. Perhaps the hon. Gentleman should ask his right hon. Friend for this assurance, as he can give it.
  Mr. Orme: I should have liked to have made these remarks to my right hon. Friend in Committee, but I never saw that Committee. The minority point of view was never democratically represented, and many of us resent that. I hope that the First Secretary will give us a clear assurance, because whatever his right hon. Friend has said outside, he is responsible for legislation here. But I think that my right hon. Friend has already raised this matter.
  We are entitled to know, because I was under the clear impression that the Bill would end on 11th August, 1968, and much of the Government's policy is based on that presumption. If there are conflicting statements by other Members of the Government, that can only do harm to the voluntary system, to which both they and we attach importance. Therefore, I want a categorical assurance on that point.
  Mr. John Biffen: My right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) has moved an Amendment of very considerable significance. As the hon. Member for Salford, West (Mr. Orme) rightly appreciates, this is a test of the good faith and good intentions of the Government to move towards a voluntary prices and incomes policy—if such an animal exists. I am prepared to accept the definitions of the Government that such an animal does exist. I should be out of order if I were to think otherwise. The question whether the Bill is a bridge away from a compulsory system as embodied in the Prices and Incomes Act to a voluntary system calls from hon. Members a degree of credulity which has been severely strained over the weekend.
  The proposition throughout on the Bill is that it is a bridge not only in terms of legislation but, even more im-
  214
  portant, in terms of time, and it is in that respect that the Amendment is so significant. It is a bridge towards some other system of determining price and income.
  In Committee, on which I was privileged to serve and where I sadly missed, as all of us in the Opposition did, the assistance of the hon. Member for Salford, West, the First Secretary of State commented:
  "I described on Second Reading how the country had to move from the fully voluntary Statement of Intent to the undoubtedly stringent powers of Part IV. We are now moving in the opposite direction, towards a voluntary system."—[OFFICIAL REPORT, Standing Committee A, 20th June, 1967; c. 44.]
  Anyone who has followed the Government's activities in pursuit of their prices and incomes policy has, of necessity, to become an acute student of semantics. It was in the pursuit of that art that my right hon. Friend the Member for Enfield, West undoubtedly felt it necessary to table an Amendment determining, in this specific form, the date on which these powers should terminate. But in pursuing that art, I invite hon. Members opposite—and I know that the hon. Member for Salford, West is a keen student of these affairs—to reflect on the two sentences which I have quoted from the speech of the First Secretary. What existed before Part IV was, apparently, a "fully voluntary" system. Those are the adjectives adjoined to the Statement of Intent. We now move towards not a "fully voluntary" system but the "voluntary" system.
  I would normally think that this was an absurd, almost mediaeval theological discussion were it not for the fact that we are constantly told that we are moving towards a voluntary system, but not a fully voluntary system. That is the system we abandoned. During one of the nocturnal discussions which we had on various Orders laid under Part IV, I remember the hon. Member for Liverpool, Walton (Mr. Heller) describing how the voluntary system which was apparently being pursued was of the voluntary nature of the sergeant major's request—and how right he was, and how right he is under the legislation and Amendment which we are considering.
  We all know that the Leader of the House was employed during the war in

  215
  psychological warfare. That is a warning, if ever one was needed, to all of us to examine and weigh every calculated word very carefully. The Leader of the House talks of selfish trade unionists—never of selfish intellectuals, presumably—and we will have a chance to debate that on a later Amendment. Meanwhile, the matter at stake in the Amendment is of immense significance because if the Government wish to demonstrate that they want to return to the system that existed before Part IV, they would surely interrupt me now and say, "That is our intention. We accept the Amendment as a token of our conviction and determination to revert to the situation that existed before the prices and incomes legislation of last year".
  But that is not what the Government intend at all. They will reject the Amendment because they want these powers and will find an excuse to use them. The seamen blew them off course last year and enabled them to rationalise their instinctive yearning to control prices and incomes through the legislative system. No doubt, the consequences of the Middle East situation on our balance of payments will give them exactly the relationalisation for their instinctive yearning for more detailed control.
  The speeches of the First Secretary in Committee are among my favourite reading. The right hon. Gentleman said:
  "As a result partly of voluntary agreements, but also through the work of the Board, sometimes with the use or possibility with the use of powers, price increases which undoubtedly would otherwise have occurred have been held back …"—[OFFICIAL REPORT, Standing Committee A, 20th June, 1967; c. 47.]
  I am totally indifferent to whether the argument is about prices or incomes, and I accept that there are serious distinctions from the point of view of the sheer practicabilities involved in enforcing legislation in either direction. On the broad issues of principle, we have a confusion of thought about what is freely accepted and what is freely accepted under duress. The Government choose, as their definition of "freely accepted", free acceptance under the final duress of reference to the Board or reference through legislation consequential on any adverse report of the Board.
  216
  This is not freedom for manufacturers to price according to the workings of the economy, or of trade union leaders to seek to determine the price of labour of their members according to the law of supply and demand, the forces to which the Leader of the House apparently referred—
  Mr. Speaker: Order. I hesitate to interrupt the hon. Gentleman in his enthusiasm, but he must address his remarks to the Amendment.
  9.30 p.m.
  Mr. Biffen: —the economic forces, as the Leader of the House called them, because economic forces cannot conceivably be permitted under this legislation.
  The Amendment tests the Government. If they believe that it is the rôle of trade unionists to seek to maximise the potential earnings of their members they will accept the Amendment, because they will know, and the First Secretary will be advised by that master of psychology, the Leader of the House, that this will be a gesture that will be widely appreciated below the Gangway, for we know from the representations from below the Gangway we have heard this evening that a method of this sort is required.
  I suggest, therefore, that all the evidence points to the one clear conclusion that the First Secretary of State should use this constructive opportunity presented by the Amendment to assert that the Government mean that in a voluntary prices and incomes policy it is the word "voluntary" that can be construed and understood by every ordinary, thinking individual.
  Mr. Ian Mikardo: I am now a hard-bitten old Member of this hard-bitten old House and it is not very often that any of its proceedings twang the strings of my emotions, but I must say that a few moments ago I was greatly moved by the account given by the hon. Member for Oswestry (Mr. Biffen) of the way he sat in the Standing Committee on this Bill feeling disappointed, frustrated and unhappy because there he was lacking the company of my hon. Friend the Member for Salford, West (Mr. Orme). That account, Mr. Speaker, of the sufferings of the hon. Gentleman jerked my

  217
  tear glands and reduced me to an advanced state of lachrimosity.
  Mr. Biffen: Does the hon. Gentleman realise that he will quite soon have an opportunity to assuage the pangs of conscience, and redeem the hurt feelings I had from that Standing Committee by joining with me in the same Division Lobby?
  Mr. Speaker: Order. We must move now from the tears to the Amendment.
  Mr. Mikardo: Yes, Mr. Speaker. May I say to the hon. Member that I am not unacquainted with the opportunities which the procedures of the House provide from time to time to its hon. Members.
  I should like now to refer to a point made by the hon. Member, and earlier in an intervention by the hon. Member for Bath (Sir E. Brown). If it is a fact, and it is, that some of my hon. Friends and I are devoting a little more attention to this Report stage than we otherwise would have done, and have, as hon. Members will have observed from the Notice Paper, sought leave to move a number of Amendments, we do so because none of my hon. Friends who feel as I do were selected by the Committee of Selection to serve on the Standing Committee.
  You know me well enough, Mr. Speaker, to know that I am the very last Member to imply by so much as a breath any criticism of the Committee of Selection. It would be grossly out of order to do so. It is in so sense criticism of the Committee of Selection, but merely a statement of fact to say that of the three major trends of view existing in this House about the Bill, and all represented on Second Reading—those of the Government and their supporters, who support the Bill, those of hon. and right hon. Members opposite who, for one set of reasons oppose it, and those of some of my hon. Friends and myself who oppose it for a different set of reasons—only two were represented on the Committee.
  I repeat that I say this, not by way of criticism but simply as a statement of fact, and it is equally not a criticism of the Committee of Selection but, again, a simple statement of fact, to say that the last time the list of Members added
  218
  to the Committee on a Bill differed from the lists presented by the Chief Whips on either side was about the same as the last time the Derby was won by a grey, which is a long time ago—
  Mr. Speaker: Order. Now that the hon. Gentleman has refrained from criticism, will he come to the Amendment?
  Mr. Mikardo: I do not criticise at all, Mr. Speaker. I was merely uttering two statements of absolute incontrovertible fact.
  I come to the Amendment. The key thing about it was said by the hon. Member for Oswestry: that the question of whether the Government resist it is a crucial test of good faith. If they mean what they say and what they have said over and over again—that they look upon the prices and incomes legislation, with its statutory and compulsory provisions, as a necessary and temporary evil to be got rid of at the earliest reasonable date—there can be no grounds on which they could resist the Amendment.
  The French in their ineffable wisdom have many interesting sayings, one of which is C'est seulement le provisoire qui dure—it is only the provisional which lasts for ever. A story is told in my constituency of a docker who was once taken to task by his parish priest for having lived, as the expression goes, in sin with the same lady for 35 years. He was asked why, if he liked her that much, he did not marry her, and he replied that it was a purely temporary arrangement—"One Thursday afternoon in 1922, between unloading one ship and loading another, I popped in to the lady to have a cup of tea, and I have been there ever since." I have a horrible feeling that that is what is happening and will happen to the prices and incomes legislation. It will go on being temporary for ever. It will always be temporary but it will always be there.
  There were warning flags at the head of the mast even before the speech of my right hon. Friend the Leader of the House at the weekend. We had presented to us the other day a Report by the Government Actuary on the Financial Provisions of the National Insurance (No. 2) Bill, 1967. Paragraph 10 of that Report states that on Government instructions, certain assumptions have been

  219
  made in the calculations. I will not quote the first assumption because, although it is serious, it is not germane to the matter which is before us. The second assumption is that
  "Throughout the period covered by the estimates"—
  which is three years—
  "earnings are assumed to remain constant at the level expected to apply at the end of October, 1967."
  If my right hon. Friend says that there is no intention on the part of the Government to carry forward the powers in the Bill beyond August next year, and if he resists the Amendment, as I suspect that he will, on the ground not that it is wrong but that it is not necessary, I ask him to answer the following question.
  How is it that the Government can assume constant earnings at the level of those of October, 1967, for a further three years without a continuation of legislative control of wages? If my right hon. Friend can find an answer to that which makes sense to me, he might even, though I doubt the possibility, persuade me to go into the Lobby with him in the Division at the end of the debate. I cannot see how he can.
  Mr. McMaster: Has the hon. Member considered the possibility of heavier and heavier unemployment?
  Mr. Mikardo: There is an assumption in the Report about unemployment, but I deliberately did not comment on it because I am trying, as always, to keep closely within the rules of order. I am, therefore, keeping purely to the question of earnings, which is what is covered by the Bill. We have a situation in which this temporary legislation will take effect for three years, for two years after it ceases to have effect. I want to know how this miracle will be achieved.
  I say with sorrow that if my right hon. Friend resists the Amendment, millions of people will draw their own conclusions from that, and they will be conclusions which he will not find welcome.
  Mr. Burden: There is no doubt from the beginning of the suggestion of a Prices and Incomes Bill many hon. Members opposite took very strong exception to the restraint on wages.
  220
  There is also no doubt that many of them believed that the Government were in good faith determined to bring it to an end at the earliest possible moment and return to a system of voluntary wage restraint. There is also no doubt that, if the Government do not accept the Amendment, it is clearly their intention that the powers of compulsion shall remain. There is also no doubt that the comments of the Leader of the House over the weekend—it is not the first time that comments of the Leader of the House have caused serious embarrassment to the Labour Party, even before it took office—have blown the gaff and caused the Government serious concern.
  I am sure that the hon. Member for Salford, West (Mr. Orme) and other hon. Members opposite below the Gangway who are critical of the Government's actions in relation to the Bill would, in common with my right hon. and hon. Friends, very much like to hear the Leader of the House explain exactly what he meant. If the Leader of the House stays away tonight, we can only conclude that, despite all his denials, the report put out by the Press was accurate and that he is deliberately staying away hoping that this exchange with the reporter will preclude him from coming and answering in person tonight.
  There is plenty of time. A message could have gone to him by now. If he held for the House the respect which is due to it from a Leader of the House, he would certainly be here before the end of the debate. If he does not appear before the end of the debate, and if the First Secretary does not accept the Amendment, it will be perfectly clear that the Government have kidded the unions regarding the ending of compulsion, that they have kidded the people regarding the ending of compulsion, that they have kidded Parliament as a whole, and, above all, they have kidded the members of their own party who have been critical of the policy from the time the Bill was introduced. No only will it be shown that the Labour Government generally have kidded the people but that, in particular, the Prime Minister when he appeared on television, as referred to by my right hon. Friend the Member for Enfield, West

  221
  (Mr. Iain Macleod), was more culpable than anybody else. But I hope that, before the debate ends, the Leader of the House will come here and in person explain the words which he used over the weekend.
  9.45 p.m.
  Mr. Heffer: I wish to put several questions to my right hon. Friend. I have been particularly disturbed by the speech made by my right hon. Friend the Leader of the House because, unlike some hon. Members, perhaps, I believed that the Government intended to give up the compulsory powers by August next year. Perhaps I was a little naïve. Perhaps I was a little too trusting. But everyone assured mc, "You chaps have really won the battle. Although this Bill is coming along, it is nothing like what was intended, and we can assure you that, by August next year, all the powers will have gone and we shall then have the beginnings of our voluntary system".
  I believed it. Then, this morning, I read the speech of the Leader of the House. There were in it remarks about "another dose of medicine", as though my right hon. Friend was talking to a bunch of school kids who were going to get the medicine whether they wanted it or not.
  Mr. Mikardo: And without a spoonful of sugar.
  Mr. Heffer: We are, after all, talking to adults, to grown-up trade unionists, to workers who work in the docks, in the mines and on the building sites. We do not need to talk about "medicine". They understand the realities of life very well. They experience the realities of life. They do not need lectures by intellectuals or anybody else—certainly no' by right hon. Members opposite.
  We need a clear statement on this matter from the Government. Frankly, I do not understand why the Government cannot accept the Amendment. It was not put down by my hon. Friends and myself, but it is an Amendment which we could easily have put down. As far as I can see, it is a perfectly sensible Amendment, on the basis of the statements which we have been given, that the voluntary system will come into operation from August next year.
  222
  My hon. Friend the Member for Poplar (Mr. Mikardo) is right when he says that millions of working people will be closely watching the Government's attitude on this question tonight. Unless they can have a categorical assurance that the powers will cease by August next year, they can be forgiven if they honestly believe that they are being kidded. I warn my right hon. Friends that one can kid people for a little while and get away with it, but, if the working class of this country believe that they are being kidded, particularly by a Government whom they themselves have elected, the results can be disastrous.
  I say this in all seriousness and as a real warning to my right hon. Friends. I put this question to them: Did my right hon. Friend's speech which was reported this morning mean what it said, or what it was reported to have said, or are we going to have the end of the compulsory powers by next August? This is the 64,000-dollar question, and we are entitled to an answer. On the basis of that answer, the people of this country, certainly the trade unionists, will decide their future attitude towards the Government, particularly on this question.
  Sir E. Brown: This is one of the most vital matters which we fought during Committee, attempting to obtain an answer from the Minister. While the Leader of the House is absent tonight, despite the invitation to come and join in the discussion on this Amendment, in my opinion the culprits are sitting on the Government Front Bench. They are the three Ministers responsible for the attitude taken when we were pressing them during that debate.
  The answer which we will get tonight from the right hon. Gentleman is clearly that the Prices and Incomes (No. 2) Act will finish on 11th August, 1968. What the right hon. Gentleman and his friends will not tell us is whether there will be another Bill in its place, either before it, or at the same time as this one ends.
  This is the answer which we want from the right hon. Gentleman. Everyone knows that this Bill, when it becomes an Act, will end on 11th August, 1968. The 64,000-dollar question which we know will not be answered is: "Will

  223
  there be another Prices and Incomes Bill in its place?" If the Minister accepts my right hon. Friend's Amendment, we shall know that the Government are acting in good faith, acting honestly. I doubt whether we shall get an honest answer. We shall be told when this Bill will die, but as to the prospects of a Prices and Incomes (No. 3) Bill, we shall just have to wait until next year.
  Mr. Mendelson: It would be much more to the point not to throw about terms like "honesty" and other moral attitudes too much. It would be better to concentrate on the practical importance of the issues before us. The other preliminary point that I would like to make is that I do not complain of the absence of my right hon. Friend the Leader of the House. We have the responsible Minister, the First Secretary of State and Secretary of State for Economic Affairs, who is in charge of the Bill. It is the custom and convention of the House, as the right hon. Gentleman the Member for Enfield, West (Mr. Iain Macleod) will confirm, with his experience of Government office, that there cannot be two Ministers in charge of one Bill, from two different Departments.
  Mr. Burden Mr. Burden rose—
  Mr. Mendelson: I cannot give way. We have serious business to attend to, and this is a serious problem. I do not complain of the absence of my right hon. Friend. It is only natural that the First Secretary should regard it as his duty and responsibility to reply to this debate, and to make all the points which have been raised, on behalf of his Department and the Government.
  Nor do I take kindly to the attitude of the right hon. Gentleman the Member for Enfield, West who spoke in such a high moral tone when moving this Amendment. He and other hon. Members opposite seem to give the impression that this Government are the only one who have ever contemplated or are contemplating, some form of legislation that might be regarded by the trade unions as interfering with their traditional rights.
  We are meeting today on the Monday following the Saturday when the right hon. Gentleman the Leader of the Opposition, in a major speech at Carshalton,
  224
  spoke of a far-reaching and serious programme of legal interference with the rights of trade unions. When the party opposite was last in office, it announced on several occasions, through the mouths of various Prime Ministers, that it intended to introduce very severe legislation to curtail the rights of the trade unions.
  Mr. Peyton Mr. Peyton rose—
  Mr. Mendelson: I will give way to the hon. Gentleman in a moment. He knows that I always give way to him. It is important to put these facts on record before the moral tone, set for a definite political purpose in this debate by hon. Members opposite, becomes an established and accepted fact.
  Mr. Peyton: I do not wish to tempt the hon. Member out of order in discussing the speech of my right hon. Friend the Leader of the Opposition, but will he as least acknowledge that my right hon. Friend could not, under any circumstances, be accused of presenting this as being on a voluntary basis? The core of this evening's controversy lies in whether the Government's policy is genuinely voluntary or is compulsory.
  Mr. Mendelson: I need no instruction on either the nature of this legislation, which hon. Members, including myself, have studied for a long time now, or the plain intents of the Leader of the Opposition, because his intentions are a deliberate continuation of what the party opposite has now been saying it wants to do for more than five years—introduce legislation to put the clock back and put the trade unions into a straitjacket. Hon. Members opposite cannot get away with it by putting on a display of high moral indignation in this debate.
  As the First Secretary knows—he has always indicated it in all the contributions that he has made to these debates—this is a matter which very much concerns trade unionists, members on his own back benches and the best supporters, and the supporters in general, of Labour and the Labour Movement in the country. This is a Measure of great importance to them. My right hon. Friend has an opportunity tonight to deal with this point in a way that would give reassurance to the trade

  225
  union movement and the supporters of Labour in the country.
  The point is this. It would be understandable that on the technical point about legislation my right hon. Friend could say—he has said it on previous occasions—that there is involved here the effectiveness of an Order beyond a certain date once it had been legally introduced. That is one thing. I would not expect my right hon. Friend when piloting the legislation and replying to a debate on an Amendment suddenly to change course and give an interpretation different from that of the Law Officers of the Government and different from his own intentions. But he will recall that on a previous occasion I put a supplementary question to him on whether he would give the House an assurance that no further legislation of this kind would be introduced, and he said at the time—this is the kernel of the argument that I am putting to him—that ho and the Government would not be reasonably advised to give such an assurance in such categorical terms.
  I say in conclusion to my right hon. Friend that there have been various events that have been mentioned and also interpretations and re-interpretations of one kind and another for which he need not be necessarily personally responsible, but this is an important opportunity for him, as the member of the Government concerned with piloting the Bill, to give an assurance on further actions going beyond the effectiveness of particular Orders under the current legislation that he is piloting, and he should not under-estimate the concern that has been created and the great duty that he has to make the position clear when he replies.
  Mr. M. Stewart: It will be necessary, I think—I trust that I can do it without
  getting out of order—to reply not merely on the particular matter that is involved in this Amendment but on the general question which so many hon. Members have raised. A connection has been drawn—as I shall hope to show, not altogether correctly drawn—between the precise terms of the Amendment and the situation 12 months from now. I trust that I shall be in order in replying—I am sure that it will be the wish of the House—on both these points—the nature of the Amendment itself and the whole question of the relationship of statutory powers to prices and incomes policy. It is rather a large question, but I shall try to do it as briefly as it can be done.
  I would start in this way. It is possible to think of having no policy about prices and incomes at all, except what is sometimes called a "free-for-all". That is the proposition that every group of workers, every person or group of persons fixing a price or every landlord and every tenant can fix all these prices and wages solely according to their individual bargaining power and nothing else. As I understand it, most people, with the possible exceptions of the hon. Member for Oswestry (Mr. Biffen) and the right hon. Member for Wolverhampton, South-West (Mr. Powell), reject that free-for-all approach and that rejection has become the more impressive in recent years—
  It being Ten o'clock, the debate stood adjourned.
  Motion made, and Question put,
  That the Proceedings on the Prices and Incomes (No. 2) Bill may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Stewart.]
  The House divided: Ayes 200, Noes 138.

  Division No. 431.]

  AYES

  [10.0 p.m.

  Abse, Leo

  Bray, Dr. Jeremy

  Cullen, Mrs. Alice

  Alldritt, Walter

  Brooks, Edwin

  Dalyell, Tam

  Armstrong, Ernest

  Brown, Hugh D. (G'gow, Provan)

  Davidson, Arthur (Accrington)

  Ashley, Jack

  Brown, Bob (N'c'tle-upon-Tyne, W)

  Davies, G. Elfed (Rhondda, E.)

  Atkins, Ronald (Preston, N.)

  Brown, R. W. (Shoreditch & F'bury)

  Davies, Harold (Leek)

  Bacon, Rt. Hn. Alice

  Buchan, Norman

  Davies, Ifor (Gower)

  Bagler, Gordon A. T.

  Buchanan, Richard (G'gow, Sp'burn)

  de Freitas, Rt. Hn. Sir Geoffrey

  Barnes, Michael

  Butler, Herbert (Hackney, C.)

  Delargy, Hugh

  Baxter, William

  Callaghan, Rt. Hn. James

  Dell, Edmund

  Bence, Cyril

  Carmichael, Neil

  Dempsey, James

  Benn, Rt. Hn. Anthony Wedgwood

  Castle, Rt. Hn. Barbara

  Dewar, Donald

  Bidwell, Sydney

  Coe, Denis

  Diamond, Rt. Hn. John

  Binns, John

  Coleman, Donald

  Doig, Peter

  Bishop, E. S.

  Conlan, Bernard

  Dunn, James A.

  Blackburn, F.

  Crawshaw, Richard

  Dunwoody, Mrs. Gwyneth (Exeter)

  Boardman, H.

  Cronin, John

  Dunwoody, Dr. John (F'th & C'b'e)

  Bradley, Tom

  Crosland, Rt. Hn. Anthony

  Eadie, Alex

  Edwards, Robert (Bilston)

  Jones, T. Alec (Rhondda, West)

  Parkyn, Brian (Bedford)

  Ellis, John

  Judd, Frank

  Pavitt, Laurence

  English, Michael

  Kelley, Richard

  Pearson, Arthur (Pontypridd)

  Ensor, David

  Kerr, Russell (Feltham)

  Peart, Rt. Hn. Fred

  Evans, Albert (Islington, S.W.)

  Lawson, George

  Pentland, Norman

  Fernyhough, E.

  Leadbitter, Ted

  Perry, George H. (Nottingham, S.)

  Fletcher, Raymond (Ilkeston)

  Ledger, Ron

  Rankin, John

  Fletcher, Ted (Darlington)

  Lee, Rt. Hn. Frederick (Newton)

  Rees, Merlyn

  Foot, Michael (Ebbw Vale)

  Lee, John (Reading)

  Reynolds, G. W.

  Forrester, John

  Lewis, Ron (Carlisle)

  Roberts, Gwilym (Bedfordshire, S.)

  Fowler, Gerry

  Lipton, Marcus

  Robinson, W. O. J. (Walth'stow, E.)

  Fraser, John (Norwood)

  Lomas, Kenneth

  Roebuck, Roy

  Fraser, Rt. Hn. Tom (Hamilton)

  Loughlin, Charles

  Rose, Paul

  Freeson, Reginald

  Lyon, Alexander W. (York)

  Shaw, Arnold (Ilford, S.)

  Ginsburg, David

  Lyons, Edward (Bradford, E.)

  Shore, Peter (Stepney)

  Gordon Walker, Rt. Hn. P. C.

  McBride, Neil

  Short, Rt. Hn. Edward (N'c'tle-u-Tyne)

  Gourlay, Harry

  McCann, John

  Short, Mrs. Renée (W'hampton, N.E.)

  Gray, Dr. Hugh (Yarmouth)

  MacColl, James

  Silkin, Rt. Hn. John (Deptford)

  Gregory, Arnold

  MacDermot, Niall

  Silverman, Julius (Aston)

  Grey, Charles (Durham)

  Mackenzie, Gregor (Rutherglen)

  Slater, Joseph

  Griffiths, David (Rother Valley)

  Mackintosh, John P.

  Small, William

  Hamilton, James (Bothwell)

  Maclennan, Robert

  Snow, Julian

  Hamilton, William (Fife, W.)

  McMillan, Tom (Glasgow, C.)

  Spriggs, Leslie

  Hamling, William

  McNamara, J. Kevin

  Steele, Thomas (Dunbartonshire, W.)

  Hannan, William

  MacPherson, Malcolm

  Stewart, Rt. Hn. Michael

  Harper, Joseph

  Mahon, Peter (Preston, S.)

  Summerskill, Hn. Dr. Shirley

  Harrison, Walter (Wakefield)

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

  Swingler, Stephen

  Hart, Mrs. Judith

  Manuel, Archie

  Thomas, George (Cardiff, W.)

  Haseldine, Norman

  Mapp, Charles

  Tinn, James

  Hattersley, Roy

  Marquand, David

  Urwin, T. W.

  Hazell, Bert

  Mason, Roy

  Wainwright, Edwin (Dearne Valley)

  Heffer, Eric S.

  Maxwell, Robert

  Walker, Harold (Doncaster)

  Henig, Stanley

  Mellish, Robert

  Watkins, David (Consett)

  Herbison, Rt. Hn. Margaret

  Mendelson, J. J.

  Watkins, Tudor (Brecon & Radnor)

  Hooley, Frank

  Mikardo, Ian

  Wells, William (Walsall, N.)

  Houghton, Rt. Hn. Douglas

  Millan, Bruce

  White, Mrs. Eirene

  Howarth, Harry (Wellingborough)

  Miller, Dr. M. S.

  Whitlock, William

  Howarth, Robert (Bolton, E.)

  Milne, Edward (Blyth)

  Willey, Rt. Hn. Frederick

  Howell, Denis (Small Heath)

  Morris, Alfred (Wythenshawe)

  Williams, Alan (Swansea, W.)

  Howie, W.

  Morris, John (Aberavon)

  Williams, Alan Lee (Hornchurch)

  Hoy, James

  Murray, Albert

  Williams, W. T. (Warrington)

  Huckfield, L.

  Oakes, Gordon

  Willis, George (Edinburgh, E.)

  Hughes, Roy (Newport)

  Ogden, Eric

  Wilson, Rt. Hn. Harold (Huyton)

  Hunter, Adam

  O'Malley, Brian

  Wilson, William (Coventry, S.)

  Hynd, John

  Orbach, Maurice

  Winterbottom, R. E.

  Jackson, Colin (B'h'se & Spenb'gh)

  Orme, Stanley

  Woodburn, Rt. Hn. A.

  Jay, Rt. Hn. Douglas

  Owen, Dr. David (Plymouth, S'tn)

  Woof, Robert

  Jeger, Mrs. Lena (H'b'n & St. P'cras, S.)

  Owen, Will (Morpeth)

  Johnson, James (K'ston-on-Hull, W.)

  Page, Derek (King's Lynn)

  TELLERS FOR THE AYES:

  Jones, Dan (Burnley)

  Paget, R. T.

  Mr. Alan Fitch and

  Jones, Rt. Hn. SirElwyn (W. Ham, S.)

  Pannell, Rt. Hn. Charles

  Mr. Ioan L. Evans.

  NOES

  Alison, Michael (Barkston Ash)

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

  Iremonger, T. L.

  Allason, James (Hemel Hempstead)

  Errington, Sir Eric

  Irvine, Bryant Godman (Rye)

  Astor, John

  Eyre, Reginald

  Jenkin, Patrick (Woodford)

  Baker, W. H. K.

  Fisher, Nigel

  Jennings, J. C. (Burton)

  Biffen, John

  Fletcher-Cooke, Charles

  Johnson Smith, G. (E. Grinstead)

  Boyle, Rt. Hn. Sir Edward

  Fortescue, Tim

  Jopling, Michael

  Braine, Bernard

  Fraser, Rt. Hn. Hugh (St'fford & Stone)

  Kaberry, Sir Donald

  Brewis, John

  Galbraith, Hn. T. G.

  Kimball, Marcus

  Bromley-Davenport, Lt.-Col. Sir Walter

  Gilmour, Sir John (Fife, E.)

  King, Evelyn (Dorset, S.)

  Brown, Sir Edward (Bath)

  Glover, Sir Douglas

  Kirk, Peter

  Bruce-Gardyne, J.

  Glyn, Sir Richard

  Knight, Mrs. Jill

  Bullus, Sir Eric

  Gower, Raymond

  Lambton, Viscount

  Burden, F. A.

  Grant-Ferris, R.

  Lewis, Kenneth (Rutland)

  Campbell, Gordon

  Griffiths, Eldon (Bury St. Edmunds)

  Lubbock, Eric

  Carlisle, Mark

  Grimond, Rt. Hn. J.

  McAdden, Sir Stephen

  Carr, Rt. Hn. Robert

  Gurden, Harold

  MacArthur, Ian

  Chichester-Clark, R.

  Harris, Frederic (Croydon, N.W.)

  Macleod, Rt. Hn. Iain

  Clegg, Walter

  Harvie Anderson, Miss

  McMaster, Stanley

  Cooper-Key, Sir Neill

  Hawkins, Paul

  Maude, Angus

  Corfield, F. V.

  Heald, Rt. Hn. Sir Lionel

  Mawby, Ray

  Costain, A. P.

  Heseltine, Michael

  Maxwell-Hyslop, R. J.

  Craddock, Sir Beresford (Spelthorne)

  Higgins, Terence L.

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

  Crosthwaite-Eyre, Sir Oliver

  Hiley, Joseph

  Mills, Peter (Torrington)

  Crouch, David

  Hirst, Geoffrey

  Miscampbell, Norman

  Dance, James

  Holland, Philip

  Mitchell, David (Basingstoke)

  Davidson, James (Aberdeenshire, W.)

  Hooson, Emlyn

  Monro, Hector

  Dean, Paul (Somerset, N.)

  Hordern, Peter

  More, Jasper

  Deedes, Rt. Hn. W. F. (Ashford)

  Hornby, Richard

  Morgan, Geraint (Denbigh)

  Dodds-Parker, Douglas

  Hunt, John

  Morrison, Charles (Devizes)

  Eden, Sir John

  Hutchison, Michael Clark

  Munro-Lucas-Tooth, Sir Hugh

  228

  229

  Murton, Oscar

  Scott, Nicholas

  Walker-Smith, Rt. Hn. Sir Derek

  Noble, Rt. Hn. Michael

  Sharples, Richard

  Walters, Dennis

  Onslow, Cranley

  Shaw, Michael (Sc'b'gh & Whitby)

  Ward, Dame Irene

  Page, Graham (Crosby)

  Sinclair, Sir George

  Weatherill, Bernard

  Page, John (Harrow, W.)

  Steel, David (Roxburgh)

  Webster, David

  Pardoe, John

  Stoddart-Scott, Col. Sir M. (Ripon)

  Wells, John (Maidstone)

  Peel, John

  Summers, Sir Spencer

  Whitelaw, Rt. Hn. William

  Percival, Ian

  Tapsell, Peter

  Wills, Sir Gerald (Bridgwater)

  Peyton, John

  Taylor, Sir Charles (Eastbourne)

  Wilson, Geoffrey (Truro)

  Pink, R. Bonner

  Taylor, Edward M. (G'gow, Cathcart)

  Winstanley, Dr. M. P.

  Prior, J. M. L.

  Taylor, Frank (Moss Side)

  Wolrige-Gordon, Patrick

  Pym, Francis

  Temple, John M.

  Wood, Rt. Hn. Richard

  Ramsden, Rt. Hn. James

  Thatcher, Mrs. Margaret

  Wright, Esmond

  Renton, Rt. Hn. Sir David

  Tilney, John

  Wylie, N. R.

  Ridley, Hn. Nicholas

  Turton, Rt. Hn. R. H.

  Royle, Anthony

  van Straubenzee, W. R.

  TELLERS FOR THE NOES:

  Russell, Sir Ronald

  Wainwright, Richard (Colne Valley)

  Mr. Anthony Grant and

  Mr. Timothy Kitson.

  Question again proposed, That the proposed words be there inserted in the Bill.
  Mr. M. Stewart: I was saying that, with a few exceptions, there was a widespread and general rejection in the House and the country of that approach to prices and incomes which is sometimes described as a free-for-all, which would mean that every manufacturer, every supplier, every trade union, every landlord, would use his own bargaining power as seemed most appropriate at the moment, without regard to any wider considerations.
  This rejection has gathered strength because of what has been happening in recent years in the trade union movement, the growing realisation that a single trade union acting on the doctrine of a free-for-all would not, except in the very short term, even be serving the best interests of its own members, the general recognition, not only on the trade union side but among management as well, that the pursuit by each particular group of a free-for-all was liable to have such effects on the economy as a whole that all groups would be the losers. That is the philosophy which lies behind the growing rejection of a free-for-all which is now becoming accepted belief.
  It was that belief which was behind the statement of intent—that, without any powers of legal compulsion, there should be resolutely accepted and acted upon the concept that prices and incomes should not be left to work themselves out in a free-for-all, but should be a matter of policy to be worked out by common consent, and that, as part of the machinery necessary to that process, there should be a body like the Prices and Incomes Board which would help those involved in reaching judgments as to what claims with regard to prices and incomes were and were not reasonable.
  230
  I assert both as my own belief and as the policy of the Government that that is the situation which one wants to create. That was the situation which we hoped to create when the statement of intent was signed. We were overtaken by the balance of payments difficulties and other factors which the House knows, but I repeat that that is what the Government believe to be the right way of handling the problem and that this should be something accepted universally by all groups of workers.
  I understand the feelings of my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) about this matter. I ask him to believe that those of us who have taken a rather different view have not done so out of mere expediency and that what I am saying now is out of my deep conviction that we must avoid a free-for-all and if humanly possible avoid it without legal compulsion as something vital to the national welfare and something which ought to be acceptable, particularly to members of our party.
  It rather distresses me that he has so usually found it necessary when referring to this matter to add a smear about people who earn their livings by intellectual occupations, because if this rejection of a free-for-all is to mean anything, it surely has to mean the unity of purpose, to use a phrase with which we on this side of the House are familiar, of workers by hand and by brain. We ought to foster the mutual understanding between different kinds of workers with their different backgrounds and the common objective which they all have of avoiding the evils of a free-for-all and gradually getting more and more justice and common sense into the whole question of the distribution of incomes and the distribution of wealth. I believe that

  231
  I carry many on both sides with me so far.
  10.15 p.m.
  We come now to the question raised by the Amendment. if our object is the kind which I have just described, and which was set forth in the Statement of Intent, what part, if any, ought statutory powers by the Government to play? I think it will be accepted that there will be such minimum statutory powers as are needed to set up a Prices and Incomes Board and enable it to do its work, but the critical question is: If the degree of self-control exercised on either the prices or the wages side is not big enough voluntarily to prevent the nation from running into grave economic difficulties, ought the Government, even temporarily, to take what are sometimes called long-stop powers, and particularly ought they to take that kind of power if the situation is, as I am sure it was last October, that the great majority of trade unionists are willing to work the thing voluntarily, and do not want to see their voluntary effort frustrated by the actions of a very small minority among them?
  That was the situation last October. It was that which caused the trade union movement to accept the idea of activating Part IV of the Prices and Incomes Act, despite the natural concern with which anyone with a trade union or a professional background must look at a statute like Part IV. I would have thought that I would still carry many of the House with me if I said that while a voluntary system—and I hope that I have made it clear what I mean by a voluntary system—is what we want, in times of grave emergency there is a case for the Government having what are called long-stop powers.
  Mr. Orme: Will my right hon. Friend explain how a thing can he voluntary if it is surrounded by compulsion?
  Mr. Stewart: I think that I can answer my hon. Friend. I said that I distinguished very clearly between a voluntary system, and one in which there was any element of compulsion. I said that I believed that what we want to work for is the voluntary system as I described it. I then said, however, that I thought there were many people who would agree that in times of grave emergency, and if
  232
  the great majority of trade unionists wanted the thing to be voluntary, but were worried that their voluntary effort would be frustrated by a few, we might temporarily, in an emergency, take a degree of compulsory power.
  I accept that the moment we do that we cannot call it a voluntary system in the full sense of the term. I have never disputed that, and I do not do so now, but to describe that situation as if it were one in which the Government, by their own absolute will, imposed compulsion on a whole unwilling mass of trade unionists is a complete misrepresentation of the position, because it would be a physical impossibility for any Government to have even the moderate degree of statutory powers which I have mentioned unless the great majority of the people believed in the working of a prices and incomes policy.
  That is why I think it is fair in some circumstances to use the term "fully voluntary" to make it clear that we are describing what I described earlier, namely, the kind of situation set out in the Statement of Intent, where there is no measure of legal compulsion, even long-stop compulsion. It is wrong to represent the imposition of limited emergency powers as an imposition, by the Government's absolute will, of compulsion on a great mass of unwilling people. If anyone thinks that, let him look at the situation as it has developed in the last twelve months. This has not been a voluntary period, but it has been a period in which the great majority of trade unionists have assented to the existence and to the use of the powers. I have never used powers concerning wages without consultation with the T.U.C. It has never objected to any particular use of those powers.
  Mr. Biffen: I am grateful to the right hon. Gentleman for the semantic distinction that he has drawn, but may we have a clear understanding that it is now the Government's policy, unequivocally, not to return to the system which he designated as "fully voluntary", but to proceed with the system which he designates as "voluntary"?
  Mr. Stewart: The hon. Member is putting into my mouth things that I did not say. I have used the terms "voluntary" and "fully voluntary" in the same

  233
  sense. I have never disputed the fact that if we have something like Part IV the system is not voluntary. What I have said is that to describe it as an exercise of tyrannical power is a misrepresentation of the facts.
  Part IV was an example of the introduction into what had previously been a voluntary system of a degree of compulsory legal powers. Part IV ends in August of this year. The present Bill gives the Government far fewer powers, in time and in circumstances, than did Part IV. That is why I have previously described it as a step towards the voluntary system—a step on the road of return to the voluntary system.
  Now we come to the question: what about the period after 12 months from now or, to be exact, in August of next year? As the House, and especially my hon. Friend the Member for Penistone (Mr. Mendelson), will be aware, I have already answered this question. In the Second Reading debate my hon. Friend asked me whether I could give a definite assurance not only that the Bill would run out in 12 months' time—which was net in dispute—but that from that date there would be no legal power whatever.
  I replied that I could not give my hon. Friend that assurance; I could tell him that it was the Government's most earnest hope that it would be possible to do that, but I thought that it would be neither wise nor prudent to give that undertaking now. It is possible for any hon. Member, on either side, to say that he does not like that answer. It is not open to any hon. Member to say that he has been deceived by that question. If I tried to give an undertaking which I do not think it would be wise or prudent to give now I may be criticised for deceiving the House. I do not attempt to do that.
  I assure the House of one other thing. I have said that it is the Government's most earnest hope that we shall be able to be free of legal powers altogether in August of next year. The charge has been levelled in some speeches that the Government do not really nourish that hope and that, behind my refusal to give the categorical undertaking for which my hon. Friend asks, there lies a deliberate resolve, already established in the Government's mind, to continue the powers after next August. I can only ask the
  234
  House to accept my firm and absolute assurance that this is not true and that I meant exactly what I said in answer to my hon. Friend. I do not think it right to give him the undertaking now. I can go no further than saying that it is my earnest hope that we shall achieve what we both want in August next year—
  Sir E. Brown: Does this mean that we will come to the end on 11th August next year and return to the free-for-all which the right hon. Gentleman says we should not have?
  Mr. Stewart: The hon. Gentleman has left out one vital stage in the argument, on which I laid much of the stress. I rejected the free-for-all. I said that I thought that what we all wanted was the ideal enshrined in the Statement of Intent, whereby groups decided deliberately to limit their own action, not because of statutory compulsion but because they believed it just and in the long-term interests of their members as well as anyone else. That is what I want us to return to in August next year and what I thought most of us wanted.
  I must ask the House to accept on my behalf and that of the Government my assurance that my answer to my hon. Friend meant exactly what it said. It is suggested that I could give an earnest of that by accepting the Amendment, but its nature stands that argument on its head. If the Government or I had a secret resolve to bring in legislation next August, I could readily accept the Amendment and allow all the anomalies which would follow, knowing that I could tidy it up by legislation next August. It is, on the contrary, because it is my most earnest desire that there shall be no further legislation of this kind next August that I want to see this piece not ending up with what would otherwise be a ragged untidy and unjust arrangement.
  It would be unjust because, so far as the powers are to be used at all—I remind the House how few workers have had their pay restricted by Order in the last 12 months how it might work out? A group of workers might try to get a claim clearly in conflict with policy and with a recommendation against it from the Board, so that we felt justified in making an Order. That might happen in November this year and, with the Bill amended as is proposed, their pay

  235
  could be held back for six months. But a group of workers behaving in exactly the same way in April or May next year would have a limit imposed perhaps for only one or two months. That would not be just or reasonable—
  Mr. Mikardo: Would that not be exactly what has happened under the existing legislation—totally different treatment of different groups of workers, some of them held back for two months, some for three or six months and some for longer? Why is my right hon. Friend making a virtue of a consistency which he does not possess?
  Mr. Stewart: There have been some differences, but, so far as our present legal powers have allowed, in deciding how long an order should run, we have always considered where the balance of fairness and justice lay. It is true that, under the present legislation, there cannot be as satisfactory and consistent a result as under this legislation. But I see no reason why shortcomings in the existing legislation should be repeated in the Bill.
  10.30 p.m.
  The whole of the argument which I am advancing would be unnecessary if the Government or I had a secret intent to bring in new legislation of this sort in 12 months' time, because it would be possible in such legislation to pick up any untidy or awkward bits and deal with them then. It is because I trust most earnestly that I shall not be doing that that I ask the House to pass the Bill in a form in which it gives more justice and consistency than one would get from the Amendment.
  But what is in issue is not only the merits of the Amendment, but the relationship of this to the whole of prices and incomes policy.
  Mr. Higgins: The right hon. Gentleman says that he could introduce legislation next year and pick up all the
  236
  anomalies. Would not he agree that that is not so? There are specific Clauses in the Bill designed as links and he could not do it next year in a new Bill.
  Mr. Stewart: Such is the power of Parliament that in a new Bill one could make whatever arrangements Parliament was prepared to agree to. But we are concerned, not only with the Amendment, but with the whole nature of prices and incomes policy.
  In previous Parliaments, when our party was in opposition, I was very much concerned with housing and the operation of the Rent Acts. I saw the Rent Act, 1965, which we introduced when we came to power, as the beginning of the establishment of something like justice in one field of prices. But in that field, for historical reasons, it could and should be done by legislation. What I want to see is the same concept of justice in the distribution of incomes established by the voluntary acceptance by workers and management of the fact that the pursuit of a free-for-all is not only morally wrong, but is not, in the end, except on the shortest view, in the interests of those who pursue it. To get the whole nation to accept that is not easily done.
  We have been driven by the pressure of events to try, as I think one of my hon. Friends said on Second Reading, to get short-term as well as long-term results. That it is which has caused some of the differences we have had with the trade union movement and management and between the Government and some of my hon. Friends. I have sought to understand their arguments and tried to share their feelings. They must do the same for the Government. We are taking the course we are taking because we believe that these measures are a necessary step in the very difficult period we are going through. We do not want argument over them to sour or spoil the achievement which I think we all have in mind of a just productivity, prices and incomes policy.
  Mr. Peyton: I apologise to the First Secretary and the House for not having been here for the first part of the right hon. Gentleman's speech. I feel that his speech is an important one. I do not charge him with insincerity, because I believe that the sincerity and earnestness of what he said was unchallengeable, but we have grave doubts about how far this policy is practicable and how far the measures he is propounding will endure; how long a time will be necessary before the right hon. Gentleman must take further steps to reinforce measures which none of us find very acceptable.
  The First Secretary claimed that it was an accepted belief that free-for-all methods should be rejected. But that rejection does not imply acceptance of impracticable and illusory alternatives. He said his aim was to introduce more and more justice into the distribution of incomes. Considering the events of the past two-and-a-half years, we have no ground to accept that there is a reasonable prospect of even that kind of fairness and justice being secured.
  The right hon. Gentleman then talked about the voluntary system, said how it was wanted and urged that in times of grave emergency the Government needed long-stop powers. But for how long will this grape emergency last? We are fearful that so long as the Labour Party lasts, this emergency will endure. And how far from the wicket are these long-stop powers? The hon. Member for Poplar (Mr. Mikardo) asked this question but did not get an answer. It is all very well to employ a loose sporting metaphor of this kind, but the right hon. Gentleman must explain its effect on the lives and affairs of ordinary people.
  The First Secretary was asked how something could be voluntary yet surrounded by compulsion, but he did not reply. From the look on his face at the moment he seems in pain. It does not come from listening to me, but because he must be realising the impracticability of his policy. Hon. Gentlemen opposite have a tendency—they have caught it from the Prime Minister—to push out a smokescreen of words which sound fine but which have not been thought out. This smokescreen of phrases does not go to the heart of the problem and, because it is a smokescreen,
  238
  it is sometimes difficult to disagree with the argument.
  The right hon. Gentleman said that it would be a complete misrepresentation to say that the Government had imposed their will on the mass of trade unionists. I wonder how far that is true? Perhaps measures of this kind can be tolerated for a time, but, after the events of the past 12 months, the Government are in grave danger. They have run out of time. They told that great mass of trade unionists that they needed a year. They gave the impression that they would not need to continue to resort to such powers as these. But they have done so, and I believe that in British industry today there is a great impatience, and that when people realise that the Government have not, in fact, moved very substantially from the bad position they took up a year ago there will be a wave of anger.
  I do not for one moment say that we on this side have been able completely to produce a solution for the most difficult problem of our time, but if we are true to our beliefs, as we are not always, we must say that we believe that a free market, free competition, a really competitive system backed by a sensible taxation system, is a far more efficient way of producing the fair and just consequences which the right hon. Gentleman has as his objectives than any of these hotchpotch measures which may sound good but which, in the end, will prove to be useless.
  I do not want to go on with the semantic argument about what is or what is not voluntary, though the right hon. Gentleman is in difficulty here. It has not been a voluntary period but the great majority of people have assented, apparently, to compulsion, and the First Secretary himself told us that when he said "voluntary" it meant much the same thing as when he said "fully voluntary". His difficulties in expressing his case in words are an indication, and only a very small indication, of the far greater difficulties that underlie the whole problem with which he and the Government have been wholly incapable of grappling in the long term.
  He protested that the claim that the Government have exercised tyrannical powers over the trade unions is a misrepresentation, but he went on to claim

  239
  that this Bill represented a step on the road to the return to a voluntary system. With great respect to the right hon. Gentleman—one does not want to be unkind to him in his present terribly awkward predicament, or to his right hon. Friend, who must find it even more acutely uncomfortable—one must say that it is a very small step. The road on which his predecessor the Foreign Secretary embarked last year was a difficult and dangerous road, and retracing steps along that road will be an even more difficult operation. I wish I could feel that the Government's heart was committed to the task of retracing their steps. I do not believe that it is, nor do I believe such a retracing to be possible for the Government.
  The right hon. Gentleman was absolutely fair. I am quite sure that even those of his hon. Friends who do not share his ideas will have accepted that he was not in any way deceiving the House. He went out of his way to say that it would be wrong, that it would be imprudent, to give any assurance that no continuation of legal powers would be necessary in any circumstances. But we are in some difficulty. Over the weekend, we have had a speech, and it is no good denying it, from the Leader of the House, whom we miss here—[HON. MEMBERS: "Where is he?"]—though when he is here he does not always contribute to the harmony as one might expect from the Leader of the House—[Interruption.]
  Mr. Speaker: Order. Let us have only one debater at a time.
  Mr. Peyton: The hon. Member for Coatbridge and Airdrie (Mr. Dempsey) never loses his charm by the fact that he speaks when sitting down.
  Tonight it is necessary to give attention to the fact that the Labour Party thought it necessary to make a statement on the speech made by the Leader of the House. It said, in particular, that
  "Nowhere in the speech did Mr. Crossman either say or imply that the Government is contemplating a return to compulsory wage restraint under any circumstances whatever."
  Amongst other things, the right hon. Gentleman said this:
  "Now we have Part IV coming off and, if they fail to do it voluntarily, then exactly the
  240
  same thing will happen again. This is hard, economic fact."
  It may be hard, economic fact, but it does not exactly tie in with what the right hon. Gentleman has just told the House.
  10.45 p.m.
  At the end of the report of the speech made by the Leader of the House, we have these words:
  "We have to face the fact that if it happens again and economic forces reassert themselves, the same sort of medicine would have to be given to the people."
  What intolerable arrogance this is. I do not believe that even the Leader of the House, arrogant as he so often is, would be inclined to use those words to a House of Commons his contempt for which he has never bothered to conceal.
  The issues which we are discussing in the Bill are fundamental. They are of great importance to the future of the Government and of the country. One of the charges which I sincerely make against the Government is that faced with really serious issues, they have fumbled and grabbed from the air an ill-thought-out solution which, they hoped, would buy them a year's peace. Now, they face the moment of having to pay the bill and, once again, they are having to put up a facade of words unsatisfactory even to their own supporters, a facade of words, moreover, which threatens to divide and wreck the party opposite and which certainly does nothing to convince us.
  Mr. Iain Macleod: To deal first with a point which worried the hon. Member for Poplar (Mr. Mikardo), the last time that a full grey won the Derby was Airborne, in 1946, at 50 to one. The hon. Member will remember it. It was the year he first became a Member of the House.
  We have been discussing a matter of great importance. My hon. Friend the Member for Oswestry (Mr. Biffen) and several hon. Members opposite said that the Amendment, perhaps above all others on Report, was a test of the sincerity of the Government. If that be the test, one can only charge that the Government have failed it, although the First Secretary honourably did his best with the case that was made to him.

  241
  We have heard a good deal—in my view rightly, because it both worried and angered people—about the speech of the Leader of the House. The hon. Member for Penistone (Mr. Mendelson) said that he made no complaint that his right hon. Friend the Leader of the House was not present. I do complain. The hon. Member for Penistone said that he was content for the First Secretary, who is in charge of the Bill, to answer the debate and deal with these matters. The First Secretary said not a word about it from beginning to end of a rather lengthy reply to the debate.
  I have no doubt that the Leader of the House has been told of what has been said. I have no doubt that the Whips, with their usual efficiency, have discharged that task. The Leader of the House has heard the request that he should come, and he has ignored it. That is a disgraceful way to treat the House of Commons. It is not a question of who is in charge of the Bill. Of course, the First Secretary is in charge of it, but what was said by the Leader of the House undermines the whole basis of the Bill.
  If the First Secretary, whose embarrassment at that appalling speech by the Leader of the House I can understand, wishes to shuffle it over in silence, at least he should see that the Leader of the House was present to explain what he said. The truth of the matter is that tin speech of the Leader of the House was a hectoring, arrogant and bombastic speech and no explanation of it is credible if one studies closely, as I have done, the shorthand account of it. I cannot believe that when the Leader of the House spoke of medicine being given—I ask the House to note the arrogance of the phrase "being given"—to the people he meant unemployment. Of course he did not. He meant Part IV and what goes with it, or a new version of Part II when the time comes.
  The hon. Member for Liverpool, Wilton (Mr. Heffer) said that he for one believed the Government when they said that they were moving towards a voluntary system or, perhaps, towards in the end a version of what is called a free-for-all with a longstop, whatever it may be. The hon. Gentleman believed it and he believed the Government. I can understand, therefore, that it is even
  242
  worse for him than it is for us, because we never believed it. We expected and we prophesied the double cross that we have seen particularly appropriately in the speech that the Leader of the House made a day or two ago. All these statements are, at the very best, devious and, at the worse, a good deal less attractive than that.
  I want to make it absolutely clear—I did so in my first speech, but I spell it out now—that I accept absolutely the First Secretary's good faith. I think I would be joined in that by every one of my right hon. and hon. Friends. But I must say frankly that we do not extend that same belief to the Prime Minister, nor to the Leader of the House. A few moments ago the First Secretary said that these powers of Part IV were, I think his words were, not tyrannical. When the Prime Minister wished to play up the effectiveness of Part IV—he was in Washington, not in the House—this is what he said:
  "We have taken steps which have not been taken by any other democratic government in the world. We are taking steps with regard to prices and wages which no other Government, even in wartime, has taken."
  That is what the Prime Minister said when he wanted to sell the effectiveness of Part IV in Washington. It is no good using soft, dove-like words here. It was the hawk speaking in Washington. It is not possible to believe a Government whose spokesmen say such utterly different things.
  The First Secretary very fairly said that he could not give a guarantee for next year. He will understand that it is precisely this that makes us so suspicious.
  The Government's spokesman in another place, the Parliamentary Secretary to the Minister of Public Building and Works, Lord Winterbottom, in the debate on the incomes policy in another place last week, said this:
  "Whether or not by 1968 we shall have a further Prices and Incomes Bill is in the lap of the gods."—[OFFICIAL REPORT, House of Lords, 5th July, 1967; Vol. 284, c. 172.]
  I have no doubt that that is the position. I have no doubt that the First Secretary has not made up his mind. He tells us that he has not. The words which Lord Winterbottom used—I will not weary the House by reading on—show that he is at least more than dubious as to whether

  243
  we shall be able to move away from compulsory legislation, but I accept the First Secretary's good faith. Indeed, I have never doubted it; and no words of mine have impugned it. However, I do impugn what the Prime Minister said in Washington and the reality in this country of Part IV. I attack the Prime Minister for saying what he said on B.B.C. television in "24 Hours", which I quoted in my opening remarks, as contrasted with the reality of the Bill.
  Above all, we attack the Leader of the House for his speech last weekend, both
  for what he said and for his cowardice in not coming to explain it to the House of Commons.
  Sir D. Glover Sir D. Glover rose—
  Mr. William Whitlock (Lord Commissioner of the Treasury)Mr. William Whitlock (Lord Commissioner of the Treasury) rose in his place and claimed to move, That the Question be now put.
  Question put, That the Question be now put:—
  The House divided: Ayes 189. Noes 129.

  Division No. 432.]

  AYES

  [10.54 p.m.

  Abse, Leo

  Fraser, Rt. Hn. Tom (Hamilton)

  McMillan, Tom (Glasgow, C.)

  Alldritt, Walter

  Freeson, Reginald

  McNamara, J. Kevin

  Armstrong, Ernest

  Gardner, Tony

  MacPherson, Malcolm

  Ashley, Jack

  Gordon Walker, Rt. Hn. P. C.

  Mahon, Peter (Preston, S.)

  Atkins, Ronald (Preston, N.)

  Gourlay, Harry

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

  Atkinson, Norman (Tottenham)

  Gray, Dr. Hugh (Yarmouth)

  Manuel, Archie

  Bacon, Rt. Hn. Alice

  Gregory, Arnold

  Mapp, Charles

  Bagier, Gordon A. T.

  Grey, Charles (Durham)

  Marquand, David

  Barnes, Michael

  Griffiths, Will (Exchange)

  Mason, Roy

  Baxter, William

  Hamilton, James (Bothwell)

  Maxwell, Robert

  Bence, Cyril

  Hannan, William

  Mellish, Robert

  Benn, Rt. Hn. Anthony Wedgwood

  Harper, Joseph

  Mendelson, J. J.

  Bidwell, Sydney

  Harrison, Walter (Wakefield)

  Mikardo, Ian

  Binns, John

  Hart, Mrs. Judith

  Millan, Bruce

  Bishop, E. S.

  Haseldine, Norman

  Milne, Edward (Blyth)

  Blackburn, F.

  Hattersley, Roy

  Morris, Charles R. (Openshaw)

  Bradley, Tom

  Hazell, Bert

  Morris, John (Aberavon)

  Bray, Dr. Jeremy

  Heffer, Eric S.

  Murray, Albert

  Brooks, Edwin

  Henig, Stanley

  Newens, Stan

  Brown, Rt. Hn, George (Belper)

  Herbison, Rt. Hn. Margaret

  Oakes, Gordon

  Brown, Hugh D. (G'gow, Provan)

  Hooley, Frank

  Ogden, Eric

  Brown, Bob (N'c'tle-upon-Tyne, W)

  Houghton, Rt. Hn. Douglas

  O'Malley, Brian

  Brown, R. W. (Shoreditch & F'bury)

  Howarth, Robert (Bolton, E.)

  Orbach, Maurice

  Buchan, Norman

  Howell, Denis (Small Heath)

  Orme, Stanley

  Buchanan, Richard (G'gow, Sp'burn)

  Howie, W.

  Owen, Dr. David (Plymouth, S'tn)

  Callaghan, Rt. Hn. James

  Hoy, James

  Page, Derek (King's Lynn)

  Carmichael, Neil

  Huckfield, L.

  Paget, R. T.

  Coe, Denis

  Hughes, Roy (Newport)

  Parkyn, Brian (Bedford)

  Coleman, Donald

  Hunter, Adam

  Pavitt, Laurence

  Conlan, Bernard

  Jackson, Colin (B'h'se & Spenb'gh)

  Pearson, Arthur (Pontypridd)

  Crawshaw, Richard

  Jay, Rt. Hn. Douglas

  Pentland, Norman

  Crosland, Rt. Hn. Anthony

  Jeger, Mrs. Lena (H'b'n & St. P'cras, S.)

  Perry, George H. (Nottingham, S.)

  Cullen, Mrs. Alice

  Jenkins, Hugh (Putney)

  Rees, Merlyn

  Dalyell, Tam

  Johnson, James (K'ston-on-Hull, W.)

  Reynolds, G. W.

  Davidson, Arthur (Accrington)

  Jones, Dan (Burnley)

  Roberts, Albert (Normanton)

  Davies, Harold (Leek)

  Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)

  Roberts, Gwilym (Bedfordshire, S.)

  Davies, Ifor (Gower)

  Jones, T. Alec (Rhondda, West)

  Robinson, W. O. J. (Walth'stow, E.)

  de Freitas, Rt. Hn. Sir Geoffrey

  Judd, Frank

  Roebuck, Roy

  Dell, Edmund

  Kerr, Russell (Feltham)

  Rose, Paul

  Dempsey, James

  Lawson, George

  Shaw, Arnold (Ilford, S.)

  Dewar, Donald

  Leadbitter, Ted

  Shore, Peter (Stepney)

  Diamond, Rt. Hn. John

  Ledger, Ron

  Short, Rt. Hn. Edward (N'c'tle-u-Tyne)

  Doig, Peter

  Lee, Rt. Hn. Frederick (Newton)

  Short, Mrs. Renée (W'hampton, N. E.)

  Dunn, James A.

  Lee, John (Reading)

  Silkin, Rt. Hn. John (Deptford)

  Dunwoody, Mrs. Gwyneth (Exeter)

  Dunwoody, Dr. John (F'th & C'b'e)

  Lewis, Ron (Carlisle)

  Silverman, Julius (Aston)

  Eadie, Alex

  Lipton, Marcus

  Slater, Joseph

  Ellis, John

  Lomas, Kenneth

  Small, William

  English, Michael

  Loughlin, Charles

  Spriggs, Leslie

  Ennals, David

  Lyon, Alexander W. (York)

  Stewart, Rt. Hn. Michael

  Ensor, David

  Lyons, Edward (Bradford, E.)

  Summerskill, Hn. Dr. Shirley

  Evans, Albert (Islington, S.W.)

  McBride, Neil

  Swingler, Stephen

  Evans, Ioan L. (Birm'h'm, Yardley)

  McCann, John

  Thomas, George (Cardiff, W.)

  Fernyhough, E.

  MacColl, James

  Tinn, James

  Fletcher, Raymond (Ilkeston)

  MacDermot, Niall

  Urwin, T. W.

  Fletcher, Ted (Darlington)

  McGuire, Michael

  Wainwright, Edwin (Dearne Valley)

  Foot, Michael (Ebbw Vale)

  Mackenzie, Gregor (Rutherglen)

  Watkins, David (Consett)

  Forrester, John

  Mackie, John

  Watkins, Tudor (Brecon & Radnor)

  Fowler, Gerry

  Mackintosh, John P.

  Wells, William (Walsall, N.)

  Fraser, John (Norwood)

  Maclennan, Robert

  White, Mrs. Eirene

  Whitlock, William

  Williams, W. T. (Warrington)

  Woof, Robert

  Willey, Rt. Hn. Frederick

  Willis, George (Edinburgh, E.)

  Williams, Alan (Swansea, W.)

  Wilson, Rt. Hn. Harold (Huyton)

  TELLERS FOR THE AYES:

  Williams, Alan Lee (Hornchurch)

  Wilson, William (Coventry, S.)

  Mr. Alan Fitch and

  Williams, Mrs. Shirley (Hitchin)

  Woodburn, Rt. Hn. A.

  Mr. Harold Walker.

  NOES

  Alison, Michael (Barkston Ash)

  Hawkins, Paul

  Peel, John

  Allason, James (Hemel Hempstead)

  Heald, Rt. Hn. Sir Lionel

  Percival, Ian

  Astor, John

  Heseltine, Michael

  Peyton, John

  Atkins, Humphrey (M't'n & M'd'n)

  Higgins, Terence L.

  Pink, R. Bonner

  Baker, W. H. K.

  Hiley, Joseph

  Price, David (Eastleigh)

  Biffen, John

  Hill, J. E. B.

  Prior, J. M. L.

  Boyle, Rt. Hn. Sir Edward

  Hirst, Geoffrey

  Pym, Francis

  Braine, Bernard

  Holland, Philip

  Ramsden, Rt. Hn. James

  Brewis, John

  Hooson, Emlyn

  Renton, Rt. Hn. Sir David

  Bromley-Davenport, Lt.-Col. Sir Walter

  Hordern, Peter

  Ridley, Hn. Nicholas

  Brown, Sir Edward (Bath)

  Hornby, Richard

  Royle, Anthony

  Bruce-Gardyne, J.

  Howell, David (Guildford)

  Russell, Sir Ronald

  Carlisle, Mark

  Hunt, John

  Scott, Nicholas

  Carr, Rt. Hn. Robert

  Hutchison, Michael Clark

  Sharples, Richard

  Chichester-Clark, R.

  Iremonger, T. L.

  Shaw, Michael (Sc'b'gh & Whitby)

  Clegg, Walter

  Jenkin, Patrick (Woodford)

  Sinclair, Sir George

  Cooper-Key, Sir Neill

  Johnson Smith, G. (E. Grinstead)

  Smith, John

  Corfield, F. V.

  Jopling, Michael

  Steel, David (Roxburgh)

  Dance, James

  Kaberry, Sir Donald

  Stoddart-Scott, Col. Sir M. (Ripon)

  Davidson, James (Aberdeenshire, W.)

  Kimball, Marcus

  Summers, Sir Spencer

  Dean, Paul (Somerset, N.)

  King, Evelyn (Dorset, S.)

  Tapsell, Peter

  Deedes, Rt. Hn. W. F. (Ashford)

  Kirk, Peter

  Taylor, Sir Charles (Eastbourne)

  Dodds-Parker, Douglas

  Kitson, Timothy

  Taylor, Edward M. (G'gow, Cathcart)

  Eden, Sir John

  Knight, Mrs. Jill

  Taylor, Frank (Moss Side)

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

  Lambton, Viscount

  Thatcher, Mrs. Margaret

  Emery, Peter

  Lewis, Kenneth (Rutland)

  Tilney, John

  Errington, Sir Eric

  Lubbock, Eric

  Turton, Rt. Hn. R. H.

  Fisher, Nigel

  MacArthur, Ian

  van Straubenzee, W. R.

  Fletcher-Cooke, Charles

  Macleod, Rt. Hn. Iain

  Wainwright, Richard (Colne Valley)

  Fortescue, Tim

  Maude, Angus

  Walker, Peter (Worcester)

  Fraser, Rt. Hn. Hugh (St'fford & Stone)

  Maxwell-Hyslop, R. J.

  Ward, Dame Irene

  Gilmour, Sir John (Fife, E.)

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

  Weatherill, Bernard

  Glover, Sir Douglas

  Mills, Peter (Torrington)

  Webster, David

  Glyn, Sir Richard

  Miscampbell, Norman

  Wells, John (Maidstone)

  Goodhew, Victor

  Mitchell, David (Basingstoke)

  Whitelaw, Rt. Hn. William

  Gower, Raymond

  Monro, Hector

  Wills, Sir Gerald (Bridgwater)

  Grant, Anthony

  Morrison, Charles (Devizes)

  Wilson, Geoffrey (Truro)

  Grant-Ferris, R.

  Munro-Lucas-Tooth, Sir Hugh

  Winstanley, Dr. M. P.

  Griffiths, Eldon (Bury St. Edmunds)

  Murton, Oscar

  Wolrige-Gordon, Patrick

  Grimond, Rt. Hn. J.

  Noble, Rt. Hn. Michael

  Wylie, N. R.

  Gurden, Harold

  Onslow, Cranley

  Younger, Hn. George

  Harris, Frederic (Croydon, N.W.)

  Page, Graham (Crosby)

  TELLERS FOR THE NOES:

  Harris, Reader (Heston)

  Page, John (Harrow, W.)

  Mr. Jasper More

  Harvie Anderson, Miss

  Pardoe, John

  and Mr. Reginald Eyre.

  Question put accordingly, That the proposed words be there inserted in the Bill:—
  The House divided: Ayes 129, Noes 174.

  Division No. 433.]

  AYES

  [11.4 p.m.

  Alison, Michael (Barkston Ash)

  Dodds-Parker, Douglas

  Hawkins, Paul

  Allason, James (Hemel Hempstead)

  Eden, Sir John

  Heald, Rt. Hn. Sir Lionel

  Astor, John

  Emery, Peter

  Heseltine, Michael

  Atkins, Humphrey (M't'n & M'd'n)

  Errington, Sir Eric

  Higgins, Terence L.

  Baker, W. H. K.

  Eyre, Reginald

  Hiley, Joseph

  Biffen, John

  Fisher, Nigel

  Hill, J. E. B.

  Boyle, Rt. Hn. Sir Edward

  Fletcher-Cooke, Charles

  Hirst, Geoffrey

  Braine, Bernard

  Fortescue, Tim

  Holland, Philip

  Brewis, John

  Fraser, Rt. Hn. Hugh (St'fford & Stone)

  Hooson, Emlyn

  Bromley-Davenport, Lt.-Col. Sir Walter

  Gilmour, Sir John (Fife, E.)

  Hordern, Peter

  Brown, Sir Edward (Bath)

  Glover, Sir Douglas

  Hornby, Richard

  Bruce-Gardyne, J.

  Glyn, Sir Richard

  Howell, David (Guildford)

  Carlisle, Mark

  Goodhew, Victor

  Hunt, John

  Carr, Rt. Hn. Robert

  Cower, Raymond

  Hutchison, Michael Clark

  Chichester-Clark, R.

  Grant, Anthony

  Iremonger, T. L.

  Clegg, Walter

  Grant-Ferris, R.

  Jenkin, Patrick (Woodford)

  Cooper-Key, Sir Neill

  Griffiths, Eldon (Bury St. Edmunds)

  Johnson Smith, G. (E. Grinstead)

  Corfield, F. V.

  Grimond, Rt. Hn. J.

  Jopling, Michael

  Dance, James

  Gurden, Harold

  Kaberry, Sir Donald

  Davidson, James (Aberdeenshire, W.)

  Harris, Frederic (Croydon, N.W.)

  Kimball, Marcus

  Dean, Paul (Somerset, N.)

  Harris, Reader (Heston)

  King, Evelyn (Dorset, S.)

  Deedes, Rt. Hn. W. F. (Ashford)

  Harvie Anderson, Miss

  Kirk, Peter

  Kitson, Timothy

  Peel, John

  Taylor, Edward M. (G'gow, Cathcart)

  Knight, Mrs. Jill

  Percival, Ian

  Taylor, Frank (Moss Side)

  Lambton, Viscount

  Peyton, John

  Thatcher, Mrs. Margaret

  Lewis, Kenneth (Rutland)

  Pink, R. Bonner

  Tilney, John

  Lubbock, Eric

  Price, David (Eastleigh)

  Turton, Rt. Hn. R. H.

  MacArthur, Ian

  Prior, J. M. L.

  van Straubenzee, W. R.

  Macleod, Rt. Hit. Iain

  Pym, Francis

  Wainwright, Richard (Colne Valley)

  Maude, Angus

  Ramsden, Rt. Hn. James

  Walker, Peter (Worcester)

  Maxwell-Hyslop, R. J.

  Renton, Rt. Hn. Sir David

  Ward, Dame Irene

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

  Ridley, Hn. Nicholas

  Weatherill, Bernard

  Mills, Peter (Torrington)

  Royle, Anthony

  Webster, David

  Miscampbell, Norman

  Russell, Sir Ronald

  Wells, John (Maidstone)

  Mitchell, David (Basingstoke)

  Scott, Nicholas

  Whitelaw, Rt. Hn. William

  Monro, Hector

  Sharples, Richard

  Wills, Sir Gerald (Bridgwater)

  Morrison, Charles (Devizes)

  Shaw, Michael (Sc'b'gh & Whitby)

  Wilson, Geoffrey (Truro)

  Munro-Lucas-Tooth, Sir Hugh

  Sinclair, Sir George

  Winstanley, Dr. M. P.

  Murton, Oscar

  Smith, John

  Wolrige-Gordon, Patrick

  Noble, Rt. Hn. Michael

  Steel, David (Roxburgh)

  Wylie, N. R.

  Onslow, Cranley

  Stoddart-Scott, Col. Sir M. (Ripon)

  Younger, Hn. George

  Page, Graham (Crosby)

  Summers, Sir Spencer

  TELLERS FOR THE AYES:

  Page, John (Harrow, W.)

  Tapsell, Peter

  Mr. R. W. Elliott and

  Pardoe, John

  Taylor, Sir Charles (Eastbourne)

  Mr. Jasper More.

  NOES

  Abse, Leo

  Gordon Walker, Rt. Hn. P. C.

  Maxwell, Robert

  Alldritt, Walter

  Gourlay, Harry

  Mellish, Robert

  Armstrong, Ernest

  Gray, Dr. Hugh (Yarmouth)

  Millan, Bruce

  Ashley, Jack

  Gregory, Arnold

  Milne, Edward (Blyth)

  Atkins, Ronald (Preston, N.)

  Grey, Charles (Durham)

  Morris, Charles R. (Openshaw)

  Bacon, Rt. Hn. Alice

  Hamilton, James (Bothwell)

  Morris, John (Aberavon)

  Bagier, Gordon A. T.

  Hannan, William

  Murray, Albert

  Barnes, Michael

  Harper, Joseph

  Noel-Baker, Rt. Hn. Philip (Derby, s.)

  Baxter, William

  Harrison, Walter (Wakefield)

  Oakes, Gordon

  Bence, Cyril

  Hart, Mrs. Judith

  Ogden, Eric

  Benn, Rt. Hn. Anthony Wedgwood

  Haseldine, Norman

  O'Malley, Brian

  Binns, John

  Hattersley, Roy

  Orbach, Maurice

  Bishop, E. S.

  Hazell, Bert

  Owen, Dr. David (Plymouth, S'tn)

  Blackburn, F.

  Henig, Stanley

  Page, Derek (King's Lynn)

  Bradley, Tom

  Herbison, Rt. Hn. Margaret

  Parkyn, Brian (Bedford)

  Bray, Dr. Jeremy

  Hooley, Frank

  Pavitt, Laurence

  Brooks, Edwin

  Houghton, Rt. Hn. Douglas

  Pearson, Arthur (Pontypridd)

  Brown, Rt. Hn. George (Belper)

  Howarth, Robert (Bolton, E.)

  Pentland, Norman

  Brown, Hugh D. (G'gow, Provan)

  Howell, Denis (Small Heath)

  Rees, Merlyn

  Brown, R. W. (Shoreditch & F'bury)

  Howie, W.

  Reynolds, G. W.

  Buchan, Norman

  Hoy, James

  Roberts, Albert (Normanton)

  Buchanan, Richard (G'gow, Sp'burn)

  Huckfield, L.

  Roberts, Gwilym (Bedfordshire, S.)

  Callaghan, Rt. Hn. James

  Hunter, Adam

  Robinson, W. O. J. (Walth'stow, E.)

  Carmichael, Neil

  Hynd, John

  Roebuck, Roy

  Coe, Denis

  Jackson, Colin (B'h'se & Spenb'gh)

  Rose, Paul

  Coleman, Donald

  Jackson, Peter M. (High Peak)

  Shaw, Arnold (Ilford, S.)

  Conlan, Bernard

  Jenkins, Hugh (Putney)

  Shore, Peter (Stepney)

  Crawshaw, Richard

  Johnson, James (K'ston-on-Hull, W.)

  Short, Rt. Hn. Edward (N'c'tle-u-Tyne)

  Crosland, Rt. Hn. Anthony

  Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)

  Short, Mrs. Renée (W'hampton, N.E.)

  Cullen, Mrs. Alice

  Jones, T. Alec (Rhondda, West)

  Silkin, Rt. Hn. John (Deptford)

  Dalyell, Tam

  Judd, Frank

  Slater, Joseph

  Davidson, Arthur (Accrington)

  Lawson, George

  Small, William

  Davies, Harold (Leek)

  Leadbitter, Ted

  Spriggs, Leslie

  Davies, Ifor (Gower)

  Ledger, Ron

  Stewart, Rt. Hn. Michael

  de Freitas, Rt. Hn. Sir Geoffrey

  Lee, Rt. Hn. Frederick (Newton)

  Summerskill, Hn. Dr. Shirley

  Dell, Edmund

  Lewis, Ron (Carlisle)

  Swingler, Stephen

  Dempsey, James

  Lipton, Marcus

  Thomas, George (Cardiff, W.)

  Dewar, Donald

  Lomas, Kenneth

  Tinn, James

  Diamond, Rt. Hn. John

  Loughlin, Charles

  Urwin, T. W.

  Doig, Peter

  Lyon, Alexander W. (York)

  Wainwright, Edwin (Dearne Valley)

  Dunn, James A.

  Lyons, Edward (Bradford, E.)

  Watkins, David (Consett)

  Dunwoody, Mrs. Gwyneth (Exeter)

  McBride, Neil

  Watkins, Tudor (Brecon & Radnor)

  Dunwoody, Dr. John (F'th & C'b'e)

  McCann, John

  Wells, William (Walsall, N.)

  Eadie, Alex

  Maccoll, James

  White, Mrs. Eirene

  Edwards, Robert (Bilston)

  MacDermot, Niall

  Whitlock, William

  Ellis, John

  McGuire, Michael

  Willey, Rt. Hn. Frederick

  English, Michael

  Mackenzie, Gregor (Rutherglen)

  Williams, Alan (Swansea, W.)

  Ennals, David

  Mackie, John

  Williams, Alan Lee (Hornchurch)

  Ensor, David

  Mackintosh, John P.

  Williams, Mrs. Shirley (Hitchin)

  Evans, Albert (Islington, S.W.)

  Maclennan, Robert

  Williams, W. T. (Warrington)

  Evans, Ioan L. (Birm'h'm, Yardley)

  McMillan, Tom (Glasgow, C.)

  Willis, George (Edinburgh, E.)

  Fernyhough, E.

  McNamara, J. Kevin

  Wilson, Rt. Hn. Harold (Huyton)

  Fletcher, Raymond (Ilkeston)

  MacPherson, Malcolm

  Wilson, William (Coventry, S.)

  Forrester, John

  Mahon, Peter (Preston, S.)

  Winter bottom, R. E.

  Fowler, Gerry

  Malialieu, J.P.W. (Huddersfieid, E.)

  Woodburn, Rt. Hn. A.

  Fraser, John (Norwood)

  Manuel, Archie

  Woof, Robert

  Fraser, Rt. Hn. Tom (Hamilton)

  Mapp, Charles

  TELLERS FOR THE NOES:

  Freeson, Reginald

  Marquand, David

  Mr. Alan Fitch and

  Gardner, Tony

  Mason, Roy

  Mr. Harold Walker.

  Mr. Atkinson: I beg to move Amendment No. 12, in page 2, line 9, at the end to insert:
  (3) Subsections (1) and (2) of this section shall not apply to any award or settlement which increases the wages or salary of any person or persons by an amount equivalent to an increase in the National Insurance contribution payable by that person or those persons.
  The benches opposite may be a little premature, depending on some of the things we may have to say. All of us have learnt a great deal about the Opposition in these debates. We are now seeing some true colours. If insincerity can be charged against anyone it can certainly be charged against those hon. Members opposite who have taken part in these debates.
  Lieut.-Colonel Sir Walter Bromley-Davenport: Oh, get on with it.
  Mr. Atkinson: If the hon. and gallant Member for Knutsford (Sir W. Bromley-Davenport) carries on like that, I am sure that he will be in serious trouble before long.
  This is an extremely important Amendment, because it concerns a section of the community which has suffered possibly more than any other as a result of the incomes policy—the lower income workers, who have, noticeably, not had any increase of any substantial amount during the last three or four years. We move the Amendment to try to help solve some of the difficulties from which those people suffer and to direct the attention of the Government to the plight of these people. This is a very difficult Amendment to move, because I do not want to stray beyond the guide lines laid down by both yourself, Mr. Deputy Speaker, and Mr. Speaker himself.
  11.15 p.m.
  Mr. Webster: On a point of order. The hon. Gentleman is not audible in this part of the Chamber. We cannot hear hint at all.
  Sir W. Bromley-Davenport: He is not worth hearing, anyway.
  Mr. Deputy Speaker: I hope that the House will enable the hon. Member for Tottenham (Mr. Atkinson) to be heard.
  Mr. Atkinson: I am surprised about that sort of complaint. I should have
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  thought that I was one of those—perhaps in a minority in the House—that even the cloth ears of those opposite could hear what I have to say.
  I was speaking about a section of the community which gathers no sympathy from those opposite. Therefore, many of the things which have been said—[HON. MEMBERS: "Why?"] I can tell hon. Members why. We have to listen in the debate to a lack of sincerity in talking about the lower income groups and about some of the provisions of the Bill. Therefore, I want to distinguish myself from the comments made opposite. I hope to prove that the cheers which we had earlier from the Opposition are unjust. In doing so I am referring to the Government's decision to impose yet a further burden on many people in the form of an increase in their National Insurance contributions. This amounts to about 2s., which, on an average wage of about £10 a week, is a 1 per cent. decrease in their earnings. I suggest that this is a formidable amount when the costs of living are increasing in the way that they are.
  This 2s. has taken on the form of compulsory savings. Many of us have had a great deal to say about the idea of a poll tax, but this 2s. looks very much like that. I want to avoid going into the whole detail of the insurance charges. I recognise that it is not for us in this debate to repeat any of the argument that was used last Friday or since the announcement was made. Our purpose is to recognise that the 2s. is to be charged from October next. None the less, it is a very serious imposition on many of our lower income people.
  I make one reference to the 2s. itself. The statement by the Minister of Pensions, in referring to the tables which have been published, indicated that that 2s. will over-subscribe the amount required to meet the increasing benefits. Therefore, we could argue that we are accumulating an amount of money for some time in the future. Over the next three years, according to the tables published, we will be in the black, as it were, and accumulating a large sum of money, but the Government are adamant in their decision to make this extra 2s. payable from October. The position is that many of our lower income people, who are suffering the imposition of a

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  rigid incomes policy, have yet again to face up to this additional burden.
  We move the Amendment in the hope that the Government will look again at some method of excluding workers below a certain income from direct payment of this 2s. We suggest that any wage award that is made in any negotiations should be excluded if it relates to the 2s. additional burden imposed by the changes in National Insurance.
  We also make this argument because most people who are dependent on bonus earnings, or who can derive some benefit from piece work earnings, or those many sections of the community which are able to gain some kind of expense account, are able to augment their incomes in many ways which are not directly applicable to the prices and incomes policy and can escape, because they can adjust their incomes to take account of this further imposition. But there are large sections of the community, those to whom we often refer as the under-privileged, the deprived sections, the lower income groups, particularly those with large families, who pay no taxation but who rather receive allowances and so on, who have yet again to face a further reduction in their living standards.
  Our idea in moving the Amendment is to draw the attention of the Government to the needs of these people, those who cannot offset this additional cost from any other source, but who are dependent on Government action to be able to negotiate with their employers an increase equivalent to the increased National Insurance contribution.
  That is basically the case which we want to make and I have made it in a very few minutes, because on this side of the House we are conscious of the time involved in our further Amendments and perhaps by the brevity of our speeches on our first Amendment we can set the tone of the debate.
  Mr. Biffen: The cheers which were accorded to the hon. Member for Tottenham (Mr. Atkinson) and, surprisingly, to myself merely reflect the generosity and good nature of the House at this early stage of this evening's proceedings. Although the hon. Member for Tottenham truly said that he had dealt with the subject briefly, he would be the first to
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  concede that the brevity was not in any way related to the significance of the Amendment, because it is an important Amendment which exercised those of us who had the privilege of serving on the Standing Committee, which the hon. Member did not have, despite his memorable contribution on Second Reading.
  Fairly early in our proceedings on the Standing Committee we taxed the First Secretary with all the implications, which would flow from an increase in the employee's National Insurance contribution, for the Government's prices and incomes policy, and the fact that no satisfactory answer was given on that occasion fully justifies this Amendment.
  It is useful for the House to reflect upon the process of income determination of wage negotiation. Of course it is perfectly true that very rarely, if ever, will a claim be made solely to recoup for the employee the amount by which his tax—which is what the National Insurance contribution is—is increased. The First Secretary's view was:
  "What should be the response to a wage increase demand solely to match the increased contribution?"
  Then, the First Secretary, to engage the Committee, put to use his wide-ranging knowledge when he continued:
  "I do not believe that situation will ever occur. When wage demands are made, many other criteria come in as well."
  That is perfectly true. If I may be allowed some self-publicity, there was some point in my sub-argument, subsequently addressed to the First Secretary. I said that all people concerned, whether as employers or employees, with wage increases, and I quote:
  "… in the course of negotiations should know whether they should disregard any element which arises from the National Insurance increase cost to be borne by the employee."
  I continued for a short while and my hon. Friend the Member for Worthing (Mr. Higgins) said:
  "We really must have an answer on this"—[OFFICIAL REPORT. Standing Committee A, 22nd June, 1967; c. 94–8.]
  But the First Secretary had the answer. He rose in his place and claimed to move, "That the Question be now put."
  Mr. Russell Kerr: About due!
  Mr. Biffen: The hon. Member for Feltham said, I think, "About due". I hope he will not be quite so easily put off by that kind of treatment, should it be preferred by the Treasury Bench on the Amendment which he has signed, because a number of principles arise from the Amendment.
  We know that, in many cases, one part of the claim filed on behalf of employees will be the increase in the cost of living on account of National Insurance contributions. When employers respond to this claim in what the First Secretary is pleased to call a voluntary policy, presumably they will want guide lines on this specific issue: should they disregard that element of the claim which arises from the increase in the employee's National Insurance contribution? The First Secretary, in Standing Committee, did not deal with that point. If he is not prepared to reveal this to the House, does he reveal it to the employers? If so, this House should be jealous of its traditions and rights.
  As the hon. Member for Tottenham said, a National Insurance employee's contribution is a poll tax. To pretend that the National Insurance Fund is funded in any conventional sense is part of the fiction of the National Insurance system, but it would be out of order to discuss that on this Amendment. This contribution bears significantly much more heavily on the lower-paid worker. We are told it is the objective and determination of the Government in putting through this legislation that the lower-paid worker shall have his position improved relative to his fellow employees, and presumably to the self-emloyed. Therefore, it is a test of whether the Government stand by their declaration as to how they will respond to the Amendment proposed from below the Gangway opposite. It cannot be dismissed as an unnecessary Amendment, one creating technical difficulties. It challenges the Government in the precise area in which they have sought to be judged, the assumption that this policy can narrow differentials, and relatively improve the status of the lower paid.
  11.30 p.m.
  The third point of principle is that the Amendment raises the whole problem not merely of Government expenditure
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  which proceeds from the National Insurance Fund, but the whole range of Government expenditure. There are many increases in taxation which inevitably bear much more heavily upon the employed sections of the community, and one is entitled to direct this question specifically to the Government, because the call is for generalised restraint, restraint for everyone, apparently, except the Government. The one characteristic which is quite clear is that public expenditure has not been restrained to any noticeable degree over the last 12 months, or is likely to be over the next 12 months. From this will inevitably flow increasing rates of taxation, which must have a very real bearing on the whole question of the determination of wages, and the extent to which employers are expected by the Government to disregard wage claims which proceed from the argument that taxation has increased, and the cost of living has gone up as a consequence.
  I am not here arguing—because I wish to try to keep myself to the terms of order—about whether this is, or is not, a desirable thing, but one thing which is quite certain is that the House should be told what the Government expect should be the reaction of employers.
  Mr. Mendelson: I think that the hon. Gentleman is wise not to say too much about the latter point two days after the Leader of the Opposition has announced that he intends to shift the burden of taxation from those who can carry it very well, to the shoulders of those who cannot carry it at all.
  Mr. Biffen: The night is young, and I am invited to broaden the debate.
  Mr. Deputy Speaker (Sir Eric Fletcher): The hon. Member must resist that temptation.
  Mr. Biffen: With great reluctance, but of course I accept your Ruling. Nevertheless, the point will not be lost. I hope that the debate will be continued not only in this Chamber, but in the country. We are determined that it will be. I am sure that a large number of trade unionists are hoping that when the debate is continued outside the Chamber there will be rather more virility attached to the actions of the opponents of the

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  Government's prices and incomes policy than the rather passive attitude which has been deployed so far.
  I am speaking early in the evening, and this is the first Amendment which has come from the benches opposite below the Gangway. In some senses this is going to be their first occasion this evening to show exactly with what force and determination—I do not use the word "sincerity", because I do not for one minute doubt the sincerity of hon. Gentlemen opposite—they intend to pursue this Amendment.
  I have been sidetracked. I was dealing with the principle which arises from the generalised attitude towards restraint on public expenditure, and how this was clearly linked with the Amendment.
  There is one final point that I make on this. I believe this to be a matter of real significance, and it certainly should be for hon. Gentlemen opposite. In this Amendment we are discussing the employee's National Insurance contribution. It is extraordinary that throughout all these debates on prices and incomes policy there proceeds the assumption that it is the rôle of the Government to determine and allocate employee incomes. There is never a word about incomes arising from self-employment, and yet this is bound to be a very real factor in the total level of income within this country. For touching on this point the hon. Member for Tottenham must be congratulated.
  Of course, the Government have no means of identifying any movement of price or of fee which will recoup the self-employed person on the same scale as they will through the normal, conventional collective machinery for wage negotiation which may seek to recoup the income for the employee. There is by virtue of sheer administrative necessity a double standard of judgment, and hon. Members opposite know this to be true. They know perfectly well that the machinery which is being put before the House in this legislation can operate effectively only where those who are participating in price or wage determination are visible and organised. Visibility is the crime.
  The Amendment demonstrates the concern which the hon. Member for Tottenham and his hon. Friends have for the lower-paid employees, but in so doing it
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  raises all these other issues and, indeed, almost every Amendment to this legislation is a trip-wire which sets up wider considerations of immense ramifications.
  The fact is that the Government have not really thought this out at all. This is what gives such a sinister significance to the speech of the Leader of the House. I am not going back over all that again, but I feel that I have some very strong claim to comment on it. After all, it was made in the County of Shropshire and it was made to some of my constituents; also I fought the Leader of the House in the 1959 election, albeit unsuccessfully. Having got those "commercials" out of the way, I say that the speech of the Leader of the House is bound to be the recurring theme throughout the Amendments that we are discussing this evening.
  Mr. Deputy Speaker: No, we really cannot go back and have a Second Reading debate on every Amendment. We have finished with that now.
  Mr. Biffen: I fully agree, Mr. Deputy Speaker. These raise perhaps wider points which I can more adequately ventilate on Third Reading.
  I have no wish to detract from the force of the argument of the hon. Member for Tottenham when I say that this matter was considered and debated in Standing Committee, and I hope that I have demonstrated from the references that I have made to the debates in Standing Committee what cavalier treatment we were given.
  The person who should be answering this debate is the person who moved "That the Question be now put," namely, the First Secretary of State. He sent the Joint Parliamentary Secretary to the Ministry of Labour to do the dirty work for him. I am second to none in my membership of the fan club of the Joint Parliamentary Secretary, but he ought not to be at the Dispatch Box answering this Amendment. This is the first Amendment to come from below the Gangway on the benches opposite, and the First Secretary of State is the person suitable to answer it.
  Mr. Mikardo: For the hon. Member for Oswestry (Mr. Biffen), the Amendment is a challenge to the Government and the chance to launch a generalised attack on almost everything they ever say

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  and do, and he gave some advice to the Government on who should reply to the debate. For me, it is none of these things, but a serious attempt to help some people who are badly off and for whom the continuing increases in their contribution to the weekly stamp represents, because they are low-paid, an almost intolerable burden.
  One of the Government's strongest arguments for their policy is that it is designed precisely to advantage these people against the interests of what it is now fashionable to call the "selfish minority". The picture painted by the First Secretary and some of his colleagues is of a helpless mass of low-paid workers being done down by a handful of selfish workers who are well off, not because they live by not working, as do the best-off people, but because they are paid more for their work. It is said that the Government are providing a "long-stop" on their behalf, but what they call a long-stop is more like a little boy under the sightscreen on the wrong side of the boundary rails.
  Are they really protecting these workers? If so, they should think about the insurance contribution, which bears heavily on them. It is a pity that we cannot illustrate our speeches with a blackboard, as what I am saying could he better put that way. If one drew a curve on which the vertical axis was the percentage of income taken in taxation, and the horizontal axis was income, the curve would start at just under 30 per cent., would drop steadily as income increased to little more than half that, and would then rise steadily to the highest point of earned income, back to the original 30 per cent.
  Thus, taking all forms of taxation, direct and indirect, the people who pay the highest percentage of income in taxation are the lowest-paid and the highest-paid workers, and a wide range of people in between pay a lower percentage, sometimes not much more than half as much. This is simply because of the stamp. In all other forms of taxation it Js roughly progressive. The poorest worker pays no Income Tax, and he drinks and smokes less than others because he cannot afford more. In almost all those forms of tax based on consumption he pays less than the man who earns 50 to 200 per cent. more. Yet he still pays
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  a higher percentage of his income in tax because the regressive effects of the poll tax are sufficient to over-set the progressive effect of all other forms of taxation.
  11.45 p.m.
  This is seldom understood except by people who have the opportunity to see how the families of the lower-paid workers work out their weekly budgets and what it means to them in practice. Whereas the £1,000-a-year man or £1,500-a-year man can take on the chin without great difficulty the periodic increases in the employees' contribution to the stamp, the man at the lowest end of the earning scale can pay them only by doing without something else. There is no fat from which it can come. There are no luxuries in such a household, and a necessity must go to the wall.
  Therefore, nothing is a greater inspirer of wage claims at that level than an increase in the poll tax. The hon. Gentleman was right to say that nearly always a wage claim is inspired by an amalgam of three things. But I do not know a single one which induces it more than such an increase, when the wife says to her husband at the end of the week, "Bill, you must get a bit more money from somewhere because you have taken this out of my housekeeping and I just cannot manage."
  I hope that the Government will not tell us that all the apparatus which they are now putting at their disposal, this great engine which they have fashioned for their control, will be put to work where small marginal wage claims are most directly inspired among the lowest-paid workers in this way. The Amendment relates to all workers, but if the Government wanted to change that we should be happy. We do not have the resources of Government Departments or even of the research department of the Conservative Central Office at our disposal. We must do our own homework. Some of us are not very good at it, but we do our best. If my right hon. Friends wanted to suggest a better form of words which would confine the benefit to the sort of people of whom I am speaking, we should be very happy to accept it. It it of these people that we are thinking, and it is for their benefit that we have put down the Amendment.

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  If it is resisted, I shall never again attach the least credence or weight to any of my right hon. Friends who talk about the Bill being designed to help the lowest-paid workers. That argument would simply not hang together. For that reason, I very much hope that whatever happens to other Amendments, this one will commend itself to the Government and be accepted by them.
  Mr. Pardoe: I should like to take up a point made by the hon. Member for Tottenham (Mr. Atkinson) in moving the Amendment, which I support. He accused hon. Members on this side of the House of insincerity. He must take that back in connection with the Liberal Bench, because it was from here that most of the cheers came when he rose to make his speech.
  Sir W. Bromley-Davenport: Where are they?
  Mr. Pardoe: I doubt very much whether the mathematics of the hon. and gallant Member are so bad that he can find much more than one-twelfth of his party behind him.
  We have been advocating the abolition of this poll tax certainly since I left the Labour Party and joined the Liberal Party—and that is at least seven years.
  Mr. Webster: In view of the hon. Gentleman's great knowledge of the subject, why was not one Member of the Liberal Party on the Committee which dealt with the Bill concerning graduated pensions in 1958–59?
  Mr. Pardoe: I suspect that it was for the usual reason. Unless we twist the arms of the Government Whips, as we did in the recent selection of the Sub-Committee on oil pollution of the beaches, we do not usually get Members of our party on committees of any sort. We occasionally exercise blackmail and are successful.
  I wonder why the proposers of the Amendment did not take the opportunity of opposing this tax when we had a three-hour debate last week when it was imposed? I do not remember seeing any of the proposers of the Amendment here on Friday to discuss the matter. Many of us were here to oppose the Government then.
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  Like the hon. Member for Poplar (Mr. Mikardo), I do not have the advantages of the Civil Service or the Conservative Central Office Research Department behind me, and it is probably because of that that I represent the only party which has an effective substitute for this tax. There was plenty of opportunity to oppose this tax last week. There have been 21 years in which to oppose it since the Labour Party came to power. There have been two major increases in contribution since, and on each occasion they have hit the lowest-paid workers hardest. It would have been very much better to have opposed the tax, which we are told is a poll tax, as it is, rather than try to make up for the hard effects of the tax by tabling this Amendment.
  Mr. Orme: The hon. Gentleman is missing the point of the Amendment. We are not attacking the tax system or any increases; that would not be in order. What we are saying is that any increases, for whatever reason, must be excluded from the prices and incomes policy and must not be taken into account when wage demands are made.
  Mr. Pardoe: But both the hon. Gentleman's hon. Friends have made great play with the fact that this is a poll tax. It was precisely that point that I was taking up. As I say, it would have been better if they had attacked the tax when it was imposed rather than by tabling this Amendment.
  It is not lack of concern that I hold against the Labour Party. I know that its members know that there is real poverty and that lower-paid workers will suffer very much from the tax. What I oppose them on is the fact that they know that the effects of an increase in a tax of this sort will be severe and that the Government will not accept their proposal. This increase will have a very real effect on the families of lower-paid workers. In the last week or so we have had a survey of the circumstances of families which highlighted what many of us already knew about the circumstances of poorer families.
  From where is the 2s. 0d. coming? It may be only 1 per cent. of the income of a family living on £10 a week, but when it has to come out of one tin or other on the kitchen mantelpiece, and when it is a matter of its coming out

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  of the expenditure on the one meal a week with which the family has meat, it is a very real imposition. It is too easy to say, as the Government say, "Anybody can afford 2s. a week". But at these levels of income and expenditure, a tax of an extra 2s. a week, for families which budget in sixpences and pennies, is a real burden.
  This increase will hit certain areas of the country more than others. In my constituency in Cornwall many people earn low incomes. For many of them the payment of an extra 2s. a week will be a burden. Yet, like many hon. Gentlemen opposite, I had believed that the incomes policy was designed to help the lower-paid workers. I recall the speeches made during the last General Election campaign, and at that time I had considerable sympathy for a policy which would help those families which find it difficult to manage. There has been no evidence that the Labour Party's policy will aid the lower-paid workers and it is now proven that the Govern-m Nit do not care a fig for these workers.
  Mr. Michael Foot: My hon. Friend the Member for Poplar (Mr. Mikardo) put the principal argument for the Amendment plainly and there is no need for me to delay the House or repeat that case. However, there are additional arguments which should persuade the Government to adopt the Amendment or a comparable method of dealing with the problem.
  In seeking to pursue their incomes policy this year, the Government are making a mistake very much like the one they made last year. Over and above the intrinsic weaknesses in the policies introduced in July of last year, the Chancellor of the Exchequer had taken steps which made it impossible for the incomes policy to proceed. In his Budget last year, the Chancellor introduced S.E.T., and as it was to come into operation that autumn, it was bound to increase prices. That made it impossible for the Government to win overwhelming backing for their incomes policy at that time.
  In the same way, on this occasion, what the Government have done—may be for perfectly reputable reasons in another sphere—is to say that National Insurance
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  contributions are to be increased to pay for increased old age pensions, which means this Measure being maintained in circumstances when the Government are taking action to weaken the incomes position and to make the pressure against the incomes policy all the greater. This being so, I trust that the Government will try to see if they can go some way to accepting the Amendment.
  There is another argument—a wider, political one—which is strictly related to the Amendment. I am sure that all my hon. Friends want to see a proper incomes policy introduced. Indeed, we believe that such a policy is essential to Socialism. However, we believe that a proper incomes policy cannot be inserted by itself into an economy in which the Government are refusing to take a series of other measures which are required to secure a fairer distribution of incomes. It is because the Government have held back many of the measures for the fairer distribution of income to which they are committed that they make it all the more difficult for them to win allegiance for their incomes policy.
  12 m.
  This applies directly to the question of insurance contributions. It has been the policy of the Labour Party for many years that we are not content with the poll tax system. There is hardly one member of the party who has not denounced the poll tax principle of the insurance scheme over the past five or six years. For longer than even the hon. Member for Cornwall, North (Mr. Pardoe) can recall, in his political infancy, many of us were denouncing it. I remember that Aneurin Bevan denounced the principle of the poll tax years ago. It has become part of the accepted philosophy of the Labour Party that we are opposed to the insurance contribution on the flat-rate poll tax basis.
  Therefore, over the years, the Labour Party has also devised and presented to the public a series of proposals for overcoming this difficulty. We were committed, and are committed, to abolishing the whole of the graduated pension swindle introduced by hon. Members opposite, and substituting an entirely new system of our own. A great deal of work has been done by the Labour Party, both by those in Transport House

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  and those who devised the general policy statements that have been presented to the party.
  Those statements were incorporated in the official policies of the party, and were presented to the electorate both in 1964 and 1966. Elaborations of the policy were presented in 1966: there was to be an income guarantee; an alteration of the whole system of the poll tax; a complete overhaul of the pensions scheme, and an entirely new system was to be introduced as one of the reforming measures to which the Government were committed. No one on this side of the House can dispute that.
  All those measures have been held up, and all of them are intimately concerned with an incomes policy. Part of the incomes policy to which the Labour Party was committed at the last election was the pensions plan. That pensions plan is not in operation, and we do not even know when it will come into operation. I do not know of the experience of some of my hon. Friends, but I get asked at political meetings up and down the country by workers who are engaged in active employment no more frequent question than when the pledge about the graduated pensions scheme is to be brought into operation.
  I have heard my right hon. Friend the Minister of Social Security say that she wishes to proceed with it. I am sure that she does, and that the Government do, but it has been held up because of the general financial stringency in which the Government say the country is placed. But if that is the case, if an essential part of our incomes policy of trying to share more fairly the wealth of the country is held up because of the economic situation, the Government cannot claim that they are carrying out the full incomes policy.
  They should be making provisions to safeguard the position in the meantime, if they are not able to bring into operation the principles of the fair pensions policy to which they are pledged—and the Government are as much committed as we are to the proposition that the present pensions schemes are unfair and that the poll tax is unfair. They are committed to a graduated system of payments instead of the poll tax system, but
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  say they have not the money to introduce that scheme yet—
  Mr. Pardoe: But does not the hon. Member agree that the part of the proposals that would do away with the poll tax would not necessarily increase the burden on the economy at all, that therefore it could well be brought in, and the Government argument has no force at all?
  Mr. Foot: I understand that the Government's claim is—and there is some force in it—that they wish to introduce a radical overhaul of the whole pensions scheme and, undoubtedly, if it were carried through on a proper basis, that would cost the Exchequer more. I do not want to see a half-baked or a quarter-baked scheme introduced instead. Undoubtedly, it was believed by most of those who voted for the Labour Party at the last election that we should have proceeded much sooner with that essential part of sharing the wealth of the nation fairly: that is, a complete overhaul of the pension scheme. That is held up and we do not know when it will come into operation.
  In the meantime, the Government say that they are going ahead with a certain part of their incomes policy. It is largely because of this, because of the context in which the Government try to operate their incomes policy—because they have not changed the general climate in the country—that they get such poor allegiance to their policy.
  My right hon. Friend the First Secretary talked earlier about the idea of an incomes policy being sound. I do not know whether he was referring to the attacks made upon it by some of my hon. Friends. It is not our attacks which cause sour feelings about the incomes policy. One of the perils of the Government's policy is that they have associated an incomes policy with ferocious deflation, with their whole economic policy of stringency and the deliberate creation of unemployment.
  The Government have associated an incomes policy with those policies and with an abandonment of the immediate or early commitment for a radical overhaul of our pension scheme. Because they have done this, they have made an incomes policy look entirely as a policy of restriction, of stopping wage

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  increases. People who jumped to that conclusion have jumped to the right conclusion. The Government have not even taken measures to try to impose a proper wage policy on Surtax payers, who still get the £80 million a year in relief that they were given by the right hon. and learned Member for Wirral (Mr. Selwyn Lloyd) when he was Chancellor of the Exchequer.
  Mr. Deputy Speaker: Order. The hon. Member is getting a long way from the Amendment.
  Mr. Foot: If I have gone a long way, I must come a long way back. I assure you, Mr. Deputy Speaker, that I considered the argument relevant, because the Government have not taken measures for using the Budget to alter the sharing of the nation's wealth. Unless they accept the Amendment, they are not taking special precautions to ensure that those with the lowest incomes will be able to recompense themselves by wage increases for the heavy increases in insurance contributions which are being imposed.
  I hope, therefore, that the Government will be prepared to consider our Amendments. I hope that in this debate they have not set out with the idea of suggesting that they must resist all my hon. Friends' Amendments. I hope that each of them will be considered on merit. If the Government made a number of concessions to some of my hon. Friends who propose the Amendments, if they would make a start by accepting this Amendment, they could start to get a different attitude to their incomes policy in the country.
  Let the Government realise that we represent far bigger numbers outside the House of Commons. They know very well that they will have the greatest difficulty in getting support for their policy at the Trades Union Congress and the Labour Party Conference. If they wish to show that they understand the strength of feeling outside the House of Commons in the Labour and trade union movements, their best course would be, if not to accept the precise wording of the Amendment, to show that they are willing to consider it and produce an Amendment which safeguards the essen-
  266
  tial principle which my hon. Friends have put forward.
  Mr. Paul Hawkins: I support the Amendment, and in doing so I hope that the hon. Member for Tottenham (Mr. Atkinson), who moved it, will take back what I can only consider as a nasty smear on hon. Members on this side of the House. We represent, just as hon. Members opposite do, lower-paid workers in many industries who, I certainly agree, have an extremely thin time. The Amendment would make a gesture at least in trying to alleviate those who are at the lower end of the income group.
  In my area a large number of agricultural and ancillary workers earn £5 a week less than the average wage of all manual workers. To earn their wage they must work five hours a week longer. There is no more hard-working or underpaid band of men than agricultural workers. I know these workers. I know the conditions in which they live. Many of them have fairly large families. They have to budget down to the last penny to make ends meet.
  I believe that the Government's prices and incomes policy has not helped lower-paid workers to even begin to catch up those who earn a little more than them. I support the Amendment from my personal knowledge of many families who live in a wage level which we do not want to see. These people work very hard. The Amendment would go some way towards alleviating their position. I hope that, if a satisfactory answer is not given, the Amendment will be pressed to a Division.
  Mr. Webster: I share the views of my hon. Friend the Member for Norfolk, South-West (Mr. Hawkins) about the remarks of the hon. Member for Tottenham (Mr. Atkinson) which, as usual, were moderate except about his political opponents. I wish the hon. Gentleman would not always impute that anybody who speaks on such an Amendment does so with a lack of sincerity. That was his imputation. It has not been withdrawn. I regret that the hon. Gentleman has on two occasions in my hearing during this fairly long Report stage imputed dishonourable motives. I impute none to him.
  Mr. Atkinson: My invitation to hon. Members opposite, if they feel so keenly about this, is that they should denounce their behaviour during 13 years of Tory Government. If hon. Members opposite —I exclude Liberals—were to say, "We recognise that for 13 years the Tory Government were wrong in what they did", I would accept their sincerity.
  Mr. Webster: I agree with the hon. Gentleman about excluding the Liberals. I had the privilege to serve as a P.P.S. at the Ministry of Pensions and National Insurance during a period in which the National Insurance pension increased by 20 per cent. more than the cost of living. That is not an achievement which is to be seen at present. I therefore hope that the hon. Gentleman will not make such imputations. During my first weeks in the House, when the National Insurance Bill was being debated in 1959, Labour Members resisted the graduated contribution proposals root and branch. Those innovations by the Tory Government have given great benefit, albeit they were only a start. On our return to office we shall do more to increase the opportunity of people who earn a little more to set aside more of their earnings towards their retirement. This refers to the increase in contributions which is payable in total.
  I accept the point that the hon. Gentleman the Member for Tottenham makes on the subject of family poverty. It is real and very desperate, and I very much hope that I will not make political points on this subject. It exists and everyone deplores it. It is one of the greatest problems in what is often seen to be an affluent society. The affluence is on the surface; the poverty is miserably submerged. This is something which can be done to assist.
  12.15 a.m.
  In last week's Ministry of Social Security report it was suggested, in The Times, that there were about 1 million children in families below subsistence level. I am thinking particularly of the children. About half a million of them were in 160,000 families which were thought to be enduring the greatest hardship. They were the children of fathers who were in full-time employment, or who were out of work and prevented by the wage stop from receiving full allowances. In these cases allowances are
  268
  kept to what the father would have been earning if he had been at work.
  There is great validity in what the hon. Gentleman has said, and I hope that if he does not get a satisfactory answer from the Minister he will press the Amendment. It is deplorable that there is no one here from the Minister of Social Security to give the view of the Department, when the Minister has, for years in opposition and Government, trumpeted up and down the country, talking about the grinding meanness of Tory policy.
  Mr. Pardoe: I should like to draw the hon. Member's attention to the fact that not only is no one here tonight from the Ministry of Social Security, but that the Minister without Portfolio, who is responsible for all these changes in the overall system, did not come here on Friday, when we discussed this matter.
  Mr. Webster: I listened with very great interest to the speech by the Chairman of the Parliamentary Labour Party, the right hon. Member for Sowerby (Mr. Houghton). It was the best speech that I have heard from that side of the House. There is a tussle entering pensions, when the Government are spreading the benefits too thinly over the whole rather than giving to those in greatest need.
  The hon. Member for Tottenham and the hon. Member for Poplar (Mr. Mikardo) came nearer to my hon. Friends than ever on the subject of a means test, and I hope that this indicates a change of thinking among hon. Members opposite. It is wrong to deprive those who are in the greatest need, particularly children. They will be made miserable and may, I do not say this in a pejorative sense, become stunted citizens. Hon. Members opposite know in their heart of hearts that this is wrong.
  Another thing that I have noticed is that during this debate hardly anyone has mentioned the contributory principle. If we had debated this subject 10 years ago everyone would have stuck to this principle. I am one of those who is sufficiently old-fashioned to think that we should stick to this principle, and who thinks that people should have the feeling that their pension is theirs, as of right. They may not contribute more than 30 per cent. of it. We appreciate that, but they have contributed a great

  269
  deal more through their taxes, as well as through their insurance contributions as employees.
  I should not like to see the day come w hen the contributory principle is dispensed with altogether, and it is strange that we should do something to erode it in these particular cases.
  Mr. Fletcher-Cooke: This debate is very simple and within a narrow compass. Unlike all the other provisions of the Bill, which are immensely complicated, this one is simple and easy to understand. It is whether not only lower-paid workers but all workers should be able to save themselves from having their standard of living positively arid directly depressed to the degree of 2s. a week by asking—not necessarily getting but asking—for wages in compensation for that depression.
  That is something which I think every hon. Member can understand and, I should have thought, would have accepted; that they would be entitled to ask, and if their employer is so minded, entitled to get it. But no.
  The hon. Member for Poplar (Mr. Mikardo) said that if this Amendment was resisted he would never attach any credence to talk from the Government about their care for lower-paid workers. I have news for him. It will be resisted because it was resisted in Committee. My hon. Friend the Member for Oswestry (Mr. Biffen) was not, I think, absolutely correct when he said we did not get an answer to this question in Committee. After a great deal of needling, after a great deal of pressure conducted, I may say, exclusively by hon. Members on this side of the House and with not a word from any of the hon. Members on the other side, the First Secretary—after the evasive sentence in col. 94 quoted by my hon. Friend—said this:
  "What should be the response to a wage increase demand solely to match the increased contribution? do not believe that situation will ever occur."
  He does not believe that any worker in the country will ask his boss for another 2s to make up for the increased contribution he has to pay. That is what the Firs: Secretary said, but of course everybody will. He then went on eventually to say this:
  "If we were asked if it"—
  270
  that is the ability to comply with this request for an extra two bob to make up for the increased contribution
  "where in accordance with the criteria to pay an increase simply and solely to match the increased contribution, the answer would be 'No'"—
  so that from that moment the credence of the hon. Member for Poplar has to disappear. The answer has been given as "No" and the First Secretary goes on
  "as anybody who has read the criteria would be aware, but, in any case, the situation would not arise."—[OFFICIAL REPORT, Standing Committee A, 22nd June, 1967; c. 94.]
  That, I think, was the most astonishing ivory tower statement I have heard. Of course it will arise in cases where workers seek compensation for this increased contribution. In many more cases it will be one of the ingredients put forward to justify wage increases which will have to be isolated and dismissed by anybody who is considering granting it on pain or fear of being reported to Mr. Aubrey Jones.
  The hon. Member for Poplar and his friends may be sure of this—it is not in accordance with the law of the Medes and Persians, and that is the criteria; the criteria do not admit of this, and when there is conflict between the criteria and the needs of the lower-paid workers the criteria will win.
  As I said, this is a simple matter but a very important one. There are eight names to this Amendment and I am sure many more sympathisers with it among hon. Members opposite. It is the first time, as far as I know, that the conflict has become sharp and direct between what they believe and what their party orders say, and we look forward with great interest—and so does the country —to see which will prevail.
  Mr. Hattersley: I begin by endorsing the words of my hon. Friend the Member for Poplar (Mr. Mikardo) when he said that this is a serious Amendment. It is indeed, and it is so treated by the Government.
  I want also to comment on the words of my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot), who said that he hoped that the Government had not set out with the idea of resisting the Amendments tabled by some of his and my hon. Friends. I give a categorical

  271
  assurance that that has certainly not been the case. I think that my hon. Friend supposes that there are two alternatives, one being that the Government look at these Amendments with a jaundiced eye and decide to resist them and the other that the Government look at them objectively and decide to accept them. I think that on reflection he will agree that there is at least one further alternative, and it may be that that third alternative is one that the Government have to choose this evening.
  Before I come to the Government's actual choice, I want to make the further concession that essentially this debate is about the lowest-paid workers. I understand very well that technically the Amendment would make it possible for wage and salary increases to be paid to all financial sections of society to meet the increases in the National Insurance contributions, but I know very well that the intention of my hon. Friends in tabling the Amendment was to safeguard the interests of the lowest-paid workers. Therefore, I make no attempts to score points or make debating points about the inappropriateness of tabling Amendments which would offer the extension of the concession to many other categories.
  Nor do I make a point about the entirely artificial nature of the situation which such Amendments pose. I am sure that it is artificial to assume that a wage increase would be totally related to an increase in National Insurance contributions and artificial to assume that if a wage increase was not totally so related the element in it related to such increase could be identified. But I can say that all those things are unimportant in terms of my speech on the Amendment. The Amendment is about the lowest-paid workers, and it is to them that I want to come.
  But before I do that I must talk for a moment about the general financing of National Insurance and the general economic exercise—
  Mr. Deputy Speaker: The hon. Gentleman cannot do that on the Amendment. It does not arise on the Amendment.
  Mr. Hattersley: I understand your point very well, Mr. Deputy Speaker. My
  272
  mistake was to say that I must spend a moment on the general concept of the financing of National Insurance.
  I should have said that I turn first to the theory outlined in the admirable speech, in many ways, of the hon. Member for Weston-super-Mare (Mr. Webster), who told us to consider for a moment the concept of a pensions scheme which was related to its contributions and said how very much he regretted that the idea that contributions and payments would be related to each other was sometimes in over-sophisticated quarters these days regarded as fiction. He urged us to remember that the investment, as it was to him, in the form of a National Insurance contribution was in terms of a benefit eventually received and that the immediate investment was intended to provoke an eventual receipt.
  If this is the intention of the National Insurance contribution, clearly the Government cannot support an Amendment which says that this direct, if not actuarily funded, contribution towards an eventual pension should be made not out of the real incomes of the man who eventually receives the pension but out of a paper wage increase, that that increase in contributions should be financed out of inflation—because that is what it amounts to if the Amendment is accepted and is understood in the terms of National Insurance finance as outlined by the hon. Member for Weston-super-Mare.
  Not least of the reasons why the Government could not accept a situation in which National Insurance contributions are financed out of a wage inflation is that a society and an economy which run their affairs in that way are the sort of society and economy which find is difficult to organise the sort of social security scheme that was expected by my hon. Friend the Member for Ebbw Vale and was rightly described by him as a sort of scheme at which we should be aiming.
  12.30 a.m.
  Another alternative theory, put forward by my hon. Friend the Member for Tottenham (Mr. Atkinson) and the hon. Member for Oswestry (Mr. Biffen), is that the increase in contributions is in no way directly related to the eventual benefit of the recipient but is really a glorified form of taxation, a poll tax, something related not to their eventual

  273
  receipts but to the receipts of other people receiving Natiónal Insurance payments this year rather than in 40 years' time.
  I hope again that my hon. Friend and the other supporters of the Amendment will understand that, if the National Insurance contribution were intended as a taxation measure which compensated for additional purchasing power poured into the economy in the form of increased old age pensions, clearly it would be economically disastrous if that compensatory taxation were simply accounted for by wage inflation.
  Again, the sort of society which allows for that sort of taxation increase or contribution increase to be compensated for simply by wage inflation is the sort of society which cannot afford the right sort of social security benefits in the first place.
  These are the two economic justifications which the Government must put forward for saying that they cannot accept the Amendment. But, having given those justifications, I repeat that I understand the problems which beset the lowest-paid workers. I do not minimise the problems of the lowest-paid workers if an extra I per cent. of their income goes into contributions. I understand that the extra 2s. or 1s. 9d. is considered as a tax. It is a regressive tax, taking no account of family commitments or income levels. Therefore, I accept the many criticisms of this fiat rate in terms of the lowest-paid workers.
  But this does not seem to me to be a justification for accepting the Amendment as it stands. What it does mean is a total justification for ensuring that the lowest-paid workers receive special concessions and special concern in the general prices and incomes policy. What we should be saying is not that to the 2 million lowest-paid workers who have received wage increases during the period of severe restraint an extra 2s. might well be an additional burden they would find hard to bear. We should remember that it is because they are the lowest-paid workers and because additional burdens are difficult for them to bear that the general concessions to them have been made.
  Because they have special problems—meeting small family items, making ends meet, balancing the family budget—the
  274
  lowest-paid workers have been largely exempted from the period of severe restraint. Our attitude towards them should not be to exempt them from special charges but to ensure that their general income level increases despite the incomes policy and according to the criteria, which means that such special attitudes are not extended to those not regarded as being among the lowest paid.
  I therefore ask my hon. Friends to resist the Amendment in the knowledge that the Government are aware of and sensitive to the problems of the lowest-paid workers and that the record shows that the Government have always allowed a pay increase to go ahead when the lowest-paid workers were involved. I ask them to resist the Amendment in the knowledge, also, that when, as surely will he the case, lowest-paid worker criteria are presented to the Government as a reason for allowing a pay increase to go through despite the period and the policy, it will be operated in that case. When, whether it comes from a wages council or some other source, the case is put, "We want exemption because the men in this category are lowest-paid workers", the exemption will be granted. Exemption may be not specific or overt, or diagnosed as a precise part of the agreement, but one of the reasons why such a wage increase will be allowed is that the Government know that, with this additional burden on them, the lowest-paid workers must be given special concessions to enable them to meet those burdens.
  Mr. R. Carr: When the hon. Gentleman spoke about the three alternatives that he saw I began to think that he was going to recommend his colleagues on the Front Bench to abstain in the forthcoming Division. When the House heard his concluding remarks about the Government's sensitivity to and concern for the problems of the lower-paid workers and the complicated way in which he could not say yes to the Amendment but nevertheless these matters would be taken into account, we were getting near the heart of the reason why the policy which the Government are pursuing will not be understood and will not be accepted. People concerned with these matters are well able to understand the basic affairs of the country in its economic situation and all the rest of it,

  275
  but they do expect, and have a right to expect, fairly clear answers from the Government to fairly clear questions. This is the one thing they are not getting on this or other matters.
  The House should be grateful to hon. Gentlemen opposite for moving the Amendment. We were deprived of their contribution in Standing Committee. I know that I must not comment on that, but, as my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) said, it was left entirely to those of us on this side to press this point upstairs, and it has been valuable to the House to have this debate initiated by hon. Gentlemen opposite today.
  Like my hon. Friend the Member for Weston-super-Mare (Mr. Webster), however, I regret the way in which the hon. Gentleman the Member for Tottenham (Mr. Atkinson) seems to find it necessary to square his conscience for doing things like this and opposing his own Front Bench by casting aspersions on all on this side. He says he would believe in our sincerity had it not been for the 13 years of Tory Government.
  Mr. Robert Maxwell: Hear, hear.
  Mr. Carr: I would be very happy if the hon. Member for Buckingham (Mr. Maxwell), who has just arrived, and the hon. Member for Tottenham would come among my constituents and say that sort of thing, because, like many hon. Members, I am finding that many people who fell victim to the talk of 13 years of Tory misrule would now be delighted to have some more of it, because they know, including the lowest-paid workers and recipients of benefits, that they did better year in, year out, in the 13 years than they have done in the last three years, or look like doing in the future.
  We doubt whether the problem of the lower-paid workers can be dealt with by means of this or any other incomes policy. It is a matter largely to be determined by policies which we cannot talk about tonight—social service policies. Whether that be so or not, we have not yet had those other policies from the Government. We have had from the Government a double claim for their policy: first, the claim that their incomes policy would take special account of the
  276
  lower-paid workers, and secondly, their more general claim that this policy is meant to encourage fairness in the wages and salaries structure throughout the county. That it is not doing. It is not encouraging; it is not bringing about fairness. On the contrary, there is plenty of evidence that it is doing the reverse. It is causing changes in relative wages and in certain differentials in the most arbitrary manner which has no connection with any recognisable principle of fairness.
  When the Parliamentary Secretary, having advised his hon. Friends to turn down the Amendment, speaks of special concessions to lower-paid workers, one can think only that he means special concessions as long as they are not as much as 2s. a week, which is what is involved in the Amendment. We have heard from the Government that in considering prices, increases in taxation—the effect of the Selective Employment Tax, for example—can be and have been, with the Government's approval, taken into account. Earlier today, my hon. Friend the Member for Gillingham (Mr. Burden) quoted the example—we can all find many more—of a bill which he had had in a British Railways hotel in which this nationalised industry had added a special surcharge to take account of increased tax and had done so with the blessing of the Government. But, surely, this is a tax on workers' wages which affects all of us, however much we earn, but which is particularly felt by the lower-paid workers.
  One cannot help contrasting the Government's attitude to this Amendment with the recent speech by the Chancellor of the Exchequer—the "Sunny Jim" speech it was dubbed in the Press—when we gathered that all this gloom was coming to an end and that everybody could look forward to rising standards of living.
  There is another aspect of the unfairness which the House will want to take into account and which is that while the Government are saying categorically that this element of the increase in National Insurance contributions cannot specifically be taken into account, there are hundreds of thousands of workers of one kind or another who are not members of unions, who are employed individually or in small numbers, and

  277
  who are not dealt with by the sort of agreements which have come under surveillance in this policy and who will undoubtedly get the benefit of this sort of help from their employers. I am sure that we shall again see, as we have seen in the Orders which have come forward under the 1966 Act, that this policy bites arbitrarily and unfairly particularly on members of trade unions.
  But it is not only for lower-paid workers that the Amendment is important. It is also important to the Government's basic incomes policy. In Committee we pressed hard to get certainty. We made it clear that if we were to move, as the Government claim that we are trying to move, to a voluntary system in which people would voluntarily follow the Government's lead and do what the Government believed to be in the national interest, it was extremely important that those who had to make decisions should be clear about what was and what was not in line with what the Government had to say.
  While we realise that there are many factors which must come into decisions about prices and incomes and which are indeterminate and outside the control of the Government, here is a matter of an increase in tax, or an increase in
  contributions, which is definite and within the control of the Government and it is therefore a matter about which those who have to operate this policy both could and should expect to hear from the Government a very clear and definite answer.
  In Committee we pressed and pressed to get it, and eventually we got a "No". Before that "No" could be explored, the Government moved the Closure. The House ought not to accept that "No" from the Parliamentary Secretary tonight. Therefore, because of the effect on the lower-paid workers and because the Government have put forward no other means of coping with their problems and because of the effect of the Bill on any claim by the Government to be moving towards a genuine voluntary policy, I must advise my right hon. and hon. Friends to vote for the Amendment.
  Mr. Whitlock Mr. Whitlock rose in his place and claimed to move, That the Question be now put:—
  Question put, That the Question be now put.
  The House divided: Ayes 151, Noes 117.

  Division No. 434.]

  AYES

  [12.45 a.m.

  Alldritt, Walter

  Dewar, Donald

  Hunter, Adam

  Armstrong, Ernest

  Diamond, Rt. Hn. John

  Hynd, John

  Ashley, Jack

  Doig, Peter

  Jackson, Colin (B'h'se & Spenb'gh)

  Atkins, Ronald (Preston, N.)

  Eadie, Alex

  Jeger, Mrs. Lena (H'b'n&St. P'cras, S.)

  Bacon, Rt. Hn. Alice

  Edwards, Robert (Bilston)

  Johnson, James (K'ston-on-Hull, W.)

  Bagier, Gordon A. T.

  Ellis, John

  Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)

  Barnes, Michael

  English, Michael

  Jones, T. Alec (Rhondda, West)

  Baxter, William

  Ennals, David

  Judd, Frank

  Bence, Cyril

  Ensor, David

  Lawson, George

  Benn, Rt. Hn. Anthony Wedgwood

  Evans, loan L. (Birm'h'm, Yardley)

  Leadbitter, Ted

  Binns, John

  Fernyhough, E.

  Ledger, Ron

  Bishop, E. S.

  Forrester, John

  Lee, Rt. Hn. Frederick (Newton)

  Blackburn, F.

  Fowler, Gerry

  Lewis, Ron (Carlisle)

  Bradley, Tom

  Fraser, John (Norwood)

  Lomas, Kenneth

  Bray, Dr. Jeremy

  Fraser, Rt. Hn. Tom (Hamilton)

  Loughlin, Charles

  Brooks, Edwin

  Freeson, Reginald

  Lyon, Alexander W. (York)

  Brown, Rt. Hn. George (Bolper)

  Gardner, Tony

  Lyons, Edward (Bradford, E.)

  Brown, Hugh D. (G'gow, Provan)

  Gray, Dr. Hugh (Yarmouth)

  McBride, Neil

  Brown, Bob (N 'c'tle-upon-Tyne, W)

  Gregory, Arnold

  MacColl, James

  Brown, R. W. (Shoreditch & F'bury)

  Grey, Charles (Durham)

  MacDermot, Niall

  Buchan, Norman

  Hamilton, James (Bothwell)

  Mackenzie, Gregor (Rutherglen)

  Buchanan, Richard (G'gow, Sp'burn)

  Hannan, William

  Mackintosh, John P.

  Callaghan, Rt. Hn. James

  Harrison, Walter (Wakefield)

  Maclennan, Robert

  Carmichael, Neil

  Hart, Mrs. Judith

  McMillan, Tom (Glasgow, C.)

  Coe, Denis

  Haseldine, Norman

  McNamara, J. Kevin

  Coleman, Donald

  Hattersley, Roy

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

  Conlan, Bernard

  Hazell, Bert

  Manuel, Archie

  Crawshaw, Richard

  Henig, Stanley

  Mapp, Charles

  Crosland, Rt. Hn. Anthony

  Herbison, Rt. Hn. Margaret

  Marquand, David

  Crossman, Rt. Hn. Richard

  Hooley, Frank

  Mason, Roy

  Dalyell, Tam

  Howarth, Robert (Bolton, E.)

  Maxwell, Robert

  Davidson, Arthur (Accrington)

  Howell, Denis (Smalt Heath)

  Millan, Bruce

  Davies, Harold (Leek)

  Howie, W.

  Milne, Edward (Blyth)

  Dell, Edmund

  Hoy, James

  Morris, Charles R. (Openshaw)

  Dempsey, James

  Huckfield, L.

  Morris, John (Aberavon)

  Murray, Albert

  Rose, Paul

  Wells, William (Walsall, N.)

  Noel-Baker, Francis (Swindon)

  Shaw, Arnold (llford, S.)

  White, Mrs. Eirene

  Oakes, Gordon

  Shore, Peter (Stepney)

  Whitlock, William

  Ogden, Eric

  Short, Mrs. Renée (W'hampton, N. E,)

  Willey, Rt. Hn. Frederick

  O'Malley, Brian

  Silkin, Rt. Hn. John (Deptford)

  Williams, Alan (Swansea, W.)

  Owen, Dr. David (Plymouth, S'tn)

  Silverman, Julius (Aston)

  Williams, Alan Lee (Hornchurch)

  Page, Derek (King's Lynn)

  Slater, Joseph

  Williams, Mrs. Shirley (Hitchin)

  Paget, R. T.

  Stewart, Rt. Hn. Michael

  Willis, George (Edinburgh, E.)

  Parkyn, Brian (Bedford)

  Summerskill, Hn. Dr. Shirley

  Wilson, William (Coventry, S.)

  Pavitt, Laurence

  Swingler, Stephen

  Winterbottom, R. E.

  Pentland, Norman

  Taverne, Dick

  Woodburn, Rt. Hn. A.

  Rees, Merlyn

  Tinn, James

  Woof, Robert

  Reynolds, G. W.

  Urwin, T. W.

  Roberts, Albert (Normanton)

  Wainwright, Edwin (Dearne Valley)

  TELLERS FOR THE AYES:

  Roberts, Gwilym (Bedfordshire, S.)

  Walker, Harold (Doncaster)

  Mr. Alan Fitch and

  Robinson, W. O. J. (Walth'stow, E.)

  Watkins, David (Consett)

  Mr. Joseph Harper.

  Roebuck, Roy

  Watkins, Tudor (Brecon & Radnor)

  NOES

  Alison, Michael (Barkston Ash)

  Heseltine, Michael

  Pardoe, John

  Allason, James (Hemel Hempstead)

  Higgins, Terence L.

  Peel, John

  Astor, John

  Hiley, Joseph

  Percival, Ian

  Atkins, Humphrey (M't'n & M'd'n)

  Hill, J. E. B.

  Pink, R. Bonner

  Baker, W. H. K.

  Hirst, Geoffrey

  Price, David (Eastleigh)

  Biffen, John

  Holland, Philip

  Prior, J. M. L.

  Boyle, Rt. Hn. Sir Edward

  Hordern, Peter

  Pym, Francis

  Brewis, John

  Howell, David (Guildford)

  Renton, Rt. Hn. Sir David

  Bromley-Davenport, Lt. -Col. Sir Walter

  Hunt, John

  Ridley, Hn, Nicholas

  Brown, Sir Edward (Bath)

  Hutchison, Michael Clark

  Royle, Anthony

  Bruce-Gardyne, J.

  Iremonger, T. L.

  Russell, Sir Ronald

  Carr, Rt. Hn. Robert

  Jenkin, Patrick (Woodford)

  Scott, Nicholas

  Chichester-Clark, R.

  Johnson Smith, G. (E. Grinstead)

  Sharpies, Richard

  Clegg, Walter

  Jopting, Michael

  Shaw, Michael (Sc'b'gh & Whitby)

  Corfield, F. V.

  Kaberry, Sir Donald

  Sinclair, Sir George

  Dance, James

  Kershaw, Anthony

  Smith, John

  Dean, Paul (Somerset, N.)

  Kimball, Marcus

  Stoddart-Scott, Col. Sir M. (Ripon)

  Deedes, Rt. Hn. W. F. (Ashford)

  King, Evelyn (Dorset, S.)

  Taylor, Sir Charles (Eastbourne)

  Dodds-Parker, Douglas

  Kirk, Peter

  Taylor, Edward M. (G'gow, Cathcart)

  Eden, Sir John

  Kitson, Timothy

  Taylor, Frank (Moss Side)

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

  Knight, Mrs. Jill

  Thatcher, Mrs. Margaret

  Emery, Peter

  Lambton, Viscount

  Turton, Rt. Hn. R. H.

  Errington, Sir Eric

  Lewis, Kenneth (Rutland)

  van Straubenzee, W. R.

  Eyre, Reginald

  Lubbock, Eric

  Wainwright, Richard (Colne Valley)

  Fisher, Nigel

  MacArthur, Ian

  Walker, Peter (Worcester)

  Fletcher-Cooke, Charles

  Macleod, Rt. Hn. lain

  Ward, Dame Irene

  Fortescue, Tim

  Fraser, Rt. Hn. Hugh (St'fford& Stone)

  Maude, Angus

  Weatherill, Bernard

  Gilmour, Sir John (Fife, E.)

  Mawby, Ray

  Webster, David

  Glover, Sir Douglas

  Maxwell-Hyslop, R. J.

  Wells, John (Maidstone)

  Glyn, Sir Richard

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

  Whitelaw, Rt. Hn. William

  Goodhew, Victor

  Mills, Peter (Torrington)

  Wilson, Geoffrey (Truro)

  Gower, Raymond

  Miscampbell, Norman

  Winstanley, Dr. M. P.

  Grant, Anthony

  More, Jasper

  Wolrige-Gardon, Patrick

  Grant-Ferris, R.

  Morrison, Charles (Devizes)

  Wright, Esmond

  Griffiths, Eldon (Bury St. Edmunds)

  Munro-Lucas-Tooth, Sir Hugh

  Wylie, N. R.

  Gurden, Harold

  Murton, Oscar

  Younger, Hn. George

  Harris, Reader (Heston)

  Noble, Rt. Hn. Michael

  Harvie Anderson, Miss

  Onslow, Cranley

  TELLERS FOR THE NOES:

  Hawkins, Paul

  Page, Graham (Crosby)

  Mr. David Mitchell and

  Heald, Rt. Hn. Sir Lionel

  Page, John (Harrow, W.)

  Mr. Hector Monro.

  Question put accordingly, That the proposed words be there inserted in the Bill:—
  The House divided: Ayes 118, Noes 151.

  Division No. 435.]

  AYES

  [12.54 a.m.

  Alison, Michael (Barkston Ash)

  Chichester-Clark, R.

  Fletcher-Cooke, Charles

  Allason, James (Hemel Hempstead)

  Clegg, Walter

  Fortescue, Tim

  Astor, John

  Corfield, F. V.

  Fraser, Rt. Hn. Hugh (St'fford& Stone)

  Atkins, Humphrey (M't'n & M'd'n)

  Dance, James

  Gilmour, Sir John (Fife, E.)

  Baker, W. H. K.

  Dean, Paul (Somerset, N.)

  Glover, Sir Douglas

  Balniel, Lord

  Deedes, Rt. Hn. W. F. (Ashford)

  Glyn, Sir Richard

  Biffen, John

  Dodds-Parker, Douglas

  Goodhew, Victor

  Boyle, Rt. Hn. Sir Edward

  Eden, Sir John

  Gower, Raymond

  Brewis, John

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

  Grant, Anthony

  Bromley-Davenport, Lt. -Col. Sir Walter

  Emery, Peter

  Grant-Ferris, R.

  Brown, Sir Edward (Bath)

  Errington, Sir Eric

  Griffiths, Eldon (Bury St. Edmunds)

  Bruce-Gardyne, J.

  Eyre, Reginald

  Gurden, Harold

  Carr, Rt. Hn. Robert

  Fisher, Nigel

  Harris, Reader (Heston)

  Harvie Anderson, Miss

  Macleod, Rt. Hn. Iain

  Shaw, Michael (Sc'b'gh & Whitby)

  Hawkins, Paul

  Maude, Angus

  Sinclair, Sir George

  Heald, Rt. Hn. Sir Lionel

  Mawby, Ray

  Smith, John

  Heseltine, Michael

  Maxwell-Hyslop, R. J.

  Stoddart-Scott, Col. Sir M. (Ripon)

  Higgins, Terence L.

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

  Taylor, Sir Charles (Eastbourne)

  Hiley, Joseph

  Mills, Peter (Torrington)

  Taylor, Edward M. (G'gow, Cathcart)

  Hill, J. E. B.

  Miscampbell, Norman

  Taylor, Frank (Moss Side)

  Hirst, Geoffrey

  More, Jasper

  Thatcher, Mrs. Margaret

  Holland, Philip

  Morrison, Charles (Devizes)

  Turton, Rt. Hn. R. H.

  Hordern, Peter

  Munro-Lucas-Tooth, Sir Hugh

  van Straubenzee, W. R.

  Howell, David (Guildford)

  Murton, Oscar

  Wainwright, Richard (Colne valley)

  Hunt, John

  Noble, Rt. Hn. Michael

  Walker, Peter (Worcester)

  Hutchison, Michael Clark

  Onslow, Cranley

  Ward, Dame Irene

  Iremonger, T. L.

  Page, Graham (Crosby)

  Weatherill, Bernard

  Jenkin, Patrick (Woodford)

  Page, John (Harrow, W.)

  Webster, David

  Johnson Smith, C. (E. Grinstead)

  Pardoe, John

  Wells, John (Maidstone)

  Jopling, Michael

  Peel, John

  Whitelaw, Rt. Hn. William

  Kaberry, Sir Donald

  Percival, Ian

  Wilson, Geoffrey (Truro)

  Kershaw, Anthony

  Pink, R. Bonner

  Winstanley, Dr. M. P.

  Kimball, Marcus

  Price, David (Eastleigh)

  Wolrige-Gordon, Patrick

  King, Evelyn (Dorset, S.)

  Prior, J. M. L.

  Wright, Esmond

  Kirk, Peter

  Pym, Francis

  Wylie, N. R.

  Kitson, Timothy

  Renton, Rt. Hn. Sir David

  Younger, Hn. George

  Knight, Mrs. Jill

  Ridley, Hn. Nicholas

  Lambton, Viscount

  Royle, Anthony

  TELLERS FOR THE AYES:

  Lewis, Kenneth (Rutland)

  Russell, Sir Ronald

  Mr. David Mitchell and

  Lubbock, Eric

  Scott, Nicholas

  Mr. Hector Monro.

  Mac Arthur, Ian

  Sharples, Richard

  NOES

  Alldritt, Walter

  Freeson, Reginald

  Milne, Edward (Blyth)

  Armstrong, Ernest

  Gardner, Tony

  Morris, Charles R. (Openshaw)

  Ashley, Jack

  Garrett, W. E.

  Morris, John (Aberavon)

  Atkins, Ronald (Preston, N.)

  Gray, Dr. Hugh (Yarmouth)

  Murray, Albert

  Bacon, Rt. Hn. Alice

  Gregory, Arnold

  Noel-Baker, Francis (Swindon)

  Bagier, Gordon A. T.

  Grey, Charles (Durham)

  Oakes, Gordon

  Barnes, Michael

  Hamilton, James (Bothwell)

  Ogden, Eric

  Baxter, William

  Hannan, William

  O'Malley, Brian

  Bence, Cyril

  Harrison, Walter (Wakefield)

  Owen, Dr. David (Plymouth, S'tn)

  Benn, Rt. Hn. Anthony Wedgwood

  Hart, Mrs. Judith

  Page, Derek (King's Lynn)

  Binns, John

  Haseldine, Norman

  Parkyn, Brian (Bedford)

  Bishop, E. S.

  Hattersley, Roy

  Pavitt, Laurence

  Blackburn, F.

  Hazell, Bert

  Pentland, Norman

  Bradley, Tom

  Henig, Stanley

  Rees, Merlyn

  Bray, Dr. Jeremy

  Herbison, Rt. Hn. Margaret

  Reynolds, G. W.

  Brooks, Edwin

  Hooley, Frank

  Roberts, Albert (Normanton)

  Brown, Rt. Hn. George (Belper)

  Howarth, Robert (Bolton, E.)

  Roberts, Gwilym (Bedfordshire, S.)

  Brown, Hugh D. (G'gow, Provan)

  Howell, Denis (Small Heath)

  Robinson, W. O. J. (Walth'stow, E.)

  Brown, Bob (N'c'tle-upon-Tyne, W)

  Howie, W.

  Roebuck, Roy

  Brown, R. W. (Shoreditch & F'bury)

  Hoy, James

  Rose, Paul

  Buchan, Norman

  Huckfield, L.

  Shaw, Arnold (Ilford, S.)

  Buchanan, Richard (G'gow, Sp'burn)

  Hunter, Adam

  Shore, Peter (Stepney)

  Callaghan, Rt. Hn. James

  Hynd, John

  Short, Mrs. René e (W'hampton, N. E.)

  Carmichael, Neil

  Jackson, Colin (B'h'se & Spenb'gh)

  Silkin, Rt. Hn. John (Deptford)

  Coe, Denis

  Johnson, James (K'ston-on-Hull, W.)

  Slater, Joseph

  Coleman, Donald

  Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)

  Stewart, Rt. Hn. Michael

  Conlan, Bernard

  Jones, T. Alec (Rhondda, West)

  Summerskill, Hn. Dr. Shirley

  Crawshaw, Richard

  Judd, Frank

  Swingler, Stephen

  Crosland, Rt. Hn. Anthony

  Lawson, George

  Taverne, Dick

  Crossman, Rt. Hn. Richard

  Leadbitter, Ted

  Tinn, James

  Dalyell, Tam

  Ledger, Ron

  Urwin, T. W.

  Davidson, Arthur (Accrington)

  Lee, Rt. Hn. Frederick (Newton)

  Wainwright, Edwin (Dearne Valley)

  Davies, Harold (Leek)

  Lewis, Ron (Carlisle)

  Walker, Harold (Doncaster)

  Dell, Edmund

  Lomas, Kenneth

  Watkins, David (Consett)

  Dempsey, James

  Loughlin, Charles

  Watkins, Tudor (Brecon & Radnor)

  Dewar, Donald

  Lyon, Alexander W. (York)

  Wells, William (Walsall, N.)

  Diamond, Rt. Hn. John

  Lyons, Edward (Bradford, E.)

  White, Mrs. Elrene

  Doig, Peter

  McBride, Neil

  Whitlock, William

  Dunn, James A.

  MacColl, James

  Willey, Rt. Hn. Frederick

  Dunwoody, Mrs. Gwyneth (Exeter)

  MacDermot, Niall

  Williams, Alan (Swansea, W.) Williams, Alan Lee (Hornchurch)

  Dunwoody, Dr. John (F'th & C'b'e)

  Mackenzie, Cregor (Rutherglen)

  Eadie, Alex

  Mackie, John

  Williams, Mrs. Shirley (Hitchin)

  Edwards, Robert (Bilston)

  Mackintosh, John P.

  Willis, George (Edinburgh, E.)

  English, Michael

  Maclennan, Robert

  Wilson, William (Coventry, S.)

  Ennals, David

  McMillan, Tom (Glasgow, C.)

  Winterbottom, R. E.

  Ensor, David

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

  Woodburn, Rt. Hn. A.

  Evans, Ioan L. (Birm'h'm, Yardley)

  Manuel, Archie

  Woof, Robert

  Fernyhough, E.

  Mapp, Charles

  Forrester, John

  Marquand, David

  TELLERS FOR THE NOES:

  Fowler, Gerry

  Mason, Roy

  Fraser, John (Norwood)

  Maxwell, Robert

  Mr. Alan Fitch and

  Fraser, Rt. Hn. Tom (Hamilton)

  Millan, Bruce

  Mr. Joseph Harper.

  Mr. Ian Macleod: I beg to move,
  That further consideration of the Bill, as amended, be now adjourned.
  I move this Motion partly in a spirit of inquiry and partly in a spirit of complaint. The inquiry is the ordinary inquiry which is always made about this time of night, if indeed not earlier, as to what are the intentions of the Government and how far they think we might reasonably go tonight. We shall not undertake to fall in with their wishes, but it would at least be interesting to hear them.
  Secondly, on the spirit of complaint, I think that the House of Commons has been disgracefully treated by the Government and particularly by the Leader of the House. [HON. MEMBERS: "Where is he?"] We can perhaps develop at leisure the question where he is, and I think that it would be difficult for him not to make some appearance in response to it in due course.
  When the Leader of the House announced the business for Monday of this week, representations were made at once through the usual channels that it was quite intolerable to expect, as was originally suggested on Thursday, that we should take the affirmative Order for Part II, then the whole of the Report stage of an extremely contentious Bill, and then the Third Reading. On the Business statement my right hon. Friend the Leader of the Opposition and I both pressed the Leader of the House on this. His reply was typical of him. He said that we would just see how we got on. He then waited till the next day when the Whips had gone out and the House had dispersed, and he changed the business. He changed the order of business by putting the Bill first and the affirmative Order second. I think that that is the first instance of intolerable treatment of the House of Commons by the Leader of the House.
  Secondly, we have now embarked upon the Report stage of the Bill. We have not yet completed consideration of Clause 1, and the last two Amendments—one moved from each side of the House—were divided on only with the aid of the Closure and steadily dwindling majorities.
  What is more important is that the attitude of hon. Members on both sides
  284
  has been transformed by the speech which the Leader of the House made over the weekend. It was an arrogant and disdainful speech that was quite impossible to explain away, in spite of the two announcements which I understand have already gone out from Labour Party headquarters.
  If, on a matter being discussed by the House, the Leader of the House wishes to say that he was misrepresented or misreported—this happens to us all, he should do it in the House. The invitation to do so has been issued to him repeatedly from both sides. It has been conveyed to him by the Chief Whip, or, rather, it was conveyed to him with strict instructions that under no condition was he to put his face inside the House, because he might have something lo answer for. The rest of the House is left, with the speech unexplained and inexplicable, to do what it can with the Bill.
  It is not possible to take a proper attitude on the question of how long the Bill should remain on the Statute Book once it is an Act unless we have an explanation of the Leader of the House's speech We expected to get it in response to the debate on Amendment 11 from the First Secretary. We waited patiently through a very long reply, but he never mentioned the subject from beginning to end. I can understand that. I do not doubt that he is very angry with his right hon. Friend the Leader of the House for making such, a silly speech, and so are we. But that is no reason why these matters should not be properly debated in the House.
  Those are all formidable reasons why we should not proceed further with the Bill tonight, but there are others. One reason always advanced for going further with a Bill at other than a normal hour of the evening or night is the question of time. But time is the one thing this Leader of the House is lavish with on every Bill—except the most important in this Session. All sorts of other Bills, most of which I happen to favour—but that is irrelevant—arouse strong feelings on both sides of the House and both sides of the questions involved. Time is promised for those Bills, and we must try to shuffle through this enormously important Bill on the original plan of one day and, presumably, a longish night's sitting.

  285
  If the Leader of the House will behave like this, at least he should have enough valour to come here and defend himself. It is not reasonable for him to sneak around the Palace of Westminster to vote occasionally, and decline to explain both his speech and his handling of the business of the House, and particularly the Bill. The right place to explain—if the Foreign Secretary would like to go to bed, will he please go?
  The Secretary of State for Foreign Affairs (Mr. George Brown): It almost sounded as if the right hon. Gentleman meant it.
  Mr. Macleod: I have heard the right hon. Gentleman move enough of these Motions in my day. I just do them rather better.
  I have no doubt that the Leader of the House should now come here. I am sure that the Chief Whip can get him from whatever corner he may be skulking in and bring him here.
  No doubt my hon. Friends will wish to advance many more reasons why we should not go forward with the Bill at this time. I do not think we shall make very much more progress on the Bill if the House is treated like this. If hon. Members feel that the Leader of the House is staying away from the House because he is afraid of the House of Commons, it is unreasonable to expect them to make dramatic or, indeed, any progress with the Bill.
  There is no need for the First Secretary to reply at once. I am sure that of her hon. Members wish to develop this point, and the First Secretary is always more effective in speaking when he has listened to the arguments. I am sure that it is the view of many of my right hon. and hon. Friends that from the beginning we have been asked to undertake an impossible action and that the House has been uncivilly treated by the changing of the order of business and the lamentably small amount of time given to possibly the most important Bill of the Session. We should not, therefore, carry on with the debate tonight.
  Mr. Michael Jopling: I speak in favour of the Motion, not from any personal point of view, which perhaps some hon. Members have every justification in doing, because I was not able to attend the House last week after
  286
  the Foreign Secretary, whom I am glad to see in his place, did his best to poison me at a reception which he gave—
  Mr. George Brown: Sorry I did not succeed!
  Mr. Jopling: The Foreign Secretary seems to go round the world making enemies. It is a pity that he should continue doing so in the House.
  There is one important reason why the House should rise now. I draw attention to item No. 4 on the Order Paper which is a matter which the House should reach as soon as possible so that leave may be given to the Select Committee on Agriculture to hold sittings in Brussels. Until this business is passed, the Select Committee, which has been doing a great deal of hard work upstairs, will not be able—
  Mr. Speaker: Order. With the utmost tolerance, I cannot see how the hon. Gentleman can link what he is saying with the Motion.
  Mr. Jopling: With the greatest respect, I will come to the point when I explain the position concerning the Select Committee.
  It is essential that the Motion concerning the Select Committee should be passed at an early hour because it is the intention of a number of members of the Select Committee to travel to Brussels later this morning. I do not intend to move the adjournment of the House under Standing Order No. 9, but it might be that one would have to consider doing so at a later stage.
  1.15 a.m.
  It is essential that members of the Select Committee should go to Brussels as soon as possible because the Committee has to report to the House by the end of this Session, and time is running extremely short. The Select Committee has been trying to get to Brussels for a long time. It is essential for the work of the Committee that members of it should go to Brussels as early as possible.
  In a few hours a number of hon. Members who are members of the Select Committee on Agriculture will have to leave for Brussels. Unless Motion No. 4 on the Order Paper is passed, they will not be able to go. It would be a tragedy if the new business which the House has

  287
  embarked upon in the Select Committee upstairs were not allowed to proceed, particularly since important arrangements have been made in Brussels for hon. Members to meet both the British Mission and the Commission. The Chairman of the Committee, the hon. Member for Brecon and Radnor (Mr. Watkins), is in his place and is waiting to move the Motion. I trust that the Government will agree to the Motion.
  Mr. Speaker: I apologise to the hon. Gentleman for calling him to order earlier. He was completely in order.
  Mr. Peter Emery: In urging the Government to accept the Motion, I remind them that the next group of Amendments is of the greatest importance and will take a considerable time to discuss. The Government should call a halt now, and allow hon. Members to start again refreshed—perhaps with larger ranks on the benches opposite—so that we may properly tackle the subject of productivity, to which the following Amendments refer.
  I, too, wish to refer to the Leader of the House. [HON. MEMBERS: "Where is he"?] It must be embarrassing to the Government Front Bench not to have the right hon. Gentleman here. The objection to the Motion appears to be based on the fact that the right hon. Gentlemen opposite are not sure whether or not the Leader of the House would be with them, and—[Interruption.]
  Mr. Speaker: Order. I want to hear why the House should adjourn consideration of the Prices and Incomes (No. 2) Bill.
  Mr. Emery: The latest reports are that the Leader of the House has issued, or has had issued, from Transport House an entirely different interpretation of some words in his recent speech, an interpretation different from that which we had at the start of this debate. I read on the tape that the use of the word "medicine"—the word which has been so much in people's minds—had nothing to do with Part IV or Part II of the Bill, but referred completely and absolutely to the unpleasant fact of unemployment. If this is so—and it must be so; the right hon. Gentleman would not have said so
  288
  otherwise—it seems to make his speech even more damaging. It means that the right hon. Gentleman is now suggesting that the Government, as a matter of policy—because it was a matter of policy that he was considering giving the medicine to the British electorate—are considering massive unemployment. This is an even worse—[Interruption.]
  Mr. Speaker: Order. We cannot get into a debate on the merits of a speech by the Leader of the House, except in so far as it is a reason for adjourning consideration of the Bill.
  Mr. Emery: Thank you for your guidance, Mr. Speaker. May I follow it by saying that my reason for raising this point and explaining it is that in my view the Leader of the House needs to explain completely a speech which so affects this Bill, and which has been given an interpretation completely different from that which we have heard from the Treasury Bench in these debates.
  If the Leader of the House were fulfilling some appointment outside London, one would not press this point, but when he is in the building, as I know from having seen him only a matter of an hour ago—[HON. MEMBERS: "Oh."]— it seems to me to be a matter—[Interruption.]
  Mr. Speaker: Order. Let us get back to doing what we can in a Parliamentary way.
  Mr. Emery: I welcome the appearance of the Leader of the House, and I will immediately cut short my speech—[Interruption.]—in the hope that the right hon. Gentleman will seek to answer the point made by many hon. Members that we should not continue this debate on the Bill until we have had a complete interpretation, yet again, of his speech which, at the moment, appears to have three different meanings, according to the Press. Then, and then only, will we be able to proceed properly with a full discussion of the other Amendments.
  Sir D. Glover: I support the Motion moved by my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod). I want to give various reasons why I think the debate should now be adjourned, and to raise some points that have not so far been made.

  289
  Since the Leader of the House has just come in, and so did not hear my hon. Friend the Member for Westmorland (Mr. Jopling), it is worth repeating that one of the reasons why the House should now adjourn further discussion of the Bill is that if the fourth item on the Order Paper is not reached today it will create a great deal of embarrassment for the Select Committee on Agriculture which wants to go to Brussels and must have the Order approved in order to do so. I am sure that the Foreign Secretary, who probably went out and got the Leader of the House to come in to listen to the debate, would be very embarrassed if, as a result of this debate on the Bill, the Select Committee were not able to proceed to Brussels.
  My main point is that the Leader of the House, who has shown during the last two Sessions that he is probably the most incompetent Leader of the House we have seen for a very long time, altered our procedure so that on Mondays and Wednesdays the official business of the House was due to finish at half-past nine. I admit that that was considered to be inconvenient and has therefore recently been altered to ten o'clock, but the fact is that the House has now been sitting since ten o'clock on Monday morning till twenty-five past one on Tuesday morning, and we are still debating what is perhaps the most important Bill of the Session.
  This is complete incompetence on the part of the Leader of the House. He is treating Members, and particularly back benchers, with contempt, and without any consideration at all. He is not only treating the Members of the House with contempt but he is also creating a very great and serious problem in connection with the staff on the premises. We are having more and more night sittings now than we have had since the very early days when I came to the House.
  I go so far as to say that, leaving aside the Finance Bill, we are now staying longer hours in the House than we have done, despite all the alterations of procedure, during the last 10 years. This is all under the leadership of the right hon. Gentleman.
  Mr. Speaker: Order. The hon. Member must concentrate on this particular night.
  Sir D. Glover: I appreciate that, Mr. Speaker. The Bill is one of the most important Bills, if not the most important Bill, that the House has debated this Session. There are very strong feelings on both sides, and I am sure that I carry a great many hon. Members below the Gangway opposite with me on this. [AN HON. MEMBER: "YOU do not carry anyone."] There is great feeling on both sides about the implications of the Bill. Therefore, however the business of the House is organised, it will be—and it should be—a long debate on all the Amendments on Report.
  We have been debating the Bill from half-past three until half-past one. It cannot be said that there has been an irrelevant speech throughout the whole of the Bill—[Interruption.]—with the notable exception of some of the replies from the Government Front Bench. It has been a thoughtful debate. The speeches have all been thoughtful, on both sides.
  If the House is to do its business properly, the Government must realise that there is a point in time when the House is bound to deteriorate in its discussions. After nearly 12 hours, I reckon that the House has reached a point when, in common sense, if the Government want to maintain unity in their own party, if they want to maintain the reputation of having a grip on their legislative programme, they should accept the Motion, we should go home and the Leader of the House should show more competence and organise our business so that we finish at a reasonable hour of the night.
  Sir W. Bromley-Davenport: I support the Motion which has been moved so admirably by my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod). I wish to support the Motion —[Interruption.]
  Mr. Speaker: Order. This is an important Parliamentary exercise. We do not want to spoil it by foolish noises.
  Sir W. Bromley-Davenport: Thank you for your support, Mr. Speaker.
  My reason for supporting the Motion is that the general level of speeches is deteriorating so rapidly—[HON. MEMBERS: "Hear, hear."] If I may continue, it is deteriorating so rapidly among members of the Government and the Lobby fodder of which it largely consists.

  291
  I wish to give some examples. Let me take the hon. Member for Tottenham (Mr. Atkinson) with his celebrated inaudible monologue. He was so exhausted —that was what it was. Added to that was the tripe he talked.
  Mr. Speaker: Order. We cannot go back over previous debates.
  1.30 a.m.
  Sir W. Bromley-Davenport: I will not particularise. Unfortunately, Sir, you were not in the Chair when the hon. Member for Poplar (Mr. Mikardo) talked about taxation. That is all we got from him.
  Mr. Speaker: Order. It is not in order to go back over the previous debates of the evening.
  Sir W. Bromley-Davenport: I will give one final example. I will not talk any more about what anyone has said here. I will merely mention one recent example of behaviour which you, Sir, saw and which I saw and which could not have happened unless the person concerned had been exhausted. I refer to the Leader of the House—look at him now. I have never seen this happen before during my 20 years as a Member of the House. He sauntered in in that arrogant way of his, with his hands in his pockets—bad manners. Then he sat down and closed both his eyes. He must have been exhausted to do that.
  Mr. Speaker: Order. We must continue the debate in a serious way. If the hon. and gallant Gentleman has nothing serious to say, he must resume his seat.
  Sir W. Bromley-Davenport: I will not go any further, except to say, for those reasons, I support the Motion.
  Mr. Nicholas Ridley: It is always a pleasure to follow my hon. and gallant Friend the Member for Knutsford (Sir W. Bromley-Davenport), even though it will be difficult to maintain his high standard of contribution to this important debate.
  My hon. Friend the Member for Westmorland (Mr. Jopling), in stating the reasons why the House should adjourn, was a little inclined to be selfish. Had he looked further down the Order Paper, he would have seen that also tonight the Motion
  292
  "That leave be given to Sub-Committee B of the Select Committee on Science and Technology to hold sittings in Europe"
  must be moved. That Sub-Committee is not off this morning, but it is clear that the Select Committee on Agriculture is not the only Committee concerned.
  Mr. Speaker: Order. If the Sub-Committee is not off this morning, perhaps the hon. Gentleman could come to the Motion before the House.
  Mr. Ridley: I must also regretfully point out that the Motion concerning the gift of a Speaker's Chair to The Gambia is to be moved tonight. I do not know whether that is off tomorrow. It is clear that there is much important business to be completed this morning. If we are to take the rest of the Bill as well as the Order, it is very unlikely that the remainder of the Business will be reached.
  The business of the House is grossly overloaded. We have had a whole series of all-night sittings in the last few weeks. It is likely that there will be two more this week, one on Wednesday on the Companies Bill and one on Thursday on the Medical Termination of Pregnancy Bill. What is more, in all probability there will be another next Monday, because the Leader of the House has announced that we are to debate the Coal Industry (Borrowing Powers) Order, which excites great interest on both sides of the House and which can certainly run till dawn or even till breakfast on Tuesday of next week. We are faced with three all-night sittings already. If we add another one tonight, it will make four in the short span of eight days. The fact that the Government have got themselves into such an unholy mess with their legislative programme is no reason to take it out of hon. Members and, what is worse, of the staff of the House. This has been the longest Session for many years. It has been going on for 18 months already. It seems quite wrong, having had such a whale of a Session, for the Government to introduce more and more legislation, rules, Orders and the rest.
  Mr. Speaker: Order. It is only this piece of legislation that we can discuss tonight.
  Mr. Ridley: I would certainly include the business for tonight in this long list of undigested legislation which is being unleashed upon the House at this late stage in the Session. The reason why we have morning sittings is to avoid late-night sittings of the sort which now faces us. Hon. Members, as well as the servants of the House, who man it at night, have a very just cause for complaint, because not only have we had the added burden of morning sittings, which many hon. Members on both sides of the House find extremely inconvenient, but at the same time there have been more all-night sittings than previously. This makes a fool of the House of Commons.
  It is not admired and respected in the country. People think that this is a bad practice. They think that we cannot possibly be talking good sense at this hour of the night. They believe that we ought to find some way out of it. I want to make it abundantly clear that the blame for this state of affairs lies with the Government. If they had not brought in so much legislation we would not be sitting all night.
  Mr. Speaker: Order. With respect, the hon. Gentleman can refer only to this particular business. He can refer to the other matters at some other time.
  Mr. Ridley: I have no wish to pursue this, except to say that this particular al-night sitting will be the last straw which broke the camel's back. If the Government want to retrieve the position, and put themselves right in the eyes of the country, they would be far wiser not to proceed further, and to allow more time for this Bill by giving another day. Then perhaps we could regain the respect of the people, who think it unwise for the House to sit all night on so many occasions in the week. I therefore have great pleasure in supporting my right hon. Friend.
  Mr. F. V. Corfield: Would my hon. Friend repeat his speech for the benefit of the Leader of the House, who has been asleep throughout it?
  Mr. M. Stewart: I do not think that the House would be well-advised to accept the Motion. The right hon. Gentleman the Member for Enfield, West
  294
  (Mr. Iain Macleod), who moved it, said that it was moved, first of all, for information. He wanted to know what were the Government's intentions. At this stage it would be reasonable to say that the Government's intentions are to make further progress with the Bill, and to see how we go. We have a number of interesting and important Amendments, upon which hon. Members on both sides are well qualified to make contributions, whatever the hour.
  Secondly, it was said that the Motion was moved in a spirit of complaint.
  Mr. Iain Macleod: The First Secretary will appreciate that he had said that we should make further progress and that this is very different from the business as announced on Thursday, when it was said that we would take the Order and the Bill. The order of business has been reversed, but I am not on that point now. Would the First Secretary like to clarify what he has said? Would he be content to say whether the first Clause of the Bill will be taken, or has he any other alternative? The phrase that he has used is very different from that of the Leader of the House. We should like to know exactly where we stand.
  Mr. Stewart: I can tell the right hon. Gentleman straight away that we will certainly get further than the first Clause. It would not be sensible to try to predict exactly where we shall get. It has been suggested by some hon. Members that all contributions have been relevant, and to the point. The hon. Member for Ormskirk (Sir D. Glover) said that it had been an evening of splendid speeches, and two minutes later the hon. and gallant Member for Knutsford (Sir W. Bromley-Davenport) said that speeches had begun to deteriorate. Both propositions commanded widespread agreement. We cannot say that the House is not in a condition to discuss this Bill reasonably.
  As has been said, it is an important Bill. The Amendments, however, which lie in front of us do not now, as some of the earlier Amendments did, go over so wide a range of argument. We had the debate on one Amendment in which there was much reference to the speech of my right hon. Friend the Leader of the House, which was a general debate on the nature of prices and incomes policy

  295
  and the relation of Government legislative powers to it. But really we have covered that point. The House, after ample time, did reach a decision on it. What lies ahead of us in the Amendments immediately to come are, I think, certain important but rather specialised points to which, in the interests of all the persons this Bill would affect, the House should get down and give speedy consideration.
  This is a Bill which affects a number of people. It is not right that they should be left in uncertainty for a long time as to what the Bill should actually contain, and I think the House owes them a duty to get on with it. I do not think it can be maintained that the Government has not been reasonably generous in the time it has allowed the House to consider this Bill. We did, indeed, make provision for time in Committee which in the event the Opposition found they did not require on the scale that the Government would have been willing to provide. The Government can fairly say, therefore, that it was something of a surprise to see the number of Amendments—some of them covering points that either were or could have been raised in Committee—which went down on Report stage. It was partly in view of that that it did seem reasonable to change the order of business and to take the Report stage and the rather long list of Amendments first, and the Order thereafter.
  Mr. Emery: I thank the right hon. Gentleman for giving way. Is it not a fact, when he talks about providing extra time for the Committee, that this was extra time to sit in the afternoon when the House was already sitting and that this would have been exceptionally inconvenient to hon. Members who wished—[HON. MEMBERS: "Oh."]—It is an argument that has been propounded by nearly every member of the Government Bench at other times, that this is most inconvenient.
  Mr. Speaker: Order. Interventions must be brief.
  Mr. Stewart: We would have been happy to sit on a Tuesday morning, but in the event it was found that neither side of the Committee thought it necessary to do so, and so I do not think that
  296
  point is really valid. I say, therefore, that the Government have not been unreasonable in the provision of time for this Bill and it is now good sense, in view of the desirability of getting certainty for the many people this Bill will affect, that we should proceed as expeditiously as possible with the consideration of the Bill and the activating of Part II of the Act, a process which is bound up with the operation of the Bill itself.
  I think, therefore, that on consideration the right hon. Gentleman the Member for Enfield, West will feel that the most reasonable course would be to withdraw this Motion and allow us to proceed with the Bill.
  Mr. R. Carr: I must tell the First Secretary that on the reply he has given to us I am afraid we certainly take no such view at all as the one he has suggested.
  My right hon. Friend moved this Motion partly to seek information and partly by way of complaint. The First Secretary has really addressed himself to neither of these complaints. The information he has given us is, to put it mildly, of the vaguest. One is used in this House to Ministers in charge of Bills replying to Motions of this kind in something other than the most precise terms, but I do not think I have ever heard more vague terms than those just used by the First Secretary. As to the complaint which so closely concerns the Leader of the House, I should have thought that the House might have been entitled to expect that we should have heard from him before we proceed with this business. That is a point to which I shall return in a moment in my brief remarks.
  1.45 a.m.
  I sum up why we feel that it is important at least to have much more definite information from the Government about how they propose to go on. There is the extremely important point about the Motion on the Order Paper regarding the Select Committee on Agriculture and its visit to Brussels. I know that there are still a number of hours left before the latest moment at which the House can pass the necessary Motion to enable it to go, but with the amount of business that we still have before us on the Bill it seems almost impossible to conceive that we could finish the whole of the Report

  297
  stage of the Bill, let alone the Third Reading, in time for that Committee to get the permission that it needs to go away. I suggest very seriously to the House that it is not only for the convenience of the members of that Select Committee and of this House which they serve but it is also surely something of importance to the reputation of this country. When the House of Commons is sending a Committee to Brussels to investigate in these matters it does this country no good if it cannot turn up as expected because the Government have so bungled the business in the House of Commons that it is prevented from going.
  There is also the fact, raised by several of my hon. Friends, that it is now 151 hours since the House started this sitting yesterday and we have now had no less than 11 hours on this Bill. In those 11 hours we have dealt with and disposed of five groups of Amendments. But there are still 13 groups of Amendments ahead of us. When the First Secretary says "We ask the House to continue a little longer", I think that the House is entitled to something a little more definite it the way of information from the Government before we proceed.
  As my hon. Friends have said, it is not only hon. Members who are concerned in this. The staff of the House, of all sections of it, have just cause for complaint. We ought not to treat them in the way that the Government are forcing the House to treat them at the moment.
  The main cause of our concern is, of course, with the Bill itself, because there is no need in our view for the rush in which the Bill is being taken by the Government. The White Paper on which it is based was published as long ago as March, and yet we had to wait until 5th June before the House was given a sight of the Bill. Having had the Second Reading on 13th June, the Government then said that it was so important that they must have the Committee stage completed not later than Tuesday, 4th July. It is somewhat hard when the Opposition have tried to assist the Government in that way then to have thrown across the Table by the First Secretary the suggestion that we did not need the time anyhow.
  The Committee stage was steamrollered. It was steam-rollered in more
  298
  than one sense. It was steam-rollered not only in the time that the Government wanted to allow to it and the fact that they insisted after only two sittings in the morning that we should sit in the afternoons as well, but also in the sense that, presumably through whatever processes these suggestions are made, we had on the Standing Committee no representatives of a large and important stream of opinion in the House—which is one of the reasons why we have so many Amendments on Report. You, Mr. Speaker, have recognised this by the very selection of the Amendments. The House must take into account that of the 18 groups of Amendments on the Notice Paper which we have to dispose of today a large proportion come not from the Opposition benches but from members on the Government side of the House—hon. Members opposite who, because none of them were chosen to serve on the Standing Committee, had no chance to put their views earlier.
  Mr. Speaker: Order. The right how Gentleman may not pursue that argument much further. He must link it to reasons why we should adjourn consideration of the Bill.
  Mr. Carr: I bow to your Ruling, Mr. Speaker and I apologise if I was transgressing. But it is for these reasons that we have these large groups of Amendments and they will need full discussion because they have not been aired in detail on the Bill before. We still have 13 of the 18 groups of Amendments ahead of us and it seems to us inconceivable that they can be completed in this sitting. For these reasons, again I say to the Government that they must give us more information about their proposals before we make progress.
  Finally, I come to the question of the Leader of the House. I have been in this House for some 17 years—
  Mr. George Brown: Poor fellow.
  Mr. Carr: The Foreign Secretary has had longer of it than I have and I hope that we shall both have a good bit more. But perhaps he will agree with me that, in our experience of these matters, on both sides of the House, it has been usual for the Leader of the House of the day to be present whenever the House has got into great difficulty. It is not

  299
  good for the House, and does not make a favourable impression or put people in the right spirit to co-operate, when we know that the Leader of the House is lurking on the premises and will not come in to be with us.
  We suspected all the time that the Leader of the House was lurking on the premises and we believe that he voted in the last two Divisions. It is obvious that he came here in the end only because the Foreign Secretary, with his great experience and—let me say this quite genuinely to him—his feel for the House, felt that the time was long since past when the Leader of the House ought to be present. [Laughter.] Right hon. Members opposite may laugh if they like, but they should also take into account that the feelings I am expressing are more genuinely representative of the House as a whole than their attitude. They are not felt only on this side.
  This would have been important even if the Leader of the House had not in any way been personally involved in today's business. But he is personally involved in it. This Bill was presented to us as a temporary Measure leading to a voluntary system. Then, over the weekend, the Leader of the House, on the
  eve of our discussions of the Bill, made a speech in which, according to reports, he clearly indicated that it is unlikely to be voluntary at all. Statements are then made claiming that he is misreported and he himself makes a further statement saying that he was not referring to Part IV when he spoke of a lesson but to unemployment.
  Whichever way we have it, those remarks of the Leader of the House were arrogant, offensive and have a big bearing on our debates today. I do not see how we can continue, let alone conclude, these debates until we know whether what he said does or does not represent Government policy and whether he was or was not misreported. If he was misreported, let him tell the House what he did say and not just issue statements through Transport House.
  Several Hon. Members Several Hon. Members rose—
  The Parliamentary Secretary to the Treasury (Mr. John Silkin)The Parliamentary Secretary to the Treasury (Mr. John Silkin) rose in his place and claimed to move, That the Question be now put:—
  Question put, That the Question be now put.
  The House divided: Ayes 163, Noes 114.

  Division No. 436.]

  AYES

  [1.55 a.m.

  Alldritt, Walter

  Dempsey, James

  Herbison, Rt. Hn. Margaret

  Armstrong, Ernest

  Dewar, Donald

  Hooley, Frank

  Ashley, Jack

  Diamond, Rt. Hn. John

  Howarth, Robert (Bolton, E.)

  Atkins, Ronald (Preston, N.)

  Doig, Peter

  Howell, Denis (Small Heath)

  Atkinson, Norman (Tottenham)

  Dunn, James A.

  Howie, W.

  Bacon, Rt. Hn. Alice

  Dunwoody, Mrs. Gwyneth (Exeter)

  Hoy, James

  Bagier, Gordon A. T.

  Dunwoody, Dr. John (F'th & C'b'e)

  Huckfield, L.

  Barnes, Michael

  Eadie, Alex

  Hunter, Adam

  Baxter, William

  Ellis, John

  Hynd, John

  Bence, Cyril

  English, Michael

  Jackson, Colin (B'h'se & Spenb'gh)

  Benn, Rt. Hn. Anthony Wedgwood

  Ennals, David

  Jeger, Mrs. Lena (H'b'n&St. P'crae, S.)

  Bidwell, Sydney

  Ensor, David

  Johnson, James (K'ston-on-Hull, W.)

  Binns, John

  Evans, Ioan L. (Birm'h'm, Yardley)

  Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)

  Bishop, E. S.

  Fernyhough, E.

  Blackburn, F.

  Fletcher, Raymond (Ilkeston)

  Jones, T. Alec (Rhondda, West)

  Bradley, Tom

  Foot, Michael (Ebbw Vale)

  Judd, Frank

  Bray, Dr. Jeremy

  Forrester, John

  Kerr, Russell (Feltham)

  Brooks, Edwin

  Fowler, Gerry

  Lawson, George

  Brown, Rt. Hn. George (Belper)

  Fraser, John (Norwood)

  Leadbitter, Ted

  Brown, Hugh D. (G'gow, Provan)

  Freeson, Reginald

  Ledger, Ron

  Brown, Bob (N'c'tle-upon-Tyne, W)

  Gardner, Tony

  Lee, Rt. Hn. Frederick (Newton)

  Brown, R. W. (Shoreditch & F'bury)

  Garrett, W. E.

  Lee, John (Reading)

  Buchan, Norman

  Gray, Dr. Hugh (Yarmouth)

  Lewis, Ron (Carlisle)

  Buchanan, Richard (G'gow, Sp'bu n)

  Gregory, Arnold

  Lomas, Kenneth

  Callaghan, Rt. Hn. James

  Grey, Charles (Durham)

  Loughlin, Charles

  Carmichael, Neil

  Hamilton, James (Bothwell)

  Lyon, Alexander W. (York)

  Coe, Denis

  Hannan, William

  Lyons, Edward (Bradford, E.)

  Coleman, Donald

  Harper, Joseph

  MacColl, James

  Conlan, Bernard

  Harrison, Walter (Wakefield)

  MacDermot, Niall

  Crawshaw, Richard

  Hart, Mrs. Judith

  Mackenzie, Gregor (Rutherglen)

  Crosland, Rt. Hn. Anthony

  Haseldine, Norman

  Mackie, John

  Crossman, Rt. Hn. Richard

  Hattersley, Roy

  Mackintosh, John P.

  Davidson, Arthur (Accrington)

  Hazell, Bert

  Maclennan, Robert

  Davies, Harold (Leek)

  Heffer, Eric S.

  McMillan, Tom (Glasgow, C.)

  Dell, Edmund

  Henig, Stanley

  McNamara, J. Kevin

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

  Parkyn, Brian (Bedford)

  Urwin, T. W.

  Manuel, Archie

  Pavitt, Laurence

  Wainwright, Edwin (Dearne Valley)

  Mapp, Charles

  Pentland, Norman

  Walker, Harold (Doncaster)

  Marquand, David

  Perry, George H. (Nottingham, S.)

  Watkins, David (Consett)

  Mason, Roy

  Rees, Merlyn

  Watkins, Tudor (Brecon & Radnor)

  Maxwell, Robert

  Reynolds, G. W.

  Wells, William (Walsall, N.)

  Mendelson, J. J.

  Roberts, Albert (Normanton)

  White, Mrs. Eirene

  Mikardo, Ian

  Roberts, Gwilym (Bedfordshire, S.)

  Whitlock, William

  Millan, Bruce

  Robinson, W. O. J. (Walth'stow, E.)

  Willey, Rt. Hn. Frederick

  Milne, Edward (Blyth)

  Roebuck, Roy

  Williams, Alan (Swansea, W.)

  Morris, Charles R. (Openshaw)

  Rose, Paul

  Williams, Alan Lee (Hornchurch)

  Morris, John (Aberavon)

  Shaw, Arnold (Ilford, S.)

  Williams, Mrs. Shirley (Hitchin)

  Murray, Albert

  Shore, Peter (Stepney)

  Willis, George (Edinburgh, E.)

  Newens, Stan

  Silkin, Rt. Hn. John (Deptford)

  Wilson, William (Coventry, S.)

  Noel-Baker, Francis (Swindon)

  Silverman, Julius (Aston)

  Winterbottom, R. E.

  Oakes, Gordon

  Slater, Joseph

  Woodburn, Rt. Hn. A.

  Ogden, Eric

  Stewart, Rt. Hn. Michael

  Woof, Robert

  O'Malley, Brian

  Summerskill, Hn. Dr. Shirley

  Orme, Stanley

  Swingler, Stephen

  TELLERS FOR THE AYES:

  Owen, Dr. David (Plymouth, S'tn)

  Taverne, Dick

  Mr. Alan Fitch and

  Page, Derek (King's Lynn)

  Tinn, James

  Mr. Neil McBride.

  NOES

  Allason, James (Hemel Hempstead)

  Heald, Rt. Hn. Sir Lionel

  Page, Graham (Crosby)

  Astor, John

  Heseltine, Michael

  Page, John (Harrow, W.)

  Atkins, Humphrey (M't'n & M'd'n)

  Higgins, Terence L.

  Pardoe, John

  Baker, W. H. K.

  Hiley, Joseph

  Peel, John

  Balniel, Lord

  Hill, J. E. B.

  Percival, Ian

  Biffen, John

  Hirst, Geoffrey

  Pink, R. Bonner

  Boyle, Rt. Hn, Sir Edward

  Holland, Philip

  Price, David (Eastleigh)

  Brewis, John

  Hordern, peter

  Prior, J. M. L.

  Bromley-Davenport, Lt.-Col. Sir Walter

  Howell, David (Guildford)

  Pym, Francis

  Brown, Sir Edward (Bath)

  Hunt, John

  Ridley, Hn. Nicholas

  Bruce-Gardyne, J.

  Hutchison, Michael Clark

  Royle, Anthony

  Carr, Rt. Hn. Robert

  Iremonger, T. L.

  Russell, Sir Ronald

  Chichester-Clark, R.

  Jenkin, Patrick (Woodford)

  Scott, Nicholas

  Clegg, Walter

  Johnson Smith, G. (E. Grinstead)

  Sharples, Richard

  Corfield, F. V.

  Jopling, Michael

  Shaw, Michael (Sc'b'gh & Whitby)

  Dance, James

  Kaberry, Sir Donald

  Sinclair, Sir George

  Dean, Paul (Somerset, N.)

  Kershaw, Anthony

  Smith, John

  Deedes, Rt. Hn. W. F. (Ashford)

  Kimball, Marcus

  Stoddart-Scott, Col. Sir M. (Ripon)

  Dodds-Parker, Douglas

  King, Evelyn (Dorset, S.)

  Taylor, Sir Charles (Eastbourne)

  Eden, Sir John

  Kirk, Peter

  Taylor, Edward M. (G'gow, Cathcart)

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

  Kitson, Timothy

  Taylor, Frank (Moss Side)

  Emery, Peter

  Knight, Mrs. Jill

  Thatcher, Mrs. Margaret

  Errington, Sir Eric

  Lambton, Viscount

  Turton, Rt. Hn. R. H.

  Eyre, Reginald

  Lewis, Kenneth (Rutland)

  van Straubenzee, W. R.

  Fisher, Nigel

  Lubbock, Eric

  Wainwright, Richard (Colne Valley)

  Fletcher-Cooke, Charles

  MacArthur, Ian

  Walker, Peter (Worcester)

  Fortescue, Tim

  Macleod, Rt, Hn, Iain

  Weatherill, Bernard

  Gilmour, Sir John (Fife, E.)

  Maude, Angus

  Webster, David

  Glover, Sir Douglas

  Mawby, Ray

  Wells, John (Maidstone)

  Glyn, Sir Richard

  Maxwell-Hyslop, R. J.

  Whitelaw, Rt. Hn. William

  Goodhew, Victor

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

  Wilson, Geoffrey (Truro)

  Gower, Raymond

  Mills, Peter (Torrington)

  Winstanley, Dr. M. P.

  Grant, Anthony

  Miscampbell, Norman

  Wolrige-Gordon, Patrick

  Grant-Ferris, R.

  Mitchell, David (Basingstoke)

  Wright, Esmond

  Griffiths, Eldon (Bury St. Edmunds)

  Morrison, Charles (Devizes)

  Wylie, N. R.

  Gurden, Harold

  Munro-Lucas-Tooth, Sir Hugh

  Younger, Hn. George

  Harris, Reader (Heston)

  Murton, Oscar

  Harvie Anderson, Miss

  Noble, Rt. Hn. Michael

  TELLERS FOR THE NOES:

  Hawkins, Paul

  Onslow, Cranley

  Mr. Jasper More and

  Mr. Hector Monro.

  Question put accordingly, That further consideration of the Bill, as amended, be now adjourned:—
  The House divided: Ayes 115, Noes 164.

  Division No. 437.]

  AYES

  [2.3 a.m.

  Alison, Michael (Barkston Ash)

  Bruce-Cardyne, J.

  Emery, Peter

  Allason, James (Hemel Hempstead)

  Carr, Rt. Hn. Robert

  Errington, Sir Eric

  Astor, John

  Chichester-Clark, R.

  Eyre, Reginald

  Atkins, Humphrey (M't'n & M'd'n)

  Clegg, Walter

  Fisher, Nigel

  Baker, W. H. K.

  Corfield, F. V.

  Fletcher-Cooke, Charles

  Balniel, Lord

  Dance, James

  Fortescue, Tim

  Biffen, John

  Dean, Paul (Somerset, N.)

  Gilmour, Sir John (Fife, E.)

  Boyle, Rt. Hn. Sir Edward

  Deedes, Rt. Hn. W. F. (Ashford)

  Glover, Sir Douglas

  Brewis, John

  Dodds-Parker, Douglas

  Glyn, Sir Richard

  Bromley-Davenport, Lt.-Col. Sir Walter

  Eden, Sir John

  Goodhew, Victor

  Brown, Sir Edward (Bath)

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

  Gower, Raymond

  Grant, Anthony

  Lambton, Viscount

  Russell, Sir Ronald

  Grant-Ferris, R.

  Lewis, Kenneth (Rutland)

  Scott, Nicholas

  Griffiths, Eldon (Bury St. Edmunds)

  Lubbock, Eric

  Sharples, Richard

  Gurden, Harold

  MacArthur, Ian

  Shaw, Michael (Sc'b'gh & Whitby)

  Harris, Reader (Heston)

  Macleod, Rt. Hn. Iain

  Sinclair, Sir George

  Harvie Anderson, Miss

  Maude, Angus

  Smith, John

  Hawkins, Paul

  Mawby, Ray

  Stoddart-Scott, Col. Sir M. (Ripon)

  Heald, Rt. Hn. Sir Lionel

  Maxwell-Hyslop, R. J.

  Taylor, Sir Charles (Eastbourne)

  Heseltine, Michael

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

  Taylor, Edward M. (G'gow, Cathcart)

  Higgins, Terence L.

  Mills, Peter (Torrington)

  Taylor, Frank (Moss Side)

  Hiley, Joseph

  Miscampbell, Norman

  Thatcher, Mrs. Margaret

  Hill, J. E. B.

  Mitchell, David (Basingstoke)

  Turton, Rt. Hn. R. H.

  Hirst, Geoffrey

  Monro, Hector

  van Straubenzee, W. R.

  Holland, Philip

  More, Jasper

  Wainwright, Richard (Colne Valley)

  Hordern, Peter

  Morrison, Charles (Devizes)

  Walker, Peter (Worcester)

  Howell, David (Guildford)

  Munro-Lucas-Tooth, Sir Hugh

  Webster, David

  Hunt, John

  Murton, Oscar

  Wells, John (Maidstone)

  Hutchison, Michael Clark

  Noble, Rt. Hn. Michael

  Whitelaw, Rt. Hn. William

  Iremonger, T. L.

  Onslow, Cranley

  Wilson, Geoffrey (Truro)

  Jenkin, Patrick (Woodford)

  Page, Graham (Crosby)

  Winstanley, Dr. M. P.

  Johnson Smith, G. (E. Grinstead)

  Page, John (Harrow, W.)

  Wolrige-Cordon, Patrick

  Jopling, Michael

  Pardoe, John

  Wright, Esmond

  Kaberry, Sir Donald

  peel, John

  Wylie, N. R.

  Kershaw, Anthony

  Percival, Ian

  Younger, Hn. George

  Kimball, Marcus

  Pink, R. Bonner

  King, Evelyn (Dorset, S.)

  Price, David (Eastleigh)

  TELLERS FOR THE AYES:

  Kirk, Peter

  Prior, J. M. L.

  Mr. Bernard Weatherill and

  Kitson, Timothy

  Pym, Francis

  Mr. Anthony Royle.

  Knight, Mrs. Jill

  Ridley, Hn. Nicholas

  NOES

  Alldritt, Walter

  Forrester, John

  McNamara, J. Kevin

  Armstrong, Ernest

  Fowler, Gerry

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

  Ashley, Jack

  Fraser, John (Norwood)

  Manuel, Archie

  Atkins, Ronald (Preston, N.)

  Freeson, Reginald

  Mapp, Charles

  Atkinson, Norman (Tottenham)

  Gardner, Tony

  Marquand, David

  Bacon, Rt. Hn. Alice

  Garrett, W. E.

  Mason, Roy

  Bagier, Gordon A. T.

  Gray, Dr. Hugh (Yarmouth)

  Maxwell, Robert

  Barnes, Michael

  Gregory, Arnold

  Mendelson, J. J.

  Baxter, William

  Grey, Charles (Durham)

  Mikardo, Ian

  Bence, Cyril

  Hamilton, James (Bothwell)

  Millan, Bruce

  Benn, Rt. Hn. Anthony Wedgwood

  Hannan, William

  Milne, Edward (Blyth)

  Bidwell, Sydney

  Harper, Joseph

  Morris, Charles R. (Openshaw)

  Binns, John

  Harrison, Walter (Wakefield)

  Morris, John (Aberavon)

  Bishop, E. S.

  Hart, Mrs. Judith

  Murray, Albert

  Blackburn, F.

  Haseldine, Norman

  Newens, Stan

  Bradley, Tom

  Hattersley, Roy

  Noel-Baker, Francis (Swindon)

  Bray, Dr. Jeremy

  Hazell, Bert

  Oakes, Gordon

  Brooks, Edwin

  Heffer, Eric S.

  Ogden, Eric

  Brown, Rt. Hn. George (Belper)

  Henig, Stanley

  O'Malley, Brian

  Brown, Hugh D. (G'gow, Provan)

  Herbison, Rt. Hn. Margaret

  Orme, Stanley

  Brown, Bob(N'c'tle-upon-Tyne, W)

  Hooley, Frank

  Owen, Dr. David (Plymouth, S'tn)

  Brown, R. W. (Shoreditch & F'bury)

  Howarth, Robert (Bolton, E.)

  Page, Derek (King's Lynn)

  Buchan, Norman

  Howell, Denis (Small Heath)

  Parkyn, Brian (Bedford)

  Buchanan, Richard (G'gow, Sp'burn)

  Howie, W.

  Pavitt, Laurence

  Callaghan, Rt. Hn. James

  Hoy, James

  Pentland, Norman

  Carmichael, Neil

  Huckfield, L.

  Perry, George H. (Nottingham, S.)

  Coe, Denis

  Hunter, Adam

  Rees, Merlyn

  Coleman, Donald

  Hynd, John

  Reynolds, G. W.

  Conlan, Bernard

  Jackson, Colin (B'h'se & Spenb'gh)

  Roberts, Albert (Normanton)

  Crawshaw, Richard

  Jeger, Mrs. Lena (H'b'n & St. P'cras, S.)

  Roberts, Gwilym (Bedfordshire, S.)

  Crosland, Rt. Hn. Anthony

  Jenkins, Hugh (Putney)

  Robinson, W. O. J. (Walth'stow, E.)

  Crossman, Rt. Hn. Richard

  Johnson, James (K'ston-on-Hull, W.)

  Roebuck, Roy

  Dalyell, Tam

  Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)

  Rose, Paul

  Davidson, Arthur (Accrington)

  Jones, T. Alec (Rhondda, West)

  Shaw, Arnold (Ilford, S.)

  Davies, Harold (Leek)

  Judd, Frank

  Shore, Peter (Stepney)

  Dell, Edmund

  Kerr, Russell (Feltham)

  Silkin, Rt. Hn. John (Deptford)

  Dempsey, James

  Leadbitter, Ted

  Silverman, Julius (Aston)

  Dewar, Donald

  Ledger, Ron

  Slater, Joseph

  Diamond, Rt. Hn. John

  Lee, Rt. Hn. Frederick (Newton)

  Stewart, Rt. Hn. Michael

  Doig, Peter

  Lee, John (Reading)

  Summerskill, Hn. Dr. Shirley

  Dunn, James A.

  Lewis, Ron (Carlisle)

  Swingler, Stephen

  Dunwoody, Mrs. Gwyneth (Exeter)

  Lomas, Kenneth

  Taverne, Dick

  Dunwoody, Dr. John (F'th & C'b'e)

  Loughlin, Charles

  Tinn, James

  Eadie, Alex

  Lyon, Alexander W. (York)

  Urwin, T. W.

  Edwards, Robert (Bilston)

  Lyons, Edward (Bradford, E.)

  Wainwright, Edwin (Dearne Valley)

  Ellis, John

  MacColl, James

  Walker, Harold (Doncaster)

  English, Michael

  MacDermot, Niall

  Watkins, David (Consett)

  Ennals, David

  Mackenzie, Gregor (Rutherglen)

  Watkins, Tudor (Brecon & Radnor)

  Ensor, David

  Mackie, John

  Wells, William (Walsall, N.)

  Evans, Ioan L. (Birm'h'm, Yardley)

  Mackintosh, John P.

  White, Mrs. Eirene

  Fernyhough, E.

  Maclennan, Robert

  Whitlock, William

  Foot, Michael (Ebbw Vale)

  McMillan, Tom (Glasgow, C.)

  Willey, Rt. Hn. Frederick

  304

  305

  Williams, Alan (Swansea, W.)

  Wilson, William (Coventry, s.)

  TELLERS FOR THE NOES:

  Williams, Alan Lee (Hornchurch)

  Winterbottom, R. E.

  Mr. Alan Fitch and

  Williams, Mrs. Shirley (Hitchin)

  Woodburn, Rt. Hn. A.

  Mr. Neil McBride.

  Willis, George (Edinburgh, E.)

  Woof, Robert

  Mr. Orme: I beg to move Amendment No. 13, in page 2, line 9, at the end to insert:
  (3) Subsections (1) and (2) of this section shall not apply to any award or settlement which forms part of a productivity bargain.
  Mr. Deputy Speaker (Sir Eric Fletcher): I think that it will be for the convenience of the House if with that Amendment we discuss Amendment No. 24, in Clause 3, page 3, line 19, at the end to insert:
  'and
  (c) it appears to the Secretary of State that there has been no increase in productivity',
  Amendment No. 38, in Clause 6, page 8, line 1, after 'Prices' to insert 'Productivity', Amendment No. 39, in page 8, line 3, after 'Prices', to insert 'Productivity' and Amendment No. 44, in the Schedule, page 8, line 14, after 'respect', to insert:
  'which is part of a productivity bargain or'.
  Sir D. Glover: On a point of Order. Mr. Deputy Speaker, does that mean that we can have only one Division, or will we he able to divide on the others?
  Mr. Deputy Speaker: Only one Division, will be permitted, on Amendment No. 13.
  Mr. Orme: We attach a great deal of importance to this issue of productivity, and to productivity agreements. In my brief contribution to this debate I propose to draw attention to the fact that ore is hard put to find the word "productivity" in the Bill. I think that this in itself is lamentable, especially when one remembers that we set off on this road with this statement produced by the then First Secretary of State, now the Foreign Secretary, entitled "Joint Statement of Intent on Productivity, Prices and Incomes".
  My hon. Friends and I want to know what has happened to the consideration of productivity. It appears to us that the emphasis has moved away from productivity and prices, but has remained on incomes. This is our basic complaint about the Government's approach to this
  306
  subject. My right hon. Friend made a long statement in reply to the previous debate, but it was only when he was about to resume his seat that he referred to the productivity, prices and incomes policy. That was the first time that I had heard it mentioned throughout the debate. I do not know what happened in Committee, but we have not heard productivity referred to here, and therefore my hon. Friends and I want to exclude from these agreements the issue of productivity.
  2.15 a.m.
  We have had some illuminating experiences of the productivity issue during the operation of Part IV of the Act. Some interesting things have happened in the last 12 months. The Fawley petrol agreement two or three years ago was heralded as outstanding and has borne fruit since in the shape of the famous agreements at Esso, Fairfields Shipyard and British Oxygen, but that agreement would not have been accepable under the Prices and Incomes Act and the other three were not acceptable until the Government realised the fantastic difficulties of reversing them.
  Those agreements, affecting many workers, went through the net, but Government Orders under Part IV refuted much smaller ones, like that concerning the Birmingham drivers. Where do the Government stand on productivity, to which we attach the greatest importance? If we are to achieve economic growth, we must give incentives linked to productivity and the return for increased effort. It is facile to imagine that it will happen otherwise.
  The Government's policy is restrictive and does not lead to growth of wages—this is the major criticism in the country—but to a wages freeze. We all know that the increased productivity which everyone wants can be achieved in British industry. The 4 per cent. growth rate which seems so unattainable is within our reach but can be achieved only through incentives and by giving the unions the right to conclude agreements with employers. To think of

  307
  shuffling on to Aubrey Jones the day-to-day negotiations and discussions of industry, in the mine, the dockyard and the building site is to live in cloud-cuckoo-land.
  Who will negotiate? Will the unions make concessions in return for receiving them, knowing that, if they complete these agreements instead of their being automatically enforced, they will have to wait a long time while they are investigated by the Board? They are, no doubt. a splendid body of gentlemen, but I do not think they know enough about British industry to deal with productivity agreements.
  The Government have got the detailed day-to-day knowledge of these matters. My hon. Friends and I regard this as a very important Amendment and we want to know what are the intentions of the Government. Where do they stand in relation to productivity agreements? How will these be affected by the Bill? It will not be good enough to shunt these things off into the sidings. Throughout industry there is a great deal of cynicism about the whole issue of prices and incomes, particularly with an economy which is running with slack in it, in a period when we have stagnation and unemployment.
  We hear a good deal of talk about getting rid of restrictive practices. I noticed that the Leader of the Opposition returned to this subject during the weekend. But that is not the priority. Confidence is needed in industry. Full employment is needed. People want the right to organise, and organised workers require to go ahead with their productivity agreements. I have never held out much hope for wages councils and such bodies for the lower-paid workers. Many of these workers who are in unorganised industries would be better off if they became organised in proper trade unions. I see this as the logical step to be taken by trade unionists. It is interesting to note that some of our highest-paid workers are among the highest organised in the country. This is a very important fact which should not be overlooked.
  My hon. Friends and I feel that much of the difficulty which has been encountered-tonight could have been overcome
  308
  if the Government had had the foresight to appreciate that if one cannot express democratic points of view in Committee one must do it in the House of Commons. I say this in all sincerity to my right hon. and hon. Friends on the Front Bench. We submit this as a serious Amendment which we believe should be incorporated in the Bill, for we believe that productivity agreements should be outside the terms of this Bill.
  Mr. R. Carr: I suppose that the hon. Member for Salford, West (Mr. Orme) and hon. Members on this side of the House have pretty fundamental differences about a good many things in politics. But it is a treat to hear an hon. Member talking about this subject from the benches opposite for a change with the touch of practical experience in industry and what goes on on the factory floor. Many of us, not only in the House but outside, feel that a little more of this from the Government would make a great deal of difference to the way our industrial affairs are going.
  We too attach much importance to productivity. The hon. Gentleman said that it would be hard to find mention of it in the Bill. In fact, it is impossible; the word is not mentioned between one cover and the other. We believe that it should be included, and we therefore support the Amendments put down by hon. Gentlemen opposite on this subject, and we have put down one of the group of Amendments which we are also now discussing.
  As the hon. Gentleman said, the policy with which we are concerned started as the policy for productivity, prices and incomes. However much we on this side of the House may have disagreed with the methods and agencies proposed by the Government, at least the tripartite policy of productivity, prices and incomes made sense as a concept, whatever differences people might feel about the way of pursuing it.
  But we agree that productivity seems to have got lost in the wash. It is about time it was found again. There is unanimity not only in the House but in the country as a whole that we are seeking a way of obtaining a balance in the equation between increases in earnings and increases in productivity. That

  309
  balance can be obtained in more than one way. It can be obtained by repressing earnings, by encouraging productivity, or by a little of each.
  We are in no doubt that in the way in which the Government's policy has developed, particularly over the past year and as it is proposed for the next year, far too much emphasis is being put on the repression of earnings. The country will never solve its problems in that way.
  It is high time the balance was redressed. We cannot discuss all the measures required to increase productivity, because most of them, and probably the main ones, lie outside the scope of this or any other Prices and Incomes Bill. The Bill, however amended, could not be one of the chief weapons for this purpose.
  Nevertheless, it is most important that it should at least not discourage the search for increased productivity and that if possible it should contain measures which will promote it. It would be a great mistake if the Bill left here with no overt recognition of the need to encourage productivity. Therefore, I hope that the Government will agree to the Amendments, or that if they do not like them they will produce similar Amendments of their own. The Bill must not leave here without the word "productivity" in it, in a significant way.
  I doubt whether the Government appreciate the damage which has been done and is being done to the cause of higher productivity by the way their prices and incomes policies have been pursued. Therefore, I doubt whether they are yet fully aware of the urgent need to correct that damage.
  We urgently want more agreements like that at Fawley. It may not be perfect in every way, but I do not think that anybody with experience of industry could have any doubt that it was a break-through. I know that that word can be over-done, but I believe that it was a break-through which should be emulated and in no way held back in other parts of industry. But it is extremely doubtful whether the Fawley agreement would have got through under the Government's policies without a long drawn reference to the Prices and Incomes Board. The House must consider what that means. If we are to get pro-
  310
  ductivity agreements, it is very important that the people at plant level should know that they can do business with each other and should feel free to put the results of it into practice without the gentleman in Whitehall thinking that he knows better and causing long delay.
  2.30 a.m.
  I should not be in order in going into the question of the Birmingham car delivery workers, but, from what I know of it, that is a much more doubtful example of a productivity agreement than the Fawley agreement. The dreadful thing is that under the Government's policy, even after all this time, there is still uncertainty as to what the status of the agreement is and about whether some of the workers, if the law is to be enforced, should be prosecuted. This is not the way in which we shall get a balance in the equation between prices and increases in productivity and increases in incomes.
  I return to a point which I touched on earlier. If we are to get increases in productivity, which we must have, there must be flexibility in methods of work and in wage structures and differentials. There must be the acceptance of change and confidence that the change will be to the good and that all aspects of an agreement will be honoured in full. There must, therefore, be confidence, particularly at plant level, that managers and trade unions can do business together. I do not think that the Government yet realise the damage which has been done in the last year by forcing employers to break their contracts and the damage which will be done in the next year by creating the feeling that employers and trade unions cannot come to an agreement without one side or the other being prevented from honouring it, or, if they honour it, being forced to break it.
  I know of examples in which this damage has been done. I know of hard work which has been done to overcome the historical suspicions of trade unions in relation to certain practices and in which success was at least achieved in getting certain practices given up. I know of a case in which certain practices were given up in return for a promise that certain increases would be made last autumn and the employers were prevented from making good their promise. How will employers get back on a satisfactory

  311
  level with trade unions in view of that sort of thing?
  This way of going on has created damage and will continue to create damage. The least that the Government can do is to make sure that we show by the words in the Bill our wholehearted support for the fact that productivity, and only productivity, will be the cure for our problems. For those reasons, my right hon. and hon. Friends will support the Amendments.
  Mr. Mikardo: The right hon. Member for Mitcham (Mr. R. Carr) said—and I agree with him—that a great deal of damage was caused because a number of employers were, against their will, compelled to dishonour agreements into which they had freely entered and which, I am sure, they wanted to honour. I know of a number of companies in which industrial relations were pretty good which have had a shaking because of the compulsion put on employers. Many employers were not compelled to dishonour agreements, but they rushed to dishonour them all the same. Others anticipated the legislation and broke agreements which they were not compelled to break. They were delighted to break them, and a great deal of damage was done in those cases.
  In debating an earlier Amendment my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot) pointed out that my hon. Friends who had tabled Amendments, which we did not have an opportunity of tabling in Committee, were not opposed to a policy for productivity, prices and incomes but were tabling Amendments because the Government's policy in this matter had got out of focus and balance. Nothing could demonstrate this more clearly than the complete absence from the Bill of any mention of productivity.
  We are supposed to be having a Government policy for productivity, prices and incomes, with equal weight attached to each. In respect of incomes we have Government controls, plus punitive sanctions. In respect of prices we have Government controls but no punitive sanctions. And in respect of productivity we have absolutely nothing whatever. How on earth can anybody say that this is a balanced policy for productivity, prices and incomes?
  312
  If the Parliamentary Secretary asks the House to reject this series of Amendments and does not suggest putting something in its place, I do not envy him the next time he goes to a trade union conference and tries to explain that the Government's policy is designed to stimulate productivity. How will he even be able to keep a straight face when he knows that the word "productivity" does not even appear in the title of the Bill, let alone in its provisions? If my hon. Friend rejects these proposals and does not put anything in their place, he will be making life impossible for his hon. Friends who have entered a large programme of addressing policy conferences throughout the country, at which large numbers of trade unionists are present.
  Having listened to so many of the Parliamentary Secretary's speeches, I know what he is likely to reply to these arguments. I have entered into his mind; and I am sure he has entered into mine. I could make his speech for him. There is only one difference between us, and that is that I know what his legislations means while he does not. I recall that when we were debating the No. 1 Measure some of us told him that it did not say what he thought it said. The trade union of which I am a member—and of which he is a distinguished ornament—told him that the Measure meant what we thought it meant, and he said we were wrong; but the High Court said that we were right and he was wrong. Sometimes my hon. Friend has been a little rough with the House when replying to debates on Orders made under the No. 1 Measure. I hope, since we knew more about the first piece of legislation on this subject than he knew, that he will now speak with a little humility.
  I know what my hon. Friend will tell us. He will say that these Amendments are unnecessary because, when references are made to the National Board for Prices and Incomes, one of the things the Board will take into account is whether it is part of a productivity bargain; that, if it is, the Board will O.K. it, and there is therefore no need for the provision. That may be all right in theory but not in practice, for two very good reasons that I shall try to explain.
  The first reason is that the effect of not having this provision in the Bill and

  313
  of saying that workers can get increased wages as part of a productivity bargain which the Board looks at and then says it is all right, if it is, will be that many productivity bargains that would otherwise have been negotiated will not be negotiated. I do not think that members of the Government who have never done ally wage bargaining appreciate that working out a productivity bargain is not the sort of thing that can be done in five minutes. In nearly every industry it is a long-drawn-out operation, and in some industries it is a most difficult and intricate operation.
  No one on either the management side or the trade union side will embark on what is often several months of research into the job— not just bargaining across the table, but having a joint study of the job by a study group composed of the two sides and doing several months of research—if, at the end of it all, they do not know whether or not the agreement, if reached, resulting from their joint research will be validated. In that case they will be very hesitant to do that work. It is therefore not true to say that good productivity agreements will get by under this Measure. A lot of good productivity agreements will be stillborn; they will never be worked out in order to go to the Prices and Incomes Board.
  I can give my hon. Friend an illustration at the present time from a nationalised industry. One of the reasons why the British Overseas Airways Corporation is at the moment in a pretty big upswing is that two or three years ago it was able to nip in before this prices and incomes policy came about and negotiate an agreement which revolutionised its maintenance methods under what is known as the "dual function" system; a system under which those who supervise the maintenance work may also inspect it and certificate it. This meant a great upsurge in productivity, as the Corporation was very quick to recognise. It has been one of the major contributors to the Corporation's excellent operational and financial results of the last two or three years.
  The same is not true of the British European Airways, which is doing not nearly as well as B.O.A.C. because it was not quite so quick. It attempted to emulate the same revolution that has been carried out by B.O.A.C. but it has
  314
  been caught in the Prices and Incomes Act. British European Airways had actually worked out the same sort of system as B.O.A.C.—mutatis mutandis, because there are differences between long-haul and short-haul airlines, but it was ready to get down to detailed negotiations.
  But it is now known that, whatever the result of the detailed negotiations, the Corporation and the trade unions may propose but Mr. Aubrey Jones will dispose, and the trade unions are not prepared to have Mr. Aubrey Jones in this case dispose of their welfare, so the negotiation is not going forward. It is no use my hon Friend saying, if he was intending to say, that B.E.A. can do just as well as B.O.A.C.; that all it has to do is to reach an agreement and put it up. It will not be put up. I can tell him so with absolute authority, because I am one of the chaps who is supposed to be working it out, and I shall not waste time working it out. So it just is not going to be put up. That is straight from the horses's mouth.
  There is another reason why it would be purely theoretical to say that this Amendment is unnecessary because we can leave the P.I.B. to work out the matter. The Prices and Incomes Board does not personally investigate these matters. It could not. The members of the Board do not have nearly enough man hours available for the purpose, even if they had the expertise, and, with respect, I do not think that many of them have any expertise. Even if they did, they could not investigate all these matters. So they rely on people brought in from outside, consultants of various sorts and others. They may be very good people, but we do not know whether they are, because they are very anonymous people. That is their greatest characteristic.
  2.45 a.m.
  When a trade union and an employer put up to the Board a productivity bargain which they have reached, they do not know whom they are putting it up to. They are people who know the industry. It is a great sweat to get the agreement, and they will not do it if it goes up to some anonymous, faceless man who does

  315
  the job, however much it is rubber-stamped afterwards by one of the Board nominally acting as chairman of the investigating committee. They will not go through it all if it is to be put up to a faceless consultant.
  There is an increasing tendency to use American firms of consultants on this sort of thing. Although, no doubt, they are technically competent, many of them do not yet have the feel for British industry. They will get it when they have been here another 30 years. Some of them, however, come by aircraft from New York and they do not have the fee] of industrial relations in Britain. Certainly, the trade unions and a great many managements do not have confidence in them to understand the sort of things that are talked about in a negotiated productivity agreement.
  For those reasons, I say to my hon. Friend the Joint Parliamentary Secretary that the speech which he makes, and which I have made for him in advance, to the effect there is no need for all this because the Board will see it, is not a very good speech. I hope that by the time he gets up to speak, he can think out a better one.
  Mr, Alison: The hon. Member for Salford, West (Mr. Orme), to whom I listened with great enjoyment, has done the House a service by trying to get the missing word "productivity" into the Bill. As everybody has pointed out, it was conspicuous by its absence until he introduced his Amendment.
  The hon. Member has, however, not gone far enough in his analysis of where some of the rewards for increases in productivity should go. He laid great stress on the reward to labour, but there is another aspect of it. This is where the whole productivity outlook and analysis by the Government is hoplelessly awry and completely contradictory. They do not even know what one part of the Government body is saying.
  I remind the Joint Parliamentary Secretary of what that extraordinary document called "Progress Report", issued by the Department of Economic Affairs—one of the great misnomers of the Socialist Government—said recently
  316
  about productivity. The latest one to be issued said:
  "The broad determinants of productivity growth are, however, the increase in capital and improvements in technique and organisation."
  It goes on to say:
  "The effects of these are difficult or impossible to measure directly"—
  that may be one reason why the Government have not introduced the concept of productivity into the Bill—
  "though work on this problem is going on in the Government, universities and other institutions. There is no doubt, however, that there is great scope for raising the growth of productivity".
  One thing which is conspicuously true also is that there is no scope here for increasing the rewards for an increase in productivity. It says:
  "There is no doubt, however, that there is great scope for raising the growth of productivity through the application of improvements in technology and organisation, and this is a subject that has been increasingly occupying the attention of Government and industry."
  This is a point of some importance, because the Government explicitly talk about
  "the increase in capital and improvements in technique and organisation"—
  that is, capital and management—as being
  "the broad determinants of productivity growth".
  There is very little mention of these.
  There was one lacuna in the speech of the hon. Member for Salford, West. He talked a lot about the reward which should properly be applicable to labour in productivity increases. What about the return to capital and the return to management? This point needs developing, because too much attention in many ways is paid to the labour aspect of increases in productivity. I want to quote some very penetrating words by that very well known American management consultant, Mr. Peter Drucker, who points out that the balance between all factors of production is what is crucial in productivity increases and is only distantly related to output per worker. He says that the concept of productivity increase related to output per worker is based on the mechanistic fallacy that all human achievement could eventually be measured in units of muscle effort. But

  317
  productivity, he says, in modern economies, is always achieved by doing away with muscle effort and substituting something else for the labourer—that is, capital equipment and, before capital, even, conceptual, theoretical, analytical effort, that is, management.
  This is not in any way to denounce the rôle of labour in productivity. Part of the difficulty is that many of the rank and file jobs in industry are managerial. The key in increasing productivity is in recognising that it is essentially a function of capital and, even before capital, the function of analytical and conceptual ideas of management and organising capital. We see clearly how companies with parallel and similar levels of capital intensity can achieve different returns on capital investment, simply because of better management in one place than in another. This is what occurs in the United States.
  There is not a glimmer of understanding of this in any of the Government's proposals for increases in productivity. There is no conception at all that management and capital need a return. The Government have gone flat out to try to depress the return, not only on capital but for management, in the determination to try to keep prices down whilst allowing some costs to rise and decreasing the incentive for private business to invest. The Government must recognise this and take action. Do they believe that there should be a positive encouragement for a greater return on capital in increases in productivity? This is apparently ignored by the Government in the whole o their concept of the prices, productivity and incomes policy.
  Another point arises from the elimination of the norm. In paragraph 20 of Cmnd. 3235, which is now to be a Schedule to the 1966 Act, the Government baldly state:
  "There can be no justification at present for returning to the norm of 3–3½ per cent. per annum which prevailed up to July, 1966, and which in practice tended to be regarded as the minimum increase which everyone expected to receive."
  The Government have deliberately abandoned the norm. Again, this is a crazy and completely contradictory thing to have done in the circumstances, because the whole purpose of the norm, as the Government have repeatedly said in
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  various of their publications, was to match increases in wages and earnings with the long-term trend of productivity. Something must be substituted for the abandoned norm.
  What I suspect will be substituted for it is not the long-term increase in productivity, running at somewhere between 3 per cent. and 3½ per cent., which is the reason for originally fixing the norm at 3 per cent. to 3½ per cent. What will happen is that the measure of a legitimate increase in earnings or wages will be that which measures against the short-term increase in productivity. There is a great difference between the long-term and short-term increase in productivity. On the upswing of an economy's development, when there is a lot of slack, and the tendency is to try to get output increased as rapidly and as effectively as possible, there are quite sensational short-term increases in productivity.
  Although the long-term trends in productivity increases in the rate of growth in the economy have been between 3 per cent. and 3½ per cent.—and this was the reason for the original norm—to take for example 1964, there was a growth in productivity in that year of 4½ per cent., but it was an upswing year, and the economy was booming and things were expanding. This is 50 per cent. higher than the longer-term trend. That means that if the Government are explicitly abandoning the norm and writing nothing into the Act to replace it, they will be governed, in respect of claims for increases based on increases in productivity, by the only available guide in a particular year for which application is made, the short-term increase in productivity.
  When the 1967–68 upswing comes, if it does, there will be a surge in productivity, while we rise in degrees of economic activity to the level of full productive potential, before productivity begins to undergo the long-term reversion to the norm. In the short term there might be a 4½ per cent. to 5 per cent. increase in productivity. By deliberately eliminating a guiding norm, the Government must now concede that in a year of upswing the productivity increase upon which earnings or increased wages can be judged, and applied for, must relate to that short-term increase.

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  The Government will find themselves in a much worse situation than before. At precisely the moment that they want to control prices, when the economy is in a boom, and profit resource is increasing, then it will be that the Government's present proposals will enable a very much higher application for wage increases to be made than would be admissible under the old concept of the long-term trend.
  The Government do not have a clue about productivity. They have not taken any notice of the theory of this, of the analyses which their Departments are working on. All that they are concerned with is to keep things down, to batten down the hatches. The effect of this will be precisely what we fear—private investors will not invest, and there will not be the attempt to increase the productivity of the economy by the only rational means, which is to increase capital intensity and improve matters. The Government do not know what they are doing and this was made abundantly clear by the speech of the hon. Member for Salford, West. We certainly welcome this attempt to get the idea of productivity into the Bill.
  Sir John Eden: I congratulate my hon. Friend the Member for Barkston Ash (Mr. Alison) on his fluency, and upon making such an interesting contribution to this important debate. He drew out some of the major elements of the argument, and I will add one or two observations. So often when management is considering the installation of new capital equipment to try to improve methods of production and increase the number of units produced, thereby reducing the unit cost of what is being made, the opportunity is taken to introduce new scales of remuneration. It is also in order to try to ensure that the costly new capital equipment is utilised to the fullest possible extent, so that the customs which have been growing up over past years which are no longer relevant to the present time are prevented from being carried forward into the new era in the future.
  3.0 a.m.
  This is why I think this Amendment is so important, because after all that is what productivity is all about. Pro-
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  ductivity is not just matter of—[Interruption.]
  Mr. Deputy Speaker: Order.
  Sir J. Eden: It is quite all right, Mr. Deputy Speaker. I think there is an important conference going on over there. We shall no doubt hear about it in due course as the hon. Member for Ebbw Vale (Mr. Michael Foot) has been extremely active and doubtless will be rising to his feet to explain to the House what is the purport of the consultations taking place behind him. I notice that this has succeeded in evicting the hon. Member for Poplar (Mr. Mikardo). What a pity the hon. Gentleman is not here to listen to the rest of the debate, because he made a very significant contribution himself.
  The point I was making was that the whole purpose of introducing new plant and capital equipment into a factory is to improve the methods of production and to lower the unit cost. When this is done it leads almost invariably to the introduction of new rates of pay; new manning agreements are introduced, and since the introduction of new capital equipment almost invariably leads to a reduction in the labour force engaged on that particular section of the factory, the plant or the manufacture, then with the reduced labour force the opportunity is given for higher rates of pay to be introduced.
  I should have thought that this is what we are all about, and I take a less pessimistic view than the hon. Member for Salford, West (Mr. Orme) about the attitude of the Government here. I should have thought that they would accept, if not the exact wording of this Amendment, something very similar to it. I would expect they would rush to introduce an Amendment comparable to this for themselves because I am certain they will wish to have included in the Bill more than just a passing reference to productivity. I should have thought they would want the whole thing spelt out in detail.
  Like the hon. Member, and others of my hon. Friends who have spoken, I was always under the impression that the whole purpose of phase 2 of this massive

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  operation of prices and incomes restriction was in order to get greater productivity. That was the whole object of the exercise. If it is not, I do not know what is. If it is just to restrict wages or halt prices then it is a very sterile operation. Surely the whole purpose was to get Britain moving again. If they are to do that we must have increased productivity, and if we are to have increased productivity we must have better utilisation of capital and of manpower. If we ate to get getter utilisation of manpower, we will not get it by freezing wages but by offering better reward, by seeing that there is better opportunity, by seeing that there are prospects of much more substantial earnings arising out of more sensible manning of the latest installation of capital equipment. This is, at any rate, my concept of a prices and incomes policy, and I would be wholeheartedly in favour of it if it was geared to the positive objective I have touched upon, rather than always being bogged down in this wholly negative approach which the Government seem to be adopting.
  I can also echo very strongly what the hon. Member for Salford, West and my hon. Friend also mentioned, the need to have a restoration of confidence throughout industry at every level. There is no doubt that confidence has been sadly shattered in the past few months. The Government could assist a great deal towards its restoration if they gave a clear indication, which they new have an opportunity of doing, that the emphasis in future will be on increased productivity rather than the reverse.
  I hope that from now on we shall see the possibility at an increasingly rapid pace of having direct negotiations at plant level for proper manning agreements which will bring the prospect of increasing rewards to the men engaged in these activities. I agree with what my hon. Friend the Member for Barkston Ash said about the importance of ensuring that these productivity agreements and the increased remuneration which should go with them and be part and parcel of them should operate and have effect at all levels of the industrial scale from management to the shop floor. For what else do men work except for greater reward? If the Government cannot offer
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  them that there is no prospect for the future of this country.
  Mr. Emery: It seems to me that in this debate an increase in productivity is the most major essential for British industry in future. This is not something new for me to say; it has been said time and time again by Ministers on the Government Front Bench throughout the country over the last 2½ years. How can they expect either the trade unions or management in industry to have any respect for those speeches if when they have a possibility of showing the good faith of their words in action they do not put anything into the Bill about productivity?
  At the start the whole basis and first principle of this business was a policy of productivity, prices and incomes. Yet we have now got so far along the road that productivity is absolutely forgotten. It is a terrifying condemnation of the action of the Government in their handling of the policy which is part of the corner-stone of their economic policy. What worries me even more is that the Government are asking industry to give more and more publicity to this in its reports and discussions within factories, and yet here again they will not take the lead by trying to do anything themselves.
  I turn to two of the Amendments that we are discussing. Amendment No. 13 states that the section:
  "shall not apply to any award or settlement which forms part of a productivity bargain."
  Amendment No. 24 which would provide power of definition in the words:
  "it appears to the Secretary of State that there has been no increase in productivity."
  The difference between the two is that Amendment No. 24 would allow the right hon. Gentleman to define what was an increase in productivity. This is an important nuance.
  I do not disagree with the general principles laid down in the admirable speech of the hon. Member for Salford, West (Mr. Orme). He understands the problems which have arisen but I believe that they are less real than worried about in relation to the interpretation of what is or is not a productivity bargain. I hope to have the support of hon. Members opposite in urging the Government

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  that, even if they cannot accept Amendment No. 13, they should turn their attention to Amendment No. 24, which would give them specific extra power to interpret what is or is not a productivity agreement. This might well get over a large number of the worries the Government might propound for not accepting Amendment No. 13. They might claim, "So many things have been called 'productivity bargains' which never have been". But Amendment No. 24 would allow the Government to interpret what was or was not a productivity bargain. Perhaps it would be too wide a power but I would be willing for the Government to have it in order that we might get somewhere in productivity.
  The hon. Member referred to cynicism and certain aspects of it among trade unionists. There is also considerable cynicism in managements, who have been encouraged to bring these bargains to a head. As the hon. Member for Poplar (Mr. Mikardo) said, if managements see there is no chance of these bargains being considered, they ask, "What are the Government up to? What do they want us to do?"
  There is cynicism among the most progressive managements, on whom much of the productivity of the future will rest. If the Government give no encouragement to these people, their policy will be doomed to even greater failure. The hon. Member for Salford, West spoke of the need for full employment and there is also need for full capacitiy because it is by the use of full capacity that we shall get an increase in productivity. Is it by using the national assets to the full that the greatest benefit can be achieved. If full capacity is not used there is no chance of getting the increased drive for productivity which we all want to encourage.
  One of my hon. Friends said that the Bill must not go through without a mention of productivity. I agree, but it is not only a matter of changing the title of the Bill, as a later Amendment suggests, but of changing its contents, and without such a change the Bill is nonsense. It will only be a cloak for the Government's actions.
  3.15 a.m.
  The trouble is that productivity is wanted not only for the benefit of
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  management and worker. One section of the community never mentioned in debates on productivity is the ordinary consumer. The only time that the ordinary consumer—the housewife or the individual, the buyer in industry or the buyer in the shops—can receive a basic benefit is if productivity goes up sufficiently for both unions and management to benefit, and the consumer may then have a third of the increase reflected in a decrease in price, or an increase in quality.
  Too often the ordinary consumer is forgotten in a debate of this sort. The trade unions are represented on one side of the House and management is talked about on the other. Let us have some realisation that the consumer has as important an interest in increased productivity as anybody else.
  The hon. Member for Poplar said that firms needlessly rushed to break agreements when the initial legislation came in. If that can be substantiated, as I am sure it can, I would no more agree with it than he would, because it would be quite wrong.
  The Board's Report No. 36, Productivity Agreements, deals with the very subject matter of this debate. Are productivity agreements right? Are they beneficial? Do they do what they set out to do? In paragraph 138 the Board says:
  "We have reached the conclusion that, within the framework of a prices and incomes policy, productivity agreements are to be encouraged."
  Do not the Government want that? Do they believe that these things will happen without any active encouragement?
  In "Guide-lines for the Future", page 40, paragaph 179, the Board says:
  "We indicated earlier that in the light of our investigations there is a strong case for encouraging the spread of productivity agreements which conform with the requirements of a prices and incomes policy. We attach great importance"—
  I emphasise "great importance"—
  "to this relationship between the two. …"
  Why will not the Government realise this? Why will not the Government admit this in the Bill? The Board is the body which will be asked to interpret the working of the Bill. It is the body which has already pronounced on this

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  very subject. Yet we seem to have stonewalling by the Government, but I hope that I am wrong about that.
  The Government have sometimes suggested that the making of productivity agreements has been to cloak price or wage increases, but the Prices and Incomes Board has set out in full the criteria for what a proper productivity bargain or agreement should be. If there is any doubt about it, I will read the lot, but surely the House will accept that.
  Mr. Biffen: I have always rather doubted the capacity of the National Board for Prices and Incomes to lay these "tablets" before a wider public. Therefore, I should be interested if my hon. Friend would read them, because I might be educated in the true sense by this process.
  Mr. Emery: At this early or, late hour, I am certain that I should not please all hon. Members if I helped towards the education of my hon. Friend.
  However, in paragraph 139 of its Report No. 36, the Board states quite clearly:
  "It is for this reason that we indicated in Report No. 23 that it would be wrong to regard a comprehensive productivity agreement as a route to a quick increase in pay"
  I know that many hon. Members have been worried that such agreements might be used to cloak other pay increases. The Board accepts that fear and stresses the need in any proper productivity bargain for what it calls an elaborate plan to control the system and to provide the necessary information and to provide checks to ensure that the agreement works in the manner spelled out. In the guide-lines in that report the Board sets out seven criteria for control and checks.
  This is, therefore, what the Government themselves are propounding. Why do they not accept its inclusion in the Bill? Why do they not admit that they have made a howling error of omission, that they had not thought about it, that they were too concerned about control and the problem of inflation and trying to hold down wages and prices and so failed fully to consider—let me be that generous to them—the productivity aspect of the prices, incomes and productivity policy?
  Instead of acting like the Prime Minister and believing that if they make
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  a mistake, they have to bat on regardless, taking the view "I can never make an error", it would be healthy for them to admit a mistake and, instead of saying that they believe that the matter will be covered by letting the Board deal with it, agree that a sound argument has been propounded by both sides of the House and that both sides of industry require to be encouraged to work for greater productivity.
  If the Government accepted the Amendments—and of course we appreciate that the drafting may not be perfect—they would be exactly following the Board's summary of conclusions in Report No. 36:
  "We conclude that there is a strong case for encouraging the spread of productivity agreements which conform with the requirements of the prices and incomes policy."
  That is one of the Report's major recommendations. Why will not the Government live up to and accept and carry that through?
  I hope that, with the general feeling, not of wanting to kick the Government, but of wanting to encourage them to get on with something essential, which is not a party political matter but the increase of productivity within the whole nation, the Government will not just speak but act, and the best way in which they could act would be to accept the general principle of the Amendment in order to show both sides of British industry that they mean what they say.
  Mr. Hattersley: In a constructive speech a little spoilt by the attack on the Government at the end, the hon. Member for Honiton (Mr. Emery), quite rightly distinguished between Amendment No. 24 and the problems of definition surrounding Amendments No. 13 and 44. I hope, having talked about the principal Clause, that I may return to the other Amendment because the problems involved in accepting that are different from those involved in accepting the principal Amendment.
  That is the Amendment which seeks to restrict the Government's ability to extend the standstill or implement the 10 or 30 day automatic extension of a wage standstill which results from what is described in the Amendment as a productivity agreement. May I say at the

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  outset to my hon. Friend the Member for Poplar (Mr. Mikardo) that of course the Government accept that this is a serious Amendment, accept the obligation to consider it on its merits objectively and seriously and that my hon. Friend's motives in moving it were no more nor less than to draw attention to the propriety of productivity agreements.
  Having made that admission gladly, I have to say, trying to summon up sufficient humility to satisfy my hon. Friend, why I cannot suggest to my hon. Friends that we should accept the Amendment. My hon. Friend the Member for Poplar said that if I were unable to urge acceptance, I should put something in its place. I think he knows that something is already in its place.
  Unlike the right hon. Member for Mitcham (Mr. R. Carr), my hon. Friend did not say that there was no mention of productivity in the Bill. Those were the words of the right hon. Gentleman, and in a limited and literal sense, they are true. In this Bill "productivity" does not appear—[Interruption]—if my hon. Friend the Member for Salford, West (Mr. Orme) wants me to correct him as well, I will. It was a point he made as well.
  This is a rather narrow definition because this Bill is in all aspects concerned with the parent Act, and to believe that an omission in the second Bill cannot be remedied by something in the first Act is altogether wrong. If the hon. Members will consider Section 4(1) they will find that it requires the Government to refer to Schedule 2 as from time to time amended, and they will see that Schedule 2 consists for the period after 1st July, 1967, of what is White Paper Cmd. 3235. Paragraph 22(i) of that White Paper gave criteria which may be used to allow wage increases to go ahead in the next year: One of them was:
  "where the employees concerned, for example by accepting more exacting work or a major change in working practices, make a direct contribution towards increasing productivity in the particular firm or industry. Even in such cases some of the benefit should accrue to the community as a whole in the form of lower prices;"
  Mr. Orme: A tortuous journey to arrive at the point.
  Mr. Hattersley: While my hon. Friend says it is a tortuous journey to arrive at the point, I hope he accepts that we have arrived at the point in the end. The Government are required by Section 4(1) of the parent Act to take account of the Schedule which lays down positively and definitely that one of the criteria they must consider when allowing or refusing to allow a wage increase to go forward is the increase in productivity.
  3.30 a.m.
  All that the Government seek to do is to carry out the requirements of the parent Act, and therefore the obligation to investigate productivity agreements and to make sure that the productivity bargain, the productivity agreement, is genuine. I am sure the House understands that unless my hon. Friends are arguing—and I am sure that they are not—for a free-for-all in which people are entitled to dress up a normal wage negotiation as if it were a productivity bargain and foist it on the Government in the guise of a productivity agreement, it is essential that the Government should have some measures and some means whereby they can determine when a genuine productivity agreement exists.
  That is really the only point which distinguishes my case from that of my hon. Friend the Member for Salford, West. When he asks whether we have all the day-to-day knowledge—and by "we" I am not sure whether he means the Prices and Incomes Board acting on behalf of the Government, or the Government themselves—to judge when a productivity bargain is genuine and when it is not, I think that he must accept the logical extension of that question. It is this. If he seeks to amend the Bill to instruct my right hon. Friend to accept a productivity agreement whenever one is presented to him, when we do not have the knowledge to decide when an agreement is genuine, and when it is bogus, he is asking my right hon. Friend to do no more and no less than accept anything which is presented to him and called a productivity agreement. I am sure that this is a task which my right hon. Friend, quite rightly and properly, would refuse to accept. But what my right hon. Friend does accept is the right to judge a genuine productivity agreement when he sees it, and not necessarily make that judgment in the form of a reference to,

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  and eventually a report from, the Board. I hope in about two minutes to give some figures of the productivity agreements accepted by the Government During the period of severe restraint—
  Mr. Higgins: Will they include the figure for the Birmingham car delivery drivers? The hon. Gentleman says that the Government accept responsibility for distinguishing between a genuine productivity agreement and one which is not, but he said about 12 hours ago that months after this had been referred to him he could not tell whether such a thing was or was not genuine.
  Mr. Hattersley: I cannot believe that the hon. Gentleman has forgotten my answer so soon. What I said this afternoon was that the Government would be capable of deciding whether the Long-bridge agreement was a productivity agreement as soon as some evidence was presented to us. I also said that evidence had been hard to come by, and I confirm now that when the evidence is presented we will be capable of deciding whether it constitutes a productivity agreement. The evidence by which we will decide is the evidence laid down initially in Report No. 23 by the N.B.P.I.—the seven criteria for genuine productivity agreements. Certainly, they strike me, and I hope strike my hon. Friends, and some hon. Gentlemen opposite, as reasonable and realistic assessments of what is a genuine productivity bargain.
  Let me remind the House of the obligations of the First Secretary under the Act as it stands. He could, if he regarded a wage increase as stemming from a genuine productivity agreement, implement it automatically, and often, using his judgment and deciding that the bargain was genuine, he would choose to do that. The only alternative open to him if he is to postpone the increase is to refer it to the Board, and it is quite clear, under the terms of the Second Schedule to the parent Act, that if the Board found that the agreement was a genuine productivity bargain it would be under an obligation to make a positive recommendation to my right hon. Friend for the wage increase to go forward, and my right hon. Friend would be under an obligation to allow it rather than prohibit it.
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  I told the hon. Member for Honiton that I accepted his implied criticism.
  Sir D. Glover: Can the hon. Gentleman give an instance of his right hon. Friend accepting a productivity agreement?
  Mr. Hattersley: The Ministry of Labour has accepted 270 productivity agreements during the period of severe restraint, in the six months ending 1st July this year—
  Mr. Biffen: Were they all examined by members of the Civil Service, or was the examination sub-contracted to trade associations?
  Mr. Hattersley: The examination was done by members of the Civil Service. The Board's report No. 36 shows that officers of the Ministry made some comments, at the Board's request, about how the original set of criteria could be implemented.
  The hon. Member for Honiton mentioned the lack of definition in the principal Amendment. It simply requires my right hon. Friend to implement automatically what are described as "productivity agreements". The difficulty is defining the term and the circumstances in which they would operate. A trade union might believe that it had entered into such an agreement, which did not seem to qualify in my right hon. Friend's terms, and might seek recourse to the courts to determine whether a productivity agreement operated in that ease. My right hon. Friend must have some citeria for approving or referring to the Board productivity agreements, but not the sort which might, because of their omissions, be referred to the courts for definition—
  Mr. Orme: My hon. Friend referred to "genuine" agreements, as though employers and trade unions make agreements which are not genuine. I do not know where he spent his life, but mine was spent in industry, where it is not easy to make agreements which are not genuine. This is a slur on industry, and I should like him to explain himself.
  Mr. Hattersley: I would explain myself with an example. The Minister of Labour approved a wage increase for the ACROW company of engineers, because

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  he considered that a productivity agreement was involved. But we were told in the House that ACROW had somehow beaten the freeze by arranging what was described as a bogus agreement. I am sure that my hon. Friend realises that some people may be sufficiently determined on a wage increase to dress up an agreement as a productivity agreement. I am not casting a slur on industry or stretching his credulity by asking him to believe that that does happen and that we must ensure that it does not happen within the terms of the policy—
  Sir J. Eden: Surely the purpose of offering an increase as part of such an agreement is that the management think they will get better productivity. The hon. Gentleman says this is a bogus proposition, but surely the people to judge are those who will pay the increase.
  Mr. Hattersley: Again the hon. Gentleman is tempting me to make more specific and more definite proposals as to what the sort of evasions could be. I agree with him that the nature of a genuine productivity agreement is that more productivity ensues for the company. I am simply saying that one could imagine a situation in which the management might want to co-operate with the trade unions in arranging a wage increase without there being a productivity element but it might be presented to my right hon. Friend the Minister of Labour as if it were.
  Because of all these qualifications I would not like the House to imagine that the Government lack enthusiasm for productivity agreements. Indeed, I should have thought that the mere fact that we were creating a situation in which, in general, wage increases were not encouraged, but agreements were encouraged if they were associated with productivity bargains, was an indication of our enthusiasm for arrangements of that sort.
  If the House wants any more evidence of our enthusiasm I hope that hon. Members will remember the 270 productivity schemes approved by the Ministry of Labour during the period of severe restraint and the many other productivity schemes approved in local government and allied organisations by the Ministry of Housing. I hope they will
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  remember that specifically Schedule 2 of the parent Act has always included reference to productivity agreements, commending them to industry and promising them special regard.
  If any final accolade is needed, I hope the hon. Member for Honiton, who referred the House to Report No. 36 of the National Board for Prices and Incomes, will recall those parts of paragraphs 179 and 181 which he did not read to the House. The judgment of that Report, at the end of paragraph 179, is that
  "a prices and incomes policy can produce the most favourable environment for successful productivity agreements."
  Lest it be thought that the Prices and Incomes Board is talking in vacuo and saying that any prices and incomes policy can produce a favourable environment for productivity agreements, let me read paragraph 181 of that Report. That paragraph and paragraph 179 are related to each other. Paragraph 181 says:
  "All that we have heard suggests that the effect of Government policy, especially since July 1966, has been to direct the attention of both the employers and trade unionists away from conventional bargaining and towards productivity bargaining."
  Lest there be hon. Members who join with the hon. Member for Oswestry (Mr. Biffen) and say "So what? The National Board for Prices and Incomes is not to be relied upon on these occasions; its judgment is a little clouded by Government policy anyway. We doubt whether it can take an objective and practical look at industry", let me refer the House to a document which may commend itself to some Members more than anything produced by Mr. Aubrey Jones. I refer to "British Industry", the journal of the C.B.I. In its latest issue, the issue of 7th July, its first leader was a generally critical analysis of productivity agreements. It accused the National Board for Prices and Incomes and, by implication, the Government of being overenthusiastic about the virtues of such agreements.
  At the end of paragraph 5, having spent a great deal of time showing all the difficulties and problems which might arise from such agreements, it says:
  "… except, of course, the genuine productivity deal which should pay due regard to the guide-lines set out by the Prices and Incomes Report."

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  That is all that the Government seek to do. If we were to accept the Amendment, due regard to those guide-lines would no longer be possible.
  The Government ask that the Amendment should not be accepted, so that productivity agreements can go on if they are legitimate. I believe that they will go on in the same flourishing way that they went on, not during the period of severe restraint but because of the period of severe restraint.
  3.45 a.m.
  Mr. Higgins: If the hon. Gentleman believes his last few words, he will believe absolutely anything about the Government's policy on prices and incomes. I intervene briefly because many of my hon. Friends wish to speak in what seems to me to be probably the most important individual debate during the whole of our consideration of this Bill. The whole of the rest of the Bill is negative and restrictive. The Amendments are designed to lead to a constructive policy on which a reasonable future can be built for the country.
  But it is becoming increasingly apparent from the Government's replies that we can hope for nothing either for the lowest-paid workers and social justice or for productivity and economic growth. It is clear that the Government's view of their policy as it stands is utterly and completely restrictive, and we believe that it is utterly and completely hopeless.
  The word "productivity" does not appear in the Bill. It appears only in vague declarations of intent for the "golden era" on which we now look back, when the present Foreign Secretary put forward his initial views on the policy. We are told that we can also hope for more productivity in a future era, when there will apparently be a completely voluntary policy but no free-for-all.
  I was surprised to hear the Parliamentary Secretary use those words. He knows as well as I do that arguments put forward by the First Secretary about a free-for-all are completely fallacious. He may argue that everyone is volunteering, yet he gives no explanation why any individual union or firm should volunteer when the Government are in no position to tell them that everyone else will also volunteer. At either end
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  of the spectrum we have a golden age, but in the middle there is a completely restrictive policy that is not likely to result in increased economic growth or prosperity for the country.
  I want to take up the whole question of what is a genuine productivity agreement. The Government view some such agreements as being genuine and others as not being genuine. It was pointed out in an earlier speech that apparently the Fawley agreement, which the Government say was good, would not fall within the criteria they have now established. The Parliamentary Secretary made no attempt to answer this point, but I shall gladly give way if he would like to answer it now. Is the Fawley agreement a genuine productivity agreement within the meaning that the Government now understand or not?
  Mr. Hattersley: I think that the hon. Gentleman has Report No. 36 in front of him. I said that if there were an issue of doubt, if there were any marginal area where my right hon. Friend the First Secretary was not sure whether or not a productivity agreement was legitimate or genuine, it was his duty and obligation to refer it to the Prices and Incomes Board. Having seen what the Board says about the Fawley agreement in the document which he now holds in his hand, does the hon. Gentleman doubt for a moment that it would have produced a report which said that that was a good thing and that the wage increases should go on?
  Mr. Higgins: In that case, all we conclude is that the Board's criteria are not consistent with its views on any particular agreement. This is an absurd situation, but it is typical of the kind of nonsense put forward by the Government.
  We must return to what seems to me in many respect to be the typical case of the Birmingham car delivery drivers.
  Mr. Mikardo: The point is even stronger than the hon. Gentleman is making it. If the fact is, as I think that he has established, that a determination may be made by the Board on whether a given agreement is all right or not irrespective of the criteria which it lays down, the situation is wide open for its treating some groups of workers and unions as "blue-eyed boys" and making its judgment on whether it happens to like the

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  people concerned. That is a situation which some people suspect already exists.
  Mr. Higgins: I could not agree more, because we have maintained consistently throughout the debates on Prayers concerning Orders under the policy that the element of discrimination is fundamental to the Government's whole aproach. We never managed to establish why they should refer a particular case to the Board or make a particular Order. We started by thinking that it was only the weakest individuals who would have an Order slapped on them and then we found that it was the unions which were getting out of line.
  The essential point is that the Government, with the criteria set out in Report No. 36 and in the document on the period of severe restraint, are still unable, after months, to establish whether they feel that the Birmingham car delivery workers' agreement is a genuine productivity agreement or not. Yet the Bill only gives power to delay an increase for roughly the period which they have had to make up their mind about whether this agreement was or was not a genuine productivity agreement.
  The Parliamentary Secretary says that the Government do not have the evidence on the case, despite the wide publicity and the fact that they have had goodness knows how many conversations with the management and the unions. If they cannot decide this case because they have not got the evidence, how can they hope to get the evidence in any other cases? We are told that 280 agreements have been approved by some anonymous civil servants. We do not know on what basis they have decided—whether on the basis of the criteria set out by the Board, or by reason of some purely arbitrary Government decision based on this or that White Paper, depending how Schedule 2 of the parent Act changes almost from day to day.
  The Government are not taking a clear line. They have refused to define what they mean by a "genuine productivity agreement".
  Mr. Eldon Griffiths: Is is not a fact that in the 280 agreements referred to by the Parliamentary Secretary there must have been many which were determined before the
  336
  criteria were laid down? Therefore, there cannot be any consistency.
  Mr. Higgins: I do not think for a moment that there is any consistency.
  The core of the matter was referred to by the hon. Member for Poplar (Mr. Mikardo), in a speech based on great experience, when he said that the whole idea of a productivity agreement, which was commended by the Prices and Incomes Board, was that certain restrictive practices should be abolished as a result of which an increase in pay was given. These are very tender plants, and we cannot hope to get agreements of this kind if we say, "You must refer the matter to the Government. You must then refer it to the Board" and then in the end say, "We will freeze the whole thing for nine months and you must start again because quite different conditions will then prevail".
  This is not a prices, incomes and productivity policy, because the effect of the Government's action has been, as it was in the case of the Birmingham car delivery drivers, not to increase productivity, but to diminish productivity. The whole matter has proceeded in a downward spiral. This is endemic in the approach of the Government in the last year.
  The First Secretary may have a grand, global tautology that the important thing is to keep increases in incomes in line with increases in productivity. This is a tautology. It is no criterion as a basis for action. It is something which, if one can bring it about, is true by definition, but nothing which the Government are doing is likely to bring about that desirable state of affairs. They are creating a situation with high unemployment and stagnant production which is likely to bring back the restrictive trade practices which grew up in the 1930s. The sooner they get away from this approach and adopt a sensible approach which encourages increases in productivity, the better it will be. I hope that my right hon. and hon. Friends will support the Amendments.
  Mr. John Silkin Mr. John Silkin rose in his place and claimed to move, That the Question be now put:—
  Question put, That the Question be now put:
  The House divided: Ayes 143. Noes 109.

  Division No. 438.]

  AYES

  [3.55 a.m.

  Alldritt, Walter

  Fowler, Gerry

  Milne, Edward (Blyth)

  Ashley, Jack

  Fraser, John (Norwood)

  Morris, Charles R. (Openshaw)

  Atkins, Ronald (Preston, N.)

  Freeson, Reginald

  Morris, John (Aberavon)

  Bacon, Rt. Hn. Alice

  Gardner, Tony

  Murray, Albert

  Bagier, Gordon A. T.

  Garrett, W. E.

  Newens, Stan

  Barnes, Michael

  Gray, Dr. Hugh (Yarmouth)

  Noel-Baker, Francis (Swindon)

  Baxter, William

  Grey, Charles (Durham)

  Oakes, Gordon

  Bence, Cyril

  Hamilton, James (Bothwell)

  Ogden, Eric

  Benn, Rt. Hn. Anthony Wedgwood

  Hannan, William

  O'Malley, Brian

  Binns, John

  Harper, Joseph

  Owen, Dr. David (Plymouth, S'tn)

  Bishop, E. S.

  Harrison, Walter (Wakefield)

  Page, Derek (King's Lynn)

  Blackburn, F.

  Hart, Mrs. Judith

  Parkyn, Brian (Bedford)

  Bradley, Tom

  Haseldine, Norman

  Pavitt, Laurence

  Bray, Dr. Jeremy

  Hattersley, Roy

  Pentland, Norman

  Brooks, Edwin

  Hazell, Bert

  Rees, Merlyn

  Brown, Rt. Hn. George (Belper)

  Herbison, Rt. Hn. Margaret

  Reynolds, G. W.

  Brown, Hugh D. (G'gow, Provan)

  Hooley, Frank

  Roberts, Albert (Normanton)

  Brown, Bob (N'c'tle-upon-Tyne, W)

  Howarth, Robert (Bolton, B.)

  Roberts, Gwilym (Bedfordshire, S.)

  Brown, R. W. (Shoreditch & F'bury)

  Howell, Denis (Small Heath)

  Robinson, W. O. J. (Walth'stow, E.)

  Buchan, Norman

  Hoy, James

  Roebuck, Roy

  Buchanan, Richard (G'gow, Sp'burn)

  Huckfield, L.

  Rose, Paul

  Callaghan, Rt. Hn. James

  Hunter, Adam

  Shaw, Arnold (Ilford, S.)

  Carmichael, Neil

  Jackson, Colin (B'h'se & Spenb'gh)

  Shore, Peter (Stepney)

  Coe, Denis

  Johnson, James (K'ston-on-Hull, W.)

  Silkin, Rt. Hn. John (Deptford)

  Coleman, Donald

  Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)

  Slater, Joseph

  Conlan, Bernard

  Jones, T. Alec (Rhondda, West)

  Stewart, Rt. Hn. Michael

  Crawshaw, Richard

  Judd, Frank

  Summerskill, Hn. Dr. Shirley

  Crossman, Rt. Hn. Richard

  Leadbitter, Ted

  Swingler, Stephen

  Dalyell, Tam

  Ledger, Ron

  Taverne, Dick

  Davidson, Arthur (Accrington)

  Lee, Rt. Hn. Frederick (Newton)

  Tinn, James

  Davies, Harold (Leek)

  Lewis, Ron (Carlisle)

  Urwin, T. W.

  Dell, Edmund

  Lomas, Kenneth

  Wainwright, Edwin (Dearne Valley)

  Dempsey, James

  Loughlin, Charles

  Walker, Harold (Doncaster)

  Dewar, Donald

  Lyons, Edward (Bradford, E.)

  Watkins, David (Consett)

  Diamond, Rt. Hn. John

  McBride, Neil

  Watkins, Tudor (Brecon & Radnor)

  Dobson, Ray

  MacColl, James

  White, Mrs. Eirene

  Doig, Peter

  MacDermot, Niall

  Whitlock, William

  Dunn, James A.

  Mackenzie, Gregor (Rutherglen)

  Willey, Rt. Hn. Frederick

  Dunwoody, Mrs. Gwyneth (Exeter)

  Mackie, John

  Williams, Alan (Swansea, W.)

  Dunwoody, Dr. John (F'th & C'b'e)

  Mackintosh, John P.

  Williams, Alan Lee (Hornchurch)

  Eadie, Alex

  Maclennan, Robert

  Williams, Mrs. Shirley (Hitchin)

  Ellis, John

  McMillan, Tom (Glasgow, C.)

  Willis, George (Edinburgh, E.)

  English, Michael

  McNamara, J. Kevin

  Wilson, William (Coventry, S.)

  Ennals, David

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

  Woodburn, Rt. Hn. A.

  Ensor, David

  Manuel, Archie

  Woof, Robert

  Evans, Ioan L. (Birm'h'm, Yardley)

  Mapp, Charles

  Fernyhough, E.

  Marquand, David

  TELLERS FOR THE AYES:

  Fitch, Alan (Wigan)

  Mason, Roy

  Mr. William Howie and

  Forrester, John

  Millan, Bruce

  Mr. Ernest Armstrong.

  NOES

  Alison, Michael (Barkston Ash)

  Gilmour, Sir John (Fife, E.)

  Kaberry, Sir Donald

  Allason, James (Hemel Hempstead)

  Glover, Sir Douglas

  Kershaw, Anthony

  Astor, John

  Glyn, Sir Richard

  Kimball, Marcus

  Atkins, Humphrey (M't'n & M'd'n)

  Goodhew, Victor

  King, Evelyn (Dorset, S.)

  Baker, W. H. K.

  Gower, Raymond

  Kirk, Peter

  Balniel, Lord

  Grant, Anthony

  Kitson, Timothy

  Biffen, John

  Grant-Ferris, R.

  Knight, Mrs. Jill

  Brewis, John

  Griffiths, Eldon (Bury St. Edmunds)

  Lambton, Viscount

  Bromley-Davenport, Lt.-Col. Sir Walter

  Gurden, Harold

  Lewis, Kenneth (Rutland)

  Brown, Sir Edward (Bath)

  Harris, Reader (Heston)

  MacArthur, Ian

  Bruce-Gardyne, J.

  Harvie Anderson, Miss

  Macleod, Rt. Hn. Iain

  Carr, Rt. Hn. Robert

  Hawkins, Paul

  Maude, Angus

  Chichester-Clark, R.

  Heseltine, Michael

  Mawby, Ray

  Clegg, Walter

  Higgins, Terence L.

  Maxwell-Hyslop, R. J.

  Corfield, F. V.

  Hiley, Joseph

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

  Dance, James

  Hill, J. E. B.

  Mills, Peter (Torrington)

  Dean, Paul (Somerset, N.)

  Hirst, Geoffrey

  Miscampbell, Norman

  Deedes, Rt. Hn. W. F. (Ashford)

  Holland, Philip

  Monro, Hector

  Dodds-Parker, Douglas

  Hordern, Peter

  More, Jasper

  Eden, Sir John

  Howell, David (Guildford)

  Morrison, Charles (Devizes)

  Emery, Peter

  Hunt, John

  Munro-Lucas-Tooth, Sir Hugh

  Errington, Sir Eric

  Hutchison, Michael Clark

  Murton, Oscar

  Eyre, Reginald

  Iremonger, T. L.

  Noble, Rt. Hn. Michael

  Fisher, Nigel

  Jenkin, Patrick (Woodford)

  Onslow, Cranley

  Fletcher-Cooke, Charles

  Johnson Smith, G. (E. Grinstead)

  Page, Graham (Crosby)

  Fortescue, Tim

  Jopling, Michael

  Page, John (Harrow, W.)

  Pardoe, John

  Shaw, Michael (Sc'b'gh & Whitby)

  Wells, John (Maidstone)

  Peel, John

  Sinclair, Sir George

  Whitelaw, Rt. Hn. William

  Percival, Ian

  Smith, John

  Wilson, Geoffrey (Truro)

  Pink, R. Bonner

  Stoddart-Scott, Col. Sir M. (Ripon)

  Wolrige-Gordon, Patrick

  Price, David (Eastleigh)

  Taylor, Sir Charles (Eastbourne)

  Wright, Esmond

  Prior, J, M. L.

  Taylor, Edward M. (G'gow, Cathcart)

  Wylie, N. R.

  Pym, Francis

  Thatcher, Mrs. Margaret

  Younger, Hn. George

  Ridley, Hn. Nicholas

  Turton, Rt. Hn. R. H.

  Royle, Anthony

  van Straubenzee, W. R.

  TELLERS FOR THE NOES:

  Russell, Sir Ronald

  Walker, Peter (Worcester)

  Mr. R. W. Elliott and

  Scott, Nicholas

  Weatherill, Bernard

  Mr. David Mitchell.

  Sharples, Richard

  Webster, David

  Question put accordingly, That the proposed words be there inserted in the Bill:—
  The House divided: Ayes 109,Noes 142.

  Division No. 439.]

  AYES

  [4.5 a.m.

  Alison, Michael (Barkston Ash)

  Heseltine, Michael

  Page, Graham (Crosby)

  Allason, James (Hemel Hempstead)

  Higgins, Terence L.

  Page, John (Harrow, W.)

  Astor, John

  Hiley, Joseph

  Pardoe, John

  Atkins, Humphrey (M't'n & M'd'n)

  Hill, J. E. B.

  Peel, John

  Baker, W. H. K.

  Hirst, Geoffrey

  Percival, Ian

  Balniel, Lord

  Holland, Philip

  Pink, R. Bonner

  Biffen, John

  Hordern, Peter

  Price, David (Eastleigh)

  Brewis, John

  Howell, David (Guildford)

  Prior, J. M. L.

  Bromley-Davenport, Lt.-Col. Sir Walter

  Hunt, John

  Pym, Francis

  Brown, Sir Edward (Bath)

  Hutchison, Michael Clark

  Ridley, Hn. Nicholas

  Bruce-Gardyne, J.

  Iremonger, T. L.

  Royle, Anthony

  Carr, Rt. Hn. Robert

  Jenkin, Patrick (Woodford)

  Russell, Sir Ronald

  Chichester-Clark, R.

  Johnson Smith, G. (E. Grinstead)

  Scott, Nicholas

  Clegg, Walter

  Jopling, Michael

  Sharples, Richard

  Corfield, F. V.

  Kaberry, Sir Donald

  Shaw, Michael (Sc'b'gh & Whitby)

  Dance, James

  Kershaw, Anthony

  Sinclair, Sir George

  Dean, Paul (Somerset, N.)

  Kimball, Marcus

  Smith, John

  Deedes, Rt. Hn. W. F. (Ashford)

  King, Evelyn (Dorset, S.)

  Stoddart-Scott, Col. Sir M. (Ripon)

  Dodds-Parker, Douglas

  Kirk, Peter

  Taylor, Sir Charles (Eastbourne)

  Eden, Sir John

  Knight, Mrs. Jill

  Taylor, Edward M. (G'gow, Cathcart)

  Emery, Peter

  Lambton, Viscount

  Thatcher, Mrs. Margaret

  Errington, Sir Eric

  Lewis, Kenneth (Rutland)

  Turton, Rt. Hn. R. H.

  Eyre, Reginald

  MacArthur, Ian

  van Straubenzee, W. R.

  Fisher, Nigel

  Macleod, Rt. Hn, Iain

  Walker, Peter (Worcester)

  Fletcher-Cooke, Charles

  Maude, Angus

  Weatherill, Bernard

  Fortescue, Tim

  Mawby, Ray

  Webster, David

  Gilmour, Sir John (Fife, E.)

  Maxwell-Hyslop, R. J.

  Wells, John (Maidstone)

  Glover, Sir Douglas

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

  Whitelaw, Rt. Hn. William

  Glyn, Sir Richard

  Mills, Peter (Torrington)

  Wilson, Geoffrey (Truro)

  Goodhew, Victor

  Miscampbell, Norman

  Wolrige-Gordon, Patrick

  Gower, Raymond

  Mitchell, David (Basingstoke)

  Wright, Esmond

  Grant, Anthony

  Monro, Hector

  Wylie, N. R.

  Grant-Ferris, R.

  More, Jasper

  Younger, Hn. George

  Griffiths, Eldon (Bury St. Edmunds)

  Morrison, Charles (Devizes)

  Gurden, Harold

  Munro-Lucas-Tooth, Sir Hugh

  TELLERS FOR THE AYES:

  Harris, Reader (Heston)

  Murton, Oscar

  Mr. R. W. Elliot and

  Harvie Anderson, Miss

  Noble, Rt. Hn. Michael

  Mr. Timothy Kitson.

  Hawkins, Paul

  Onslow, Cranley

  NOES

  Alldritt, Walter

  Callaghan, Rt. Hn. James

  Edwards, Robert (Bilston)

  Ashley, Jack

  Carmichael, Neil

  English, Michael

  Atkins, Ronald (Preston, N.)

  Coe, Denis

  Ennals, David

  Bacon, Rt. Hn. Alice

  Coleman, Donald

  Ensor, David

  Bagier, Gordon A. T.

  Conlan, Bernard

  Evans, Ioan L. (Birm'h'm, Yardley)

  Barnes, Michael

  Crawshaw, Richard

  Fernyhough, E.

  Baxter, William

  Crosland, Rt. Hn. Anthony

  Fitch, Alan (Wigan)

  Bence, Cyril

  Crossman, Rt. Hn. Richard

  Forrester, John

  Benn, Rt. Hn, Anthony Wedgwood

  Dalyell, Tam

  Fowler, Gerry

  Binns, John

  Davidson, Arthur (Accrington)

  Fraser, John (Norwood)

  Bishop, E. S.

  Davies, Harold (Leek)

  Freeson, Reginald

  Blackburn, F.

  Dell, Edmund

  Gardner, Tony

  Bradley, Tom

  Dempsey, James

  Garrett, W. E.

  Bray, Dr. Jeremy

  Dewar, Donald

  Gray, Dr. Hugh (Yarmouth)

  Brooks, Edwin

  Diamond, Rt. Hn. John

  Grey, Charles (Durham)

  Brown, Rt. Hn. George (Belper)

  Dobson, Ray

  Hamilton, James (Bothwell)

  Brown, Hugh D. (G'gow, Provan)

  Doig, Peter

  Hannan, William

  Brown, Bob (N'c'tle-upon-Tyne, W)

  Dunn, James A.

  Harper, Joseph

  Brown, R. W. (Shoreditch & F'bury)

  Dunwoody, Mrs. Gwyneth (Exeter)

  Harrison, Walter (Wakefield)

  Buchan, Norman

  Dunwoody, Dr. John (F'th & C'b'e)

  Hart, Mrs. Judith

  Buchanan, Richard (G'gow, Sp'burn)

  Eadie, Alex

  Haseldine, Norman

  Hattersley, Roy

  McMillan, Tom (Glasgow, C.)

  Shore, Peter (Stepney)

  Hazell, Bert

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

  Silkin, Rt. Hn. John (Deptford)

  Herbison, Rt. Hn. Margaret

  Manuel, Archie

  Slater, Joseph

  Hooley, Frank

  Mapp, Charles

  Stewart, Rt. Hn. Michael

  Howarth, Robert (Bolton, E.)

  Marquand, David

  Summerskill, Hn. Dr. Shirley

  Howell, Denis (Small Heath)

  Mason, Roy

  Swingler, Stephen

  Hoy, James

  Millan, Bruce

  Taverne, Dick

  Huckfield, L.

  Milne, Edward (Blyth)

  Tinn, James

  Hunter, Adam

  Morris, Charles R. (Openshaw)

  Urwin, T. W.

  Jackson, Colin (B'h'se & Spenb'gh)

  Morris, John (Aberavon)

  Wainwright, Edwin (Dearne Valley)

  Johnson, James (K'ston-on-Hull, W.)

  Murray, Albert

  Walker, Harold (Doncaster)

  Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)

  Noel-Baker, Francis (Swindon)

  Watkins, David (Consett)

  Jones, T. Alec (Rhondda, West)

  Oakes, Gordon

  Watkins, Tudor (Brecon & Radnor)

  Judd, Frank

  Ogden, Eric

  White, Mrs. Eirene

  Leadbitter, Ted

  O'Malley, Brian

  Whitlock, William

  Ledger, Ron

  Owen, Dr. David (Plymouth, S'tn)

  Willey, Rt. Hn. Frederick

  Lee, Rt. Hn. Frederick (Newton)

  Page, Derek (King's Lynn)

  Williams, Alan (Swansea, W.)

  Lewis, Ron (Carlisle)

  Parkyn, Brian (Bedford)

  Williams, Alan Lee (Hornchurch)

  Lomas, Kenneth

  Pavitt, Laurence

  Williams, Mrs. Shirley (Hitchin)

  Loughlin, Charles

  Pentland, Norman

  Willis, George (Edinburgh, E.)

  Lyons, Edward (Bradford, E.)

  Rees, Merlyn

  Wilson, William (Coventry, S.)

  McBride, Neil

  Reynolds, G. W.

  Woodburn, Rt. Hn. A.

  MacCoil, James

  Roberts, Albert (Normanton)

  Woof, Robert

  MacDermot, Niall

  Roberts, Gwilym (Bedfordshire, S.)

  Mackenzie, Gregor (Rutherglen)

  Robinson, W. O. J. (Walth'stow, E.)

  TELLERS FOR THE NOES:

  Mackie, John

  Roebuck, Roy

  Mr. William Howie and

  Mackintosh, John P.

  Rose, Paul

  Mr. Ernest Armstrong.

  Maclennan, Robert

  Shaw, Arnold (Ilford, S.)

  Mr. Iain Macleod: I beg to move,
  That further consideration of the Bill, as amended, be now adjourned.
  On this occasion I hope that, after a very brief statement from myself and a very brief reply from the First Secretary, I can withdraw the Motion and the House can continue consideration of the Bill. I think that it would be seemly and right for the House to be told now what the First Secretary's intentions are. Clearly, when he replied to an earlier debate the words he used indicated that he did not really expect any longer to get the whole of the Bill, much less the Order, tonight. It is now dawn and we have not completed Clause 1. Although the First Secretary might be disappointed with this progress, I do not think that anybody in the House, with the exception of the Leader of the House, will be surprised, because this is an extremely difficult Bill. I therefore hope that the First Secretary will, if he cannot agree to stop now, set a target a fairly short distance ahead on the Order Paper which we may be able to accept and work towards.
  4.15 a.m.
  Mr. M. Stewart: I do not think that we should adjourn consideration now, but I take the right hon. Gentleman's point about setting a target for how far we should get at this stage. We must accept that it will be necessary for the House to resume some part of the discussion on the Bill and Order tonight, after ten o'clock. I am anxious that that
  342
  should not be too heavy an assignment for the House.
  This could be achieved if, with the co-operation of the House, we could get as far as the end of Clause 2 before we rise. If we could all agree that this target would be reasonable, I would ask the right hon. Gentleman to withdraw his Motion.
  Mr. Iain Macleod: I am grateful to the First Secretary for his response. There is a complication in that I can speak only for this side of the House, and there are other oppositions, of which I am not the spokesman. The proposal made by the First Secretary is reasonable. He says that it will be necessary to go on tonight, at ten o'clock. That will mean a series of all night sittings, which have their own complications and which bring their own strains.
  The only point in that case, because we should not do these matters beneath the rules in the small hours of the morning, is to ask the right hon. Gentleman to ask his right hon. Friend the Leader of the House to make a short business statement at 3.30 p.m. I do not ask for an answer now, but if the First Secretary would convey that to the Leader of the House it would be for the convenience of the House.
  Hon. Members: Where is he?
  Mr. Macleod: Wherever he is, I am about to ask leave to withdraw my Motion.
  Motion, by leave, withdrawn.
  Mr. Stan Newens: I beg to move Amendment No. 14, in page 2, line 9, at the end to insert:
  (3) The provisions of subsections (1) and (2) of this section shall be disregarded in determining the pension of any employee.
  The object of this Amendment is to prevent any long-term restriction on a pension, which was surely not intended by the Bill. The intention of the Bill is to provide a limited standstill of incomes, but the possible effect of the Bill, as drafted, is to reduce the level of pension, it appears for the rest of his life, of a person at present employed. It is necessary for me to expand this by pointing out that some employees' pensions depend on the average earnings during their last years of employment.
  For example, in the case of teachers, the amount of the annual pension depends on two factors: the length of service and the average salary earned during the last three years of teaching. Teachers get one-eightieth of the average of the last three years' earnings for each year of service. There are many superannuation schemes which have a similar form for salaried staffs in other occupations.
  This means that if earnings during the course of the last year during which a person is employed are prevented from rising by the effect of this Bill, when it becomes law, then the average earnings for the course of the last three years, or whatever the requisite period may be, will be reduced and the best figure for calculating the annual pension of any person will be reduced. This means that the best figure for calculating the annual pension of any person thus affected would be reduced and, accordingly, his pension rights for life. If an employee failed to qualify during the course of the last year for, say, £39, if my arithmetic is right, he would incur a loss of 5s. a week, or £13 per annum for the rest of his life.
  This does not merely apply in cases of pensions paid out in weekly or monthly sums; it applies also in those cases in which a lump sum is paid out at the end of the employee's service because the lump sum is also based on a formula rather similar to the formula which I have described.
  In the case of teachers, with which I am familiar, the lump sum is dependent once again on the last three years of
  344
  earnings. In fact the teacher receives by way of lump sum 3/80ths, times the period of service, times the average salary in the last three years, and similar arrangements prevail in other occupations.
  At this time, I have no intention of wearying the House by adding to the example I have already quoted. It suffices to say that there are many employees who will suffer lasting loss as a result of the effects of this Bill. I believe it is totally unjust to deprive an employee of part of his retirement pension for life. It is surely enough for the employee to be obliged to tolerate the standstill and lose earnings during the final year of his employment, and it is really an injustice which was surely in no way envisaged or intended by the Bill originally that a person should be penalised for life, and I can see no reason whatsoever for perpetuating this arrangement.
  In these circumstances, I very much hope that my right hon. Friend will agree to accept the Amendment. After all, if he does agree to accept this it will not in any way frustrate the purposes of the Bill which he has set forth as far as the period of the standstill is concerned. But if he will accept the Amendment an injustice will be prevented which will particularly apply as between different people who happen to retire at different times. One individual who retires, let us say, three or four months' later than another individual, might get an enhanced pension which his colleague, who retired a little earlier, was not entitled to. In these circumstances, I think there is a very good case indeed for my right hon. Friend to give very careful consideration to this Amendment, and I hope he will agree to accept it.
  Sir D. Glover: I am astonished that the hon. Member for Epping (Mr. Newens) has had to move this Amendment. I cannot understand why the Government did not accept, long before we reached this stage of the Bill, what the hon. Member is after in his Amendment.
  We all know that there is anger and bitterness among people who are deprived of the increases they otherwise would have got in their wages or salaries for one period of 12 months, but at the end of the 12 months with any luck they may

  345
  get their rises when the matter has been in front of the Prices and Incomes Board, and all they have lost is perhaps nine months' or 12 months' of their increases.
  But when one is dealing with pensions one is dealing with a totally different picture. I am not going to delay the House, after the good example given by the hon. Member, but so many people's pensions are geared to their earnings, particularly in the last years, not just in the teaching profession but in many other professions; or it is an amalgam of their total earnings and their highest earning year affects their pension very severely. In some cases, such as in the teaching profession, it is assessed over the last three years of their earnings, and unless there is an alteration here we are providing for a permanent reduction in that person's retirement pay, not for one year but perhaps for 5, 10, 20 or even 25 years. It is not impossible for somebody who retires at 65 to live to be 90. I am told that the average age now is over 80. So there is nothing extraordinary in someone retiring at 65 and living to 90. Such a person will suffer a reduction in pension for 20–25 years.
  I am sure that this was never the intention of the Government when they started the campaign of freeze and squeeze. I am sure that it was never envisaged that this would happen to the pensioner on a permanent basis. I hope that the First Secretary will not give a reply to the Amendment bringing in the cap-trap, to use the expression used by h is hon. Friend, that this is only a follow-up Bill from the previous Measure and that the other Measure was the father Measure. If in the father Measure there were some anomalies and injustices, I should have thought that the fact that the Government had to bring in another Bill would have given them an opportunity to put the anomalies right.
  It is not sufficient to say that the Bill is based on what was in the previous Measure. If that is the case, the Minister ought not to have brought in a Bill which was a duplicate of the other Measure; he should have brought in a Bill to deal with the problem and remove the anomalies that we have been discussing on the Amendments moved by h3n. Gentleman opposite. Those anomalies could have been removed had
  346
  greater care been taken in producing the Bill.
  There is no party issue in this. There is not even an ideological issue in it between the Left and Right in the Labour Party. It is a matter of simple justice. In many cases the people concerned were able to assess 10 years ago how much they were likely to draw in pension, knowing their salary scales and the increments and also their expectations. But the freeze has upset their calculations about what they would have on retirement. They may have entered into the purchase of a cottage. Because of the arbitrary alteration their income will be reduced by £13, £15 or even £20 or more a year, which will make all the difference to their standard of living—and that will go on for the remainder of their life. This is just because the Government wanted to have a flat standstill for a period of one or two years.
  What has astonished me throughout our debates tonight is the little appreciation that has come from the Government Front Bench of what really goes on on factory floors between human beings negotiating and what goes on in households. I hope that the right hon. Gentleman will be able to accept his hon. Friend's Amendment, because I believe it represents just simple justice.
  Mr. Gerry Fowler: As a very firm supporter of my right hon. Friend's prices and incomes policy, I hope that he will be able to make a concession on this issue. Many of us have constituents who in the past 12 months have already been adversely affected by the policy. This is a matter of simple justice to most of us. It is very hard to understand why a man should be penalised for the rest of his life. In the majority of cases those affected are not likely to be among the better off sections of the community.
  4.30 a.m.
  A person who has retired is not likely to have superfluous means and it seems unfair that, because of the provisions of a policy which, in its present form, is unlikely to last more than two years, a person should be penalised in this way for the rest of his life by being unlucky enough to have been caught in this period.
  I must correct the hon. Member for Ormskirk (Sir D. Glover) on one point.

  347
  This does not really apply to a man who has been calculating for 10 years what he will receive well knowing that he is on a regular incremental scale. The policy has not affected the man on an incremental scale and the hon. Gentleman's point is therefore irrelevant. But the basic argument stands and I hope that my right hon. Friend will be able to make some concession.
  Mr. John Page: I support the Amendment on grounds of common fairness and sincerely hope that the Government will accept it. It is improper to ask a small number of people to carry for the rest of their lives a burden which was placed on the whole country for a few years. I will give two specific instances of hardship caused by this aspect of Government policy. Both persons concerned were connected with Government service, one directly and the other in a nationalised industry.
  The first concerns the extraordinary case of the engineering grades in the Post Office, where some of the senior grades did not have their review agreed before last July while some of the junior grades had their increases agreed. A man promoted from a junior to senior grade may be worse off, and if he retires during this promotion year he will actually receive, because he was promoted, a lower pension than he would otherwise have got.
  The second case is that of a constituent who came to see me today. He retired in May. He was in a senior managerial grade of British Railways. He was not allowed to receive an increment in his last year of service, which could have been about 5 per cent. His loss in pension rights will be about £100 a year for good. He also suffered a substantial loss in the lump sum retirement payment.
  My constituent had an interview with the Senior Personnel Director of British Railways, who explained that if the British Railways Board could grant him the increase so far as his pension was concerned, it would willingly do so. But the Board has been in touch with either the Treasury or the Ministry of Transport and has been told that it is not Government policy that this should be done, and that it may not do it. This is a definite intervention with a nationalised industry by Government Departments
  348
  who have said, "You may not take into consideration the increase which this long-service senior employee would have received and he will now make this sacrifice."
  He would be prepared, as would many other pensioners in the same position, to forgo an increase in pension at the full rate for a year or two.
  Mr. Biffen: I understand that the advice tendered by the Government is that it is illegal for British Railways to make these arrangements or that the making of these arrangements would be contrary to the spirit of the Government's policy. I think the distinction is very germane.
  Mr. Page: I must be careful here. As I understand it, strong pressure was brought on the British Railways Board not to grant this. If I said it was illegal, I was speaking outside my definite knowledge. However, it asked for the advice, the advice was given, and it accepted the advice and is proposing to act on it. If I said it was illegal I was probably wrong. Nevertheless, the pressure was strong enough to make it take the action that it did.
  I was saying that I am sure that pensioners in this position would be willing to forgo for a year or two, or during the period of a continued squeeze or freeze, the increase which would be legitimately theirs. If it was put to them I am sure that they would accept it, but they do not consider that it would be fair or equitable or just that they should be asked for the rest of their lives to carry the severe handicap which is their lot, because they happened to retire during the lifetime of the present Government. I therefore sincerely ask the Government to accept the Amendment or make a proposal similar to it.
  Mr. Sydney Bidwell: If I sense the mood of the House aright, it has just about had enough. I am conscious that this is not my finest hour, but since I have been sitting here for many a long hour waiting to take part in this section of the debate I should like to add a couple of points and make an appeal to my right hon. Friend. I also justify my intervention at this late, or early, hour on the ground that I have

  349
  had several representations from constituents from time to time raising this very point.
  I have looked at the Amendment very carefully and I have some knowledge, because of the kind of work that I did before I came to the House, of pensions and superannuation schemes, which vary enormously from industry to industry and from occupation to occupation. Sometimes there are none at all, as we recognise in our Labour Party policy on national superannuation ideas etc. Nevertheless, I accept the wisdom of the Amendment that has been suggested. If it is not possible to accept the exact wording, I hope that my right hon. Friend will at least accept the spirit or the intention of what was required.
  Pension schemes can be fixed schemes which have little relationship to earnings, but are assessed from time to time and are sometimes the subject of employer and trade union negotiation. On the other hand, superannuation schemes depend very much on worker-employer contributions based on a percentage system, and schemes of this kind can be adversely affected. Although automatic annual incremental scales are not very much affected, such things as merit money and merit payments in industry are affected and that can have an adverse effect on pensions, and that is not right.
  Not long ago, I was reading that boards of directors of limited liability companies salt away funds for pensions rights for directors, sometimes to a tune which exceeds what is paid in directors' fees. This is in order to ensure that directors do not have a big reduction in their standards of living when they start to get on in life. I would not like a Labour Government of all Governments to have been instrumental in exercising one law for the poor and another for the better-off sections of industry, who are better off than the average worker can hope to be.
  In view of the sequence of events and what my right hon. Friend the First Secretary has said about the way in which this policy has developed, from the declaration of intent to the freeze, to the period of severe restraint and now into a period of restraint, making this first concession and accepting what
  350
  is implied in the Amendment would go along quite comfortably with the whole notion of the future period of restraint. If the Government cannot accept the exact wording of the Amendment, I hope that they will accept its spirit and intention and will closely study it.
  Mr. Biffen: The hon. Member for Southall (Mr. Bidwell) prefaced his remarks with a charming and understandable apology for detaining the House at this hour of the morning. He should not be so modest, for at this hour vigilance and will-power are often more needed than ever before. It is just an accident of time that we happen to be considering this Amendment at a quarter to five in the morning. That is no reason why we should take a more leisurely attitude than if we were discussing it at half-past eight or half-past nine. I know that this will appeal particularly to the hon. Member for Poplar (Mr. Mikardo), because if there is anything which we have learned from the Prices and Incomes Act it is that when it was tested in the courts, it was often adjudged to be other than hon. Members had assumed on the guarantee of the Treasury Bench.
  The hon. Member for Epping (Mr. Newens) has rightly drawn attention to the fact that this legislation might have a continuing deleterious effect on pension rights and that the pension of anyone might be affected by a standstill on his earnings for six months. I do not read the Bill as indicating that inevitably someone will suffer the harmful consequences of the Bill to his pension rights.
  4.45 a.m.
  I am prepared to believe that many more nuances can be read into this than I, as a layman, possibly could, but it is quite clear that it is possible for an employer retrospectively to pay whatever increase was delayed by the Prices and Incomes Board, and this leads me to think in terms of pension arrangements. It would be possible for some retrospective arrangements to be made. It is not clear, and that is why the House should properly concern itself with this at this hour. We want clarification and clarification of a rather higher order than on the Act last year, because we do not want the House to be held to ridicule by adverse and distinguished judicial

  351
  comment on the quality of the legislation when it was finally tested in the courts by the kind courtesy of Mr. Clive Jenkins.
  I support this probing Amendment for a reason touched on by the hon. Member for Southall—that it seeks to say that the provisions of subsections (1) and (2) shall be disregarded in determining the pension of any employee.
  Subsection (1) opens:
  "Where by virtue of a reference to the National Board for Prices and Incomes. …"
  We are constantly going back to this problem that we are discussing a catalogue of people who will be placed in a specific situation because they have been selected for reference to the National Board for Prices and Incomes. We cannot peer into the future and determine with any exactitude what kind of people are likely to be referred, but it is pretty clear that it is likely to be people whose incomes are collectively determined, perhaps Government employees, perhaps those organised by what the Government deem to be a militant union.
  When we discussed pensions, the hon. Member for Southall rightly drew attention to the considerable development of pensions schemes for many people who are certainly non-unionists. I will not engage in what might be thought pejorative words about executive suites, but the provision of top hat pension schemes is encouraged by this legislation, with the more sophisticated payment of total emolument, if one wants to use these rather ponderous terms, and the trend is increasingly towards fringe benefits for this kind of person. It is perfectly reasonable for the hon. Members for Reading (Mr. John Lee) and for Southall to see in the working out of this policy, if it is ever put into legislative action, a discrimination which will tend to be to the disadvantage of the lower-paid. I think this is a fair inference.
  The Secretary of State may say that I am conjuring up a totally false proposition, but if the alternative is that the Prices and Incomes Board is to be diverted to considering the incomes of the odd two or three individuals, the counter-proposition is to my mind even more improbable. I think that the hon. Member for Epping is to
  352
  be congratulated on putting down this Amendment, and I hope that if hon. Gentlemen opposite are not satisfied with the answer they get from the Government they will make history by voting against their own leadership.
  Mr. Eldon Griffiths: I wish briefly to support the Amendment, in particular on behalf of a group in which, as the House knows, I have a special interest, namely, the police.
  There are three features of police pensions which will make them particularly vulnerable to the Bill if it is not amended in the way proposed. First, many policemen are compulsorily retired at a very early age, owing to the physical nature of the job. There is, therefore, no question in their case of hanging on for a few years until the prices and incomes policy has left us. They have to go at this early age. They have no choice.
  Secondly, they receive their pensions at a relatively early age, in many cases by the age of 50. This means that they are sent out on pension at a lower rate than they could have expected to get without this policy, and there is a very much longer period of their lives during which they suffer from this discrimination.
  Thirdly, the police pension is relatively generous. This is not, perhaps, the view that I take when I am dealing with the Whitley Council, but it is a relatively generous pension, in large measure because it is contributory. Therefore, to the extent that there is discrimination, it is apt to be one that is more felt by this group.
  From the contacts that I have had with the official side of the Whitley Council on this matter, I have formed the strong impression that the Government are not at all happy about the situation, and that there is real hope that they will deal with this question. I hope that when the right hon. Gentleman replies to the debate he will, if he is not able to give us complete satisfaction, at least give more hope—I believe that there is already some—to these people in the public service who are particularly concerned about the present situation.
  Mrs. Margaret Thatcher: I, too, would like briefly to support the Amendment, because many of the points have been advanced in some detail, and

  353
  we have learned exactly what is in the mind of the hon. Member for Epping (Mr. Newens).
  I think that the First Secretary will remember that we0 have discussed this before, when we discussed the White Paper on the standstill and severe restraint. As I undersand it, the position is that people who are on the point of retiring now will already suffer from the period of standstill and the period of severe restraint during which their salaries or incomes have been virtually frozen. Thus, in so far as they retire now on pension, and the pension is determined by reference to a fraction of their final salaries, or their salaries throughout their working lives, they will suffer considerable damage, which at the moment we can do nothing to restore. Without the Amendment, they will suffer further damage. The Amendment seeks to prevent that further damage from being suffered, and therefore to mitigate the consequences on these people.
  I suspect that the First Secretary will say that it is impracticable to do it, and very difficult, and so on, because there are so many different ways of calculating pensions. He will probably say that a person who is 10 years before retirement will also suffer if his pension is calculated by reference to one-fortieth of his yearly salary. This is true, but the people who will suffer most are those whose pensions are calculated by reference to three years of final salary, and who are about to retire now.
  I join my hon. Friends and hon. Gentlemen opposite who have pleaded this case, and I think that we must press the right hon. Gentleman to ensure that as far as possible the effect on the people to whom I have referred is mitigated. The Amendment is wider than was indicated. It could apply not only to pension entitlement, but to existing pension rights. Although it refers to the pension of "any employee" and not that of a former employee, a number working for one company could be on pension.
  What is the position of those with rights under occupational pension schemes, which cover about 12 million people, although only about two or three million are drawing the pensions under Sections 379 and 388 of the Income Tax Act? There are also a number of
  354
  gratuitous pensions. These pensions could also be referred to the Board under the 1966 Act, because they are "other kinds of income". We asked about this position in discussing the White Paper on severe restraint. Perhaps the right hon. Gentleman would make it clear that, if any company wished to put up the pension of former employees, it would not be referred to the Board.
  This should not be done, as these people must suffer a considerable drop in income in any even event. For those on pension every extra £ or few shillings contributes directly to a standard of comfort or standard of living. I hope that the right hon. Gentleman will be forthcoming both on the calculation of pension entitlement—enabling us to mitigate the effects on those whose entitlement is still being determined—and with the assurance that, if any firm wishes to put up occupational pensions which are being drawn, there will be no reference to the Board.
  Mr. M. Stewart: The speeches have been made with knowledge and feeling in this debate. The hon. Member for Finchley (Mrs. Thatcher) said that I could point out the great procedural difficulties of complying with the Amendment, but I do not propose to do that, although it would involve a thorough search of pension schemes and probably the alteration of a number of Statutes. But even those formidable difficulties would not be sufficient reason in themselves for refusing the Amendment.
  There are, however, difficulties which have not been fully understood. First, I fully accept what has been said about the position of those affected by the standstill, but the Amendment does not and cannot affect them. We must ask what group of people could be affected and in what context we are now considering the pension problem. It is quite different from that of people who have been hurt under the standstill which is now coming to an end. Implicit in the Bill is that any agreement should be notified before it is negotiated, and employers and employed are asked, in deciding whether to press a claim or make a settlement, to have regard to the criteria prevailing during this period, which are, of course, different from and more generous than those of the past.

  355
  The only groups of people to whom this Amendment could apply would be those who had agreed with their employers on a settlement which was, in fact, out of line with the criteria which had been explained and which they knew in advance. If they had done that and if, as a result and following a reference to the Board, a standstill Order had been made in their case, if this Amendment were made it would apply to them but to them only.
  5.0 a.m.
  Contrast their position with a group of employees whose employer had declined to make an agreement in conflict with the standstill. They would not benefit from this Amendment. Once again, this would be the kind of Amendment where anybody—any group of employees or employers—who had agreed, without pressing things to the point where the standstill Order was made, to respect the criteria that prevailed during this period, there would he no question of benefiting from this Amendment. The only group who could benefit from the Amendment would be those who first endeavoured to make a settlement but contravened the criteria, and in consequence had a standstill Order made against them. That would not be a position that one could defend.
  I have considered, therefore—and I considered this the more as I listened to the debate—whether there is any way round this difficulty. Could one, for example, not only bring into pension calculation a definite increase that had been agreed and then disallowed by virtue of a standstill Order, but also start working out what increases people might have got and what increases their employers might have agreed to if it had not been for the whole tenor of the policy and the whole nature of the economic circumstances in which we are now living? I have regretfully come to the conclusion that really that would be an impossible task.
  Do we not here meet something that is inherent in all pensions problems? If the man's pension is calculated, as some are, on the average of, in some cases, the last three years of his salary, it will be apparent that somebody who had the ill
  356
  luck to reach the end of his working life during a period, for any reason—whatever Government action might be—when money wages were not tending to rise, would be in a worse position than somebody whose last three years of working life occurred during a period when money wages were decidedly going up. That is the real anomaly about which hon. Members are complaining.
  That could not be remedied by an Amendment of this kind. Remedies might be sought in other ways. For instance, some might argue that this indicates the unwisdom of calculating pension solely with reference to an average of the last few years of working life—although, of course, there are arguments in favour of doing it that way; but it seems to me, however one argues this, that one cannot come to the conclusion that this Amendment remedies what is the real nature of the problem.
  All the Amendment would do would be to produce what I suggest is the unsatisfactory result that people who had accepted the criteria would not benefit and that people who had tried not to accept the criteria and then had been required to do so would benefit. It is possible, as the hon. Member for Oswestry (Mr. Biffen) suggested, that the employer himself might decide that if there were groups of his employees who were likely to be specially hard hit by this, he might take action to remedy it. It would be quite wrong of me to say anything that would encourage retrospective payments, but they would definitely not be illegal.
  I find it difficult to answer completely the question asked by the hon. Lady, which summons up rather hypothetical circumstances. Her question of whether certain pensions would be referred to the Board in certain cases is rather complicated. So far as I can answer such a question off the cuff, I must reply that I cannot envisage circumstances in which it would be right to refer such an increase to the Board. I am afraid that that is as far as I can go.
  Mr. John Page: I followed most clearly the points the right hon. Gentleman has made and see the snags in the Amendment. Would it be within the spirit of Government policy for an individual who has not received an increase

  357
  in the last year before retirement to come to an arrangement with his employer to receive a pension on the basis that he had received such a payment? Would that he something that the right hon. Gentleman would advise?
  Mr. Stewart: I could not possibly advise it. I cannot say more than I said in reply to the hon. Member for Oswestry, that it is clear that the Bill does not make that illegal.
  Hon. Members: What does that mean?
  Mr. Stewart: It means exactly what it says. One can imagine a great many courses of action which are not illegal but which we would not necessarily advise people to pursue.
  Mr. Eldon Griffiths: It is one thing for a private employer to take the view that an action is not illegal, but it is a very different matter for the official side of a Whitley Council. It would require rather more direction than the right hon. Gentleman has given.
  Mr. Stewart: I could not advise this course of action. That is plain enough. I remind the House that one of the things we must keep in mind in the whole argument about prices and incomes is that in the end what matters to all is the real value of the money they receive. If, as a result of not being as restrictive as circumstances oblige us to be, we greatly
  damage the value of money, pensioners will be among those who suffer most.
  There has been mention in the debate of letters that hon. Members have received about the policy. I too have received letters about it, and hon. Members may be surprised to learn that some of them cheer me on and encourage me in the implementation of the policy. The one I have in mind now, which represents not an individual but a whole group of people, was from a pensioners' association, which felt that it was to people like its members that the maintenance of the value of money was of the greatest importance.
  I hope that the House will believe that I have listened to the debate sympathetically and tried to see if there were a way of dealing with the matter. I refuse the Amendment only because I honestly do not believe that there is, except in a way which would only be enormously administratively difficult. That would not by itself be an overwhelming objection, but it would in addition create more anomalies and injustices than it sought to rectify.
  Therefore, I must with regret, but without hesitation, ask my hon. Friends to withdraw the Amendment.
  Question put, That those words be there inserted in the Bill:—
  The House divided: Ayes 108, Noes 141.

  Division No. 440.]

  AYES

  [5.10 a.m.

  Alison, Michael (Barkston Ash)

  Glyn, Sir Richard

  Kitson, Timothy

  Allason, James (Hemel Hempstead)

  Goodhew, Victor

  Knight, Mrs. Jill

  Astor, John

  Gower, Raymond

  Lambton, Viscount

  Atkins, Humphrey (M't'n & M'd'n)

  Grant, Anthony

  Lewis, Kenneth (Rutland)

  Baker, W. H. K.

  Grant-Ferris, R.

  MacArthur, Ian

  Balniel, Lord

  Griffiths, Eldon (Bury St. Edmunds)

  Macleod, Rt. Hn. Iain

  Biffen, John

  Gurden, Harold

  Maude, Angus

  Brewis, John

  Harris, Reader (Heston)

  Mawby, Ray

  Bromley-Davenport, Lt.-Col. Sir Walter

  Harvie Anderson, Miss

  Maxwell-Hyslop, R. J.

  Brown, Sir Edward (Bath)

  Hawkins, Paul

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

  Bruce-Gardyne, J.

  Heseltine, Michael

  Mills, Peter (Torrington)

  Carr, Rt. Hn. Robert

  Higgins, Terence L.

  Miscampbell, Norman

  Chichester-Clark, R.

  Hiley, Joseph

  Mitchell, David (Basingstoke)

  Clegg, Walter

  Hill, J. E. B.

  Monro, Hector

  Corfield, F. V.

  Hirst, Geoffrey

  More, Jasper

  Dance, James

  Holland, Philip

  Morrison, Charles (Devizes)

  Dean, Paul (Somerset, N.)

  Hordern, Peter

  Munro-Lucas-Tooth, Sir Hugh

  Deedes, Rt. Hn. W. F. (Ashford)

  Howell, David (Guildford)

  Murton, Oscar

  Dodds-Parker, Douglas

  Hunt, John

  Noble, Rt. Hn. Michael

  Eden, Sir John

  Hutchison, Michael Clark

  Onslow, Cranley

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

  Iremonger, T. L.

  Page, Graham (Crosby)

  Emery, Peter

  Jenkin, Patrick (Woodford)

  Page, John (Harrow, w.)

  Errington, Sir Eric

  Johnson Smith, G. (E. Grinstead)

  Pardoe, John

  Eyre, Reginald

  Jopling, Michael

  peel, John

  Fisher, Nigel

  Kaberry, Sir Donald

  Pink, R. Bonner

  Fletoher-Cooke, Charles

  Kershaw, Anthony

  Price, David (Eastleigh)

  Fortescue, Tim

  Kimball, Marcus

  Prior, J. M. L.

  Gilmour, Sir John (Fife, E.)

  King, Evelyn (Dorset, S.)

  Pym, Francis

  Glover, Sir Douglas

  Kirk, Peter

  Ridley, Hn. Nicholas

  Russell, Sir Ronald

  Taylor, Edward M. (G'gow, Cathcart)

  Wilson, Geoffrey (Truro)

  Scott, Nicholas

  Thatcher, Mrs. Margaret

  Wolrige-Gordon, Patrick

  Sharples, Richard

  Turton, Rt. Hn. R. H.

  Wright, Esmond

  Shaw, Michael (Sc'b'gh & Whitby)

  van Straubenzee, W. R.

  Wylie, N. R.

  Sinclair, Sir George

  Walker, Peter (Worcester)

  Younger, Hn. George

  Smith, John

  Webster, David

  Stoddart-Scott, Col. Sir M. (Ripon)

  Wells, John (Maidstone)

  TELLERS FOR THE AYES:

  Taylor, Sir Charles (Eastbourne)

  Whitelaw, Rt. Hn. William

  Mr. Anthony Royle and

  Mr. Bernard Weatherill.

  NOES

  Altdritt, Walter

  Fernyhough, E.

  Millian, Bruce

  Armstrong, Ernest

  Fitch, Alan (Wigan)

  Milne, Edward (Biyth)

  Ashley, Jack

  Forrester, John

  Morris, Charles R. (Openshaw)

  Atkins, Ronald (Preston, N.)

  Fowler, Gerry

  Morris, John (Aberavon)

  Bacon, Rt. Hn. Alice

  Fraser, John (Norwood)

  Murray, Albert

  Bagier, Gordon A. T.

  Freeson, Reginald

  Noel-Baker, Francis (Swindon)

  Barnes, Michael

  Gardner, Tony

  Oakes, Gordon

  Baxter, William

  Garrett, W. E.

  Ogden, Eric

  Bence, Cyril

  Gray, Dr. Hugh (Yarmouth)

  O'Malley, Brian

  Benn, Rt. Hn. Anthony Wedgwood

  Grey, Charles (Durham)

  Owen, Dr. David (Plymouth. S'tn)

  Binns, John

  Hamilton, James (Bothwell)

  Page, Derek (King's Lynn)

  Bishop, E. S.

  Hannan, William

  Parkyn, Brian (Bedford)

  Blackburn, F.

  Harrison, Walter (Wakefield)

  Pavitt, Laurence

  Bradley, Tom

  Hart, Mrs. Judith

  Pentland, Norman

  Bray, Dr. Jeremy

  Haseldine, Norman

  Rees, Merlyn

  Brooks, Edwin

  Hattersley, Roy

  Reynolds, G. W.

  Brown, Rt. Hn. George (Belper)

  Hazell, Bert

  Roberts, Albert (Normanton)

  Brown, Hugh D. (G'gow, Provan)

  Herbison, Rt. Hn. Margaret

  Roberts, Gwilym (Bedfordshire, S.)

  Brown, Bob (N'c'tle-upon-Tyne, W)

  Hooley, Frank

  Robinson, W. O. J. (Walth'stow, E.)

  Brown, R. W. (Shoreditch & F'bury)

  Howarth, Robert (Bolton, E.)

  Roebuck, Roy

  Buchan, Norman

  Howell, Denis (Small Heath)

  Rose, Paul

  Buchanan, Richard (G'gow, Sp'burn)

  Howle, W.

  Shaw, Arnold (Ilford, S.)

  Callaghan, Rt. Hn. James

  Hoy, James

  Shore, Peter (Stepney)

  Carmichael, Neil

  Huckfield, L.

  Silkin, Rt. Hn. John (Deptford)

  Coe, Denis

  Hunter, Adam

  Slater, Joseph

  Coleman, Donald

  Jackson, Colin (B'h'se & Spenb'gh)

  Stewart, Rt. Hn. Michael

  Conlan, Bernard

  Johnson, James (K'ston-on-Hull, W.)

  Summerskill, Hn. Dr. Shirley

  Crawshaw, Richard

  Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)

  Swingler, Stephen

  Crosland, Rt. Hn. Anthony

  Jones, T. Alec (Rhondda, West)

  Taverns, Dick

  Crossman, Rt. Hn. Richard

  Judd, Frank

  Tinn, James

  Dalyell, Tam

  Leadbitter, Ted

  Urwin, T. W.

  Davidson, Arthur (Accrington)

  Ledger, Ron

  Wainwright, Edwin (Dearne valley)

  Davies, Harold (Leek)

  Lee, Rt. Hn. Frederick (Newton)

  Walker, Harold (Doncaster)

  Dell, Edmund

  Lewis, Ron (Carlisle)

  Watkins, David (Consett)

  Dempsey, James

  Lomas, Kenneth

  Watkins, Tudor (Brecon & Radnor)

  Dewar, Donald

  Loughlin, Charles

  White, Mrs. Eirene

  Diamond, Rt. Hn. John

  Lyons, Edward (Bradford, E.)

  Whitlock, William

  Dobson, Ray

  MacColl, James

  Willey, Rt. Hn. Frederick

  Doig, Peter

  MacDermot, Niall

  Williams, Alan (Swansea, W.)

  Dunn, James A.

  Mackenzie, Gregor (Rutherglen)

  Williams, Alan Lee (Hornchurch)

  Dunwoody, Mrs. Gwyneth (Exeter)

  Mackie, John

  Williams, Mrs. Shirley (Hitchin)

  Dunwoody, Dr. John (F'th & C'b'e)

  Mackintosh, John P.

  Willis, George (Edinburgh, E.)

  Eadie, Alex

  Maclennan, Robert

  Wilson, William (Coventry, S.)

  Edwards, Robert (Bilston)

  McMillan, Tom (Glasgow, C.)

  Woodburn, Rt. Hn. A.

  English, Michael

  Mallaiieu, J.P.W. (Huddersfieid, E.)

  Woof, Robert

  Ennals, David

  Manuel, Archie

  Ensor, David

  Mapp, Charles

  TELLERS FOR THE NOES:

  Evans, Ioan L. (Blrm'h'm, Yardley)

  Mason, Roy

  Mr. Joseph Harper and

  Mr. Neil McBride.

  Mr. Kenneth Lewis: On a point of order. Before we move on to the next Amendment, Mr. Deputy Speaker, may I ask, it being five o'clock in the morning—
  Hon. Members: Where has the hon. Gentleman been?
  Mr. Lewis: I apologise. It is nearly half past five. May I ask the Leader of the House—[HON. MEMBERS: "Where is he?" —or the Government Chief Whip to tell us what he proposes to do in view of the announcement made some time
  360
  ago that the Government intend us to meet at ten o'clock tonight to discuss the Bill? This means that, after this all-night sitting, we shall have another all-night sitting tomorrow night, followed by the Wednesday morning sitting.
  Is it possible, Mr. Deputy Speaker, to have an opportunity to move the suspension of the Sessional Order to prevent our having to sit on Wednesday morning?
  I notice that we are to consider a Motion on the Civil Defence (Casualty Services) Regulations, and I should imagine that by the time we arrive at that stage we will need the use of casualty

  361
  services. We are also to discuss a Motion on the Civil Defence (Public Protection) Regulations for England and Wales and for Scotland, and we will certainly need public protection by that time. I would imagine that the Control—
  Mr. Deputy Speaker (Mr. Sydney Irving): Order. I am afraid the hon. Member cannot intervene in this way with this proposition in the middle of the Bill. Mr. Fletcher-Cooke.
  Mr. Lewis: Further to that point of order. I do not want to prolong the matter, but we have had a pronouncement—
  Mr. Deputy Speaker: Order. I am not suggesting that the hon. Gentleman may no wish to raise this matter. There may he a more appropriate time when he will wish to discuss the matter in a Business statement with the Leader of the House—
  Hon. Members: Where is he?
  Mr. Deputy Speaker: Order. Mr. Fletcher-Cooke.
  Sir J. Eden: On a point of order, Mr. Deputy Speaker. Before we can proceed any further, we ought to have the Leader of the House here. Where is he? Why dos he not come here?
  Mr. Deputy Speaker: Order. I am afraid that that is not a point of order for the Chair. I understand the anxiety the House has to make progress: perhaps it would be better if there were not interventions. Mr. Fletcher-Cooke.
  Mr. Kenneth Lewis: Further to that point of order—
  Mr. Deputy Speaker: Order. I adjudicated that that was not a point of order. The hon. Member therefore cannot further raise it. Mr. Fletcher-Cooke.

  Clause 2.—(IMPOSITION OF STANDSTILL AFTER INCREASE OF PRICES OR IMPLE- MENTATION OF AWARD, BUT BEFORE PUBLICATION OF BOARD'S REPORT.)
  Mr. Fletcher-Cooke: I beg to move Amendment No. 15, in page 2, line 18, to leave out from 'settlement' to 'the' in line 19 and to insert 'from'.
  Mr. Deputy Speaker: With this Amendment we can take Amendment No. 20—
  362
  in page 3, line 1, leave out from 'effect' to 'for' in line 3.
  Mr. Fletcher-Cooke: After 14 hours on Clause 1 we now move to Clause 2, which is infinitely more complicated and difficult to understand than Clause 1. If I fail to explain it to the crowded House I hope that hon. Members will forgive my speech for deteriorating, in the immortal words of my hon. and gallant Friend the Member for Knutsford (Sir W. Bromley-Davenport)—
  Hon. Members: Where is he?
  Mr. Fletcher-Cooke: The purpose of Clause 2 might be described as to pounce back upon persons who either on account of wages or prices have not observed the general request by the Department of Economic Affairs to notify increases in wages or prices. I think that is the purpose. It is difficult, I agree, to square with the White Paper, because in paragraph 8 of the White Paper, which is now the Schedule to the 1966 Act, the last sentence reads:
  "In the light of this review, it is the Government's intention that the existing general request for advance notification of price increases made in paragraph 9 of the White Paper"
  that is, the previous White Paper:
  "should lapse … ".
  Therefore, there is no general request for advance notification in the Statute or in the Government's policy. Be that as it may, it is evidently considered by the Government to be important that people should notify, because it is upon that basis that the whole process of Part II of the 1966 Act depends.
  Clause 2 is very important, because it enables the Government to operate even though no notification has been made, and even though no notification was known of by the person who should have notified. No duty to notify is established, owing to the White Paper, but nevertheless, anyone—and here this Clause puts everyone in the country at risk—who raises his prices or raises his wages is liable to be pounced upon, even though there is no legal obligation to notify the rise under the operation of Clause 2. It is a very strong Clause. It is retrospective to that extent.
  Previously, only those against whom Orders had been made under Section 7,

  363
  in the case of prices, or Sections 13 or 14, in the case of wages, were under any liability. Since they had already been identified, they presumably knew of their obligations. Now, however, the whole country is at risk in having this pounce-back operation performed upon it.
  Although it is difficult to compress the explanation, and one has to refer back to the Act and several parts of it, roughly what is envisaged by the Clause is that if anybody raises anybody else's wages, or if somebody raises his prices, the Government can make a direction by which those prices or wages have immediately to come back to what they were before they were raised. In that process, there is then a reference to the Prices and Incomes Board.
  The Clause is not retrospective as the First Secretary explained in Committee in the sense that wages or prices which had been paid during the interim period stood and there could be no claw-back of the excess of the wage or of the price during the, for example, six or eight weeks, as it might be. Thereafter, however, as soon as the direction has been made, the prices and the wages have to come back to what they were previously.
  That is an enormous power, because it enables the Government to dispense completely with any notification machinery or the like. They merely have to cast their eye round and see what has happened and tell everybody to stop doing it and go back to where they were. It is, therefore, the strongest Clause in the Bill, and it has great dangers. It is an invitation either to favouritism or to revenge.
  The method of selection of who is to be pounced upon in the whole of the operation is difficult and questionable. Under the old system, somebody would at least know before he had committed anything wrong or before the whole weight of the Government was brought upon him, because an Order would have been made under Section 7 or 13 of the 1966 Act, as the case might be, and would know that he could not raise wages or prices after that. Now, however, people do not know until after they have done it. Therefore, the opportunities for favouritism or revenge are very great.
  364
  Hon. Members opposite who have put down Amendment No. 37, suggesting that the Bill should be rechristened the anti- A.S.S.E.T. or the anti-D.A.T.A. Bill, might take a close look at the Clause, because it opens up rich fields for the Government to pounce back upon anybody who has no legal obligation to notify, against whom no Order has been made and who, in many cases, may have acted completely in ignorance of the vague and totally unenforceable request for information. It may be used, not only against unions and associations, but against private persons who do not have the benefit of reading HANSARD and who simply do not know that they are not supposed to increase any price or any wage.
  Mr. Pavitt: I heard most of this argument in Committee on the Question, "That the Clause stand part of the Bill". I am trying to relate it to the Amendment. Will the hon. and learned Gentleman explain how it relates to the Amendment?
  5.30 a.m.
  Mr. Fletcher-Cooke: It would take a long time to do so. I assure the hon. Gentleman that the effect of the Amendment is to stop the pounce-back. That being so, we shall revert to what is more in consonance with natural justice, namely, that people shall already know what they have or have not to do before, rather than after, they have done it. That is why by the Amendments we wish to remove the power of the pounce-back.
  I know that the First Secretary's justification for this is that it would otherwise encourage people to jump the gun, to fail to notify, to do these things—I will not say secretly, but quietly, and that they would then be in a better position than those who have observed the moral obligation, as the right hon. Gentleman puts it, to ask his Department before they do this, because those who observe his request are liable, since it has come to the notice of the right hon. Gentleman, to have the old procedure invoked against them—that is, a specific Order or a general Order under Section 7 or Section 13 of the 1966 Act—whereas those who do not observe his request and who simply do it will be in a better position.
  Superficially that is an attractive argument. I will put the counter-argument

  365
  that it will cause more ructions and dissent than if the right hon. Gentleman had omitted to take this power. I well remember a wise trade unionist, the late Lord Dukeston, who was formerly General Secretary of the General and Municipal Workers Union, telling me that what really provoked strikes and labour disputes of a bitter kind was not so much denying rises in wages as taking away rises that people had already got. That is what causes the great trouble, as it did in 1926, 1931, and at other times. The removal of the enjoyment of wages already granted, rather than the denial of an increase in wages, causes labour disputes.
  That is exactly what the "pounce-back" Clause enables the First Secretary to do. A body of workers may well have been enjoying for eight weeks or more a rise in wages. Then, by the operation of the rather complicated machinery in the Clause, the First Secretary issues his direction and specifies a date three months previously. Then the wages must go back, after they have been enjoyed for eight weeks and after various hire purchase and other commitments have been entered into, not merely on the strength of a promise of an increase in wages, but on the strength of wages actually received during that period. I cannot imagine a situation more likely to produce industrial unrest.
  I ask the First Secretary to consider whether, in his attempt to achieve a principle of fairness, he will not, by reducing wages that have been enjoyed for two months or more, be producing unrest and trouble that will put the whole of the voluntary system, the whole of the public support for the policy, into such disrepair that the last state will be much worse than the first.
  It is for this, among other reasons, that I ask my hon. and right hon. Friends to support these Amendments, because it will produce a better system if we revert to the principle that it is only against those whom Orders have been made, and who know what they have to do, that this machinery should apply, and not by, this retrospective operation, which means that those who may not even know what they are supposed to do, but have, nevertheless, done it, find that they are subsequently hit on the head.
  Mr. M. Stewart: The hon. and learned Gentleman the Member for Darwen (Mr. Fletcher-Cooke) has moved his Amendment very fairly and persuasively, and has accepted that, on my side, there is a formidable argument for doing what the Bill sets out to do. He endeavoured to show that there was a more formidable argument the other way, and I would invite the House to consider this. There would be two ways in which the necessity for what he described—I do not necessarily accept the words that he has used—as this "pounce-back" power could have been dispensed with.
  One would have been that when Part II of the 1966 Act is activated, one could then use the power under Part II to make Orders, and thrust out Orders for notification in every direction, making the notification compulsory all round. That would have removed one of the hon. and learned Members objections, and people could not have said that they did not know.
  We discussed this matter with the unions and it was quite clear from those discussions that that procedure would be unwelcome to a point when it would be unworkable. It is much more sensible and practical, although one brings Part II into force, which one needs to do for other reasons, that we should not then issue Orders making people notify all round. It is understood that that is what people are asked to do. The hon. and learned Member argued that people would not know, but that will not stand up.
  This has been a matter for public discussion for a considerable time. The detailed provisions of the Bill have been known for some time and the Act bringing Part II into operation has to be done by Order in Council. The Order has to be mentioned in the London Gazette and it would be as well known as any Order under Part II of the Act, that it had been brought into operation, and why.
  The other argument of the hon. and learned Member, which is not one to be dismissed offhand, was that this was vexatious and liable to provoke industrial dispute if one required a wage which has already reached a certain level to come down again. I can imagine circumstances in which that would be true, but I ask the hon. and learned Member to consider

  367
  what the particular circumstances are here. These are circumstances in which the very great majority of employees will not have agreed to their wages going up without notification. They will not have tried to jump the gun in this fashion. We are entitled to say that in view of the situation of the past 12 months. Much as people have disliked many aspects of the policy, the great majority of them cooperated in its working out. Those for whom it was necessary to make Orders were a very small group. We can reasonably anticipate that the great majority of the people will show that they will not try to jump the gun, but will notify.
  If, when the great majority of people have done this, and limited numbers try to beat the gun one would have to turn round to the majority and tell it that not only were those who had jumped the gun and got away with it to continue to get away with it for a few weeks before it was stopped, but that they would get away with it for the whole period, that I would have thought, would have been more irritating and provocative than what the hon. Gentleman calls the "pounce-back" power. I think, therefore. I must still rest on the argument that I advanced in Committee.
  The House has already agreed to Clause 1 of the Bill which would mean that certain settlements could be referred to the Prices and Incomes Board and that in certain circumstances a standstill could be ordered. It agreed to that for Clause 1, and that will cover everybody who notifies a proposed increase. If we do not have Clause 2 as it stands we should in effect be saying that while that is what happens under Clause 1 to everybody who does notify, if people decide they will try to dodge this we should be telling them, if we accept the hon. Gentleman's Amendment, that they will get away with it, not only for a few weeks but throughout the whole period of the standstill.
  I cannot believe that that would be right from anyone's point of view. I think it would be more likely to be vexatious and to cause industrial than the Clause as it stands now. It is a deliberate invitation to people not to acquiesce in and work with the policy. It is creating a situation in which it would be necessary to make more and
  368
  more Orders. I cannot think this would be right, and I would ask the hon. Gentleman to withdraw his Amendment.
  Mr. Higgins: I very much hope that my hon. Friend will not withdraw his Amendment. It seems to me that the arguments he put forward were extremely cogent, and that they were in no way adequately answered by the First Secretary.
  The right hon. Gentleman says there are two reasons why this Clause would be needed. If he looks at his arguments in retrospect I think he will find that they combine into one reason. He says, on the one hand, that it would be necessary for everyone to notify wage increases compulsorily, or alternatively one would not do this, one would ask them to volunteer. But the crux of the whole point is that the right hon. Gentleman is asking, people to volunteer when in very many cases they are not at all clear what they are volunteering for, and therefore I think the arrangement he feels is workable is not likely to be equitable in practice.
  We had earlier the case of what people should do when a wage claim included the National Insurance contribution, and we still have not had this point adequately clarified. Are we to understand that people must volunteer to notify an increase if they think it justified on other grounds but it includes National Insurance contribution? We do not know what the whole of this voluntary scheme involves, and we do not feel that the "pounce-back" provision is justified on these grounds.
  It is very important that we should also be clear about the point which came out in Committee and which the right hon. Gentleman has not referred to here except by implication. What this particular Clause does is this: supposing one has a wage or price which is at a certain level before there has been any notification, reference to the Board or anything else. Let us say it is a wage of 10 a week, or a price of 10s., and then the person concerned feels he is justified in raising that wage by agreement with his employer from £10 to £12, or in the case of the price, raising it from 10s. to 12s.
  The Government can then come along and say, "We feel, after all, you ought

  369
  not to have been allowed to do this and we are going to impose an Order on you, and you must go back to the original level." What will happen is that the wage that was £10 and was increased for a short period to £12 will suddenly be reduced to £10 again. I am sure that my hon. Friend is right in saying that this is likely to cause considerable unrest, far more, we suggest, than the unrest which the right hon. Gentleman envisages. A price would go up from 103. to 12s. and then the right hon. Gentleman would say, "It must be reduced to 10s. again."
  5.45 a.m.
  The important point is that the right hon. Gentleman does not propose to do anything about actual contracts carried out during the period when the price is higher. We on this side do not believe that he should; but it is grossly inconsistent of him to say that he does not propose to do so within the framework of his absurd policy. In the case of a wage increase he is not on this account and under this Clause going to say that the amount must be paid back. But he has had no scruple whatsoever under Part IV about clawing back, or attempting to do so, increases which have taken place in some previous period. Similarly, if there is a price increase which has to be down to the previous level, he is not proposing to say that all the transactions which took place at the higher price are invalid and that refunds must be made.
  So essentially we have the right hon. Gentleman, even within his own policy, being extremely inconsistent. I do not think that the fact that we are against the policy as a whole should in any way inhibit us from criticising his inconsistency. Above all else, it strikes at the question of universality, on which the whole of the Part IV Orders have been justified. He is saying "It will not be universal in many cases. There will be exceptions, and it will take us some while to catch up with them." It is typical of the way in which the policy is not universal but discriminates against groups and is applied in an inconsistent manner. For these reasons, I hope very much that my right hon. and hon. Friends will join
  370
  me in the Division Lobby with my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke).
  Mr. Biffen: I want to say a few words which arise from the remarks of the First Secretary. My hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) rightly said that this was a Clause of very considerable significance which deals with the whole question of notification.
  It is clearly the argument of the First Secretary that the requirements are widely appreciated and understood and that one needs these powers for the backsliders who have not conformed to what is obviously the indicated wish of the Government. But it is not clear—not even in the Government's White Paper. Paragraph 28 of the White Paper entitled Prices and Incomes Policy after 30th June 1967, speaks about notification about claims and proposed settlements with regard to income. It states:
  "Information about claims and proposed settlements will continue to be required, whether at national, local or company level, in all cases covering 200 employees or more".
  So far that is understood. Any company presumably can reasonably interpret whether it falls within or outside that designation. The paragraph proceeds:
  "and in other cases—"
  that is, where it is fewer than 200 employees—
  "which are regarded as significant either because of the nature of the claim or because of the possible repercussions on the pay of other groups."
  Regarded as significant by whom? Regarded as significant by the Department of Economic Affairs, or by the employer on the possible repercussions it might have on the level of employment incomes of competitive or neighbouring firms? These things are left entirely unresolved. To suggest that the Government have so set the external disciplines within which they wish people to operate that they can then proceed with the powers which they are seeking in Clause 2 which my hon. and learned Friend seeks to limit is an invitation which suggests something perilously near the kind of government by invitation which rightly causes disquiet in all parts of the House.
  Question put, That the words proposed to be left out stand part of the Bill:—
  The House divided: Ayes 139, Noes 106.

  Division No. 441.]

  AYES

  [5.51 a.m.

  Alldritt, Walter

  Forrester, John

  Mason, Roy

  Armstrong, Ernest

  Fowler, Gerry

  Milne, Edward (Blyth)

  Ashley, Jack

  Fraser, John (Norwood)

  Morris, Charles R. (Openshaw)

  Atkins, Ronald (Preston, N.)

  Freeson, Reginald

  Morris, John (Aberavon)

  Bacon, Rt. Hn. Alice

  Gardner, Tony

  Murray, Albert

  Bagier, Gordon A. T.

  Garrett, W. E.

  Noel-Baker, Francis (Swindon)

  Barnes, Michael

  Gray, Dr. Hugh (Yarmouth)

  Oakes, Gordon

  Baxter, William

  Grey, Charles (Durham)

  Ogden, Eric

  Bence, Cyril

  Hamilton, James (Bothwell)

  O'Malley, Brian

  Benn, Rt. Hn. Anthony Wedgwood

  Hannan, William

  Owen, Dr. David (Plymouth, S'tn)

  Binns, John

  Harrison, Walter (Wakefield)

  Page, Derek (King's Lynn)

  Bishop, E. S.

  Hart, Mrs. Judith

  Parkyn, Brian (Bedford)

  Blackburn, F.

  Haseldine, Norman

  Pavitt, Laurence

  Bradley, Tom

  Hattersley, Roy

  Pentland, Norman

  Bray, Dr. Jeremy

  Hazell, Bert

  Rees, Merlyn

  Brooks, Edwin

  Herbison, Rt. Hn. Margaret

  Reynolds, G. W.

  Brown, Rt. Hn. George (Belper)

  Hooley, Frank

  Roberts, Albert (Normanton)

  Brown, Hugh D. (G'gow, Provan)

  Howarth, Robert (Bolton, E.)

  Roberts, Gwilym (Bedfordshire, S.)

  Brown, Bob (N'c't1e-upon-Tyne, W)

  Howell, Denis (Small Heath)

  Robinson, W. O. J. (Walth'stow, E.)

  Brown, R. W. (Shoreditch & F'burn)

  Howie, W.

  Roebuck, Roy

  Buchan, Norman

  Hoy, James

  Rose, Paul

  Buchanan, Richard (G'gow, sp' burn)

  Huckfield, L.

  Shaw, Arnold (Ilford, S.)

  Callaghan, Rt. Hn. James

  Hunter, Adam

  Shore, Peter (Stepney)

  Carmichael, Neil

  Jackson, Colin (B'h'se & Spenb'gh)

  Silkin, Rt. Hn. John (Deptford)

  Coe, Denis

  Johnson, James (K'ston-on-Hull, W.)

  Slater, Joseph

  Coleman, Donald

  Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)

  Stewart, Rt. Hn. Michael

  Conian, Bernard

  Jones, T. Alec (Rhondda, West)

  Summerskill, Hn. Dr. Shirley

  Crawshaw, Richard

  Judd, Frank

  Swingler, Stephen

  Crosland, Rt. Hn. Anthony

  Leadbitter, Ted

  Taverne, Dick

  Crossman, Rt. Hn. Richard

  Ledger, Ron

  Tinn, James

  Dalyell, Tam

  Lee, Rt. Hn. Frederick (Newton)

  Wainwright, Edwin (Dearne Valley)

  Davidson, Arthur (Accrington)

  Lewis, Ron (Carlisle)

  Walker, Harold (Doncaster)

  Davies, Harold (Leek)

  Lomas, Kenneth

  Watkins, David (Consett)

  Dell, Edmund

  Loughlin, Charles

  Watkins, Tudor (Brecon & Radnor)

  Dempsey, James

  Lyons, Edward (Bradford, E.)

  White, Mrs. Eirene

  Dewar, Donald

  McBride, Neil

  Whitlock, William

  Dobson, Ray

  MacCoil, James

  Willey, Rt. Hn. Frederick

  Doig, Peter

  MacDermot, Niall

  Williams, Alan (Swansea, W.)

  Dunn, James A.

  Mackenzie, Gregor (Rutherglen)

  Williams, Alan Lee (Hornchurch)

  Dunwoody, Mrs. Gwyneth (Exeter)

  Mackie, John

  Willis, George (Edinburgh, E.)

  Dunwoody, Dr. John (F'th & C b' e)

  Mackintosh, John P.

  Wilson, William (Coventry, S.)

  Eadie, Alex

  Maclennan, Robert

  Woodburn, Rt. Hn. A.

  Edwards, Robert (Bilston)

  McMillan, Tom (Glasgow, C.)

  Woof, Robert

  Ellis, John

  McNamara, J. Kevin

  English, Michael

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

  TELLERS FOR THE AYES:

  Ensor, David

  Manuel, Archie

  Mr. Alan Fitch and

  Evans, Ioan L. (Birm'h'm, Yardley)

  Mapp, Charles

  Mr. Joseph Harper.

  Fernyhough, E.

  Marquand, David

  NOES

  Alison, Michael (Barkston Ash)

  Gilmour, Sir John (Fife, E.)

  Kaberry, Sir Donald

  Allason, James (Hemel Hempstead)

  Glover, Sir Douglas

  Kershaw, Anthony

  Astor, John

  Glyn, Sir Richard

  King, Evelyn (Dorset, S.)

  Atkins, Humphrey (M't'n & M'd'n)

  Goodhew, Victor

  Kirk, Peter

  Baker, W. H. K.

  Gower, Raymond

  Kitson, Timothy

  Balniel, Lord

  Grant, Anthony

  Knight, Mrs. Jill

  Biffen, John

  Grant-Ferris, R.

  Lambton, Viscount

  Brewis, John

  Griffiths, Eldon (Bury St. Edmunds)

  Lewis, Kenneth (Rutland)

  Bromley-Davenport, Lt.-Col. Sir Walter

  Gurden, Harold

  MacArthur, Ian

  Brown, Sir Edward (Bath)

  Harris, Reader (Heston)

  Macleod, Rt. Hn. Iain

  Bruce-Gardyne, J.

  Harvie Anderson, Miss

  Maude, Angus

  Carr, Rt. Hn. Robert

  Hawkins, Paul

  Mawby, Ray

  Chichester-Clark, R.

  Heseltine, Michael

  Maxwell-Hyslop, R. J,

  Clegg, Walter

  Higgins, Terence L.

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

  Dance, James

  Hiley, Joseph

  Mills, Peter (Torrington)

  Dean, Paul (Somerset, N.)

  Hill, J. E. B.

  Miscampbell, Norman

  Deedes, Rt. Hn. W. F. (Ashford)

  Hirst, Geoffrey

  Mitchell, David (Basingstoke)

  Dodds-Parker, Douglas

  Holland, Philip

  More, Jasper

  Eden, Sir John

  Hordern, Peter

  Morrison, Charles (Devizes)

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

  Howell, David (Guildford)

  Munro-Lucas-Tooth, Sir Hugh

  Emery, Peter

  Hunt, John

  Murton, Oscar

  Errington, Sir Eric

  Hutchison, Michael Clark

  Noble, Rt. Hn. Michael

  Eyre, Reginald

  Iremonger, T. L.

  Onslow, Cranley

  Fisher, Nigel

  Jenkin, Patrick (Woodford)

  Page, Graham (Crosby)

  Fletcher-Cooke, Charles

  Johnson Smith, G. (E. Grinstead)

  Pardoe, John

  Fortesoue, Tim

  Jopling, Michael

  Page, John (Harrow, W.)

  Peel, John

  Sinclair, Sir George

  Whitelaw, Rt. Hn. William

  Pink, R. Bonner

  Smith, John

  Wilson, Geoffrey (Truro)

  Price, David (Eastleigh)

  Stoddart-Scott, Col. Sir M. (Ripon)

  Wolrige-Gordon, Patrick

  Prior, J. M. L.

  Taylor, Sir Charles (Eastbourne)

  Wright, Esmond

  Pym, Francis

  Taylor, Edward M. (G'gow, Cathcart)

  Wylie, N. R.

  Ridley, Hn. Nicholas

  Thatcher, Mrs. Margaret

  Younger, Hn. George

  Royle, Anthony

  Turton, Rt. Hn. R. H.

  Russell, Sir Ronald

  van Straubcnzee, W. R.

  TELLERS FOR THE NOES:

  Scott, Nicholas

  Walker, Peter (Worcester)

  Mr. Bernard Weatherill and

  Sharples, Richard

  Webster, David

  Mr. Hector Monro.

  Shaw, Michael (Sc'b'gh & Whitby)

  Wells, John (Maidstone)

  Mr. Kenneth Lewis: On a point of order. Since you instructed me, Mr. Deputy Speaker, that I might find a more appropriate moment to raise the point of order that I raised about half an hour ago, I notice that the Leader of the House, having been absent for a very long time, is now back.
  May I, through you, Mr. Deputy Speaker, ask the Leader of the House whether he will make a statement about the Wednesday morning sitting? In view of the long sitting that we have had tonight, and the long sitting that we are likely to have tomorrow night, the position will be that we then go on to a morning sitting. As this matter not only affects Members of the House, the staff, the Press and others, could we have a comment from the Leader of the House?
  6.0 a.m.
  Mr. Deputy Speaker (Mr. Sydney Irving): When the hon. Gentleman raised this matter before, I suggested that the middle of debates on a Bill was not the appropriate time. He may well find that he will have an opportunity to raise it on a Motion which may come before the House in a few minutes.
  Mr. R. Carr: I beg to move Amendment No. 17, in page 2, line 35, to leave out 'but' and to insert 'and'.
  Mr. Deputy Speaker: With this it may be convenient to take Amendment No. 18, in page 2, line 38, leave out 'not', and Amendment No. 19, in line 38, leave out from 'apply' to end of line 41.
  Mr. Carr: At this time of the day I shall not attempt to explain the Amendment at any length. Rather I wish to move it shortly and then, according to the response, we may seek further clarification.
  My hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) has explained the general "pounce-back" characteristics of the Clause to which we
  374
  have taken exception because of the general unfairness and capriciousness which they seem to imply. The Amendment deals with one nasty feature. As subsection (2,a) stands, the Government would seem to have power to ban increases in prices or wages which had already taken effect before the passing of the Bill or this Clause.
  That seems to be retrospection in its most blatant form and we are therefore proposing in effect to leave out the whole of the parentheses at the end of subsection (2,a) which would give the Government power to make a direction in connection' with references published before the coming into force of the Clause or the Bill. We regard that retrospective element as unfair and capricious and we wish it to be removed.
  Mr. Frederick Lee: Like the right hon. Gentleman, I shall not go over the discussion which took place a few minutes ago. Obviously, in that respect there is a difference of principle between us and we will not get over that difference by any discussion of these Amendments.
  Clause 2 is meant to deal with two things. First, it applies a Part II standstill before the relevant reference has been made to the Board and, secondly, it seeks to apply that standstill where the breach occurs after the time when reference has been made, in other words, where there is a voluntary standstill which, before the Board can report, is breached.
  In the first case the requirements of Section 8(1) or 15(1) as to simultaneous publication in the Gazette can be met, but, clearly, when the breach occurs after the reference, this would obviously be impossible. Therefore, with the Amendments it would be utterly and completely impossible to apply either point to which the Clause refers.
  It may be that the Opposition wish to do that, but, quite clearly, this is where there is a great difference in principle between us. Obviously, the Amendments

  375
  would wreck completely the second reason for Clause 2 and for this reason we cannot accept them.
  Question put, That "but" stand part of the Bill:—
  The House divided: Ayes 142, Noes 103.

  Division No. 442.]

  AYES

  [6.6 a.m.

  Alldritt, Walter

  Fowler, Gerry

  Milne, Edward (Blyth)

  Ashley, Jack

  Fraser, John (Norwood)

  Morris, Charles R. (Openshaw)

  Atkins, Ronald (Preston, N.)

  Freeson, Reginald

  Morris, John (Aberavon)

  Bacon, Rt. Hn. Alice

  Gardner, Tony

  Murray, Albert

  Bagier, Gordon, A. T.

  Garrett, W. E.

  Newens, Stan

  Barnes, Michael

  Gray, Dr. Hugh (Yarmouth)

  Noel-Baker, Francis (Swindon)

  Baxter, William

  Grey, Charles (Durham)

  Oakes, Gordon

  Benn, Rt. Hn. Anthony Wedgwood

  Hamilton, James (Bothwell)

  Ogden, Eric

  Binns, John

  Hannan, William

  O'Malley, Brian

  Bishop, E. S.

  Harper, Joseph

  Owen, Dr. David (Plymouth, S'tn)

  Blackburn, F.

  Harrison, Walter (Wakefield)

  Page, Derek (King's Lynn)

  Bradley, Tom

  Hart, Mrs. Judith

  Parkyn, Brian (Bedford)

  Bray, Dr. Jeremy

  Haseldine, Norman

  Pavitt, Laurence

  Brooks, Edwin

  Hattersley, Roy

  Pentland, Norman

  Brown, Bob (N' c' tle-upon-Tyne, W)

  Hazell, Bert

  Rees, Merlyn

  Brown, Hugh D. (G'gow, Provan)

  Herbison, Rt. Hn. Margaret

  Reynolds, G. W.

  Brown, R. W. (Shoreditch & F'bury)

  Hooley, Frank

  Roberts, Albert (Normanton)

  Buchan, Norman

  Howarth, Robert (Bolton, E.)

  Roberts, Gwilym (Bedfordshire, S.)

  Buchanan, Richard (G'gow, Sp'burn)

  Howell, Denis (Small Heath)

  Robinson, W. O. J. (Walth'stow, E.)

  Callaghan, Rt. Hn. James

  Howie, W.

  Roebuck, Roy

  Carmichael, Neil

  Hoy, James

  Rose, Paul

  Coe, Denis

  Huckfield, L.

  Shaw, Arnold (Ilford, S.)

  Coleman, Donald

  Hunter, Adam

  Shore, Peter (Stepney)

  Conlan, Bernard

  Jackson, Colin (B'h'se & Spenb'gh)

  Silkin, Rt. Hn. John (Deptford)

  Crawshaw, Richard

  Johnson, James (K'ston-on-Hull, W.)

  Slater, Joseph

  Crosland, Rt. Hn. Anthony

  Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)

  Stewart, Rt. Hn. Michael

  Crossman, Rt. Hn. Richard

  Jones, T. Alec (Rhondda, West)

  Summer-skill, Hn. Dr. Shirley

  Dalyell, Tam

  Judd, Frank

  Swingler, Stephen

  Davidson, Arthur (Accrington)

  Leadbitter, Ted

  Taverne, Dick

  Davies, Harold (Leek)

  Ledger, Ron

  Tinn, James

  Dell, Edmund

  Lee, Rt. Hn. Frederick (Newton)

  Urwin, T. W.

  Dempsey, James

  Lewis, Ron (Carlisle)

  Wainwright, Edwin (Dearne Valley)

  Dewar, Donald

  Lomas, Kenneth

  Walker, Harold (Doncaster)

  Diamond, Rt. Hn. John

  Loughlin, Charles

  Watkins, David (Consett)

  Dobson, Ray

  Lyons, Edward (Bradford, E.)

  Watkins, Tudor (Brecon & Radnor)

  Doig, Peter

  MacColl, James

  White, Mrs. Eirene

  Dunn, James A.

  MacDermot, Niall

  Whitlock, William

  Dunwoody, Mrs. Gwyneth (Exeter)

  Mackenzie, Gregor (Rutherglen)

  Willey, Rt. Hn. Frederick

  Dunwoody, Dr. John (F'th & C'b'e)

  Mackie, John

  Williams, Alan (Swansea, W.)

  Eadie, Alex

  Mackintosh, John P.

  Williams, Alan Lee (Hornchurch)

  Edwards, Robert (Bilston)

  Maclennan, Robert

  Willis, George (Edinburgh, E.)

  Ellis, John

  McMillan, Tom (Glasgow, C.)

  Wilson, William (Coventry, S.)

  English, Michael

  McNamara, J. Kevin

  Woodburn, Rt. Hn. A.

  Ennals, David

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

  Woof, Robert

  Ensor, David

  Manuel, Archie

  Evans, Ioan L. (Birm'h'm, Yardley)

  Mapp, Charles

  TELLERS FOR THE AYES:

  Fernyhough, E.

  Marquand, David

  Mr. Neil McBride and

  Fitch, Alan (Wigan)

  Mason, Roy

  Mr. Ernest Armstrong.

  Forrester, John

  Millan, Bruce

  NOES

  Alison, Michael (Barkston Ash)

  Fisher, Nigel

  Hutchison, Michael Clark

  Allason, James (Hemel Hempstead)

  Fletcher-Cooke, Charles

  Jenkin, Patrick (Woodford)

  Astor, John

  Fortescue, Tim

  Johnson Smith, G. (E. Grinstead)

  Atkins, Humphrey (M't'n & M'd'n)

  Gilmour, Sir John (Fife, E.)

  Jopling, Michael

  Baker, W. H. K.

  Glover, Sir Douglas

  Kaberry, Sir Donald

  Balniel, Lord

  Glyn, Sir Richard

  Kershaw, Anthony

  Biffen, John

  Goodhew, Victor

  King, Evelyn (Dorset, S.)

  Brewis, John

  Gower, Raymond

  Kirk, Peter

  Bromley-Davenport, Lt. -Col. Sir Walter

  Grant, Anthony

  Kitson, Timothy

  Brown, Sir Edward (Bath)

  Grant-Ferris, R.

  Knight, Mrs. Jill

  Bruce-Gardyne, J.

  Griffiths, Eldon (Bury St. Edmunds)

  Lambton, Viscount

  Carr, Rt. Hn. Robert

  Gurden, Harold

  Lewis, Kenneth (Rutland)

  Chichester-Clark, R.

  Harris, Reader (Heston)

  MacArthur, Ian

  Clegg, Walter

  Harvie Anderson, Miss

  Macleod, Rt. Hn. Iain

  Dance, James

  Hawkins, Paul

  Maude, Angus

  Dean, Paul (Somerset, N.)

  Heseltine, Michael

  Mawby, Ray

  Deedes, Rt. Hn. W. F. (Ashford)

  Higgins, Terence L.

  Maxwell-Hyslop, R. J.

  Dodds-Parker, Douglas

  Hiley, Joseph

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

  Eden, Sir John

  Hill, J. E. B.

  Mills, Peter (Torrington)

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

  Holland, Philip

  Miscampbell, Norman

  Emery, Peter

  Hordern, Peter

  Mitchell, David (Basingstoke)

  Errington, Sir Eric

  Howell, David (Guildford)

  Monro, Hector

  Eyre, Reginald

  Hunt, John

  Morrison, Charles (Devizes)

  Munro-Lucas-Tooth, Sir Hugh

  Royle, Anthony

  Walker, Peter (Worcester)

  Murton, Oscar

  Russell, Sir Ronald

  Webster, David

  Noble, Rt. Hn. Michael

  Scott, Nicholas

  Wells, John (Maidstone)

  Onslow, Cranley

  Sharples, Richard

  Whitelaw, Rt. Hn. William

  Page, Graham (Crosby)

  Shaw, Michael (Sc'b'gh & Whitby)

  Wilson, Geoffrey (Truro)

  Page, John (Harrow, W.)

  Sinclair, Sir George

  Wolrige-Gordon, Patrick

  Pardoe, John

  Smith, John

  Wright, Esmond

  Peel, John

  Stoddart-Scott, Col. Sir M. (Ripon)

  Wylie, N. R.

  Pink, R. Bonner

  Taylor, Sir Charles (Eastbourne)

  Younger, Hn. George

  Price, David (Eastleigh)

  Taylor, Edward M.(G'gow, Cathcart)

  Prior, J. M. L.

  Thatcher, Mrs. Margaret

  TELLERS FOR THE NOES:

  Pym, Francis

  Turton, Rt. Hn. R. H.

  Mr. Jasper More and

  Ridley, Hn. Nicholas

  van Straubenzee, W. R.

  Mr. Bernard Weatherill.

  Motion made, and Question proposed, That further consideration of the Bill, as amended, be adjourned.—[Mr. Frederick Lee.]
  Mr. Iain Macleod: We have arrived at the point which we agreed to reach, and I welcome the Motion.
  I do not think that the Leader of the House was here at the time, so a large number of hon. Members will not be quite clear about what has happened. We therefore expect him to make a short Business statement at half-past three this afternoon.
  The Lord President of the Council and Leader of the House of Commons (Mr. Richard Crossman): I shall certainly do that, and I shall bear in mind, also, the matter raised by the hon. Member for Lewis about morning sittings.
  6.15 a.m.
  Mr. Eldon Griffiths: On a point of order. I had hoped to comment on the Motion permitting the Select Committee on Agriculture to go to Brussels, but I might then be thought to be objecting, which I am not. The House has been prevented from discussing this matter, first, because the Government did not put': it down in time—
  Mr. Speaker: Order. The hon. Gentleman must seek some other opportunity of raising the matter.
  Mr. Kenneth Lewis: On a point of order. My constituency is not in the Hebrides; I am the Member for Rutland and Stamford.
  Question put and agreed to.
  Bill, as amended (in the Standing Committee), to be further considered this day.

  THE GAMBIA (GIFT OF A SPEAKER'S CHAIR)
  Resolved,
  That an Humble Address be presented to Her Majesty praying that Her Majesty will give directions that there be presented, on behalf of this House, a Speaker's Chair to the House of Representatives of The Gambia, and assuring Her Majesty that this House will make good the expenses attending the same.—[Mr. Crossman.]
  Address to be presented by Privy Councillors or Members of Her Majesty's Household.

  Leave given to the Select Committee on Agriculture to hold sittings in Brussels.—[Mr. Tudor Watkins.]
  SCIENCE AND TECHNOLOGY
  Leave given to Sub-Committee B of the Select Committee on Science and Technology to hold sittings in Europe.—[Mr. Palmer.]

  HURN AIRPORT
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Armstrong.]
  6.17 a.m.
  Sir John Eden: I have tried to raise this matter since April, and it is a pity that it should follow 20 hours of other debates, as it is an important subject.
  A few years ago, Hum was a busy, international airport, seemingly with every prospect of continued expansion. Today, it is in decline. Why? In 1961, the Government published a White Paper, Cmnd. 1457, on their decision to transfer certain airports, including Hum, to the relevant local authorities. Bournemouth, Hampshire, and Dorset formed a consortium of local authorities to negotiate for its purchase. Six years later, the negotiations are still proceeding. Why?
  There seems no logical explanation for the sudden reversal of policy which has led to the decline of Hurn. Some suggest that it is because Eastleigh would make a better airport, but no one who has made even a cursory study of the two would accept that it could take the place of Hurn. Of course, Southampton must have its airport; I recognise its growing importance as a centre of communications. There is destined to be a substantial expansion around it. There is proposed a new city region, based on Southampton and Portsmouth, which in due course may well bring an increase of population of about 250,000. There is already a fine new rail link direct with London, and an important new goods terminal has recently been approved. Also new trunk roads are planned.
  There must obviously be an airport to meet the growing needs of this important concentration of commerce, industry and population. But this is not to say that Eastleigh should be advanced at the expense of Hurn. Let them both develop together. I am certain that there is a need for both. Because of its location and the limitation which is placed upon its further extension, Eastleigh can never replace Hum as the airport of the South. I use that expression "the airport of the South" because it is one which has been
  380
  used in the past and it has been referred to, I believe, by Ministry spokesmen before in connection with the development of Hurn. Eastleigh is in the midst of a vastly populated residential area. It has at the moment only one runway and that is not capable of taking anything larger than a Vanguard at full commercial weight. It is frequently affected by mist and by weather.
  The picture when one comes to Hurn is substantially different. There, the airport occupies a quite unique position, making it one of the safest airports in the country. For pilots the approach is ideal. It is already equipped with advanced technical and navigational facilities which are far superior to those at Eastleigh. It already has more than one runway and it is capable of taking the largest civil aircraft now in use. It has frequently been used as a diversion landing ground for aircraft prevented from landing at London Airport, although I regret to say that now this is not so much the case.
  There was the extraordinary situation, brought to my attention the other day, when an aircraft flying from Nice via Zurich to London Airport with some Bournemouth passengers aboard, was unable to land at London Airport and was then diverted to Paris when Hurn was completely clear. It was unable to land at Hurn for reasons which the Minister will know full well, namely, that the staff has been decimated and the services have been severely reduced.
  Hurn has many other advantages, and perhaps one of the most important, certainly when considering its future development, is that it lies in a thinly-populated area and there is considerable scope for the expansion of its runways over comparatively poor agricultural land or over heath. Hum, therefore, is ideally placed for serving the growing commercial and tourist needs of the whole region. It is not an airport which is restricted in its application to the requirements of one city or one centre. It is at the heart of a region which stretches from Portsmouth in the east to Wiltshire in the north and to Devon in the west. Before very long there will be a new spur road linking one of the main trunk roads with the centre of Bournemouth, and Bournemouth itself is now just 100 minutes from Waterloo.

  381
  Hum's attractions are well-known to the airlines. When the Ministry decided to stop the further employment of East-leigh as an airport the airlines flocked to Hurn, and their number increased substantially. At one time regular services linked Burn with London, Coventry, Manchester, Scotland, Ireland, Wales, Cherbourg, the Channel Islands, Basle, Belgium and Holland. A new terminal was planned, and I remember agitating at one stage to try to get the work or it expedited. The services which were and still are provided for the British Aircraft Corporation's great plant building the B.A.C. 111, and also for the air traffic school, were fully employed. Now they are employed only when those particular users need them.
  All that activity at Hurn augured well for the future. But now the most extraordinary thing has happened. For some reason the policy has been completely reversed and far from holding out great promise for the future, Hum has suddenly been precipitated into a steep decline of activity. The manning of its facilities is new down to a single watch. The airport operates an eight-hour day on weekdays only.
  This makes a complete mockery of an airport. It is being operated as though it were almost worth less than the average office in my constituency. I understand from Answers I have received from the Minister that this is being done because, he says, no demand is proven for increased facilities. Yet when Channel Airways was granted a new licence recently it took more than 1,000 bookings within 10 days.
  Had the Ministry not taken so long to come to a decision about extending the facilities for U.T.A., the French airline it would have joined Channel Airways. There is a very substantial student population in that part of the country. Because of the Anglo-Continental schools, students are brought to Bournemouth, primarily from Switzerland and Germany.
  Therefore, the decision to run down Hurn is strangely difficult to explain. In any event, operating as it is now on the basis of an eight-hour day and without any facilities for weekend activity it makes a complete nonsense of the so-called forward looking, dynamic Britain entering the air age. The air age is just
  382
  beginning, and Hurn should be playing its full part in it.
  I want to find out whose decision it was that Hurn should run down. Who decided that there should be a switch? Was it an unaided decision of the airlines? How were they suddenly lured away from Hum, which they enjoyed to a great extent, and where they had excellent facilities, and persuaded to go to Eastleigh? Was it Government policy or was anybody in the Ministry influential in persuading airlines that Hum had no future and that they had better pack their bags and go to Eastleigh quickly? What lies behind the policy of a switch to Eastleigh? Is there a deliberate attempt to destroy Hurn in favour of Eastleigh? Why were these decisions taken while negotiations for the acquisition of Hurn were still proceeding?
  With regard to the negotiations, why have there been so many delays? It is fantastic that these matters should have been held up when there was clear willingness on the part of the Government to sell the airport as quickly as possible. Why has the Town Clerk of Bournemouth had such difficulty in getting some of the information needed? Sometimes he had to wait months to get even an answer from the Ministry. Why is it that only in February this year the district valuer set about making a valuation of the airport?
  These are some of the questions which disturb me and I hope that I have indicated clearly enough to the Minister my reason for being unhappy about what is happening. It is not simply a question of one airport competing with another; that I am prepared to face. But there seems to be some element in all this which I find it impossible to explain and which does not seem to have any answer in logic. Hurn, although it has had a chequered past, has, I am convinced, a very assured future as an airport provided it is allowed to go ahead. If these negotiations drag on, however, its restoration and onward development as the leading airport of the South is being delayed, perhaps even jeopardised altogether.
  I would say to the local authority that if it does not want it it had better say so straight away, because there are many private and commercial interests ready to take it on. But, having mentioned

  383
  local authorities, I am bound to admit that I do not know exactly what is the attitude of Hampshire and Dorset. I am not absolutely sure whether they are really serious about this project. If they are not really serious, the sooner they stop pretending to be the better.
  But about one authority I have no hesitation at all. For Bournemouth, the acquisition of the airport is the key to its own future expansion and development and prosperity. I am convinced that Bournemouth must get this airport even if means going it alone. The quicker that this valuable national asset is taken out of the wasting hands of the Ministry and put into the hands of an authority which recognises the opportunities which it can bring the better.
  6.32 a.m.
  The Minister of State, Board of Trade (Mr. J. P. W. Mallalieu): I am sure that the hon. Member for Bournemouth, West (Sir J. Eden) has no need to apologise for raising this subject at this time. It is a matter of great importance to his constituency and I am only too delighted to try to answer some of his points.
  First, I agree that there is no dispute that Hurn is a good airport for the short and medium haul. It has a very good runway and reasonable buildings. It is well situated in one respect. But I must make it absolutely clear that there has been no change of Government policy. There has been no sudden decision to run down Hum Airport. What happened, as I think the hon. Gentleman knows, is that last year Southampton increased the length of its runway and was able to take Nigger aircraft.
  Because Southampton is nearer to the high density of population than Hum, the airlines, of their own free will, switched to Southampton. But I agree entirely that the long term prospects of Hum are likely to be very much better than those of Southampton, for the reasons which the hon. Gentleman gave. I am convinced that we shall see a continuing and rapid increase in air traffic, with bigger and faster aeroplanes. Because of the limitations of this site, these planes will not be able to use Southampton in time to come; and I should have thought that, when that time comes, they will move hack to Hurn.
  384
  Even as things are, Hurn is an important airport. A number of I.T. operators are working out of it and, as the hon. Gentleman said, there is alongside it one of the manufacturing and assembly plants of B.A.C. There is also a repair and service department for military aircraft, and if the Board of Trade wishes to find a home for air traffic control the skill and experimental air unit is available here. While Hum is important now, its prospects through the '70s and'80s are very good indeed.
  It would be wrong or premature for the Government to try to designate Hum at present as being "the" regional airport, as some authorities have been suggesting. Before there is any designation of an airport as being the one for the region, we must await the South Hampshire Study to see what it produces, as well as the considered views of the Regional Economic Planning Council.
  The hon. Gentleman has recently been bothered about the rundown in traffic and staff. It is an attractive idea to build up the airport and see if that produces the traffic, but unfortunately that would cost a considerable amount of money. The airport is today faced with a substantial deficit and I will give the House the figures to show the increased deficit that would result if we lengthened the number of hours worked by the staff. If we put on an extra eight hours, that would cost £11,500. An extra 32 hours would cost £45,000. If we went back to the figure of October of last year, adding another 65 hours, that would cost £85,000.
  Compared with figures often mentioned in the House, these may not seem large, but they would be a continuing drain. It is not that the Board of Trade wants to see Hurn run down. On the contrary. We would like it to build up because we genuinely and anxiously want to sell it and, within reason, we will do what we can to maintain it as a saleable proposition. Indeed, it is such a proposition.
  I agree that the negotiations about the transfer of ownership have been going on for a very long time. I do not want to apportion blame for this. Certainly, the Board of Trade has not been dragging

  385
  its feet. However, there are always difficulties about agreeing a price in negotiations of this sort. I hope that an agreement will shortly be reached with the consortium of Bournemouth, Hampshire and Dorset. Indeed, this week—I think that it is this week; as a result of these all-night sittings I am not sure which day is which—officials of my Department are going to Bournemouth to carry on the negotiations.
  I add my plea to that of the hon. Gentleman's for local authorities to "come clean", as it were, and to say whether they want this airport. Provided that we can reach a reasonable agreement on the price—and I assure the House that we are not being exorbitant in this matter—and provided they really
  386
  do want it, then, if they say so, I am sure that we can get agreement. if not, there are, as the hon. Member says, other people, including the British Airports Authority, who are interested, which does not suggest that there is any intention whatever to run the airport down.
  If the local authorities do not want it, we want to be able to open up negotiations with other people. This is a good airport. I am convinced that it has a future, and I hope that the transfer of ownership will take place very soon.
  Question put and agreed to.
  Adjourned accordingly at twenty minutes to Seven o'clock a.m.

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  Reciprocal Arrangements (Republic of Ireland)
  Reciprocal Arrangements (Republic of Ireland)
  Sainsbury Committee (Report)
  Sainsbury Committee (Report)
  Tobacco Companies (Advertising)
  Tobacco Companies (Advertising)
  Residential Homes, Salop
  Residential Homes, Salop
  Pharmaceutical Products (Exports)
  Pharmaceutical Products (Exports)
  Local Authority Health Committees (Medical Practitioners)
  Local Authority Health Committees (Medical Practitioners)
  Medical Students (Pre-Registration Studies Overseas)
  Medical Students (Pre-Registration Studies Overseas)
  Official Forms
  Official Forms
AVIATION
  Airline Cabin Staff
  Airline Cabin Staff
  Heathrow Airport (Passengers)
  Heathrow Airport (Passengers)
  Aviation Practices (Review Advisers)
  Aviation Practices (Review Advisers)
SHIPPING
  Belfast-Glasgow Ferry (Charge for Bicycles)
  Belfast-Glasgow Ferry (Charge for Bicycles)
BOARD OF TRADE
  Estate Agents
  Estate Agents
  G.A.T.T. (White Paper)
  G.A.T.T. (White Paper)
ECONOMIC AFFAIRS
  Unemployment
  Unemployment
  Industrial Reorganisation Corporation
  Industrial Reorganisation Corporation
OVERSEAS DEVELOPMENT
  Eastern Nigeria (Overseas Civil Service Salaries)
  Eastern Nigeria (Overseas Civil Service Salaries)
HOME DEPARTMENT
  Drugs
  Drugs
  Aliens and Commonwealth Immigrants
  Aliens and Commonwealth Immigrants
  Indictable Offences (Convictions)
  Indictable Offences (Convictions)
  Police Forces (United Kingdom and European Economic Community)
  Police Forces (United Kingdom and European Economic Community)
  Criminal Injuries Compensation Scheme (Dependants)
  Criminal Injuries Compensation Scheme (Dependants)
  Prison Industries
  Prison Industries
  Prisoners
  Prisoners
EDUCATION AND SCIENCE
  School Leaving Age (Industrial Training)
  School Leaving Age (Industrial Training)
  Parent-Teacher Relationships (Pamphlet)
  Parent-Teacher Relationships (Pamphlet)
COMMONWEALTH AFFAIRS
  Nigerian Students
  Nigerian Students
  St. Kitts (Mr. Gaskell)
  St. Kitts (Mr. Gaskell)
  Primary and Secondary Schools, Wales (Teachers)
  Primary and Secondary Schools, Wales (Teachers)
  COLONEL LOHAN
  COLONEL LOHAN
  CRIMINAL TRIALS (PRESS COMMENT)
  CRIMINAL TRIALS (PRESS COMMENT)
MINISTRY OF DEFENCE
  Official Forms
  Official Forms
  Royal Naval Dockyards, Portland (Wage Increases)
  Royal Naval Dockyards, Portland (Wage Increases)
  Combined Cadet Force
  Combined Cadet Force
  F111K Aircraft
  F111K Aircraft
NATIONAL FINANCE
  Purchase Tax (Deep-Freeze Cabinets)
  Purchase Tax (Deep-Freeze Cabinets)
  Hospital Service (Specific Tax)
  Hospital Service (Specific Tax)
AGRICULTURE, FISHERIES AND FOOD
  Fishing Rights (Bank Miles)
  Fishing Rights (Bank Miles)
  CHURCH ESTATES (AGRICULTURE)
  CHURCH ESTATES (AGRICULTURE)
MINISTRY OF POWER
  Fuel Oil (Imports from Canada and Australia)
  Fuel Oil (Imports from Canada and Australia)
SCOTLAND
  Traffic Signals (Corstorphine)
  Traffic Signals (Corstorphine)
  Summer Time
  Summer Time
  Herring (Supply to Oil and Meal Factories)
  Herring (Supply to Oil and Meal Factories)
SOCIAL SECURITY
  Widow's Benefit
  Widow's Benefit
  Unemployment Benefit
  Unemployment Benefit
  Supplementary Pensions (Retirement Pensioners)
  Supplementary Pensions (Retirement Pensioners)
  Retirement Pensions (Wales)
  Retirement Pensions (Wales)
TECHNOLOGY
  Aerospace Exports
  Aerospace Exports
TRANSPORT
  Fleet Line Project
  Fleet Line Project
  Buchanan Report
  Buchanan Report
ROADS
  Pricing
  Pricing
  Construction Units
  Construction Units
WALES
  Plan for Wales
  Plan for Wales

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

DISARMAMENT CONFERENCE AND NUCLEAR WEAPONS
2.35 p.m.
LORD ROWLEY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will make a statement on the progress made at the Geneva Disarmament Conference, with regard to the achievement of a Nuclear Non-proliferation Treaty and an Underground Test Ban Agreement.]
THE MINISTER OF STATE FOR FOREIGN AFFAIRS (LORD CHALFONT): My Lords, The Co-Chairmen of the Disarmament Committee are still discussing the draft of a non-proliferation treaty which we hope will be tabled in the near future. On the comprehensive test ban, the main difficulty remains the question of verification. We have urged the Soviet Union to join us in tripartite talks to discuss this, but so far they have refused.
LORD ROWLEY: My Lords, may I ask my noble friend whether there is any truth in the report that the differences between the United States Government and the Soviet Government on the draft non-proliferation agreement have been narrowed to such an extent that it is now reasonable to assume that there is every prospect of achieving agreement in the next few months?
LORD CHALFONT: My Lords, yes, I think I can confirm that. The differences between the Soviet Union and the United States have really been narrowed now to something which, in substance, is only a matter of the safeguards and control of the treaty; and we understand
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that they have arrived at some arrangement on this matter which will enable them to table a draft treaty quite soon. It is impossible to say how soon; but quite soon. Of course, negotiating that treaty with other countries will be another matter, but the tabling ought not to be too long delayed.

RAIL CLOSURES: MANCHESTER—SHEFFIELD LINE INQUIRIES
2.37 p.m.
THE EARL OF KINNOULL: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what principles are followed in the interpretation of Section 56(9) of the Transport Act 1962 when a railway passes through the area of more than one transport users' consultative committee; whether they will give general advice to the committees that, when a main line express rail service is involved, there should be a single inquiry; and whether they are aware of the consternation caused on both sides of the Pennines at the decision to hold separate inquiries at each end into the proposed closure of the main electrified railway from Manchester to Sheffield.]
LORD SHEPHERD: My Lords, the committees concerned decide how they will consider a proposal to close passenger service where the railway line passes through more than one T.U.C.C. area. Their only object is to serve the best interests of all rail users affected, and the Government do not consider the general advice suggested is necessary, or, indeed, that it would further this object. We are aware that representations have been made about the arrangements for hearing objections by some of the interested parties to the Manchester—Sheffield line proposals.
THE EARL OF KINNOULL: My Lords, while thanking the noble Lord for his reply, may I ask whether he would not agree that where a major electrified line such as the Manchester—Sheffield line is concerned, one T.U.C.C. hearing is far better than two T.U.C.C. hearings?
LORD SHEPHERD: My Lords, this is a matter which was carefully considered when the 1962 Act passed through Parliament. One inquiry will not necessarily meet the interests of all the users of a fairly long length of railway line. In some cases purely local interests may be affected, and if there were only one inquiry these might not emerge. The noble Earl will recognise that in this particular case one part of the line is in Yorkshire and the other part is in Lancashire, and if there were to be one inquiry I think there would be great difficulty in deciding where it should be located.
THE EARL OF KINNOULL: My Lords, while again thanking the noble Lord for his reply, may I ask whether he would not agree that the Minister will be put in a difficult position if the two hearings arrive at two different results?
LORD SHEPHERD: My Lords, on this matter the Minister is always in a difficult position. But, as the noble Lord is aware, the committees can submit a joint report or, if there is a difference of view, they can report separately. Certainly, as the noble Earl will also know, if local authorities are not satisfied with the report, they themselves can make their own representations direct to the Minister.
LORD INGLEWOOD: My Lords, does not the noble Lord appreciate that in many cases objectors will have to duplicate their objections and spend double the length of time, first, at one inquiry and then at another; that in all these cases time is extremely valuable for the responsible people who will be then appearing, quite apart from the fact that the eminent lawyers whom they ask to help them on these occasions charge big fees, largely on a time basis?
LORD SHEPHERD: My Lords, the noble Lord obviously has some experience in this matter. So far as I am aware, there is no reason at all why an interested party should have to go to both inquiries. Some authorities may wish to do so, but there is no reason why they should.

ARAB REFUGEES: RESPONSE TO U.N. APPEAL
2.42 p.m.
BARONESS ASQUITH OF YARNBURY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government what steps have been taken to increase international funds to meet the urgent and immediate needs of Arab refugees in occupied territory pending their settlement and rehabilitation.]
LORD CHALFONT: My Lords, the General Assembly of the United Nations has now appealed to all Governments, as well as organisations and individuals, to make special contributions to the United Nations Relief and Works Agency to enable that Agency to meet the urgent and immediate needs of the refugees. Her Majesty's Government endorse this appeal. As your Lordships will know, we ourselves have anticipated this appeal and have made a special contribution to UNRWA of half a million dollars, in addition to the 4½ million dollars we have already pledged as our contribution for this year.
BARONESS ASQUITH OF YARNBURY: My Lords, while thanking the noble Lord for his reply, may I ask him whether any response has so far been made, apart from our contribution, to the international appeal, and, if so, from what quarters it has come?
LORD CHALFONT: My Lords, in addition to the half-million dollars which I mentioned, as the House knows, Her Majesty's Government have given £500,000 to Jordan, and various other voluntary bodies in the United Kingdom have raised another £300,000. So far as other countries are concerned, there have been special contributions, both in cash and in kind, from a number of countries, including the United States of America, Sweden, Canada, Japan and the Congo. These contributions, with our own, amount to something of the order of 5½ to 6 million dollars.
THE EARL OF DUNDEE: My Lords, will the noble Lord say whether France has made any contribution?
LORD CHALFONT: My Lords, we have no record of any contribution from France, either directly or through the International Red Cross. There are a number of other countries, in addition to those I have mentioned, which have provided cash through the International Red Cross, including Greece and Bulgaria.
LORD BYERS: My Lords, could the noble Lord say what is the total estimated amount which is required urgently for immediate relief? While we thank the Government for all they are doing, there are many of us who feel that not enough is being done all round by countries other than the United Kingdom.
LORD CHALFONT: My Lords, I cannot at the moment give a specific answer to the first part of the noble Lord's question. I think it would be almost impossible to estimate the total need. The need is obviously great, and the Government have fully endorsed the United Nations' appeal. We very much hope that many other countries in the world will follow our example, and that of others, in making contributions to this end.
LORD BYERS: My Lords, I think I am right in saying that the estimate made about three weeks ago was a figure of something like £10 million. Towards that, 5½ million dollars is not sufficient.
LORD CHALFONT: No, my Lords; I entirely agree that 5½ million dollars towards a sum like that is a comparatively small contribution. But I would point out that by the end of this year Her Majesty's Government will have contributed more than 100 million dollars to this Agency; and that compares very well with the contributions elsewhere in the world. We shall do all we can to help this cause and we hope that other countries will as well.
BARONESS SUMMERSKILL: My Lords, in addition to financial help, have the United Nations Agencies been instructed to encourage the new refugees to return to their homes?
LORD CHALFONT: My Lords, the countries mainly concerned have been asked and encouraged to make sure that those refugees who have fled return to their homes and that the flow of refugees is stopped, and we will do all we can,
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through the United Nations, to see that this process continues. My noble friend will know that my right honourable friend the Foreign Secretary has in another place called for the refugee problem to be dealt with in a much bigger and fundamental way. I am sure your Lordships will agree that this is the right approach, and we very much hope that everybody concerned will look for a more permanent and imaginative solution to this problem.
BARONESS HYLTON-FOSTER: My Lords, may I ask the Minister whether he is aware that at the time when we recently debated the refugee problem France and the U.S.S.R. had contributed to the International Committee of the Red Cross?
LORD CHALFONT: My Lords, I was not aware of that, and I am grateful to the noble Lady for mentioning it.
LORD ILFORD: My Lords, may I ask the noble Lord whether any steps are being taken at present to assist these refugees in formulating and presenting their claims for compensation against the Egyptian Government?
LORD CHALFONT: My Lords, I am not aware that any formal, organised assistance is being given in this respect, but I will certainly inquire into that.

BUSINESS
LORD SHEPHERD: My Lords, last Thursday the noble Earl, Lord St. Aldwyn, the Opposition Chief Whip, made representations in regard to to-day's business. It was put to me that it might be for the convenience of the House to rise at about 8 o'clock. I undertook to have discussions with the noble Earl, and, as the matter was left on Thursday night, we agreed to wait to see how things progressed. Since then the situation has changed somewhat, in that some more substantial Amendments have been placed on the Order Paper. I hope to have further words with the Opposition Chief Whip to see whether we can make statement later as to what hour we should go this evening. But the House will wish to know that in any case dinners will be available to-night in the Dining Room.
BERMUDA CONSTITUTION BILL
Brought from the Commons on Friday last, and printed, pursuant to Standing Order 45; read 1a.
NATIONAL INSURANCE (No. 2) BILL
Brought from the Commons; read la, and to be printed.
INDUSTRIAL AND PROVIDENT SOCIETIES BILL
Read 3a(according to Order), and passed.

LEASEHOLD REFORM BILL
2.50 p.m.
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—(Lord Kennet.)
On Question, Motion agreed to.
House in Committee accordingly.
[The EARL OF LISTOWEL in the Chair.]
Clause 1:
Tenants entitled to enfranchisement or extension
1.—(1) This Part of this Act shall have effect to confer on a tenant of a leasehold house, occupying the house as his residence, a right to acquire on fair terms the freehold or an extended lease of the house and premises where—

(a) his tenancy is a long tenancy at a low rent and the rateable value of the house and premises on the appropriate day is not (or was not) more than £200 or, if it is in Greater London, than £400; and

and to confer the like right in the other cases for which provision is made in this Part of this Act.
(2) In this Part of this Act references, in relation to any tenancy, to the tenant occupying a house as his residence shall be construed as applying where, but only where, the tenant is, in right of the tenancy, occupying it as his only or main residence (whether or not he uses it also for other purposes); but—

(a) references to a person occupying a house shall shall apply where he occupies it in part only; and

(4) In subsection (1)(a) above, "the appropriate day", in relation to any house and premises, means the 23rd March, 1965 or such
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later day as by virtue of section 43(3) of the Rent Act 1965 would be the appropriate day for purposes of that Act in relation to a dwelling house consisting of that house.
THE CHAIRMAN OF COMMITTEES (THE EARL OF LISTOWEL): Before I call Amendment No. 1Z, I. should point out to the Committee that if this Amendment is agreed to I cannot call Amendments Nos. 1 or 2.
LORD BROOKE OF CUMNOR: On a point of order. I do not know whether this suggestion would make confusion worse confounded. I do not want to take an unnecessary amount of time over this Bill, and if it would be acceptable to the noble Lord, Lord Silkin, and to the Government, to discuss the Amendment of the noble Lord, Lord Silkin, and my Amendments Nos. 1 and 2 together, so as to have a general discussion about rateable value, that would be acceptable to me. On the other hand, it may queer the pitch for the noble Lord, Lord Silkin, and therefore I shall not press it.
LORD SILKIN: My Amendment was put down only on Friday, and I doubt whether the Government have had adequate time to consider it. It is in a rather different category from the Amendment of the noble Lord, Lord Brooke of Cumnor. I think I should prefer to move it separately, but I shall not take very long.
LORD SILKIN LORD SILKIN moved, in subsection (1)(a), to leave out from "rent" to the end of the paragraph. The noble Lord said: As I have said, I doubt whether the Government have had adequate time to look at this Amendment. With it go Amendments Nos: 4A and 34A, and if I may discuss the three Amendments together I think the House will be much clearer as to what I have in mind. In another place there was a strong feeling that the limitations to rateable values of £400 in London and £200 outside were rather arbitrary and that there was no justification at all for having any limit, and an Amendment was moved and carried, I think almost unanimously, that there should be no limit at all on rate-able values. I believe the Government later had second thoughts about it and these limits were restored. But I still feel it is wrong, that there should be this sudden break at £400 rateable value in London, since if the rateable value is

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£401 then all advantage to the tenant goes. He gets no advantage at all out of this Bill, which seems to me quite wrong. Similarly, outside London where there is a £200 limit there is no advantage whatever for a tenant with a rateable value of £201.
This is a scheme—it is not my own—to graduate the benefits of the Bill, so that, whatever the rateable value, certain people over the limit will get some advantage. Let us take people with a rateable value over £1,000. In their case, it is proposed by my Amendment No. 34A that they should have the advantage of being able to apply for a long lease, but the rent they would pay would be the normal market rent including the value of any buildings on the land. That is a very limited advantage.
Between £400 and £600 in London and £200 and £800 outside, it is proposed to have a graduated scale so that people with a rateable value over the limits in the Bill will have the advantage of getting a long lease—I am not proposing in my Amendment that they should purchase the freehold—at a rent graduated according to the rateable value. So as they get nearer to the higher limit set out in my Amendment they will gradually be paying the full amount of the market rent. Someone with a rateable value of, say, £500 in London would pay the rent laid down in the Bill plus one-half of the difference between the rent laid down in the Bill and the market rent.
I am not expecting my noble friend to jump at this Amendment and to stand up and say, "I accept it". I do not even expect him to say that he accepts the principle. But I should be grateful if he would at least say that it is worth considering and that he would be prepared to consider it between now and another stage. If he will say that, then I shall be happy to withdraw this Amendment and to have any conversations which he feels worth while, in order to clarify further what I have proposed. I beg to move.
Amendment moved—
Page 1, line 12, leave out from ("rent") to ("and") in line 15.—(Lord Silkin.)
THE PARLIAMENTARY SECRETARY, MINISTRY OF HOUSING AND LOCAL GOVERNMENT (LORD KENNET): On the Second Reading of this
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Bill I declared an interest as a leaseholder. I think I should perhaps say that, so far as I can understand the Amendment before us, I have a direct interest, in that if it were accepted I should be better placed than if it were not. The question of the rateable limit was discussed at very great length in Committee in the House of Commons and again on Report. The Government resolved, after considering the matter very fully, that the rateable limit should stand at £200 and £400, and the House of Commons endorsed that resolve. The Bill therefore comes before us with the rateable limits in, and no-one can say that the matter has not been fully discussed and debated. Therefore, I should recommend the House to reject without further discussion any Amendment which sought simply to knock the+ rateable value limits out again. But it seems that this Amendment is introducing something new, which I believe has not been discussed in the House of Commons; namely, the scheme of graduated increases up to £1,000 rateable value.
I myself saw this Amendment only this morning and I have not had time to discuss it even with my closest colleagues. But since, so far as I can see, it introduces a new element I think it would not be right to recommend the House to reject it, as I would if it were simply the same again. That being so, I would ask my noble friend whether he would withdraw it and the consequent Amendments which follow upon it later in the Bill, on the understanding that I will examine it with my colleagues and will have something further to say about it on Report.
LORD SILKIN: I thank my noble friend and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
2.57 p.m.
LORD BROOKE OF CUMNOR LORD BROOKE OF CUMNOR moved, in subsection (1)(a), to leave out "£200 "and insert" £150". The noble Lord said: I beg to move Amendment No. 1, and it may be convenient to discuss at the same time Amendment No. 2 which is to alter the rateable value within London from £400 to £300. I will not go over all that was said in another place about rateable values. I rest my case for these Amendments on the one fact that,

903
from the beginning, the Government have commended their White Paper and this Bill to Parliament and the country on the ground that this is a measure to relieve hardship; and I want to ask the Government straight away whether they can produce any cases of hardship that would be created by accepting my Amendments.
All through the debates on this Bill they have been arguing, from experience in South Wales and the like, about the small house built at periods up to 100 years ago on a small plot. I do not think there is now any great dispute between the Parties that enfranchisement should be allowed for cases of that kind, where the family has been living in the house for a long time and has come to regard the leasehold house as its own. But that, of course, is very different from the type of case which would be excluded from the Bill by my Amendment—the leasehold house which in London has a rateable value of between £300 and £400, and outside London a rateable value of between £150 and £200. So far as I have been able to read the proceedings on this Bill in another place, as well as our discussions on Second Reading here, I do not remember a single instance being given on behalf of the Government which would lead anybody to suppose that the leaseholder of a house in the bracket suggested by the Amendment would suffer hardship. If my Amendment were accepted, he would suffer hardship only in that he would be deprived of a quite unwarranted capital gain.
One could obviously quote a variety of cases. I do not want to take up your Lordships' time on this, but I will just quote a case in London of a house of £355 rateable value—obviously a substantial house—with an unexpired lease of 27 years at a ground rent of £40 per annum. To judge by recent property transactions and the estimates of estate agents which have been obtained on this property, the present value of that leasehold is in the neighbourhood of £10,500. The enfranchisement price, calculated according to this Bill, will be about £1,500. So the leaseholder could put himself in the position of becoming the freeholder at a total cost of £12,000., The freehold value is similarly estimated by the same people at £17,000. If therefore this Amendment is not accepted,
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the Labour Government are voting a tax-free capital gain of £5,000 to a person who has already been in a position to pay over £10,000 for his leasehold.
If that is the Labour Government's idea of hardship, it is not mine; and I find it extraordinarily hard to discover any reason on grounds of equity why my Amendment should not be accepted. I know one can argue back to Rent Act limits, but we are not here discussing the Rent Act. We are discussing a leasehold Bill: we are discussing something quite separate. Surely it is the Government's desire to try to eliminate hardship but not to create unwarranted capital gains. Indeed, that was the main reason in the Government's mind, as I understand it, why they changed their view on rateable value limits and, having first accepted an Amendment that there should be no rateable value limit, then restored the rateable value limits at the Report Stage in another place.
One may say that it does not greatly matter what the rateable value limits are if the terms of compensation are fair and equitable, and obviously one cannot discuss them at this stage because we shall come to them on later clauses of the Bill. But that will make a difference, of course, so far as enfranchisement is concerned. Quite clearly, the higher you fix the rateable value limits the more fragmentation of estates is likely to take place. The noble Lord, Lord Silsoe, has put down an important Amendment to Clause 19 (which we cannot discuss at this stage) which may reduce fragmentation of well-managed estates; but here and now, discussing this Amendment which is before your Lordships, we must assume that the rest of the Bill stays unchanged. We must look at what the Bill says on its face: that is, that it is desirable that there shall be opportunities for fragmentation of estates in respect of houses up to £400 rateable value in London or £200 rateable value outside London, and that there shall be substantial capital gains handed by the Labour Government to the present leaseholders of these more expensive houses in and outside London, which my Amendment seeks to exclude.
That, very simply, is the case for this Amendment, and I trust that the Government will not argue against it on the

905
ground that the rateable value limits must be identical with those in the Rent Acts, because that, of course, is an unsound argument. We are discussing a quite different matter here. If the Government could produce cases where, supposing the Bill were left unamended, people who had bought these pretty expensive leases would suffer genuine hardship if they were taken out of the Bill by my Amendment, then a new situation would arise; but, again, I am not prepared to accept as a case of hardship a case where a person is by this Amendment deprived of a £5,000 tax-free capital gain. It is nasty for him, but that is not to our minds hardship.
These questions about the rateable value are big questions, and we are discussing here the scope of the Bill. Whatever view any of us take about the rest of the Bill I think it is desirable for us to give our attention to what should be the scope of the Bill, particularly as the Government changed their minds twice in another place about that. What I am suggesting is that the Government have still got their rateable value limits too high, and that it will be creating scandal indeed in the cases of some of these more expensive houses if they do not accept an Amendment somewhat on these lines. I beg to move.
Amendment moved—
Page 1, line 14, leave out ("£200") and insert ("£150").—(Lord Brooke of Cumnor.)
LORD MITCHISON: It is perfectly true that the Government changed their minds, but so did the Opposition; and at one Period the Opposition were arguing exactly the opposite of what the noble Lord, Lord Brooke of Cumnor, has just been saying. Let us consider for a moment exactly what the object of this Bill is. On Second Reading, I think it was, Lord Brooke of Cumnor found socialism under the bench somewhere. He smelt it coming. He got perilously near losing his temper about it, saying that he had spent the whole of his life fighting it, and that he would go on fighting it. As I see it, this Bill is about something rather different. It is about the relations between leaseholders and freeholders in cases where a leaseholder has lived long enough in his house to claim that it is his home, and where there is a long lease and the other conditions that one sees in the Bill.
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The root injustice here, as we see it, is that in the course of years the freeholder becomes entitled to get back property which has been the leaseholder's home for a long time, and which is now, of course, of a very much greater value than when it was originally disposed of at the beginning of the lease. One may point out—and I think one is entitled to point out—that the degree of hardship on the leaseholder and the extent of his moral rights will vary from case to case. This mischief was recognised by the Conservative Government when they brought in the 1954 Act, and it has been recognised since. There was one notable occasion when Sir Keith Joseph let the cat out of the bag, if I remember rightly, and was stopped by all the other leading Members of his Party. The Conservatives, both here and in other places, have fully recognised that this is a case where the moral rights of the leaseholder and freeholder cannot depend on absolute contract and must involve something more than giving the leaseholder the right to buy back at market price the house of which he would otherwise be deprived by the ending of the lease. That seems to be the moral point behind this.
Then one comes to whether or not, in this particular case, the rateable values in the Bill should be altered by £100, in the case of London, and by some smaller amount in the case of the Provinces. This seems to me to depend, in spite of what the noble Lord, Lord Brooke of Cumnor says, on the fact that the rateable values here shown indicate the type of house which is also covered by rent control. My feeling, which I think may be shared by others on this side, is that if the occupant of rented lodgings is entitled to protection—as he has been since 1915, or thereabouts; and he has had it from successive Governments—and if you are going to decide the limits within which the occupying leaseholder should get protection, it is quite reasonable to say that he should get it up to those rateable values; and that beyond that, he should look after himself, as does the occupant of rented property in relation to rent control.
I think the whole object is clear enough. The difficulty is that, below the limits in the Bill, the leaseholder is not in a good bargaining position, and has not been for a long time. He is a man living

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in a small, or comparatively small, house, and not a man who has been able to buy a considerable and valuable piece of property. As with any other line one intends to draw—as, for instance, in the Rent Restrictions Act—one is bound to have hard cases on one side or the other, simply because they are just beyond the line one way or the other. That is inevitable. If that problem has been faced over rent control, I see no reason why it should not be faced in this case. The linking factor is the fact that in both cases the occupant of the house, whether it is under rent control or under long leasehold arrangements, stands otherwise to lose his home or to have to pay more than he can afford. That being so, I wonder why should one wish to alter the limits already in the Bill.
I cannot help noticing, as the noble Lord, Lord Brooke of Cumnor noticed, that this subject has been very fully discussed below; there have been Divisions about it and conclusions have been reached. I waited to hear for what reason your Lordships should be specifically invited to differ from the place below on a matter which I should have thought was essentially Commons' business, far more than it is any business of ours here. I am not for a moment denying that we have the right at present to pass Amendments of this character if we so wish—
SEVERAL NOBLE LORDS: Hear, hear!
LORD MITCHISON: —but I am saying that if we do make changes, it is extremely unlikely, when an opposite conclusion has been reached in another place, that they will get any further. The net effect will be what is dear to the Opposition, a certain amount of wasted Government time in the Commons.
LORD INGLEWOOD: The noble Lord opposite has been accusing my noble friend Lord Brooke of Cumnor of changing his mind. I was reminded of the arguments that he and his friends developed at length when the New Towns Bill was being argued in another place. If I remember aright, the whole argument from the Labour Benches was that it was wrong to own a freehold. Many small freeholds were bought out—and at market price, which was preferable to what is proposed to-day—and converted
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into leaseholds. If this is not the case then I hope the noble Lord will correct me.
3.15 p.m.
LORD KENNET: There is little to add to what my noble friend has said about the general background to this limit and its relationship to the Rent Act. The noble Lord, Lord Brooke of Cumnor, gave figures of capital gains available to leaseholders enfranchising at rateable values in London of between £300 and £400. I am not in a position to say whether I accept those figures or not. But, assuming that they are correct, I would point out to the Committee that we are talking about a very small number of such cases. I would also point out that the real consideration here is not so much the gross value of what we may call in shorthand the "windfall", but the value of the windfall relative to the value of the property itself. I expect the noble Lord, Lord Brooke of Cumnor, will agree with me when I say that figures proportionately similar to those he quoted could be found for houses of a London rateable value of £299. The problem will exist wherever we draw the line, so long as there is a line drawn.
The noble Lord said that the Rent Act limits (£200 and £400) were quite a different matter. I do not understand his line of argument; for both in the Rent Act of 1965 and in this Leasehold Reform Bill we are dealing with rents, values and contracts between landlord and tenant very much in the same sort of social territory. He says that they are a different matter, but I should like to ask him this question. Did he think that they were a very different matter when, in 1965, he argued that the Rent Act limit should be £300?—because that was arguing for exactly the same limit as that for which he now argues in the Leasehold Reform Bill. One would assume that he would argue for the same limits on both Bills because he thought they were rather the same matter. I think I can understand the objection of the noble Lord and his Party to the £400 limit. It is that after mature consideration—and I repeat "mature consideration"; because the noble Lord will remember that in the House of Commons his friends argued for the complete abolition of all limits—he has, like the Government, come to the conclusion that

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there must be a limit. Having accepted that, he has gone a step further and asked himself whether he could suggest a limit that would reduce the incidence of a Bill which he dislikes. This is the comprehensible reason for which he must have put down this Amendment.
The Government are against it, as they were at an earlier stage. It seems that it would not reduce greatly the problems around the limit, wherever it is, which we admit are in the Bill because of this matter of proportionality. There is a strong argument for having the line the same as in the Rent Act, which is one of simplicity. If we have overall a type of housing which we agree is in short supply, and therefore meet to control more closely than the other sort of housing, the more expensive sort which is not in short supply, the inhabitant of which does not therefore need protection, it is surely infinitely simpler that in the two principal measures governing this field we should have the same definitions for that sort of housing. I would therefore advise the Committee to reject this Amendment.
LORD SILSOE: Having heard noble Lords speaking on both sides, I should like to suggest that the problem has not really been put. There is something to be said for a limit for an extended lease, which is security of tenure comparable with that given under the Rent Act. There is nothing to be said for the same limit for enfranchisement. Unfortunately, this Bill has been drafted with the same figures for both. There is at the moment no Amendment. Later on, I intend, with your Lordships' permission, to propose several which will draw this distinction. I cannot see that the present limit of £400 for enfranchisement will prevent all the main abuses. I think it will prevent all the abuses for extended leases. I think there is something to be said for some reduction—not, I suggest, in the rateable limits, which I consider to be a very bad yardstick for all purposes—but I consider that some further consideration should be given to the question of enfranchisement. I am confident that at this limit of £400 in London (your Lordships will forgive me if I do not speak always about both figures) all the problems, such as those referred to by the noble and learned Lord, Lord Stow Hill—the hardships in Newport—and by the noble Lord,
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Lord Mitchison, who spoke of what he called "black" and "white" leases—and I refer now to the "black" ones—could be met by a sensible reduction made, in some way or other, in the enfranchisement limit.
When my turn comes I am going to propose a different method altogether from that of the noble Lord, Lord Brooke of Cumnor. I think rateable limits cause far more trouble at the breaking level than any other yardstick which could conceivably be thought of. Therefore, in respect of this Amendment I want to sound a note, and to say, as I shall say considerably more often as the debate goes on, that to have the same figures, or the same yardstick, or the same anything, for enfranchisement and for extended leases is essentially wrong. That is all I wish to say at the moment.
3.22 p.m.
LORD BROOKE OF CUMNOR: The noble Lord, Lord Mitchison, delivered an emotional speech, saying how essential it was to protect the person who had, with his family, lived in a house for many years and who had come to regard it as his own; and that it was unconscionable that such a person should have to hand the house back to the landlord. I do not know whether the noble Lord thought that any sort of answer to the case which I quoted of a leasehold house in London on which I put a present-day value of £10,500. I put it at that figure because the house had been bought for £10,500 eighteen months ago. I simply cannot understand why a person who quite freely entered into a transaction at that figure eighteen months ago, to buy the remaining 27 years of the lease of a house at a rateable value of £355, should now be presented to us by the Government as a man suffering from hardships whom we have to protect because his house is in the rateable value limits for rent control. Our discussions will be clouded and befogged if we are constantly to have the case of a small house in Cardiff or in the Welsh valleys adduced in support of arguments that relate exclusively to a house of a completely different character in London or in a big city. I ask the Government to produce cases of hardships which would result from the acceptance of my Amendment.
LORD KENNET: I wonder whether the noble Lord will yield a moment

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before he rushes away with his case between his teeth across several fields. If the man in question bought the lease only eighteen months ago, he is not entitled to enfranchise at all.
LORD BROOKE OF CUMNOR: But he certainly will be. Are the Government going to propose an Amendment that only those who have lived five years in a house at the time of the passing of this Bill shall be entitled to enfranchisement? If so, I think that such an Amendment ought to have been tabled. I suggest that we must discuss each of these Amendments in relation to the Bill as it stands and not in relation to some other changes which may possibly be made.
I simply cannot understand the argument that the type of person who is in a position to buy a leasehold in London for £10,500 needs the protection of the Government. It is not as though all houses in London were leasehold. It is not as though it is impossible to buy a house for £10,000 with some choice. The house may not be in Mayfair, or exactly where you would like; but none of us, when we buy a house, is likely to get the right house in the right place at a sacrificial price which is within our means.
LORD MITCHISON: I wonder whether the noble Lord, Lord Brooke of Cumnor will allow me to intervene for a moment. He has, no doubt, borne in mind the provisions in Clause 1(1) of the Bill, that the tenant must have been the tenant under a tenancy at a low rent and occupied the house as his residence for the last five years. Is the case he is putting to us the case of someone who so occupied a house and bought the reversion eighteen months ago?
LORD BROOKE OF CUMNOR: No, I am not putting that case. I explained exactly the case I was putting. Like the noble Lord, Lord Silsoe, I see no reason why there should be the same limit in this Bill as in the Rent Acts; and when the noble Lord, Lord Kennet asks me whether, when I proposed or supported an Amendment in 1965 to change £400 to £300, I was thinking forward about what I might do regarding this Bill which had not then been published, I think he must be very hard up for arguments. I
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do not propose to press this Amendment for the reason indicated by the noble Lord, Lord Silsoe. Whether it would be right to alter the rateable value in the way suggested will depend, in part, on what happens to the rest of this Bill. I reserve entirely my right to move this Amendment again, or a similar Amendment, at Report stage, if Amendments have not by then been made to later clauses of the Bill to bring greater equity into its provisions. I think these Amendments of mine are sound, but I entirely agree that it would be wise to wait and see what your Lordships decide to do on later clauses; and in that spirit I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
3.28 p.m.
LORD SHAWCROSS LORD SHAWCROSS moved, after subsection (1), to insert as a new subsection:
"( ) In this Part of this Act references to a leasehold house shall not include a house situated on land belonging to a landlord which is an institution, organisation or trust establishment for charitable purposes."
The noble Lord said: I am going to ask your Lordships to be so good as to bear with what, I am afraid, will be a long and tedious speech about a matter which is of great importance to the handful of estates involved, but which really involves a very minor and limited amendment of this Bill. The Amendment in no way detracts from the real purpose of the Bill and the philosophy behind it. Moreover, it is an Amendment which, if accepted, would involve the introduction of no new kind of principle in regard to the law relating to charities. On the other hand, it is an Amendment which is essential if what I have described as a handful of small and, I think admittedly, well-managed estates—such as Dulwich and Bournville—are to survive as well-managed estates, contributing to worthy, charitable objectives. The rejection of the Amendment—I can only conceive of its being rejected on grounds of a somewhat doctrinaire kind—would involve estates like the two I have mentioned (the Dulwich one now forming, as I think my noble friend Lord Silkin will agree, something of an oasis in what is otherwise a rather dreary part of South-East London) being condemned to a gradual deterioration into slum conditions; and at the same time those

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beneficial activities which have hitherto benefited from the charitable endowments which these estates provide will greatly suffer.
I should say, to indicate my interest, although it is not in any sense a financial one, that I speak as Chairman of the governing body of two schools in South-East London, the Alleyn's School and Dulwich College. These schools are among the beneficiaries of the Dulwich estate. It was called, when established in the reign of James I, the Estate of Alleyn's College of God's Gift in Dulwich. They both derive a substantial amount of their income from the existence of the estate. Although originally founded under a charitable deed, the estate is now the subject of a statutory scheme approved by the Secretary of State for Education and Science.
Before I say anything about the beneficiaries of the estate, may I explain why I ask your Lordships to feel that the acceptance of this Amendment would not in the slightest degree detract from the real purpose of the Bill? I have always understood that the philosophy behind the Bill—and I fancy that I was making speeches even before my noble friend Lord Mitchison about the reform of leasehold law and taxes on land; speeches from which I do not wish to depart in the slightest degree—which originally led to the movement for leasehold reform, was the fact that some tenants, towards the fag-end of their leases, were being subjected to extortionate treatment by landlords, who were securing large amounts for dilapidations and who were succeeding in obtaining excessive rents when they renewed their leases, and indeed very often they did not renew them at all. Such conditions undoubtedly existed in South Wales and in certain parts of the North-East, but the very places where they have nexer existed have been Dulwich and Bournville. I think it is safe to say that in none of the landed estates which have been conducted by charitable foundations have tenants received anything but the fairest and most meritorious treatment.
I have always been in favour of a measure that would remedy the evils I have described, but this Bill in its present form, because of what I am going to suggest has really been a quite inadequate
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study of the whole problem before the Bill was introduced in another place, would simply substitute other evils, and some just as great, in place of those which the Bill is designed to remove.
The Dulwich Estate covers about 1,500 acres in South-East London and contains just under 4,000 houses which are the subject of leases. Its income goes, first of all, towards the comprehensive management and systematic redevelopment of the estate, and then to the support of no fewer than six schools in different parts of London, of one of the most beautiful picture galleries outside Central London, of some almshouses, and of one or two minor charities. If all those who under this Bill were entitled to enfranchise their leases were to do so (and one would expect them to do so because they would make substantial profits from so doing) the total annual ground rental which the estate receives, now in the order of £83,000, would be reduced to £28,000.
It is perfectly true that against that amount one would have to set the income which would be received from the so-called compensation payment. What would that be? The compensation provided under this Bill—and in some cases there is no doubt ethical justification for it—is so inadequate that, in the case I am putting to your Lordships, I think it is accurate to say that there has been nothing so confiscatory on the Statute Book of this country since the reign of Henry VIII. Take, as an example, what would happen in a typical house on the Dulwich Estate, say in the Alleyn Road. As a house with vacant possession, such a house would probably command on the open market a price of about £8,000 for the freehold. That is the amount which the enfranchised tenant would expect to get under this Bill, if it is passed in its present form; but not, of course, what he would have to pay. As your Lordships know, what he will have to pay for getting the lease enfranchised is based on two curious assumptions: first, that the bricks and mortar of the house, in spite of the contract into which he entered, it may only be seven or ten years ago, belong and always belonged to him and, secondly, that vacant possession will not be available for fifty years.
Your Lordships have only to ask in relation to this kind of property: while it may be understandable that someone

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would pay £8,000 for such a house with vacant possession, who would pay anything for a plot of land on which there was no house, of which he was going to get possession only in fifty years' time, and then as part of a single lot on what had already become a completely fragmented estate? The plain fact is that in cases like these, the charity's loss would be substantial—something like £55,000 in the Dulwich case—and the amount to be set off against the annual rental loss is a completely speculative and derisorily inadequate figure by way of compensation. It is obvious that the loss to the schools, to the picture gallery, to the almshouses and to the other charities will be of the gravest kind.
I know that these schools which, because of this substantial endowment, have been able to take pupils for comparatively low fees from very humble homes, are, in the view of some people, not schools which ought to continue to exist. There are those who feel that the whole system of education in this country should be conducted by the State and that independent schools should go. This is not the occasion to argue that, but I am sure that no noble Lord would wish to destroy the independent schools by an indirect and inequitable method of this kind. By all means at some appropriate time let us debate whether independent schools serve a useful purpose or not, but this is not the way in which fair-minded people would wish to put an end to them as one of the methods of education available to citizens in this country.
Another effect of the Bill on schools of this kind is that it becomes impossible to raise money on the security of the interest in the estate. As a matter of fact, my Board have negotiated a substantial loan on that security in order to put up new buildings and make various developments necessary in the interests of education, but this Bill has destroyed the whole basis for that advance.
I pass from the effect of the Bill on the beneficiaries of charitable estates of this kind to say a word or two about the effect on the estates themselves. Here the position of Dulwich is, I think, very much the same as the position of Bourneville and the position of a small number
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—and it is only a small number—of other charitable estates. I do not pretend to have any special knowledge of these other estates. I hold no brief for Bournville. I know nothing much about it, except, of course, of the great concern which the, Cadbury family—that, distinguished family—have had in the beneficent development of this estate in Birmingham for the last seventy or eighty years. It is an estate of about 1,000 acres, within four miles of the centre of the City of Birmingham, and the present site value of the different plots there must be exceedingly high. The estate as a whole is a housing charity. It has been developed progressively in that way for seventy or eighty years (I think it is), and there is no doubt that that development has resulted in very great benefit not only to the tenants living in Bournville, a model village, but also to the whole of the City of Birmingham.
The curious thing is that in both of these estates, and no doubt in many of these charitable estates, rack-rented and leasehold properties exist side by side. One road may contain an equal number of houses, some of which are leasehold houses and the subject of possible enfranchisement under this Bill, while others are rack-rented and do not come within the scope of the Bill. If the leaseholds are enfranchised, as they will be if the Bill is passed, the estate will have no further or continuing obligation towards those properties, whether it has to maintain the roads, to maintain the park, to maintain the picture gallery or the other amenities there. Moreover, it will have no right to redevelop the road in relation to those particular premises. In regard to the rack-rented premises, on the other hand, the obligation to maintain would continue; and there would remain also the right to redevelop those houses as and when it became appropriate so to do. The rights would be quite illusory. How can you redevelop a road if you only own every other house in it and the remaining houses are owned by separate leaseholders, sitting tenants themselves, as very often they would be, in the hands of mortgagors?
In Bournville a great many of the older leased areas will require redevelopment when the leases fall in, and a curious situation exists there. At present the density is something of the order of

917
16 to 18 persons to the acre—this within four miles of the centre of Birmingham. The City Council now require redevelopment within these areas at a density of not less than 50 persons to the acre—and that is a sensible and economic development of property of that kind, so near to the centre of a great city like Birmingham. Obviously, redevelopment of that kind cannot take place without ownership, and without ownership of the whole estate.
It may be said that a scheme for the continuation of management (under, I think, Clause 19 of the Bill) might be granted by the court. I cannot at present see why any charity should be encouraged to engage in the outlay involved by such a management scheme when it would result in no gain whatever, so far as I understand, to the beneficiaries of the charity. In Dulwich not only are there the gallery, a very beautiful park and other open spaces, but every tree is owned and maintained by the estate; and they look after them. The maintenance of these trees—and there are many beautiful trees there—has kept up the value of the individual houses on this estate. If the leaseholds go, what use is it to the beneficiaries to maintain the amenities of an estate which has become completely fragmented in this way and which provides no income for them?
The fact is, I think, that the Government have now realised (I assume this from some of the Amendments accepted in another place and proposed here) that it is really impossible to divorce good estate management from ownership and the right to redevelop as occasion requires. Had this Bill been law in its present form in, say, 1939, just before the war, virtually none of the developments which have since taken place in Dulwich could have occurred. In fact, over 1,500 new houses have been erected since then, where only 270 houses existed before. And even at this time we are building, or have agreements to build, over 1,000 more houses where only 140 existed before. If the estate had been fragmented into private ownership, not only would it have been largely sterilised in its development but the absence of user covanants, and the disappearance of the common amenities, would have led to a steady deterioration. The position is exactly the same at Bournville and in other similar estates owned by charities.
I venture to be so bold as to say that this Bill has perhaps been introduced without sufficient study of some of the problems involved, and I suggest that this is, to some extent, evidenced by the attitude of the Government in regard to the £400 rateable value limit. If that limit had gone, there would have been, as the Government I think rather belatedly realised, absolute chaos in regard to the redevelopment of the big estates in Central London. The rateable value limit of £400 is quite inappropriate in an area like Dulwich. But the consequences of chaos in regard to redevelopment will follow in exactly the same way.
There is just one other matter, which I should hardly have raised had it not been mentioned in another place and by the noble Lord, Lord Brooke of Cumnor. It was said in another place by the Minister that one of the reasons for restoring the £400 limit was that if it were not restored a number of rich members of the Socialist Party would get tax-free capital gains from the Bill. It may be that many members of the Socialist Party are rich and live in houses the rateable value of which is over £400 (I have heard it said that only the very rich or the very poor can afford to be Socialists nowadays), but I venture to suggest that a great many more members of the Socialist Party, and some of them Members of Parliament, are likely to benefit financially from this Bill at under £400 limit. I gave your Lordships one particular example of a capital gain. I think it is fair to say that in places like Bournville or Dulwich those who enfranchise their houses may easily make a capital gain of anything between £5,000 and £10,000 tax-free.
I do not know whether this Amendment will be accepted or not, but possibly the Government will consider, if they reject it, the possibility of introducing another Amendment on Report stage, in regard to charities, inviting those who live on estates owned by charities and who make capital gains of this kind to hand those gains over to the charities concerned. It is one thing to enrich oneself at the expense of an ordinary landlord; it is a little less agreeable to do it at the expense of a charity.
It may be said that, from the point of view of remedying the evils with which

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this Bill is supposed to deal, it does not really matter, from the tenant's point of view, whether the landlord is a charity, or what the landlord is. The matter has to be considered, it may be argued, from the point of view of the tenant. But that is not what this Bill does. This Bill exempts land required for redevelopment if owned, not only by a local authority or a New Town Commission, as one might expect, or a nationalised industry or a Hospital Board, but by any university or college. If those are exempted, why would it not be right to grant a similar exemption to other educational charities or institutions? The principle seems to me to be exactly the same.
Finally, as to the effect of introducing a provision of this kind in regard to charities, I said that it involved no new principle. Charities have always received special treatment in regard to income tax, capital gains tax, betterment levy, selective employment tax, and all the rest. I venture to ask your Lordships to say that this is a case which would detract in no significant measure from the valid purpose of the Bill, but that it would give protection to estates which ought to be protected and enabled to continue the beneficent activities in which they are at present engaged. I beg to move.
Amendment moved—
Page 2, line 6, at end insert the said subsection.—(Lord Shawcross.)
3.52 p.m.
LORD MITCHISON: I am sorry to intervene again, but I have had associations with this Bill for some time, and I would first say that no one could put the broad purposes of it more eloquently and, I think, more accurately than the noble Lord who has just sat down. He did it infinitely better than I could ever have done it. But I was a little puzzled to hear from him that he thought the subject of charities had not been fully considered or discussed.
LORD SHAWCROSS: I did not say that I thought the subject of charities had not been fully considered or discussed. The noble Lord and I have known each other for a long time, and he may do me the credit of supposing that
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I have not omitted to read my brief or the debates in another place. I said that the consequences of this Bill in general had not been fully considered.
LORD MITCHISON: I am glad to accept that. I supposed that the noble Lord had read his brief (as he puts it), and I was going to remind him, since it is a very long brief indeed, that the specific subject of charities was in fact discussed on a new clause at the Report stage, and it has one rather remarkable aspect. Not only were the Government in favour of not exempting charities, but so was the Conservative Party in another place, and so was the Liberal Party in another place. Therefore, we get the rather peculiar position that there was no support at all, and consequently no Division, on the new clause which was going to exempt charities. It was going to exempt them in terms not very different from those in the present Amendment, but subject to the provisions of Clause 19, which I think would have been more logical than the present arrangement.
Listening to the noble Lord, I felt that a great part of his speech was devoted to matters of compensation which we shall have to deal with under Clause 9, and also to matters of the management of well-conducted estates, which we shall have to deal with under Clause 19. Therefore, to exempt charities completely was likely to be—I say no more than that—a rather drastic remedy for some particular matters. It may be so; but let us just see what was said on Report in another place. I make no apology for reading the very short passage in which the right honourable gentleman the Minister, pointed out that:
"there is no real reason for the exception that he sought to be made. First of all, there is no precedent. These charities were not exempt in the 1954 legislation"—
that was Tory legislation—
"although the effect of that legislation was very much to depreciate the value of the freehold interest."—[OFFICIAL REPORT, Commons, 20/6/67; cols. 1467–8.]
I would say at once that, quite obviously, this Bill has the effect of depreciating the freehold interest and conferring benefits, beyond the present state of the law, on the leaseholder. There can be no doubt about that. I have suggested that there are moral reasons for

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it. The noble Lord himself agreed with that. The Minister continued:
"It also affected the way in which charities felt it right and proper to deal with the leases, which was unfortunate".
There are a great many charities in this country, and some inhabitants of North Oxford would not share the view that all charities are good freeholders. There are tenants of an Oxford college which is very unpopular, whether rightly or wrongly is not for me to say, and may be affected by this Bill because of rateable values. But there is no doubt about it; and there are others. I do not think it is right to say that university bodies are generally exempted. What is exempted is the question of development rights. That I agree about, and that is a matter, I think, for Clause 19.
But may I go on for a moment?—and this really seems to me to be the kernel of the argument:
"The second objection to the clause is that one cannot justify this indefensible distinction between leaseholders which would result if it were accepted. One cannot differentiate, for example, between the leaseholders of the Hampstead Garden Suburb"—
which is not a charity—
"and leaseholders of the Dulwich Estate"—
the very estate which the noble Lord was referring to.
"The cardinal difficulty is that one cannot distinguish between leaseholders according to their character. That is why hitherto it has not been possible to exempt charities." (col. 1468.)
He then went on, a little later, to say:
"… I agree with the right honourable gentleman when he asks how in that respect we can distinguish reasonably between the landowner who is a charity and the landowner who is a private individual". (col. 1468.)
I made a slip—those were the words of the Conservative spokesman and not of the right honourable gentleman, the Minister.
LORD BROOKE OF CUMNOR: I wonder whether the noble Lord would allow me to speak. He is seeking to drive a wedge between the noble Lord, Lord Shawcross, and the Conservative Party in another place. I think that if he had read his brief better he would have realised that there was a new clause in Committee in another place, proposed by the Conservatives and supported in the Division Lobby by the Conservatives; and what he is speaking about is a limited
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clause on Report concerned only with Clause 19.
LORD MITCHISON: That is not so, with respect. Of course I read the proceedings in Committee, and of course—and the noble Lord knows it very well—I should not have tried to deceive the Committee in any respect about this. The clause on Report was this:
"Where a certificate under section 19 of the Act is given by the Minister in favour of a landlord which is"—
I may short-circuit here—a charity
"no person shall be entitled under Part I of this Act to acquire the freehold or an extended lease of the property of that landlord".
LORD MOLSON: Would the noble Lord give the reference?
LORD MITCHISON: It is col. 1466, of June 20, 1967. This is exactly what I said it was. It was an attempt, as this clause is an attempt, to remove charities from the whole operation of the Bill—or virtually the whole operation; I think the whole of it—subject in that case, but not in this, to the provisions of Clause 19. I described this perfectly accurately. That is what happened, and it was to that clause, and that attempt, that the words I have just read out—first by the Minister and next by the Front Bench spokesman of the Conservative Party—were directed. I am really very glad when Conservatives repent. I think they did so on this occasion. I think they came to the conclusion they had gone too far in Committee.
LORD BROOKE OF CUMNOR: Will the noble Lord read out the new clause which was moved by the spokesman for the Conservatives in Committee on May 11 and in favour of which the Conservatives divided? This is the major passage in another place. The other is a minor one relating to Clause 19. The noble Lord has in fact sought to deceive the Committee.
LORD MITCHISON: I object to that sort of remark. It ought not to be made, and it is quite indefensible. But I cannot cure Lord Brooke of Cumnor of bad manners, and I am not going to try at my time of life. All I can say is that the Committee can judge for itself. I read out the clause. I stated the effect

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of it quite correctly; and the observations which were made, both by the Minister and by Mr. Graham Page, would have been inappropriate to anything else. I do not think one ought to say that sort of thing. Be that as it may, I have said hard things about the noble Lord, Lord Brooke of Cumnor, in my time and I shall no doubt find the noble Lord occasionally saying some more. For the moment, let us leave it at that. But I do not want to leave the Liberal Party out—that would not be fair. I should like to read what was said by Mr. Hooson (and I quote)—
THE LORD PRIVY SEAL (THE EARL OF LONGFORD): May I intervene, in a spirit of neutrality? Whatever may be thought about the observation of the noble Lord, Lord Brooke of Cumnor, which was certainly unusual in this House, I would point out to the noble Lord, Lord Mitchison, that it is out of order here to quote verbatim remarks made by speakers in another place who are not Ministers. It is quite in order to quote Ministers, but I hope he will paraphrase the statements of those who are not Ministers.
LORD HAWKE: May I just intervene for one moment? It might interest the noble Lord to know that he certainly succeeded in deceiving me. I thought he said that the Conservative Party in another place did not put forward a clause and vote to exempt charities.
LORD MITCHISON: I think perhaps the noble Lord, Lord Hawke, might care to look at Hansard to-morrow. I am prepared to rest on that. As to the rest, I was of course in order in quoting the Minister and out of order—and I must apologise for it—in attempting to quote Mr. Hooson, but I think your Lordships will agree that I was a little tempted when the opposite was said in this House. As to Lord Brooke of Cumnor's distinction between Committee proceedings and those on Report, I think on the whole I prefer the later version, which was the Report version; but really there can be little doubt about this. There are these two perfectly good answers: one is that it would be strange indeed to put into this Bill something which was deliberately omitted by the Conservative Administration of the day from the 1954 Act.
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The second is the even stronger argument that the leaseholder's rights ought not to have to depend on the character of his landlord. This is the very mischief we are trying to remedy. Half the trouble in South Wales is that some landlords holding their tenants under long leases behave very well and others behave very badly. We know perfectly well there is always the same problem in questions of rent control, and what we say—and I am confident that here I speak for all my colleagues—is that it is wrong in matters of rented property, when we are dealing with people's homes, to have their rights as tenants depend on whether or not they happen to strike a good landlord. I am sure the Dulwich estate is a good landlord, and also the Hampstead Garden Estate, which is not a charity, and there are many more. But what we are trying to do is to give leaseholders the right to own their homes or to extend their leases—rights independent of the character of the landlord and dependent on the relationship of the long leaseholder himself and the freeholder; and surely that is the right way to tackle legislation.
4.6 p.m.
LORD KENNET: The White Paper on which this Bill was based contained no suggestion that landlords which were charities should be outside the scope of the Bill. Nor did the Bill as it was introduced into another place; nor does the Bill here. This was a difficult decision taken by the Government, but a perfectly deliberate one. The Bill is intended to rectify an unfairness to the leaseholder in the present state of leasehold legislation. It is irrelevant to this purpose whether the charity (which may be, in a certain case, the leaseholder) is devoting its money to a worthy end—as it usually is. If a leaseholder, by reason of the leasehold system as it bears at present, is suffering unfairness, he suffers it just the same, whatever the person of the landlord. Very often, indeed, charities could not vary the terms of their leases in favour of the leaseholder, even if they wished to, since they are bound by the terms of their trust to exploit the law as it stands to the benefit of their beneficiaries and no other parties.
I think this is the point at which the House ought to remember its own position in the country. We must think and feel clearly. The chairmen of great

925
property companies and the chairmen of great charitable foundations and charity land owners can come here with briefs. Leaseholders do not have experienced and eminent leaders to lead them. They do not, as such, have leaders at all, and if they did they would not be in the House of Lords. Let us not forget this.
SEVERAL NOBLE LORDS: Oh!
LORD KENNET: The noble Lord, Lord Shawcross, said of the charitable estates which he was representing that if the Bill goes through unamended the houses on those estates will be condemned to degenerate in time into something like slum conditions. I note his assessment of the owner-occupier as a householder. The question of Dulwich is a difficult one. Of course, when one sees a great and famous charitable foundation doing a great and famous job one's instinct is to say, "Well, for heaven's sake! let us exempt them and let them go right on doing their great and famous job". But it is not all as simple as that.
If we turn back to the days of Edward Alleyn himself (God rest his soul) we find that his charity was set up—and the noble Lord will correct me if I get the facts wrong—it was in fact by a tax levied on those who might live on the land round about Dulwich, the proceeds of which were devoted to educating a rather small number of poor scholars. London engulfed Dulwich; the value of that land shot up, but what is still in effect a local tax (and this is common to all leasehold estates) is levied on persons who may or may not get any benefit from the educational institution concerned and is paid over for the education of persons who may or may not live on the land so taxed. There are many differing interpretations of a great charity like Dulwich and the Alleyn Estates. I do not think they are on one foot, but this is not the point. The point why the Government resist this Amendment is simply that this is a Bill to help leaseholders, and it cannot—except in one specific circumstance which has been mentioned and to which I will return—take account of the status of the freeholder himself.
Let me turn now to the point made by the noble Lord, Lord Shawcross, with some force; namely, about the different position of local authorities, universities,
926
Hospital Boards, and so on. They are not exempt from the entire operation of this Bill, as the noble Lord's Amendment would exempt charities. They are exempt only in certain circumstances and for certain purposes which are defined in later clauses in the Bill. If it is the noble Lord's purpose to secure for the charities he has in mind the same status as the Bill provides for universities, Hospital Boards and local authorities, then the right way to do it would be by means of an Amendment at a later stage in the Bill.
Having said all that, I would remind the House that the provisions for the scheme of management under Clause 19 are pretty broad. They can be well exploited by a freeholder who retains some part of the leasehold property on his land in his own possession, as no doubt they all will, not only because some of the properties will be over the £200 or £400 limit but also because not all the tenants will wish to enfranchise. I take the point of the noble Lord, Lord Shawcross, here. If a freeholder found it difficult, under the terms of his trust, to spend any money on a scheme of management, part of the benefit of which would go to those who were no longer his leaseholders (I do not know whether this would be so or not) I would remind the House that there is a Government Amendment coming to Clause 19 which would entitle the newly enfranchised freeholders to make their own application for a scheme of management, and it may be that such a provision would be useful in the kind of circumstances the noble Lord has in mind.
LORD MOLSON: It is a remarkable thing when the Parliamentary Secretary advances it as an argument that this House of the Legislature is not in a position to discuss matters of this kind because, in his opinion, there is not a sufficient voice for tenants to make their voices heard here.
LORD KENNET: I advanced no such argument. Nothing was further from my mind than to suggest that the House was not in a position to discuss these matters. I asked the House only to remember certain facts about its position in the country and the kind of representation here.
LORD MOLSON: The Parliamentary Secretary will be able to read what Hansard took down as his remarks in that speech. Whether, if he did only refer to our being not in a position to take a fair judgment on the matter—
LORD KENNET: If I might intrude again, I did not imply that the House was not in a position to take a fair judgment on the matter. I think the words I used were as I repeated them just now, which is another suggestion.
LORD MOLSON: It has often been made ground of complaint against this House by members of the Party opposite that when matters like rent restriction came to be discussed there were noble Lords on this side of the House who expressed the point of view of property owners and complained about the unfairness and anti-social effects of the rent restriction Acts. I have no doubt at all that this House is in an extremely good position to take a fair line about all these matters.
The Government find themselves in some difficulty in arguing about this Bill. They try to stand on two entirely different legs. In his speech, the Parliamentary Secretary talked as though this Bill was generally critical of the whole leasehold system. When this Bill was introduced, and especially when the noble Lord, Lord Stow Hill, made his very remarkable speech in support of the Second Reading, he talked about it as being a special measure in order to deal with particular hardship. He referred to South Wales, to conditions in which a landlord was the sole owner of all the land in the district and the working man had no option but to take a lease on land on such terms as the landlord chose to dictate. But when we come to discuss London there is no parallel with that situation at all.
The reason that was given in another place, by the Minister who wound up the debate there, for the complete change in the attitude of the Government was that a number of members of the Socialist Party had discovered that if there were no limit upon the rateable value it would result in completely unjustifiable capital gains by a number of wealthy leaseholders in London. The position has already been explained by
928
my noble friend, Lord Brooke of Cumnor. A person can acquire a lease of an expensive house in a fashionable part of London and pay a large sum for it, and under the provisions of this Bill, as soon as the Bill is upon the Statute Book, he will be in a position to obtain enfranchisement, to leave the house and to sell it, at a vastly increased price, with vacant possession. It is cases of that kind in the Dulwich Estate to which the noble Lord, Lord Shawcross, has been referring. It is the ill-effects of breaking up a well-managed estate of that kind and the completely unjustifiable capital appreciation gained by certain individuals, while at the same time preventing a properly planned redevelopment of the estate as a whole.
It is no good the Parliamentary Secretary advancing general arguments about a criticism of the leasehold system as a whole when the particular injustices to which the noble Lords, Lord Stow Hill and Lord Shawcross, both referred have no application here whatsoever. This Bill, in the form in which the Government have brought it to this House, is not a measure dealing with leasehold as a whole. It is a discriminatory measure, trying, as I think unsuccessfully, to deal with particular cases of hardship. If such exceptions are to be made, according to the rateable values of houses, there is not the slightest justification in reason why further exceptions should not be made in the case of estates, whether privately owned, as under Clause 19, or charitable estates, as in the case of the Amendment proposed by the noble Lord, where in fact the abuses against which this Bill is directed do not arise and where the whole effect of the Bill will be merely to result in a deterioration in the living conditions of most of the tenants there, to put excessive, unexpected and unjustified profits in the hands of particular individuals who avail themselves of the clauses of this Bill, and, above all, to prevent proper and advantageous redevelopment of these areas of London.
4.17 p.m.
LORD SILSOE: Unfortunately, the noble Lord, Lord Kennet, said that charities, some of them, had to exploit their beneficiaries because of the terms of their trust. That is a horrible thing

929
to say. It should never have been said. It is not correct of any charity.
LORD KENNET: The noble Lord's enthusiasm impinges on his hearing. I said that charities, some of them, by the terms of their trust, were bound to draw—
LORD SILSOE: "Exploit" was the word used.
LORD KENNET: Exploit—not their beneficiaries but—
LORD SILSOE: "Beneficiaries" was the word, too.
LORD KENNET: —those who invested in them for the benefit of their beneficiaries. I do not char se any charity with exploiting its beneficiaries. I did say "exploit" the investors. I would withdraw the "exploit", and say "obtain a high rate of return from its investors for the benefit of its beneficiaries".
LORD SILSOE: I am very grateful. I hope the noble Lord will see that Hansard is dealt with. That was a very awkward and unpleasant thing to hear. It just is not true, even as now said.
May I say on this particular clause, as your Lordships were told in my Second Reading speech, that I do represent a charity—perhaps the largest of all. We have given very careful consideration as to whether the Amendment moved by the noble Lord on behalf of Dulwich was the right one either to move or to support. We have, and I have, a great deal of sympathy for the view expressed by the noble Lord, Lord Mitchison, when he was speaking about this House and not the other. I am glad to say that I am the only person who has not read the Report of the proceedings in the other place, so I do not know what happened. But the noble Lord, Lord Mitchison, said that it was difficult to treat a tenant who happens to be the tenant of a charity differently from a tenant of somebody else. I have sympathy with that remark. I also have sympathy with the remark that the best way of dealing with this is to have well-managed estates, under Clause 19. Unfortunately, having waited to listen to the noble Lord who speaks for the Government, I found that there was only one word of hope—and I am afraid in my
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case it is not hope—that the clause will be amended so as to make this feasible. I hope it will. I must not trespass by going into it now. There is an Amendment down in the name of the noble Lord, Lord Kennet, which gives the enfranchised freeholders power to join in a scheme. I have read it. It makes the matter much worse. The trouble is that when we stand up here and ask for some help we are asked to wait for a later clause.
I shall venture later on to move a new Clause 19, and I hope that I shall succeed. The expense entailed by the present clause is quite ridiculous. Public inquiries, Chancery courts and Heaven knows what! No charity, least of all Dulwich and Bournville, if I may say so, could possibly afford the expense. If we could have some simple arrangement in Clause 19 for exemption for a well-managed estate I should be quite happy. But I think it right to say that if that is not included in the clause, then at the next stage those people I represent will ask for exactly the same as the noble Lord representing Dulwich asks to-day.
LORD BROOKE OF CUMNOR: Perhaps the first thing to do is to get the Record straight. Noble Lords have been able to read on the Marshalled List the Amendment we are now discussing, moved by the noble Lord, Lord Shaw-cross. In Standing Committee in another place the honourable Member who was leading for the Opposition moved a new clause which began with these words:
"This Part of this Act shall not apply to land belonging to a charity and forming part of the permanent endowment of the charity."
The Conservatives supported that new clause with their voices and with their votes.
I sought to follow the reply of the noble Lord, Lord Kennet, to this new clause. As I understood it, what he was saying was that the Government had decided that protection and assistance must be given to all leaseholders against the exploitation that was inherent in the present law, and that therefore it was irrelevant for the Government to consider who the freeholders were or what happened to them. I hope your Lordships will not consider that it is irrelevant

931
to yourselves to consider both sides to this transaction.
No case of hardship, so far as I know, has been adduced by the Government at any time connected with the management or affairs of one of these charitable leasehold estates. With the rest of the field we are normally discussing a situation where the capital gain that will accrue to the leaseholder who enfranchises will be at the cost of the private freeholder. In this case, we are considering the example where the capital gain accrues to the freeholder, which in the normal instance will be wholly undeserved and will be at the expense of a charity. This is not a nice idea. It needs a great deal of justification, far more justification, I would submit, than it has received either here or elsewhere.
Questions were raised by the noble Lord, Lord Mitchison, as to whether this was a representative House. I am quite sure that the general public would wish this House to guard carefully the interests of charities, and not so to legislate that their funds are taken away from them for the benefit of private individuals unless an absolutely cast-iron case is made out that that is necessary.
On an earlier Amendment I quoted a case of a rateable value of £335 in London, and pointed out that a capital gain of some £5,000 would accrue. I do not know whether there are on the Dulwich estate, for example, any leasehold houses with a rateable value as high as £355. But there certainly would be a number of houses there with a rateable value of around £200, and if the capital gain is not £5,000 it will be £2,500, or whatever it may be proportionately. That £2,500 will be taken away from the charity and put into the pocket of the leaseholder who can, immediately the transaction is completed, sell the house and pocket the capital gain.
The majority of these houses that we are talking about are not in the sphere of maximum scarcity. They are sought after, as is practically every house within reach of Central London; but the kind of people who nowadays take leases on the Dulwich Estate are people who have some margin of choice as to where they go, and certainly are not people who are compelled by their poverty to take a
932
house on that particular leasehold estate because they cannot go anywhere else.
I do not know what the noble Lord, Lord Shawcross, intends to do about this Amendment, but if he proposes to press it I shall advise my noble friends to support him.
4.24 p.m.
LORD SHAWCROSS: I have already occupied far too much time of the Committee, and the observations I wish to address to your Lordships now will be short. The noble Lord, Lord Mitchison, made the point that it was impossible to distinguish leaseholders according to their character. It is an odd argument, to my mind, that in a Bill which is intended to remedy evils one must apply the remedy indiscriminately although the evils themselves do not exist in the case in point, and the remedy itself will create greater evils.
LORD MITCHISON: I wonder whether the noble Lord will allow me to say that I was misled by the argument put forward by the Conservative spokesman in another place?
LORD SHAWCROSS: I am afraid that I fail to understand that intervention. Nor did I understand the point that the noble Lord made earlier, when he said that in 1954 the Conservatives might have done this and did not do it. It is a matter of supreme indifference to me what the Conservatives said in another place, or did in 1954. I was not then, and am not now, a member of the Conservative Party. I hope that the Conservative Party will be capable—as indeed I hope the noble Lord will be capable—of listening to an argument and dealing with it on its merits, and that they may decide to do now what they failed to do at an earlier stage. The noble Lord's intervention and reference to the Conservative Party's view about this matter in another place appears to be totally inaccurate. The fact is that this Bill—
LORD MITCHISON: That is not so.
LORD SHAWCROSS: The fact is that this Bill does precisely that which the noble Lord said the Bill could not do. In Clause 29 the Bill distinguishes between the character of tenants according to their character. I am referring not only to the Crown Commissioners; I

933
am referring to that whole body of public authorities, including universities. It is perfectly true that it makes that distinction only in connection with the right to redevelop. But that is not the point. The distinction is made between tenants according to their character about what is perhaps the most important aspect of this Bill. I should not have so great a quarrel with this Bill if charities were included within the scope of Clause 29, but the principle of distinguishing between tenants according to their character is clearly one which is already embodied in the Bill.
The noble Lord, Lord Kennet, made a somewhat debating point about the owner-occupier. I am a great believer myself in owner-occupation. But I also realise (as I have no doubt the noble Lord would if he gave a moment's thought to the problem, which clearly he has not so far done) that owner-occupiers have shown themselves to be quite incapable of developing obsolescent property, maintaining roads and maintaining public spaces. It is in those cases—and one has seen this all over the country—where old estates, not charitable estates, but big estates, have been fragmented; property has become obsolescent; roads have not been taken over—
LORD KENNET: The noble Lord is changing his ground. He said that the owner-occupiers were going to let the property degenerate into slum conditions. That is different.
LORD SHAWCROSS: That is what I am saying has happened. I have not changed my ground in the slightest degree. That is what I am saying that experience has shown all over the country. Obsolescent property has got more obsolescent. Streets which have not been taken over have fallen into greater decay; open spaces, no longer the subject of any
obligation upon the owners of the original estates, have fallen into neglect and desuetude. In many great provincial cities one can see that that is precisely what has happened where estates have been fragmented and left in the ownership of single individuals who have lacked the financial resources to engage in redevelopment. That is what I venture to fear is likely to happen in places like Bourn-vine or in Dulwich, if the Bill is passed without Amendment to deal with these cases.
The noble Lord, Lord Kennet, pointed out that a later clause, Clause 19, and later Amendments, may have some bearing on the position of charities. That is quite true, and I hope that some of the later Amendments will be considered in the light of the position of charities. May I just ask your Lordships' indulgence to explain why I spoke at some considerable length on this Amendment? I say this because only last Thursday, I am afraid, I committed the serious discourtesy of leaving the House before the end of the 'debate; although I explained to the noble Lord who was speaking in reply that I had to catch an aeroplane. The fact is that to-morrow and Wednesday public duties elsewhere make it impossible for me to be here. I tried to make whatever points there were to be made in the case of charities, not only in relation to this Amendment but the other Amendments. I apologise in advance for not being able to take part in the work of the Committee on those later Amendments. In the meantime, I feel I should press this Amendment to a Division.
4.32 p.m.
On Question, Whether the said Amendment (No. 3) shall be agreed to?
Their Lordships divided: Contents, 91; Not-contents, 43.

CONTENTS

Aberdare, L.

Buccleuch of Queensbury, D.

Denham, L.

Aberdeen and Temair, M.

Byers, L.

Derwent, L.

Ailwyn, L.

Caccia, L. [Teller]

Dilhorne, V.

Albemarle, E.

Carrington, L.

Drumalbyn, L.

Ampthill, L.

Clinton, L.

Dudley, L.

Amulree, L.

Clwyd, L.

Ebbisham, L.

Auckland, L.

Cork and Orrery, E.

Eccles, V.

Balfour of Inchrye, L.

Cottesloe, L.

Emmet of Amberley, Bs.

Bessborough, E.

Craigavon, V.

Erroll of Hale, L.

Boston, L.

Croft, L.

Falkland, V.

Brooke of Cumnor, L.

Cromartie, E.

Fleck, L.

Brooke of Ystradfellte, Bs.

Daventry, V.

Fortescue, E.

Glendevon, L.

Lambert, V.

St. Helens, L.

Goschen, V.

Latymer, L.

St. Just, L.

Greenway, L.

MacAndrew, L.

Salisbury, M.

Grenfell, L.

Merrivale, L.

Sandford, L.

Grimston of Westbury, L.

Meston, L.

Sempill, Ly.

Guest, L.

Mills, V.

Shawcross, L.

Hacking, L.

Milverton, L.

Somers, L.

Harvey of Tasburgh, L.

Molson, L.

Stamp, L.

Hawke, L.

Monsell, V.

Stocks, Bs.

Horsbrugh, Bs.

Monson, L.

Stonehaven, V.

Hunt, L.

Montgomery of Alamein, V.

Strang, L.

Hylton-Foster, Bs.

Morrison, L.

Strange of Knokin, Bs.

Iddesleigh, E.

Mowbray and Stourton, L.

Templemore, L.

Ilford, L.

Nugent of Guildford, L.

Thurlow, L.

Inglewood, L.

Oakshott, L.

Wakefield of Kendal, L.

Jellicoe, E.

Redmayne, L.

Wedgwood, L.

Jessel, L.

Russell of Liverpool, L.

Wolverton, L. [Teller.]

Kahn, L.

St. Aldwyn, E.

Wrottesley, L.

Kemsley, V.

NOT-CONTENTS

Addison, V.

Hilton of Upton, L. [Teller.]

Royle, L.

Archibald, L.

Hughes, L.

Sainsbury, L.

Beswick, L.

Kennet, L.

St. Davids, V.

Bowles, L.

Latham, L.

Samuel, V.

Brown, L.

Leatherland, L.

Segal, L.

Buckinghamshire, E.

Lindgren, L.

Serota, Bs.

Burden, L.

Longford, E. (L. Privy Seal.)

Shackleton, L.

Chalfont, L.

Mitchison, L.

Shepherd, L.

Champion, L.

Moyle, L.

Sorensen, L.

Cooper of Stockton Heath, L.

Pargiter, L.

Summerskill, Bs.

Crook, L.

Phillips, Bs. [Teller.]

Taylor of Mansfield, L.

Gaitskell, Bs.

Plummer, Bs.

Walston, L.

Gardiner, L. (L. Chancellor.)

Popplewell, L.

Williamson, L.

Hall, V.

Rowley, L.

Winterbottom, L.

Henderson, L.

Resolved in the affirmative, and Amendment agreed to accordingly.
4.43 p.m.
LORD MOLSON LORD MOLSON moved, in subsection (2)(a), after "only" to insert:
"provided that that part forms the main part of the house".
The noble Lord said: The effect of this Amendment is that paragraph (a) of subsection (2) would read:
"references to a person occupying a house shall apply where he occupies it in part only; provided that that part forms the main part of the house".
This is a probing Amendment to obtain an explanation from the Government as to how they think that the Bill as at present worded would operate in the case of a house which had been divided. It could be partly residential property, it could be partly commercial property, or it could be a case where the long leaseholder continued to occupy only a small part of the house and was profitably—perhaps very profitably—letting other parts of the building. A tenant living in a small part of the house, even though he qualifies as the holder of a long lease, surely should not be put in a position to obtain enfranchisement of the whole
936
house, thereby making exactly the same kind of unintended and undeserved and unexpected profit which has been referred to before and which was the main reason why in another place the Government reintroduced the limitation on the value of houses. I beg to move.
Amendment moved—
Page 2, line 14, after ("only") insert ("provided that that part forms the main part of the house").—(Lord Molson.)
LORD KENNET: The main reason why the Government do not think that the Amendment of the noble Lord, Lord Molson, is necessary is because of the size of the kind of property which is going to be enfranchised. The noble Lord mentioned the case of a leaseholder who lived in only a very small part of the house and let the rest of it at a large profit. That is not really going to happen if we have rateable value limits of £400 in London and £200 outside, because the kind of house where one can let most of it at a great profit has a higher rateable value than that. In any case, the words
"provided that that part forms the main part of the house"

937
seem to me, in the first place, to be difficult to interpret, and, in the second place, probably leading to anomalies. The courts, God knows!, are wonderful at interpreting dubious language in the Statutes which we pass, but "main part" seems so very vague. It is not half by space, it is not half of what would be the rateable value if you were to split up the house into two separate hereditaments. What is "the main part"? What a job the courts would be faced with!
Secondly, let us suppose that a shopkeeper who lives above his shop, and who undoubtedly qualifies as he is in possession of the whole house, lets the shop and retires and retreats to the flat upstairs. He would probably take himself outside the provisions of the Bill if he did that, and that would be an undesirable result of the Amendment. In view of that, I would ask the noble Lord whether he is not satisfied that the word "main"' is so vague, and the possibility of anomalies of the type I mentioned is so high, that he is prepared to withdraw the Amendment.
LORD HAWKE: May I ask the noble Lord whether he could elaborate a little further as to how the retired shopkeeper manages to take himself outside the scope of the Bill, because it is not quite clear to me.
LORD KENNET: He is the leaseholder of a house which has a shop in it. He is a shopkeeper and is resident in that single leasehold. Let us suppose that he has been there for less than five years, so he is just coming up to the time when he could enfranchise. But just before that he has to retire and he wants to carry on living upstairs, but naturally enough he lets the shop down below to someone else. The shopkeeper is no longer likely to be living in the main part of that hereditament, and if we accept the Amendment of the noble Lord he could not enfranchise.
LORD BROOKE OF CUMNOR: I feel sure my noble friend Lord Molson will accept the Parliamentary Secretary's statement that "the main part" is somewhat vague. But my noble friend said that this was a probing Amendment, and I hope the result of it will be that between now and Report stage the Government will give rather more thought to this
938
matter. I cannot believe it is really the Government's desire that the Bill should give rise to successful speculation by people moving into a small part of a leasehold house and living there for five years, when they would otherwise have no intention of doing so, simply in order to pocket the capital gain at the end of five years.
The noble Lord will have had his attention drawn to advertisements which have already been appearing in some papers, drawing attention to the possibilities of a capital gain by methods of this kind. I am aware of a case—I think, in fact, details of it were sent to the Minister—of a surveyor who was consulted by a client who owned a leasehold house (it was not a very big house) which would have come within the rateable value limits. He did not live there, but he let it off in rooms or non-self-contained flats. This non-occupying leaseholder immediately saw the pecuniary possibilities of this Bill, and went and consulted a surveyor as to how much his profit would be if he moved into one of the rooms or non-self-contained flats for a period of five years while continuing to let the others.
As I read the Bill, there is no safeguard against capital profits of that kind, and in certain circumstances it can be a very attractive speculation. You buy a house at leasehold value, you move into a small part of it yourself, you let the rest in rooms without creating self-contained flats, you enfranchise at the end of five years' occupation and then you collect your tax-free profit. I really cannot believe that it is the desire of the Government that this Bill should give an encouragement to that sort of customer; and it seems to me that unless there is introduced some Amendment on the lines of that of my noble friend Lord Molson—although it may have to be a more complex one—the Bill is wide open to that form of speculation. It does not seem to me a very desirable form of money-making, or a very desirable form of house occupation. That is why I would, in all seriousness, ask the Government to see whether between now and Report stage they cannot introduce some words which will make it absolutely plain on the face of the Bill that there is going to be no encouragement to speculation of that kind. The Bill, I am

939
sure, has no such intention, but I cannot see how at present there is any safeguard against it.
LORD SILSOE: May I say a word on this subject? This is an important point which I hope the Government will look at. I have no constructive ideas as to how to alter it, but one of the things about this Bill which worries landlords is that after the publication of the Bill lessees who have no intention whatever of living in the premises will come in for the money. We are worried very much indeed about it. It is so easy to do it under the present wording, and I am sure that no one really wants to encourage it. The word "occupies" is a difficult word. "Occupies" usually means in rateable occupation, but I do not believe it means that here. It is too loose a word. If it said "rateable occupation", it would help a bit, I think. I am quite sure that the Government do not want this to become a sort of "ramp", and I hope very much indeed that some suitable words will be introduced so that the man who comes in to occupy really comes into occupy the property as his home and is not a "wangler." I say no more. I am sorry that I have no suggestion to make. If I do think of one, perhaps I might write to the noble Lord about it. But I support the noble Lord in saying that something better than this should go in.
LORD KENNET: Before the noble Lord says what he is going to do with his Amendment, I should like to say that the Government have already given a good deal of consideration to this matter, and there is another difficulty. If we put in a provision about occupying the main part, then we run another risk. I certainly recognise the risks that the noble Lord has outlined, about the owner of the leasehold moving in and establishing occupation in one room. But suppose the owner of the leasehold is already living in one room when we pass this Bill, and has let all the other rooms, and we suddenly say that, in order to qualify, he must occupy the main part. This is then an invitation to him to turn out half his tenants, and this also is undesirable. In other words, one is on a razor's edge between two undesirables here. Having said that, I shall look at this matter again, but I should not like to go so far as to hold out any hope that at Report stage
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we shall be able to come down on the other side of the razor's edge than the side on which we have come down at the moment.
LORD ST. HELENS: May I ask the noble Lord one question on what he has said? He said that there would be an incentive for the owner to turn out the tenants. But how is he going to turn out the tenants? I thought the tenants were protected under the Rent Act.
LORD KENNET: One does not want landlords to be even tempted to turn out tenants.
LORD INGLEWOOD: Before the noble Lord sits down, may I ask him one question? If it was answered in the early part of this debate, I apologise, because I am afraid I missed the first few minutes. Is there anything in the Bill to prevent anybody taking advantage over and over again of the one-room occupation principle which my noble friend described: of having one room in any number of houses and getting not just one tax-free benefit but a very large number, if he is sufficiently skilful in his dealings?
LORD KENNET: He can only do so in a house which has been for five years, or for five years out of ten, "his only or main residence".
LORD MOLSON: I said that this was only a probing Amendment, and I think it has been very useful for that purpose. As much as I am opposed to many of the provisions of this Bill, I am anxious that if it is to go through it shall be as practical and as workable as possible. I really do not think that the Parliamentary Secretary is right about being able to get rid of tenants. I think my noble friend Lord St. Helens is right about that; and I do not think that in most cases this is a real danger at all.
I think it is essential that some safeguarding provision should be inserted, and I hope the Parliamentary Secretary will not be put off by the difficulty of drafting. The courts frequently have to interpret words that are used in common parlance. In all the rent restriction Acts there is the phrase, "alternative accommodation". I have no doubt that when that was originally put into a rent restriction Act in 1915 people said, "What is 'alternative accommodation'?". There

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have been hundreds, if not thousands, of cases deciding what is, in a particular case, "alternative accommodation" within the meaning of the Act; and even if it does require some rather more complicated provision than my very simple Amendment, and even if it does mean that nobody will know exactly what it is until it has been decided by the courts, it will only be in exactly the same position as any other legislation that we pass. I therefore rely upon the Parliamentary Secretary to see that something is done to meet what is, in his own admission, a serious danger in the Bill as it is at the present time. With those words, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD SHEPHERD: Before the next Amendment is called, may I make the short statement which I promised earlier, in regard to the adjournment this evening? I understand that it would be for the convenience of a number of noble Lords if we were to adjourn this Committee stage at about 8 p.m. this evening. I think it is understood that in view of the fact that we shall be rising a little earlier than was anticipated last week we shall require to sit until fairly late tomorrow. But, again, this is a matter about which I will undertake to have discussions with the noble Lord, Lord Brooke of Cumnor, and the Opposition Chief Whip.
LORD BROOKE OF CUMNOR: I am grateful to the noble Lord for what he has said. I am sure that it would be best to stick to the arrangement to rise at eight o'clock to-night, but I think that that arrangement was arrived at on the assumption that we should have considerable time on the third day, Wednesday, for this Bill. Certainly I think that this Committee stage will require three days, or the equivalent of three days, and that we shall not be able to compress it into less.
LORD SHEPHERD: The noble Lord, Lord Brooke of Cumnor, will remember that this is the very point I made on Thursday; but I have since been pressed to rise at eight o'clock. However, this is a matter which I hope we can discuss. Certainly we wish to see the Committee stage completed this week, and to provide adequate time for it to be discussed. But I think we can arrive at a satisfactory arrangement.
5.0 p.m.
LORD LINDGREN LORD LINDGREN moved to add to the clause:
"( ) Notwithstanding anything in subsections (1) to (3) of this section, this Part of this Act shall not confer on the tenant of a house any right by reference to his occupation of it as his residence if the house forms part of an estate which on application made by the owner to the High Court either before the appointed day for this Part of the Act or within not more than three months thereafter is certified by the High Court as an estate held under statutory enactment or trust deed the purpose of which is to maintain the entity of the freehold estate and that on the date of application to the High Court the owner of the estate was required to have regard only to the letting value of the site (without including anything for the value of buildings on the site) in granting to a tenant of a house and premises an extension or renewal of an existing long tenancy at a low rent:
Provided that in the event of the conditions not continuing to apply to the estate the High Court on aplication by the Minister of Housing and Local Government or the Secretary of State shall be empowered to cancel the certificate and thereupon this Part of this Act shall apply to the estate as from the date of cancellation of the certificate.
In default of agreement between the owner of the estate and a tenant of a house held on a long lease at a low rent as to the letting value of the site of the house and premises the provisions of section 21 of this Act shall apply as if it were rent to be fixed under section 15."
The noble Lord said: This Amendment refers to Letchworth Garden City. I am sure that most noble Lords are aware that Letchworth was the first Garden City and that it is world-famous as a British achievement in town planning. The intention behind its establishment was that the land should be developed as a Garden City on behalf of the community and that the profit arising from the development should be used for the benefit of the community as a whole. The Bill we are now discussing is a Bill to deal with the common case where a landlord leases land to a person, who then builds, or has built, a house or a factory on the land and, at the termination of the lease, the building as well as the land goes back to the landlord. This is not the case so far as Letchworth is concerned.
It has been the practice since the foundation of the Garden City in 1903 (and it is enshrined in the Letchworth Garden City Corporation Act 1962) that in the event of extension or renewal of ground leases, regard is to be had only to the increased value of the land (clear

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of the buildings on it) and of any improvements to the surface made by the lessees. Therefore, so far as Letchworth is concerned, the land is leased by the Corporation, and no regard is had to the value of the property on the land. It is a lease for the land; the buildings belong to the person who put them on the land, or purchased them from someone else who had put them on the land. It has always been a peculiarity of the Letchworth leasehold system that the ground belongs to the landlord and the bricks and the mortar to the lessee; and it is this very principle which the Leasehold Reform Bill seeks to extend to leasehold properties generally.
My contention is that there is no point in granting Letchworth leaseholders the right of enfranchisement contained in the Bill. In fact, I am going to assert that Letchworth as a whole will be harmed by the introduction of this Bill; for the application of its provisions will make it difficult for the landlords, the Letchworth Garden City Corporation, to maintain the characteristics of the town. I say this despite the provisions of Clause 19. I am afraid that the Corporation running Letchworth are as sanguine as are many others as to whether Clause 19 will, in fact, be at all effective. The Corporation own the Garden City Estate in perpetuity and are charged under Section 32 of the 1962 Act to devote their surplus revenue
"to the provision of traffic facilities, lighting, drainage, markets, libraries, baths or otherwise for the embellishment of the undertaking of the Corporation, the provision of means of education, recreation or amusement for the people or for any other purpose which the Corporation may deem to be a requisite public service".
Any loss of ownership of the land, with its consequent loss of incremental value, would be at the expense of the community of Letchworth as whole.
The First Garden City, Limited, the original landlord, had fallen under the control of interests who had made it clear that they did not intend to fulfil the earlier intentions of the Garden City Company. As a result of the 1962 Act they were succeeded by the Letchworth Garden City Corporation. The Lands Tribunal award of compensation to the company by the Corporation took account of the development value inherent in the
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land which goes with many houses in the Garden City. The original population density at Letchworth was low—as it was in many other parts of the country in the early 1900s. There are much higher densities these days, and if the Letchworth leaseholders were to secure enfranchisement in respect of some of the earlier property, with the possibility of development, they would be getting the increased value and the town as a whole would suffer. The leaseholder who purchased the enfranchisement would gain materially not only from the development of that portion which was ripe for development but also from the continuance of the other services provided.
I ought to make it clear that the issues arising from this Bill have been well publicised in Letchworth. The people still vividly remember the take-over bid for the original Garden City Company that led to the 1962 Conservative Government, through the Conservative Member of Parliament for the Hitchin Division, securing the establishment of the Corporation. All this has meant that in Letchworth, a very social conscious community, there has been lively discussion on the effect of this Bill. And there is not the slightest degree of discord in any section. Both political Parties, the Labour-controlled council and its Conservative minority, desire to see Letchworth excluded from this Bill. I understand that an attempt was made to establish a leaseholders' protection society in Letchworth; but it fell by the wayside. And one can say now that the town is united asking for its exclusion from this Bill.
The Parliamentary Secretary, during the Standing Committee in another place, called attention to the fact that the 1962 Act does not oblige the Corporation to extend or renew leases. It only lays down the principles on which this shall be done, when it is done. I have the authority of the Corporation to say that on their exclusion from the provisions of this Bill (they have already given an undertaking locally during the passing of the 1962 Act in another place) leases would be refused only if the property were required for redevelopment. They are prepared to promote a Private Bill if they are excuded from the provisions of this Bill. It will be seen, therefore—

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at least, I hope that I have made clear—that in order for the Government to implement their leasehold reform policy there is no need to include Letchworth in the provisions of this Bill; secondly, that the inclusion of Letchworth would be prejudicial to its interests; thirdly, that public opinion in Letchworth is virtually unanimous in favour of exclusion; fourthly, that the Corporation are prepared to promote a Private Bill to give statutory force to the closure of any loophole which might cause the Government fear that the basis of the leasehold reform policy would not continue to operate in Letchworth. I beg to move.
Amendment moved—
Page 2, line 31, at end insert the said subsection.—(Lord Lindgren.)
5.12 p.m.
LORD SILKIN: I wish strongly to support this Amendment. My noble friend Lord Lindgren has based his case on the position of Letchworth, although that place is not mentioned in the Amendment. However, I think we all appreciate that Letchworth is probably the outstanding example of places which would be affected by the acceptance of this Amendment. Other places also would be affected, and I wish to anticipate a possible objection on the part of the Government that, by treating this Amendment as if it applied only to Letchworth, the Bill might be regarded as a hybrid Bill. The noble and learned Lord, Lord Shawcross, referred to other places—Bournville, Port Sunlight and so on—where the same kind of conditions may apply, and if this Amendment were accepted it would probably affect those places.
Letchworth is unique. We all have a great affection for it. Its creation pointed the way to New Towns. It was founded by Sir Ebenezer Howard, a humble official of this House, a shorthand writer, who started and successfully carried through the creation of this new town which pointed the way to many others. I have no doubt at all that if this Bill went through without amendment Letchworth, as such, would die. It would not be able to take advantage of the provisions in Clause 19, even in the proposed amended form. Letchworth would not have the money, and certainly not the initiative. I suppose that practically every lessee in Letchworth would
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take advantage of the provisions in the Bill, and the result would be that Letchworth would find itself with a certain amount of money but with no property. And as the Corporation are in debt to the extent of over £3 million to the company they bought out, the probability is that the greater part of this money would go in repayment of the loan. There would be no particular fund, and certainly not a prospective fund of money, for redevelopment or to carry out the task which the Letchworth Garden City Act enables them to do.
I refer to Letchworth because it is the most important of the towns affected, and its character is unique. This is not merely a case of a charitable organisation owning a section of a community: this is an organisation that owns the whole of Letchworth. Every house and building in Letchworth is affected. To that extent the place is unique and outside the scope of this Bill. If the Amendment were accepted it would affect a large number of other places in a similar position to Letchworth. I hope that the noble Lord, Lord Kennet, will at least be able to promise further consideration of the matter, even if he cannot accept this particular Amendment. I understand that there are certain defects in the drafting, but I should be very happy if he would indicate that he was prepared to reconsider the matter.
It is of vast importance that the Corporation, this pioneer in new towns, should not die but should be allowed to continue its good work. As was pointed out by my noble friend, and as the noble and learned Lord, Lord Shawcross, pointed out, it is similar to the work being done at Dulwich College with the proceeds of their funds. In the case of Letchworth, surplus funds are utilised for the benefit of the town as a whole; and it would be quite wrong if certain individuals could secure the benefit of development value, thus depriving the town of the advantages which the Letchworth Garden City Corporation are aiming to give. So I hope very much that favourable consideration will be given to this Amendment.
LORD WOLVERTON: I should like to support this Amendment, having visited Letchworth Garden City on several occasions and seen the beautiful layout

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there. As was said by the noble Lord, the intention was that property should be leasehold, and that the Garden City Company should own the freehold and control development. That is very important, as is the maintenance of the amenities. The avenues and roads at Letchworth are beautifully laid out, and if this is all fragmented we may, as was said by the noble and learned Lord, Lord Shawcross, see the same thing happen at Letchworth as we fear will happen at Dulwich. There are not many other places affected, but they ought also to be protected. They were laid out on the same principle, and I think it wrong that places should be broken up where there are tenants who knew that they were not buying freehold land but only leasehold. I hope therefore that the Government will accept the Amendment.
5.20 p.m.
LORD KENNET: My noble friend Lord Silkin was quite right when he pointed out that we are not talking only about Letchworth, and that Letchworth is not mentioned in the Amendment: we are talking about a number of places. I am not able to inform the Committee what is the number, but if the Amendment were accepted, we might expect that a good many of these places would be polishing up their claims to come under its provisions. So let us not concentrate solely on Letchworth, which we all agree has been a great achievement. My noble friend Lord Lindgren said that if Letchworth is exempted from the Bill, that does not oblige the Corporation to renew leases by any other provision. The Letchworth Garden City Corporation Act, 1962, says only that if the Corporation renew a lease, they are to do so on ground rent terms only.
The Corporation have recently issued a policy statement saying that they will normally comport themselves in this manner. If it is their intention to do this in any case, why should they object to being bound to do so by Statute? Their policy statement is reasonable and comprehensible, but it does not explain why the Corporation resist being held to their policy by an Act of Parliament.
LORD SILKIN: Is not the answer that this Bill would enfranchise the leases? What they would be prepared to do is
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to grant extensions, to grant long leases, as they have been doing up to now.
LORD KENNET: I will come to that at the end of my remarks, when I hope to be a little more constructive. My noble friend described Letchworth as a united town. He said that all parties at all levels were united against the Bill and wished the Corporation to be exempted. Then he said that he was sure that if the Bill were passed unamended, Letchworth would die. This can only mean that a great many people would enfranchise under the Bill and fail to do their duty as freeholders. It means that there must be a great many people who desire to enfranchise and therefore wish the Bill to pass. I am at a loss to know which of these arguments is right. Is everybody in Letchworth solidly against the Bill, or are there some people in favour because they wish to enfranchise?
Our common admiration for the history, traditions and present situation of Letchworth should not lead us to assume that any freeholder whose position we admire should be exempted from the Bill. I would remind your Lordships that the Crown itself has undertaken to abide by the provisions of the Bill, to act as though it were bound by the Bill. To put it shortly, if the Crown can live with it, I think Letchworth ought to be able to do so.
To return to the Corporation's statement of policy, this declaration of intention would be followed up by the introduction of a Private Bill by Letchworth Corporation to cover certain other aspects which they agree ought to be covered. I would ask my noble friends: would it not be more reasonable for the Corporation to accept the Leasehold Reform Bill unamended and then introduce their Private Bill to exempt themselves, Parliament being willing, to such an extent as they can show it is desirable, rather than take themselves out at this stage and put themselves back in again to a certain extent by a Private Bill?
I would remind my noble friends that Clause 19 provides for the postponement of any enfranchisement while the freeholder applies for a certificate of good management. While, of course, I cannot prejudge the Minister's decision on the certificate, let alone that of the court on

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the scheme itself, obviously this provision has been introduced precisely for the benefit of places like Letchworth Garden City. It is clear that if they avail themselves of this provision they will have a few months of surcease, during which time they can prepare the kind of Private Bill which the Government think they would be better advised to do in order to take themselves out of the Bill to a small extent. I hope, for all those reasons, that my noble friend will agree to withdraw his Amendment this afternoon.
LORD MOLSON: I would beg the Government not to show themselves too inflexible in this matter. They have argued, in favour of the Bill, that they do not think that the landlord should acquire the bricks and mortar when in fact he had only leased the land. In the case of Letchworth, before the Labour Party was, that great pioneer, Sir Ebenezer Howard, devised this whole conception of the perpetual renewal of leaseholds. Before the Town and Country Planning Association, before I think the noble Lord, Lord Silkin, was born, Letchworth was conceived as a place where it would be possible, owing to an enlightened Corporation exercising full planning authority over the whole of the area and carrying out all the necessary redevelopment, to have all the advantages, and some others, that we derive from the town and country planning legislation.
Why should it be that when the Government introduce a measure to deal with particular abuses in certain parts of the country, they are showing such a rigidity that they are not prepared to make an exception in favour of this remarkable enterprise, which has worked so satisfactorily and which has been prepared to give the undertaking for which the Government are now asking? The Parliamentary Secretary—and I had hoped that he was going to make a really constructive suggestion—asked why it was that Letchworth objects to the enfranchisement proposals. The noble Lord, Lord Lindgren, explained that. There are two principal reasons: first, that Letchworth has been planned with a small concentration of population. Owing to new developments, it will be
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possible for individual tenants, if they avail themselves of the right of enfranchisement, to make an entirely unwarranted profit out of the disposal of their land. If these tenants enfranchise their land and sell it at an enhanced price, the whole machinery for the planned redevelopment of Letchworth falls to the ground.
The Parliamentary Secretary put the dilemma. Do the tenants want to enfranchise or not? The answer is extremely simple. They have all joined a co-operative society, in which none of them is seeking to make a profit for himself, and such profits as there are to be equitably distributed for the benefit of the whole community. If a Socialist Government comes along with the extraordinary proposal that those who have entered this co-operative society should be allowed to dispose of their own particular holding and make an uncovenanted and unexpected profit out of it, is it entirely to be wondered at if many of them fall and say: "Here is a chance of making a profit"? And, in so far as other people do not avail themselves of it, but continue to renew their leases, those who have obtained enfranchisement of their own holding and sold it at a profit derive that benefit for themselves, or before they sell, when they have enfranchised and own this greatly increased capital asset, they continue to live and enjoy the benefits which are to be derived from the fact that their neighbours have not gone in for enfranchisement.
If the Parliamentary Secretary, as I thought at one time he indicated in his speech, wants to meet us halfway, I am not authorised to make any proposal, but it seems to me that what Letchworth particularly objects to is the enfranchisement proposal in this Bill. They are perfectly prepared to promote a Private Bill and give to their tenants a right of renewal of their leases. If the Parliamentary Secretary is prepared to put forward an Amendment which will incorporate in this Bill a statutory right to all the tenants of Letchworth to a renewal of their leases, that would not be going any further than the promise that has been made by Letchworth that they would promote a Private Bill; indeed, it would save them all the cost and bother of promoting a Private Bill. I am not

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authorised to make a proposal on behalf of Letchworth, but I believe a compromise on those lines might commend itself to Letchworth. It would meet the main point that has been made by the Parliamentary Secretary, and it would preserve Letchworth.
If every tenant in Letchworth is to be given the right of enfranchisement, then to break up his holding and sell to somebody else, the whole character and nature of Letchworth will have been destroyed: and, indeed, it will go down in social history that the great and imaginative work of Ebenezer Howard, which had prospered for a long time and which even a Conservative Government went out of its way to preserve by giving facilities for the Act of 1962, which I had the honour to move in this House, was destroyed. It is only when a Socialist Government comes into power that, with their doctrinaire ideas, they destroy a Garden City of this kind, the first and most imaginative scheme of town development.
5.34 p.m.
LORD BROOKE OF CUMNOR: I feel that the Government should give further thought to this matter. It is clearly a non-Party or an all-Party issue. The noble Lord, Lord Lindgren, has spoken forcefully and admirably in support of his Amendment, which I think he will agree is identical with an Amendment which was moved by a Conservative Member in another place and the Committee divided upon. To the best of my belief, everybody wants Letchworth preserved. Virtually everybody, except the Government, believe that Letchworth will not be preserved in its excellence if this Bill goes through unamended.
There is no case made out in the Government White Paper for interference with an estate like Letchworth. That White Paper was based on the argument of hardship. In the second sentence it said:
"In the case of long leases experience has shown that the system has worked very unfairly against the occupying leaseholder."
But nobody has ever suggested that the system in Letchworth operates unfairly against the occupying leaseholder. The proof that it is considered to operate fairly is surely shown by the fact that the two leaders on the Letchworth Council, the leaders of the Labour and the Conservative
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groups, joined in writing a letter to The Times imploring the Government to take some action. It is occasionally said that this House is not a fully democratic assembly. But, surely, if the House of Lords can do anything, it can beg once again the Government to pay attention to the desires of the people of Letchworth and their elected representatives, regardless of Party. I have spent many years in local government, and I know that it takes a considerable degree of unanimity to bring together the two Parties which are normally fighting for power on a council.
My noble friend Lord Molson explained clearly how under the normal working of human nature enfranchisement is bound to take place if the Bill goes through as it stands; and that means fragmentation, which over the years will render it literally impossible for the Corporation to secure the kind of wise re-development which it envisages.
I have nothing like the same close acquaintance with Letchworth as some other of your Lordships, but I was the responsible Minister at the beginning of the discussions which led to the 1962 Act, and, at any rate, I can claim the credit—and I hope that I shall be given credit for this by the Party opposite—for having given the original Government blessing to a Bill which was going compulsorily to take property away from private enterprise and invest it in a responsible Corporation. For Heaven's sake! let us give that Corporation the chance to do the work for which it was set up. I do not know what is the intention of the noble Lord, Lord Lindgren, but if he presses this Amendment, I for one will support him.
BARONESS STOCKS: I should like to ask the noble Lord, Lord Kennet, for an opinion on one matter. We can assume that the Civic Amenities Bill will become law. If certain clauses of that Bill are seriously and vigorously operated by the Ministry of Housing and Local Government, should it not be possible to obviate some of the ill-effects indicated by noble Lords opposite, when it comes to preserving the character and amenities of a neighbourhood operated by a trust, a public-spirited individual, a charity or any other body responsible for preserving the

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character of the neighbourhood as a neighbourhood?
THE EARL OF IDDESLEIGH: I speak with great hesitation, but I think this is the first occasion in my career in this House that I have heard it suggested that we should do something that we believe to be wrong and mistaken and then allow the victims to put it right by a Private Bill. It seems to me to be a thoroughly unusual suggestion.
LORD FARINGDON: I wonder whether my noble friend can tell me this. Is it his idea that this Private Bill, if promoted, would operate to affect all the other Garden Cities of which my noble friend Lord Silkin has made mention, or would it apply only to Letchworth?
LORD KENNET: To take up those queries, on which I do not want to spend too long, may I say, in answer to my noble friend Lord Faringdon, that I think it would be for the Letchworth Gardens City Corporation to decided whether the Bill they introduced should affect only themselves or others as well. The noble Lord, Lord Brooke of Cumnor, has said that there has been no evidence of hardship in the working of the leasehold system at Letchworth; and of course this is so. But I would point out that all the leases at Letchworth still have 40 years to run, so there can hardly have been hardship yet. One would not expect hardships to arise in the middle of the first batch of leases.
My noble friend Lady Stocks asked whether the Civic Amenities Bill could be used to help preserve what ought to be preserved at Letchworth if there is enfranchisement. The answer is, most emphatically, Yes. Why not? That is precisely the sort of case it was invented for.
LORD MOLSON: May I interrupt the Parliamentary Secretary? I do not pretend to carry the whole of the Civic Amenities Bill in my mind, but is he saying that in the Civic Amenities Bill the power to which I suppose he is referring—the power to declare an area to be a notified area (or whatever it is called)—would prevent a person who is enfranchised from selling part of his
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holding in order that an additional house should be built there?
LORD KENNET: No. But it would bind the local planning authority, in determining the application for permission to build the next house there, to have regard to the character of the area. The noble Lord shakes his head. Two noble Lords shake their heads. My memory of the Bill is fairly good, and Clause 1 binds local authorities, in the exercise of their planning function, which of course includes determining applications for permission to build new houses, to have regard to the desirability of maintaining and enhancing the character of areas which they will have designated as conservation areas.
The noble Lord, Lord Molson, appealed to the ghost of Ebenezer Howard—and how right he was to do so! He was indeed the grandfather of town and country planning. It was he who set out many of the principles which have been brought to their first fruition by my noble friend Lord Silkin, and are about to be brought to second fruition under the Town and Country Planning Bill, about which the Government have recently published a White Paper. And it will, we hope, continue to grow throughout the centuries as our techniques, and our public consciences, become more refined and civilised.
But in the days of Ebenezer Howard there was only one way to achieve proper planning, and that was by property; and that was why he took the right step, the only possible step if one were to introduce the idea of planning in the late nineteenth century. He had recourse to property to do it. The situation to-day is no longer the same. We have now a system of democratically controlled planning provisions, which can achieve decent standards of environment and conservation and new development, without actual ownership of the ground and the houses in question. I think it is time that Ebenezer Howard should merge himself into the general system of planning values which he himself so largely created. I wonder whether, if he were here to-day among us, he would insist now that it could be done only by property. I think we have done better than that.

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As to the question of the wishes of the people of Letchworth, I must admit that my perplexity remains completely undiminished. The noble Lord, Lord Molson, referred to people joining a society and agreeing in common not to draw profit from it, by not seeking to enfranchise. He said that this was why they chose to become leaseholders at Letchworth. But this Bill is not going to force them to enfranchise. The friends of the Amendment have been arguing as though they were seeking to get the Government to withdraw an implement which would condemn all the leaseholders of Letchworth to enfranchise, whether they wished it or no, which would force the Letchworth Corporation to go round with a compulsory enfranchisement instrument and say, "Sign here or appeal within two weeks". This is not the case at all. If the leaseholders of Letchworth are content with their leaseholds under the present law, and they can remain content with their leaseholds under the new law, they need not move a finger to do anything about it if they do not want to—
LORD MOLSON: May I interrupt?
LORD KENNET: May I finish my sentence? —and if the situation is as it has been described—that is, that there is a completely united town against these provisions—I have not the least doubt that they will not move a finger to enfranchise.
LORD MOLSON: But suppose that three-quarters of them choose to continue in that way, and that the other quarter decide to take a short-term capital appreciation. What then?
LORD KENNET: Then there is not a completely united town. That quarter is in favour, prima facie, of the Bill. I should be far from admitting that that is the only reason for which any Letchworth leaseholder could be in favour of the Bill.
As to accepting the Amendment, I should tell the Committee, from my own personal knowledge over the past months, that I have never seen a Government machine give more thought to a particular conundrum in the preparation of legislation than has been given to this question of Letchworth. The problem is still as it was when we first faced it many months, or even years, ago, when the
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White Paper was prepared— "If Letchworth, then others". My noble friend, in introducing the Amendment, has not been able to frame it in such a way as to mention Letchworth, and to do it in that way alone. I do not know—the Government cannot know; indeed no one can, until the matter has soaked through all over the country—how many freeholders would seek to come in under a broad Amendment of this nature. For that reason, with the greatest possible regret, I have to maintain my request to my noble friend to withdraw his Amendment, or, if he is not able to do so, to advise the Committee to vote against it.
LORD LINDGREN: I had intended to withdraw and to look again at what my noble friend has said in regard to the future proposed action of Letchworth, but I cannot do so in view of the unsatisfactory nature of the reply. I have been in planning for a very long time. If anybody wishes to convince me, as the Parliamentary Secretary has tried to, that planning permission is an alternative to a system owned by the community, I am willing to listen. But, having been in planning for such a long time, I should have thought that he would realise that planning permission has now become a saleable commodity and as such it goes to the landowner.
In a place like Letchworth, where leaseholds are taken by the Corporation, the proceeds are used for verges, playing fields, public baths and all the amenities of the community, under planning permission. We do not want to go back to the old days of ribbon development, but under the present system of planning permission the values created by the community do not go back to the community, as they do in Letchworth, but go to those who are obtaining planning permission and selling the land. Planning permission has become a saleable commodity, as I say, and that is a tremendous factor. I think the manner in which it has been dealt with by town planners in local government, in view of the fact that it is a saleable commodity and has been so profitable, is really remarkable.
Again, it is suggested that the Civic Amenities Bill covers the work which was previously done by a corporation, such as the Letchworth Corporation. Really? And who pays? If it is done, of

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course it can be done only by one body, the local authority, and then it is paid for out of the rates. So my noble friend is asking me to agree to a system which would put thousands of pounds into certain persons' pockets, if they were to take advantage of it, and that the work which is being done now should be paid for out of the rates.
The other point is that my noble friend twitted me—and it is a good debating point—by saying that, if everybody in Letchworth is against enfranchisement, why are we afraid of some persons doing it. I can only go by the Hertfordshire Express of June 15, which said that the Electors' Action Committee formed in order to support the Bill had only ten
Resolved in the affirmative, Amendment agreed to accordingly.
members. But if this provision is enacted, and it becomes possible to enfranchise, someone will see someone else doing it; and I confess that I have not sufficiently great faith in human nature to think that others will not follow. And in that event all that will be left under leasehold control will be the council houses which are under a peppercorn lease from the Corporation. In view of the unsatisfactory nature of the reply, I cannot withdraw this Amendment, and I shall take it to a Division.
5.50 p.m.
On Question, Whether the said Amendment (No. 5) shall be agreed to?
Their Lordships divided: Contents, 77; Not-Contents, 46.

CONTENTS

Aberdare, L.

Foley, L.

Monsell, V.

Ailwyn, L.

Glendevon, L.

Morrison, L.

Ampthill, L.

Goschen, V. [Teller.]

Mowbray and Stourton, L.

Audley, Bs.

Grenfell, L.

Nugent of Guildford, L.

Blackford, L.

Hacking, L.

Oakshott, L.

Boston, L.

Hawke, L.

Redmayne, L.

Brooke of Cumnor, L.

Henderson, L.

Russell of Liverpool, L.

Brooke of Ystradfellte, Bs.

Horsbrusgh, Bs.

St. Aldwyn, E.

Caccia, L.

Hunt, L.

St. Just, L.

Carrington, L.

Hylton-Foster, Bs.

Sandford, L.

Clinton, L.

Iddesleigh, E.

Silkin, L.

Clwyd, L.

Ilford, L.

Silsoe, L.

Colville of Culross, V.

Inglewood, L.

Somers, L.

Cork and Orrery, E.

Jellicoe, E.

Stocks, Bs.

Craigavon, V.

Kinloss, Ly.

Stonehaven, V.

Cullen of Ashbourne, L.

Kinnoull, E.

Strang, L.

Daventry, V.

Lambert, V.

Strange of Knokin, Bs.

Denham, L.

Latymer, L.

Swanborough, Bs.

Derwent, L.

Lindgren, L. [Teller.]

Templemore, L.

Dilhorne, V.

Lucas of Chilworth, L.

Tweedsmuir, L.

Dudley, L.

Mancroft, L.

Wakefield of Kendal, L.

Emmet of Amberley, Bs.

Merrivale, L.

Wedgwood, L.

Falkland, V.

Mills, V.

Windlesham, L.

Faringdon, L.

Milverton, L.

Wolverton, L.

Ferrers, E.

Molson, L.

Wrottesley, L.

Fleck, L.

Monckton of Brenchley, V.

NOT-CONTENTS

Addison, V.

Hilton of Upton, L.

St. Davids, V.

Beswick, L.

Hughes, L.

Samuel, V.

Blyton, L.

Kahn, L.

Segal, L.

Bowles, L. [Teller.]

Kennet, L.

Serota, Bs.

Brown, L.

Latham, L.

Shepherd, L.

Buckinghamshire, E.

Leatherland, L.

Snow, L.

Burden, L.

MacLeod of Fuinary, L.

Sorensen, L. [Teller.]

Chalfont, L.

Maelor, L.

Stonham, L.

Champion, L.

Morris of Kenwood, L.

Strabolgi, L.

Collison, L.

Moyle, L.

Summerskill, Bs.

Crook, L.

Pargiter, L.

Taylor of Mansfield, L.

Gaitskell, Bs.

Phillips, Bs.

Walston, L.

Gardiner, L. (L. Chancellor.)

Rowley, L.

Wells-Pestell, L.

Gifford, L.

Royle, L.

Williamson, L.

Granville-West, L.

Sainsbury, L.

Winterbottom, L.

Hall, V.

On Question, Whether Clause 1, as amended, shall stand part of the Bill?
LORD BROOKE OF CUMNOR: I simply rise to say that, although I have strong objection to much that is in Clause 1, we debated the principle of the Bill at length on Second Reading and I do not propose to start a new debate on one of the essential principles of the Bill on the Motion that Clause 1 stand part.
LORD MOYLE: I was pleased to hear my noble friend Lord Kennet say that he would look at the proposal made by my noble friend Lord Silkin on the question of the respective rateable limits of £200 and £400. The scheme that he suggests might solve the difficulty that was met on this issue. The limit has nothing sacrosanct about it, and I have a feeling that it is rather overloaded with the problem of the hardships of the leasehold system experienced in South Wales. I should like to suggest that the hardship experienced in South Wales when a lease expires is not to be measured by the experience of other parts of the country.
I would say that in Cambridge and Oxford and in parts of the Midlands similar rented properties will be outside the scope of the existing limit. Indeed there are properties in Oxford which, I suggest, would be almost comparable with London. Yet because the limit is £200 in Oxford as against £400 in Greater London, people will feel that they are suffering a rank injustice when they are denied the rights of enfranchisement in the operation of this Bill if the present limits are adhered to. Therefore, I would ask my noble friend to look at this and see whether he cannot, by extending the limits, endeavour to avoid those injustices that will be experienced by many leaseholders if the present limits are adhered to.
LORD KENNET: The Committee will not wish me to reply substantially to my noble friend's remarks. We shall, of course, bear all these arguments in mind in looking at the noble Lord, Lord Silkin's Amendment, which appears to be an entirely new plan and must be looked at as such.
Clause 1, as amended, agreed to.
Clause 2 [Meaning of "house" and "house and premises", and adjustment of boundary]:
LORD KENNET: This is a drafting Amendment which seeks to make clear
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the fact that in relation to minerals the leaseholders' rights cannot extend to property not comprised in the lease. I beg to move.
Amendment moved—
Page 4, line 5, after first ("minerals") insert ("comprised in the tenancy").—(Lord Kennet.)
On Question, Amendment agreed to.
Clause 2, as amended, agreed to.
Clause 3:
Meaning of "long tenancy"
3.—(1) In this Part of this Act "long tenancy" means, subject to the provisions of this section, a tenancy granted for a term of years certain exceeding twenty-one years, whether or not the tenancy is (or may become) terminable before the end of that term by notice given by or to the tenant or by re-entry, forfeiture or otherwise, and includes a tenancy for a term fixed by law under a grant with a covenant or obligation for perpetual renewal unless it is a tenancy by sub-demise from one which is not a long tenancy:
Provided that a tenancy granted so as to become terminable by notice after a death or marriage is not to be treated as a long tenancy.
6.4 p.m.
LORD BROOKE OF CUMNOR LORD BROOKE OF CUMNOR moved, in subsection (1), to leave out "twenty-one" and insert "fifty". The noble Lord said: I beg to move Amendment No. 7, and I think it would be for the convenience of your Lordships to consider with this Amendment Amendments Nos. 9, 13, and 14, which are identical with it. We are now considering the definition of a long tenancy. This is an important criterion in the Bill. Subsection (1) of Clause 3 says that a "long tenancy" means
"a tenancy granted for a term of years certain exceeding twenty-one years … "
The first point I would make is that this is not at all the kind of tenancy to which the White Paper was directed. The White Paper says in the first sentence:
"This White Paper is concerned with residential long leases particularly those granted originally in the latter half of the last century."
In order to deal with them it is not necessary to define a long lease as any lease that goes back further than 1946. Indeed my Amendment would broadly say that leases granted for a term of years certain before the First World War would be caught by this Bill, but leases which have

961
subsequently been granted for a term of 50 years or less would not.
The broad distinction between the two is really this. The long lease in its normal meaning is a building lease where the leaseholder will undertake to pay a small ground rent and to put up a building, a house, and he and his successors will enjoy the benefits of occupation of that house for a period of 99 years, sometimes 999 years, or occasionally 75 years. The term that has normally been fixed in a lease of that sort has been the prospective period of existence of the house as a satisfactory residence. If a lease is granted for a period of something between 21 and 50 years, quite clearly no leaseholder is going to put up a house on that site at his own expense and expect to hand it back to the freeholder at the end of 22 years, 30 years or 50 years, or whatever it may be. That kind of lease has been granted and entered into originally for quite a different purpose.
I think those among your Lordships who have professional qualifications as surveyors or otherwise will agree that in certain cases it has been the policy of the freeholders to grant leases for 30 years, 40 years or 50 years on terms normally which will amount to a payment of rack rent for that period by the leaseholder, whether in fact it is paid annually as a rack rent or part of it is embodied in a premium that is paid at the beginning with a smaller payment of rent like a ground rent each year thereafter. The essential point is that these shorter long leases are nothing like the 99-year leases where the leaseholder undertook to put up a house knowing that at the end of 99 years it would cease to be his property. It is, so far as I am aware, entirely in that second category that I have mentioned, the 99-year lease, the 75-year lease or a term of that kind, that the hardship adduced by the Government as the reason for this Bill is stated to arise. I have never heard it argued that hardship arises under the leasehold system where in fact the payment for the house has not fallen upon the leaseholder but upon the freeholder. This matter was discussed but briefly in another place, and the Government agreed that there were problems here. They were not able to offer a
962
solution, and they did not find wholly satisfactory the solution suggested in an Amendment, or a series of Amendments. But my Amendment does not affect the main basis or principle of the Bill at all. If it, or something like it, were introduced into the Bill, it would cut out of the field of the Bill a number of cases where the leaseholder will obtain an altogether unneeded advantage. He has never paid for the building of the house, and has never supposed himself to be the owner of the house. This is a relatively short lease, and he is occupying it generally on the terms of an ordinary occupying tenant and not as an ordinary long leaseholder.
I will not trouble the Committee with particular examples which were quoted in another place, showing how extraordinarily unfair the operation of the Bill is going to be if it is assumed, as it will be if the Bill goes through unamended, that a leaseholder who is occupying a house on what are rack rent terms, or the equivalent of rack rent terms, can in fact claim under this Bill the ownership of the bricks and mortar.
Whether fifty years is precisely the right period I could not say for certain, but it appears to me that the division, broadly, is that leases granted for more than fifty years have the character of the ninety-nine-year or the seventy-five-year lease, when the original leaseholder will have erected the building, and that leases granted for fifty years or less will not have that character. That is why I suggest that we should amend the Bill in this way.
I know that it can be argued, as with regard to rateable value limits, that to retain a period of twenty-one years would keep the Bill in line with other legislation passed by Parliament. But in this Bill we are doing something new: we are introducing completely new terms of compensation. Therefore we have to look at this as a new issue and, assuming that all the rest of the Bill stands unamended, we have to try to define a long lease in such a way that it will include the ninety-nine- or the seventy-five-year lease, but will exclude the shorter long lease, where in fact the cost of building the house has not fallen on the leaseholder. I beg to move.
Amendment moved—
Page 4, line 26, leave out ("twenty-one") and insert ("fifty").—(Lord Brooke of Cumnor.)
6.14 p.m.
LORD OGMORE: May I, as a convinced leasehold enfranchiser, one who has been in favour of leasehold enfranchisement for many years, say a word in support of what the noble Lord, Lord Brooke of Cumnor, has just said? I was associated with the Leasehold Enfranchisement Association thirty years ago, and in fact formed part of a delegation to the then Attorney General, Sir Donald Somervell. So my interest in this question has been one of long standing. I was most happy that the Labour Government had introduced in this Parliament a Bill for leasehold enfranchisement. Of course, it was intended, as the noble Lord has said, to deal with leases where there was originally a grant for a long period, usually ninety-nine years, and it was not intended to cover rack rents, where the period is quite short and where, in every case I should think, the actual house had been put up by the landlord or his predecessors in title, and the lessee or his predecessor in title had certainly never put up the house. And we had seen the evils of the system in South Wales.
I believe that to leave the words "twenty-one-years" in the Bill will to a large extent make a nonsense of it; it will, in fact, create a completely new hardship. There will be many cases where the person—it may be the father, or the grandfather—had erected the house and then let it for a short period, and would find that the terms of this Bill would apply. In the old days, when the Leasehold Reform Association was pursuing its activities and was trying to impress the Conservative Government of those days with its views, this was never intended and I think it is not a wise plan to try to remedy one injustice by creating quite another one.
In those circumstances, I would ask the Government to look again at this particular provision, to see whether something can be done to meet the point so clearly put by the noble Lord, Lord Brooke of Cumnor. As he says, whether 50 years is the right term or not, I should not like to say. Generally speaking, in
964
South Wales the term has been 99 years, but I believe that the 50 years in the Amendment is a much fairer period than the 21 years proposed by the Government. I therefore ask the Government to look at this most carefully before the next stage of the Bill.
LORD GRANVILLE-WEST: I realise and appreciate the experience of Lord Ogmore with regard to the conditions in Wales; but I am most surprised that he did not draw the attention of the Committee to the fact that in South Wales there are many building leases where the lessee is under an obligation in regard to building and maintaining property; and these leases are granted for 21 years, renewable every 21 years if notice is given, up to a term of 99 years. If this is accepted, it will mean that the lessee who has built this house and has, by reason of the powers of the ground landlord, been compelled to accept a lease which is renewable every 21 years up to 99 years, will be outside the scope of this Bill. I therefore hope that my noble friend will resist this Amendment.
LORD INGLEWOOD: I cannot claim to know the condition of South Wales in detail, but what the noble Lord has just said surely indicates that what we want in this Bill is a few clauses specially drawn to deal with the particular problems of South Wales, rather than vaguely worded clauses which will apply to the United Kingdom generally and bring injustices in their train. I should like to support my noble friend in his submission. It may be that there is some reason for a special case in some parts of Wales—that I do not know—but, taking the United Kingdom as a whole the term of 21 years is clearly less welcome. If noble Lords have studied the White Paper, which I believe is the thinking behind this Bill, they will have read that the Government intended to deal with residential long leases, particularly those granted originally in the latter half of the last century. That was much more than 21 years ago.
Furthermore, they refer from time to time to the terms "ground rent" and "long leases". When it comes to the Bill, both these clear definitions are blurred, and we find the Government referring to a term of 21 years—which is

965
not a long lease in the generally accepted sense of the term—and to a low rent of two-thirds the rateable value, which is something very much removed from the normal definition of "a ground rent". I submit that in practice that makes a large part of the Bill extremely difficult to work and will cause a great deal of resentment. There is one other injustice which we ought not to overlook. It seems unjust that under this Bill a leaseholder of a lease of 21 years should be able to extend it, not for another 21 years, but for a term of 50 years. We should give close attention to this Amendment, and we do not want to let it go until we are sure that we have the right figure. I am sure the majority of us are not happy with the figure of 21.
LORD MITCHISON: The noble Lord, Lord Brooke of Cumnor, always tells the House the truth. He does not, however, tell it the whole truth. I was waiting to see whether he was going to disclose what nobody has so far mentioned, that in the 1954 Act, brought forward under the Conservative Government to deal with the mischief which we are considering to-day, the term of the leases affected was anything over 21 years. That was not only the case in 1954; it was the case in two groups of Acts going back to 1920.
This mischief has been there for a long time. People were entitled to consider that when the Conservatives, not always notorious for their social benevolence, were willing to do something about it, those who had leases of over 21 years would probably be all right. What happened? I think I am right in saying that, in Committee at any rate, the Conservatives brought forward an Amendment for 90 years. We are now talking of a figure of 50 years, which I think has been suggested by the Chartered Surveyors or some body of that sort. I agree that it is not easy to fix a figure in a case of this kind, but where there has been previous legislation dealing with what everyone understood to be long leases—whether they were called long leases or not—and where the term was taken as 21, and where you have had 21 mentioned in previous proposals, people ought not to be disappointed by a last-minute alteration of what a long lease is.
966
My noble friend Lord Granville-West gave instances in South Wales where there were building leases. When one considers the type of lease affected by the Bill, one has to remember that it is not only to be a long lease, but it is to be a long lease at a low rent; and in fact the next clause of the Bill deals with that precise point. I suggest that it would be grossly unfair now to deprive people of the remedy which they hoped to get, and which until this moment they imagined they were getting—and which of course they may get anyhow—by altering 21 to 50, 90 or some other figure at the very last moment.
I am not allowed to say what members of the Opposition said in the Commons, but I am allowed to point out that Mr. Boyd-Carpenter, when discussing this matter before the General Election, was quoted in Hansard as having said that his Party agreed with the selection of 21 years by the Labour Government. For all those reasons, it seems to me to be a lamentable piece of Party politics to try now to substitute some other period for the 21 years which has been the rule in three previous Acts, including the last one introduced by a Tory Government.
LORD SILSOE: I seem to have had the pleasure for many years of following the noble Lord, Lord Mitchison, both at lunch and otherwise. I could not care less whether the Tories did something or not—I am rather against it if they did it. I have no interest whatever in the past politics of this matter. I am genuinely trying to get the thing right. All these political points just pass over my head. I have no doubt it is the noble Lord's duty to say it all, just as he did in the old days, but it does not "ring a bell" with me at all.
I should like to look at the merits of the matter. I was told that it was "the last moment". Well, it is the first moment that I have had a word to say on the subject, and I propose to use it to do so. We are now trying to evaluate a lease which is let at a ground rent so that everybody should be covered who is suffering from worries and troubles in this matter. There has never in the history of the world been a ground lease granted for 21 years. There is not such a thing that I can think of anywhere. Why the Tories thought of it in 1954, or why

967
somebody else thought of it in 1920, I have not the remotest idea; but there has never been in existence such a thing as a 21-year lease at a ground rent. Nobody is going to be such a fool as to put up a building and expect to recover his money in 21 years. It is absolute and complete folly, and such a thing has never existed.
The second thing that worries me is this. What is not understood by some of the Ministers guiding the Government on this matter is that 21 years is a perfectly common lease after the ground rent is over. In London the ground rents are over; in Wales they are not. I have enormous sympathy for the Welsh position. If we go on as the noble Lord, Lord Kennet, is going on, I think I should like to move an Amendment to Clause 41 that while excluding Scotland and Northern Ireland, we should also exclude England. There seems to be a lot to be said for it. The point is that these 20-year leases now are rack rent leases. The house which I occupy under a landlord—I have never owned a freehold in my life—is not on a 21-year lease, but is a 24 or 25-year lease, at a rack rent negotiated, after some argument with the landlord's agent, by myself and taken by me. That was some 24 years ago, and now it is two-thirds of the rateable value and therefore is called a ground rent. The whole thing has gone "popeyed".
I feel that 21 years is too short a period. In my experience—and I have a great deal of it as to the ground leases which are created now—people are shortening their odds a bit. In some cases they are granting leases for 50 years. I think the noble Lord got his figures from the surveyors. This period is roughly right. I have never known a ground lease granted for less than 50 years. Something should be done. Fifty years is perhaps rather generous, but those who talk about 21 years for a ground lease do not know the facts of life at all. I hope very much that the noble Lord will at least ask the Chief Valuer, who knows these things better than anyone in England, between now and the Report stage, whether what I have said is right or wrong. Surely we can have what he advises is a reasonable length of long lease.
LORD GRANVILLE-WEST: Before the noble Lord sits down, I wonder if he would tell the House whether he is denying the existence of the 21-year lease at ground rent renewable at 21-year intervals.
LORD SILSOE: May I say at once that if you had a 99-year lease renewable for ever at the whim of the landlord, which I think is what the noble Lord said, I should be entirely in favour of asking the noble Lord to amend his words to cover it. May I tell your Lordships a story to show that nothing is new in this world? There was a Prebendary of Finsbury in 1396 who granted a 99-year lease with a rent review. He was a clever chap, and when he was told that by law he could not have a longer lease than 99 years, he created four leases, each running for 99 years. So nothing is new. My own personal view is that if there is a lease of 21 years, renewable solely at the whim of the landlord for one, two, three or five years, then I hope it is caught by the Bill.
6.32 p.m.
THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR SCOTLAND (LORD HUGHES): I would not deny the right of any Member of your Lordships' House, whether it is the first opportunity or otherwise, to speak to a proposal of this kind. What I had been hoping was that somewhere during this discussion something would be said which was different from what was said in another place when a similar Amendment was moved. I do not think anything has been said which has not already been said in another place, and while I accept that that may not cut any ice at all with the noble Lord, Lord Silsoe, it is bound to cut some ice with Her Majesty's Government.
I should not wish to pretend, however, that there was not disquiet in another place at the effects of the choice of 21 years, because noble Lords have only to refer to the record of the discussion in another place to find that there were misgivings on both sides of the House. But the misgivings were not resolved, simply because in another place they saw the difficulties which have emerged during the discussion here this afternoon, to which the noble Lord, Lord Brooke of Cumnor, referred and to which, by

969
implication, the noble Lord, Lord Silsoe, has also referred that in substituting some other figure for 21 we may just create another set of difficulties. The only thing which the noble Lord, Lord Brooke of Cumnor, said with which I disagree is that the 21 years are not referred to in the White Paper. My information is that the 21 years' period is referred to in the White Paper.
LORD BROOKE OF CUMNOR: I agree entirely about that.
LORD HUGHES: I may have misunderstood the noble Lord, but I had the impression that he thought the 21 years was something which had emerged subsequent to the White Paper. I am glad we are in agreement that it is in the White Paper.
At the risk of falling foul of the noble Lord, Lord Silsoe, I must say that there is some justification for accepting this period. Precedent is something which has a value in legislation, and my noble friend Lord Mitchison referred to the fact that a Conservative Government in 1954 accepted twenty-one years as being a period which could be called a long lease for the purpose of the Landlord and Tenant Act of that year. My noble friend went further back and said that there were two previous Acts. He is one up on me, because I have been given information about only one, but it is one which has some value because the Places of Worship (Enfranchisement) Act 1920 fixed twenty-one years as the period. Obviously, in a Bill which is intended to be helpful to leaseholders, it is rather difficult for this Government to seem to be patently less kind to leaseholders than a Conservative Government was in 1954 or a Coalition Government was in 1920.
We have to remember that if we accept the Amendment and substitute a period of fifty years, we are legislating not only for the position as it exists, but also for the future. It would therefore be a direct encouragement to people to grant leases which fell short of the fifty years, which would prevent this Bill from applying. When I first entered local government I was still working on a basis where local authorities putting up houses were supposed to pay off the debt in a period of forty years, because at that time there was a hope, which subsequently was
970
abandoned, that the changes in building might be such that a house which was erected then might have outlived its usefulness in a period of forty years. I think he would be a bold man who would suggest to-day, with the changes taking place in building, that any house which is put up must of necessity have a life of fifty years or more; and, therefore, we must accept that some period below fifty years may be perfectly reasonable. I obviously cannot say on soul and conscience that we have to go down as far as twenty-one, and that twenty-one is necessarily right. This is a case of trying to choose a figure which has some basis in past legislation and which is not going to be obviously unfair on the basis of existing experience. For that reason, in a difficult situation, Her Majesty's Government chose the figure of twenty-one.
I hope, therefore, that the noble Lord, Lord Brooke of Cumnor, will not find it necessary to press this Amendment. Admittedly, it is a difficult situation, but Her Majesty's Government think, having regard to the fact that the 21-year period is one leg of the argument and the other leg is the low rent, that not all the rack-rented houses—and the noble Lord, Lord Silsoe, quoted his own case where the rack rent has become a low rent—granted on 21-year leases will have become low rents during that period of 21 years, and if they have not the Bill will not bite on them. I do not know whether there is any possibility of finding another figure between 21 and 50. My brief certainly does not permit me to advise the House that 50 is a proper period to accept, and I therefore have no option but to ask the noble Lord, Lord Brooke of Cumnor, not to press his Amendment.
LORD MOLSON: The speech of the noble Lord was extremely moderate and reasonable, but he indicated that he doubted whether there were many cases where a ground rent had been granted for so short a period as 21 years. Also, he agreed that, owing to changes in the value of money and so on, the other safeguarding provision of the low rents which we are going to discuss shortly had ceased to be an adequate test of what was a ground rent as opposed to a rack rent. The Government have made it perfectly plain all along that they base

971
their justification for this Bill upon the idea that long leases have been granted in order that the tenant should provide the house, and that it is inequitable that at the end of a long lease the owner of the freehold should obtain back not only the land but the house which has been built on it.
It has not been thought possible to draft the Bill so as to say that where the house has been built by the landlord or his predecessor in title the Bill shall not bite. The Government have relied upon two things: the long period of the lease and the lowness of the rent. If we can show that there is a danger that a house let at a rack rent—that is, a rent which represents the value of the house as well as the value of the land—is going to be caught by this Bill, will the Government be prepared to make some amendment to it? Do they accept that, if a house has been let at a rent which really includes the value of the house as well as the value of the land, it is inequitable and undesirable that this Bill should so operate—as a result of the changes in circumstances, the value of money, rateable values and so on—that a tenant will be able to obtain by enfranchisement under this Bill a house which was genuinely the property of the landlord and which was let to the tenant at a reasonable rent? There are the two points, and the fact that they are dealt with under different clauses makes it difficult to present the two arguments at the same time, but I hope I have made it clear. In view of the line the noble Lord has taken I should be grateful if he would give me an answer to that point.
LORD HUGHES: On a previous Amendment, proposed by my noble friend Lord Silkin, it was indicated by my noble friend Lord Kennet that a completely new proposal had come before the Committee, and that therefore he would undertake to look at it. Until the noble Lord, Lord Molson, got up I should have been able to say that nothing had been said which had not been said already. But obviously, if something should emerge while the Bill is before your Lordships' Committee which raises a consideration which has not been previously before Parliament, it would be grossly wrong for the Government not to
972
say that they were prepared to look at the matter. But the Government must be their own judges, and must seek to prove that it is not new, if that is the line they take—and it would be rather difficult, in some ways at any rate, in view of what was said about the official Conservative Party policy on this matter before the Election, when it was stated that the Opposition accepted the Government's view that 21 years was a proper term.
LORD BROOKE OF CUMNOR: The noble Lord, Lord Hughes, made a very reasonable speech in reply to my Amendment. I hope he will agree that I made a very reasonable speech in favour of it, too. This is a difficult matter. I think the noble Lord's speech proves up to the hilt that this Amendment of mine is not what is normally called a wrecking Amendment. It is simply seeking to draw a line in proper accord with the principles on which the Government have said they desire to legislate. I quite agree with the noble Lord that the term "more than 21 years" is included in the White Paper, but there did not seem to be any logical connection in the White Paper between the figure of 21 and the principle on which the Government said they were going to frame their legislation.
LORD HUGHES: May I interrupt to say other than, perhaps, the ordinary political line that if the Conservative Party had said 21 years was a good thing it was rather difficult for us to say it ought to be something higher.
LORD BROOKE OF CUMNOR: I was hoping that the Labour Government would show consistency in all their thinking, but perhaps that was a desperate hope. After a series of paragraphs which appear to be directed mainly to the South Wales case, with which we are all familiar, the White Paper says:
"… a leaseholder will have to satisfy two conditions: (i) he must hold a lease, originally granted for more than 21 years at a ground-rent …"
My submission is that we are going to find a number of leases granted for a term somewhat exceeding 21 years at a rent which could not be properly described as a ground rent. As to the noble Lord, Lord Granville-West, and

973
his case in South Wales, I have no desire to catch the leaseholder whose predecessors built the house, the lease having given them a reasonable certainty of 99 years' enjoyment. I quite accept that any simple Amendment here may need further Amendments to prevent injustice later.
But I come back to what I was saying at the beginning. There are a number of leases granted for between 21 and 50 years which do not appear to create the kind of conditions at which this Bill is directed. I am inclined to agree with the noble Lord, Lord Silsoe, that politicians of all Parties can spend too much time arguing back as to what they did in the past, or what somebody else did not do. I see the noble Lord, Lord Mitchison, shaking his head—I expected that.
LORD MITCHISON: I was merely thinking that the noble Lord finds it better not to mention it.
LORD BROOKE OF CUMNOR: I was not a member of the Government at the time of the 1954 Act, but a principal
effect of that Act was to give to the occupying leaseholder a right to a new tenancy, whereas this Bill gives a right to enfranchisement; and the question is whether it is proper to give a right to enfranchisement, on the terms that the leaseholder owns the bricks and mortar, in a case where it is quite clear from the form and term of the lease that the leaseholder cannot have been responsible for building the house. I therefore think that the right course to press this Amendment, and it may be that between now and Report stage, if it is going to create any difficulties or unfairness, the matter can be further examined. Because I, for one, should be only too happy to consider any additional and consequential Amendments that might be desirable in order to ensure that the change in the term which I think is essential does not cause injustice.
6.45 p.m.
On Question, Whether the said Amendment (No. 7) shall be agreed to?
*Their Lordships divided: Contents, 63; Not-Contents, 59.

CONTENTS

Aberdare, L.

Emmet of Amberley, Bs.

Monckton of Brenchley, V.

Ampthill, L.

Falkland, V.

Monsell, V.

Auckland, L.

Ferrers, E.

Monson, L.

Audley, Bs.

Glendevon, L.

Morrison, L.

Birdwood, L.

Goschen, V. [Teller.]

Mowbray and Stourton, L.

Boston, L.

Greenway, L.

Nugent of Guildford, L.

Brooke of Cumnor, L.

Grenfell, L.

Oakshott, L.

Brooke of Ystradfellte, Bs.

Grimston of Westbury, L.

Rathcavan, L.

Caccia, L.

Hacking, L.

Redmayne, L.

Carrington, L.

Hawke, L.

St. Aldwyn, E.

Clinton, L.

Horsbrugh, Bs.

St. Just, L.

Colville of Culross, V.

Ilford, L.

Silsoe, L.

Congleton, L.

Inglewood, L.

Somers, L.

Cork and Orrery, E.

Jellicoe, E.

Stonehaven, V.

Craigavon, V.

Kings Norton, L.

Strange of Knokin, Bs.

Cullen of Ashbourne, L.

Kinnoull, E.

Stuart of Findhorn, V.

Daventry, V.

Latymer, L.

Templemore, L.

Denham, L. [Teller.]

Lucas of Chilworth, L.

Wakefield of Kendal, L.

Derwent, L.

Mills, V.

Windlesham, L.

Dilhorne, V.

Milverton, L.

Wolverton, L.

Effingham, E.

Molson, L.

Wrenbury, L.

NOT-CONTENTS

Addison, V.

Faringdon, L.

Kennet, L.

Beswick, L.

Gaitskell, Bs.

Latham, L.

Blyton, L.

Gardiner, L. (L. Chancellor.)

Leatherland, L.

Bowles, L.

Gifford, L.

Lindgren, L.

Brown, L.

Granville-West, L.

Lloyd of Hampstead, L.

Buckinghamshire, E.

Hall, V.

Mitchison, L.

Burden, L.

Henderson, L.

Morris of Kenwood, L.

Champion, L.

Hilton of Upton, L.

Moyle, L.

Chorley, L.

Hughes, L.

Pargiter, L.

Collison, L.

Hunt, L.

Phillips, Bs. [Teller.]

Crook, L.

Kahn, L.

Rhodes, L.

* Note: See subsequent announcement by the Deputy Chairman (col. 988) revising the number of Not-Contents.

Rowley, L.

Shepherd, L.

Strabolgi, L.

Royle, L.

Snow, L.

Taylor of Mansfield, L.

Rusholme, L.

Sorensen, L. [Teller.]

Walston, L.

Sainsbury, L.

Stocks, Bs.

Wells-Pestell, L.

Segal, L.

Stonham, L.

Winterbottom, L.

Serota, Bs.

On Question, Amendment agreed to.

Resolved in the affirmative, and Amendment agreed to accordingly.
LORD HUGHES: Amendment No. 8 is a drafting Amendment. In another place at Report stage the words "or after" in the first line of Clause 3(4) left the drafting of the subsection somewhat inelegant. As with existing tenancies, so also with future tenancies, they will not rank as long tenancies until virtually renewed so as to take effect for more than 21 years. I beg to move.
Amendment moved—
Page 5, line 5, leave out from ("Where") to ("been") in line 6 and insert ("a tenancy is or has").—(Lord Hughes.)
LORD BROOKE OF CUMNOR LORD BROOKE OF CUMNOR: I beg to move Amendment No. 9.
Amendment moved—
Page 5, line 7, leave out ("twenty-one ") and insert ("fifty").—(Lord Brooke of Cumnor.)
LORD HUGHES LORD HUGHES: Amendment No. 10 is also a drafting Amendment. I beg to move.
Amendment moved—
Page 5, line 9, leave out ("had") and insert ("is or has").—(Lord Hughes.)
LORD HUGHES LORD HUGHES: Amendment No. 11 is also a drafting Amendment. I beg to move.
Amendment moved—
Page 5, line 10, leave out ("that") and insert ("as to bring to more than twenty-one years")—(Lord Hughes.)
LORD BROOKE OF CUMNOR: We are in some difficulty here. I do not know whether it would be acceptable if I were to move a Manuscript Amendment to No. 11, to leave out "twenty-one" and insert "fifty". I appreciate that Amendments Nos. 11 and 12 are two drafting Amendments that go together and, no doubt, they improve the drafting of the Bill. I should not wish to oppose
976
them on that account; but I should like to suggest that it might introduce consistency into the clause if the Committee were willing to accept a Manuscript Amendment to Amendment No. 11. At any rate, we should then get both drafting and consistency right. I appreciate that the policy was opposed by the Government.
Amendment to Amendment moved—
Leave out ("twenty-one") and insert ("fifty").—(Lord Brooke of Cumnor.)
LORD HUGHES: It will be quite obvious to the Committee that agreeing to the noble Lord's suggestion in no way means that the Government accept the policy: but we may as well be consistent in our unreasonableness.
Amendment, as amended, agreed to.
LORD HUGHES LORD HUGHES: I beg to move Amendment No. 12.
Amendment moved—
Page 5, line 12, leave out ("exceeded twenty-one years").—(Lord Hughes.)
THE DEPUTY CHAIRMAN OF COMMITTEES (LORD OAKSHOTT)THE DEPUTY CHAIRMAN OF COMMITTEES (LORD OAKSHOTT): Amendment No. 13 is pre-empted by Amendment No. 12.
LORD BROOKE OF CUMNOR LORD BROOKE OF CUMNOR: I beg to move Amendment No. 14.
Amendment moved—
Page 5, line 14. leave out ("twenty-one") and insert ("fifty").—(Lord Brooke of Cumnor.)
Clause 4 [Meaning of "low rent"]:
7.2 p.m.
LORD SILSOE LORD SILSOE moved, in subsection (1), to leave out, "or more than two-thirds of the rateable value of the property", and to insert:
"less than the rent which would be payable for the premises under section 15(2) under an extended lease".
The noble Lord said: I wonder what is the relationship between Amendments Nos. 15, 16 and 17. No. 17 is one of my Amendments which is alternative to No. 15. The noble Lord, Lord Molson, has said that if it was agreed he would not mind if I spoke on Amendments Nos. 15 and 17, and then he followed with Amendment No. 16. But I do not want to press that.
THE DEPUTY CHAIR004DAN OF COMMITTEES: If I can help the Committee, Amendments Nos. 16 and 17 are alternate Amendments to the same place in the Bill, and both would be pre-empted by Amendment No. 15. If Amendment No. 15 were disagreed to, I could call Amendment No. 16 in the usual way.
LORD SILSOE: I thank the noble Lord. Although I have already spoken—and perhaps I have spoken too much—this is the first proposed Amendment to the Bill which I have moved. There is a group of Amendments to follow, if I may say so without being out of order, which have been designed sincerely to try to meet the desire of the noble Lord, Lord Kennet, as was mentioned on Second Reading, that between us we should improve this Bill in Committee. In all my Amendments, possibly albeit unwillingly, I hope that I am accepting the principles and objectives as stated in the Second Reading debate by the noble Lord, Lord Shackleton, who opened the debate, and the noble Lord, Lord Kennet, who closed it. I wish to refer to them.
This Amendment is one of the two most important Amendments that I want to suggest, and Amendments which I hope that the Committee will accept completely. Although I declared an interest on Second Reading, to-day I am speaking on behalf of no one but myself. I have spent over fifty years, professionally and administratively, in the management of land, and as such I speak. It was very pleasant to hear the other day that the noble Lord, Lord Kennet, accepted that I had some experience in this matter, but I was disappointed to be told that my experience was from the landlord's eye-point. I am not sure what an "eyepoint" is.
LORD KENNET: It is a point of view.
LORD SILSOE: I think the noble Lord, Lord Kennet, may have forgotten that, at the urgent request of the noble Earl, Lord Attlee, and the noble Lord, Lord Silkin, I undertook for a previous Labour Government to try to make a success of the Central Land Board. And I had experience even before that. I hope that I have acted as impartially as possible in respect of these Amendments. I have never owned property, and I more usually act for tenants than for landlords. Amendments Nos. 15 and 17 are alternative to each other. Both seek to make the Bill follow the principles of the Government as stated during the Second Reading debate: to limit its provisions to cases where hardship would occur and to prevent those people who would not suffer hardship from obtaining an undeserved tax-free gift. I hope to be judged on the fact that I have succeeded or failed in this objective.
I played a leading part in reducing considerably the number of those cases in which the Government reduced the limits in the Bill to £400 and £200. I led a deputation to the Minister of Housing and Local Government on behalf of 18 estates, and drew attention to the position which would arise if the reduction was not made. I was glad to be told that it was accepted in another place as not being improper pressure. Among the people whom I excluded by my "foolish" act was myself, because I was going to get these enormous advantages in respect of my house, and in my view I had no merits whatsoever. But there are far too many who are still left to benefit. Among them are Members of both Houses of Parliament and Ministers, who should not be included and who, if this Bill is not amended, will obtain quite unnecessary advantages for themselves. They are not to be coupled with the hard cases about which we have been told, and I hope that they will search their consciences, as I did, before rejecting these Amendments which I am proposing.
In the discussion on the last Amendment is was said that to come within the provisions of this Bill a leaseholder must have a long tenancy and be paying a low rent. I have no more to complain about regarding the definition of a long tenancy, although it is clear that a long tenancy of as little as 21 years may, in

979
no possible sense of the term, be called a ground lease, or a building lease or any similar term. No properties are let at ground rent for such a short period.
May I, at some length, remind the Committee of the principles set out by the Government speakers on Second Reading, and refer to the mischiefs which they sought to cure? They were listed very sympathetically by the noble and learned Lord, Lord Stow Hill. I hope that my Amendment will cover every case of hardship which he mentioned and every one of the cases referred to in the debate. I have been carefully through the speeches in Hansard and I hope they will also cover the "black" cases referred to by my noble friend Lord Mitchison.
These principles were set out with great care and particularity. The noble Lord, Lord Shackleton, will, I hope, not mind my reminding him that he was new to this Bill, and therefore spoke on Second Reading on June 26 from a carefully prepared brief, which I accept completely. I hope that I may be allowed to mention the column numbers in Hansard and not read from it. The first principle which the noble Lord enunciated (column 13) was that the leasehold system, that is, the leasing of land for a long term of years for building, is peculiar to England and Wales. The noble Lord went on (in columns 13 and 14):
"The essentials of the leasehold system are that the freehold owner agrees to let his land at a ground rent for a term of years, usually a long term, 99 years or even longer, to a builder or developer who is required by the terms of the lease to put buildings on the land to the satisfaction of the owner."
That could not be clearer. The leases are what we call building leases, and they are accurately described. They are long leases. They are not 21 years but usually 99 years or even longer. The noble Lord did not mention the fact that there are some, unfortunately, which are 999-year leases which have to be dealt with.
He then proceeded to say—and he was speaking on rateable value limits:
"Interference with contract ought to be kept to a minimum, and plainly there are some people who do not need protection in any form, and who, if there were no limits, would obtain very large windfalls out of proportion to the particular hardship of their need.—(col. 18).
980
One of my intentions is to carry out the idea of the noble Lord, Lord Shackleton, that interference with contracts should be kept to a minimum. The noble Lord continued:
"… any limits entail awkward cases of people just over the limit while their neighbours are just below; …"
My Amendments will try, so far as possible, to avoid rateable limits altogether, because I accept the view that they produce awkward positions.
In replying, the noble Lord, Lord Kennet, said this:
"If you have a rateable value limit, then you have a border problem. You create friction between the leaseholder who is just below it, and the leaseholder—who may be his neighbour—who is just above it."
"… Wherever you put the limit, there would be friction at the boundary.
"On the other hand, if you abolish the limit you come face to face with the phenomenon of the windfall,…"—(col. 76).
I hope to suggest ways in various Amendments to abolish the limit and avoid that trouble. Lastly, the noble Lord made this important announcement:
"But in this Bill we are rectifying an old abuse. We are rectifying the system where, typically, it was not paid for by the landlord—in the Welsh situation which gave rise to the whole pressure for this change."—(col. 72).
I apologise for reading these quotations, but I accept all those principles completely and wish to see how the Bill can be improved, by suggesting Amendments which I hope will not be controversial.
The aim in all the remarks I have quoted is to put within the Bill ground leases and ground rents where the capital has been invested by the tenant or his predecessor. That is the accepted aim of the Bill in clear and unambiguous language. My Amendments seek to do just that. But I am sorry to say, from my knowledge of the Bill in its present form, that it covers thousands of houses where the rent was fixed as a rack-rent and thousands of others well above ground rent, sometimes loosely called improved ground rent. They are still within the Bill and I see no reason why they should be. Why has this mistake arisen? The noble Lord, Lord Kennet, said this—and this may be partly- the reason why it has not gone well in England and why a great case had been made for it in Wales:
"This Bill, … is urgent, and it is urgent because of the historical fact that it was in

981
the late 1860s that many thousands of industrial workers in the valleys of South Wales and in Cardiff fled from their original landlords into the arms of the new ground landlords and built their own houses; and those leases are now falling in."—(c. 75.)
I think that in fairness to the noble Lord, Lord Stow Hill, Monmouthshire should have been mentioned as well. Lord Kennet also said:
"The need in England is no less real, but it is less urgent because, for historical reasons, leasehold property in England is more scattered. It is possible for a leaseholder to find another house without leaving his native community. In Wales it is not.…"
However, there is another reason for this difference, which I think is an important one. The noble Lord mentioned the late 1860s (I have not been able to check his figure, but I accept it completely); in other words, the 99 years are not quite up and ground leases are still subsistent, as we know, in most parts of Wales. In England, it is quite different. I can mention only the places I know, but I have had experience of a wide area. The Nash Terraces are more than 100 years old. If I may say so, I was proud to be Crown Estate Commissioner managing the Nash Terraces and responsible for the starting of the redevelopment. When I was concerned with them over ten years ago the building leases were at an end and in most cases second short leases for 21 years were in existence.
The noble Lord, Lord Shackleton, referred to the 18th century and to the Grosvenor, Bloomsbury and Cadogan Estates. Certainly they were leased at not more than 99 years, and in most cases the ground leases have gone and rack-rents have come in. The Church's estate in Paddington was started in 1827 and finished in about 1850. There again, the ground leases are over and the Church Commissioners are proud to have started and gone half-way through a redevelopment with a master plan which has been agreed with the local authorities. Maida Vale, the northern part of the Borough of Paddington, was developed from 1840 and later. Here, alone of all the estates that I know, there are a few ground leases still subsisting because the 99 years are not up. My Amendments will keep these within the Bill.
In Chelsea, in Royal Terrace, which we are proud to manage, the development occurred between 1856 and 1860, and the
982
ground leases are over. In Chelsea, Old Church Glebe was started in 1850, and St. Mary Abbot Glebe, in Kensington, between 1840 and 1850. All these ground leases are over and rack-rents are in being. Lastly, as I have mentioned before, my own house in Smith Charities is much older than 100 years. Those who know their history will know the date; I cannot remember it, but they were built for the families of people killed by the Barbary pirates.
All these estates show that in most places—though I do not say all—we have got to the stage of being past the problem that exists in Wales. One exception is the 999-year leases. So far as I can make out—and I agree that they have to be brought into this Bill somehow they never accept the principles. What is now being sought by the definition of low rent, and, to some extent, the definition of the 21-year lease, is the rack-rent leases which follow the building leases. No Minister has said they want to catch them within the ambit of this Bill.
I do not know why the Government have changed their policy about this Bill. With the Rent Bills, the Land Commission Bill, betterment Bills and so on, full consultation has taken place. No one has consulted anybody concerned with this Bill. I say that quite deliberately. It is a great pity. It is a complete change of policy on the part of the present Government, who usually consult fully. Way back in 1965 I wrote to the then Minister of Housing and Planning a long letter about this Bill which was first introduced as a White Paper, begging him to send someone or to come himself to see the properties in London. No one has been up till this day to see any. I am sorry about it, because it is quite foreign to the normal policy of Ministers of the present Government.
How did it come about that a definition of low rent came into the Bill? How did it come about that the low rent is measured by two-thirds of the rateable value? I do not know; I can only guess. The White Paper of February, 1966, makes it perfectly clear when it says in paragraph 5:
"In order to come within the scope of the legislation a leaseholder will have to satisfy two conditions: (1) he must hold a lease originally granted for more than 21 years at a ground rent of a house …"

983
And then it goes on to deal with rateable limits. The Government, I suggest, must satisfy your Lordships that what they are defining now is a ground rent, and for reasons which I shall now give I cannot believe that there is any doubt whatever that it is not.
For example, who in this Committee has ever heard of a ground rent being two-thirds of the rack-rent? You may say it is not two-thirds of the rack-rent. But a rateable value nowadays, valued by the Crown—and very well done, if I may say so—is as near a measure of rack-rent as exists, and is often accepted. This says that a ground rent is two-thirds of the rateable value, and I am not unfair in saying that that, near enough, is two-thirds of the rack-rent, because that is what rateable value is.
Who in this Committee has ever heard of any ground rent on a house amounting to two-thirds of £400? Two-thirds of £400 for a house in London is £266 a year. Who can give me a single example of a ground rent of £266 a year on one house? I cannot give one I do not believe anybody can, although there may be some odd case somewhere. It is a huge figure for a ground rent, even fixed to-day. Who has heard of a ground rent of two-thirds of £200, which is £133, for a house in Wales? It is absolutely absurd. There is no such thing. Why this definition producing these maxima? I do not know. All I can say is that it is clearly not a definition of a ground rent. It is a definition of something else; it must be.
Your Lordships will remember that we are coming soon to Clause 15, which is the clause about fixing the rent for extended tenancies, and in that clause it clearly says that the rent is to be a ground rent. Who thinks that figures of over £200 in London and over £100 in Wales will be paid under the ground rent formula in Clause 15? Quite clearly, they will not. We are thinking in terms of much lower figures than that. If anybody had thought that it would be that sort of price there would have been frightful trouble from the tenants.
Practically the whole of my family except myself—and I am an honorary one—are surveyors, and I know from my father, my brothers, my uncles and my cousins something about their profession,
984
and I know something about their training. They are trained as young men to answer questions about the relationship of ground rent to rack-rent. That is one of the things they have to learn. They are taught at the schools that a proper answer to give if you want to pass the examination is that the ground rent is one-fifth of the rack-rent. I have no doubt that if they answered a paper and said it was two-thirds, they would be ploughed. I am perfectly certain that if they said it was a half they would be ploughed. I am doubtful whether they would get through if they said it was one-third. But this is not a definition of ground rent, or anything like it. It obviously is not meant to be, and cannot be.
Also, the right to extend leases has been put forward by Ministers as a reasonable alternative to a right to enfranchisement. They are mentioned in the same breath, rightly and properly. There is no doubt that under Clause 15 the right to enfranchisement is based upon the ground rent. Why, therefore, should not the right to enfranchisement also be based on the ground rent, and not on two-thirds of the rack-rent? I just do not follow. I will give a reason—a very bad reason—why I think this has all happened. Why was ground rent put in the White Paper? Who changed it; and why? Nothing in the speeches that we have heard in this House—as I have said, I have not read the speeches in the other place—gave us the slightest indication why it had been changed from one to the other. As has been said, it certainly was not mentioned as a justification for not opposing Second Reading here. The voters were not told at the last election that it was something above a ground rent. I believe that the real reason is—it was mentioned, incidentally, on the last Amendment—that this has been chosen because it can be found in a rent Act. The low rent is mentioned in an early rent Act. It is also mentioned in the Act of 1954, by which I am supposed to be bound by the Opposition Party. To neither of them do I pay much attention. But it is said, and it is true, that this low rent figure is in both.
Is that a reason for this provision? I think it might be a reason in regard to extended tenure. It was mentioned in the rent Acts to stop evictions. It was

985
put at a very high figure—it was way back in the 'twenties, but I am old enough to remember it—in order that people should be quite certain not to be evicted. It was chosen by the present Opposition Party in 1954—I know not why. I think it was a very foolish choice, but it was chosen. That may be the reason. Having brought in a Bill; having explained with complete exactitude in the White Paper why it is needed; having said it applies to ground leases and ground rents; having said the whole object of the Bill is to provide for ground leases and ground rents, the Government have a reason. What is the reason? Because it is something which Ministers can pick up in two Acts of Parliament—two-thirds of the rateable value.
I have pointed out that there is no ground rent in England or Wales (Scotland and Northern Ireland are fortunate enough to be out of this altogether) where the rent is approached by this formula. But I believe that is the reason why it is in here, and, if it is, I ask all your Lordships to say it is a very bad reason.
On one occasion in the last two years or more we were told, "You cannot define a ground rent. Therefore, we had to do some arithmetic." In fact, the Government have defined a ground rent, and with all due respect, I think that the definition is a very good one. It is in Clause 15(2), on page 25, line 14, which we are coming to fairly soon, and it seems quite excellent as a definition of a ground rent. It is:
"the rent shall be a ground rent in the sense that it shall represent the letting value of the site (without including anything for the value of buildings on the site) for the uses to which the house and premises have been put since the commencement of the existing tenancy, other than uses which by the terms of the new tenancy are not permitted or are permitted only with the landlord's consent".
With all due respect to the draftsmen, I think that that is an extremely accurate and fair description of a ground rent. My first Amendment, therefore, says that those words should be translated into Clause 4 and become the test for being enfranchised. I have used those very words.
Having proposed that Amendment, I think that it has one bad defect as drafted. It means that nobody will be able to know without a valuation, or
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perhaps a court case, whether they are in or not; and I accept that that is therefore probably a bad weakness in the suggestion. I felt bound to put it in in the first Amendment to remind the Government that they referred to a ground rent, and defined it in Clause 15. Therefore, if they want something else they must have it extremely close to that figure. Now, what is "close"? I have already told your Lordships that the tradition with regard to managing land and everything else, for surveyors is one-fifth. I agree that to put in one-fifth might very well entail hard-luck cases just on the margin. I have therefore decided, without much logic, to offer an alternative, in Amendment No. 17, of one-quarter. One-quarter, I am absolutely as sure as I can be, will cover all the hard cases which the noble Lord, Lord Stow Hill, mentioned—every one of them. The noble Lord, Lord Mitchison, is not with us, but it will cover those that he mentioned. All that one desires will be covered by one-quarter. I see that the noble Lord, Lord Molson, is mentioning one-third. I will leave him to make his own speech about that.
There cannot be any magic between, perhaps, my one-quarter and one-third; they are somewhere in the same realm. But two-thirds cannot possibly be a ground rent, and I ask the Government—and I think the onus to give an answer is upon them—why they referred to a ground rent in their White Paper, and why they have at least doubled it, if not more. I wrote this before I saw the Amendment of my noble friend, Lord Silkin. It is a bit out of date now, because he has made an Amendment. I said. "Since all above £400 and above £200 are now out of the clutches of this Bill". I cannot exactly say that now, because the noble Lord has promised to look at it. I am going to say it, all the same. None of those are affected. Who are affected? The people most affected are those on the fringes of Greater London. Wales is not affected, because I am perfectly certain that my Amendment will cover all of them. I believe there are some cases, such as your Lordships have heard about on past Amendments to-day, which are concerned. I would mention Dulwich, and especially Hampstead Garden Suburb,

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which seems to be full of Members of Parliament of both Houses, and should be looked at rather closely, I think, for declarations of interest. It once belonged to me. Birmingham is not affected, but areas on the South Coast of England are.
I venture to suggest—and I apologise for my long speech—that either of my Amendments, whichever is desired by the Committee, will contain the Bill within its proper limits; and with respect to the noble Lord, Lord Brooke of Cumnor, I think it will contain it without 50 years being added, because I do not believe that at one-quarter of rateable value there are low rents of this sort within 21 or 50 years. This situation is all right in Newport; it is all right in Cardiff and Abertillery, and the other places mentioned of which I know. There was mention of North Oxford. It will be all right there. I do not know of a problem there, but it will certainly be all right there. It will also cover the very few cases of modern ground rents created recently. There are very few of them, but I agree that there are some, and it will cover those.
I hope that when this Bill leaves this House the limits of the mischief which Ministers have themselves defined will be kept to. I hope also, most sincerely, that words which have been used already in reply from Whitehall to letters I have written will not be repeated this afternoon. The time should be devoted to considering whether something can be done on the lines I have suggested. I hope this very much. I hope that we shall not be forced, as I shall have to suggest to the Committee, to vote on this question to-night. There must be second thoughts. To say that there are no second thoughts when nobody—I underline this three times, nobody—has been near the estates to see them at all, just cannot be accepted, and ought not to be accepted at this stage.
If your Lordships care to look at the end of this List of Marshalled Amendments (I say this as a joke) you will see that I have the honour to be grouped with the noble Lord, Lord Kennet, in moving two Amendments, headed, "By the Lord Silsoe and the Lord Kennet". It is a most amazing thing, but we are shown as jointly tabling two Amendments. I hope that at the Report stage this Amendment will be a third.
Amendment moved—
Page 5, line 39, leave out from ("or") to ("on") in line 40 and insert the said new words.—(Lord Silsoe.)
THE DEPUTY CHAIRMAN OF COMMITTEES (LORD CHAMPION): Before putting the Amendment to the Committee, I have a correction to make in the figures announced to the Committee after the last Division, on Amendment No. 7, in the name of the noble Lord, Lord Brooke of Cumnor. The Tellers in the Not-Contents Lobby inform me that the number voting in that Lobby was 49, not 59 as announced. The correct result was therefore: Contents, 63; Not-Contents. 49.
7.38 p.m.
LORD KENNET: I think I can say that I have understood the case the noble Lord was putting and have a clear grasp of the kind of property that caused him to put it. I hope the Committee will bear with me if I am not able to follow him into as much detail as he went into, because, as he said himself, he has fifty years' experience of this world, and I have not. However, I shall do my best with it. If I understood him aright, he introduced his Amendment as part of a package of several Amendments which would get rid of the rateable value limits and institute another test about who should be allowed to enfranchise and who should not, especially in the case of more valuable property. But he has not moved an Amendment to get rid of the rateable value limits, and that being so, I think the Committee must confine their attention solely to the Amendment before them at the moment, since we have already passed the clause on which it would be appropriate to move the taking out of the rateable value limits.
LORD SILSOE: May I explain? I have not moved the top rateable value limits. I agree. The first of my two Amendments—the test for enfranchisement—will not relate to rateable value; the alternative, for the reasons I have given, would.
LORD KENNET: It was my misunderstanding; I apologise. The noble Lord is proposing to remove the rateable value as a test under this clause.
LORD SILSOE: I am quite content to take the second.
LORD KENNET: The noble Lord charged the Government with having changed their policy about this matter, in that in the White Paper the Government said that people could enfranchise if they were paying a ground rent. He asked what we meant by that, and whether it was reasonable to say that something as high as two-thirds of the rateable value was a ground rent. In seeking to determine how we should express in detail the rather vague concept of ground rent, which was as far as we thought we could reasonably go in the White Paper—the noble Lord agreed that a ground rent does not carry a label; it can be assessed only by some numerical test—the question is, what test should be applied? As the noble Lord said, the Government had recourse to the 1920 Rent Act, in which a rack-rent is defined as being two-thirds of the rateable value or above. The question arises: if a rack-rent is two-thirds or above—and that was laid down by Statute in 1920—and if we are to accept the noble Lord's and the valuing profession's definition of a ground rent as being one-fifth and below, what are all the rents lying between one-fifth and two-thirds? It seems that this is an "either/or" question: there is either a ground rent or a rack-rent, and we concluded that the ground rent in fact would be less than that; that is, two-thirds and below. I am not sure whether I followed the noble Lord correctly, but it seemed to me that at one moment he was speaking of rateable value and rack-rent as if they were often, or even very often, the same; but, of course, the rack-rent can be far higher than the rateable value.
LORD SILSOE: I am afraid I must interrupt the noble Lord because I did not say that. The rateable value is what the hypothetical tenant would pay for a rack-rent of a building, and it has been going on since the time of the first Queen Elizabeth. It does not always represent the full rack-rent which can be obtained from people by being awkward, but it is a neutral figure when assessed. On my very small house my rateable value is now £660; to be told that rack-rents are higher than that would shock me to the core. Ground rent has nothing whatsoever to do with the rateable value and is not used in rating matters. It is,
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in fact, accurately and very well described in Clause 15.
LORD KENNET: The Government are sometimes taken to task for not providing for the upward revision of rateable values quite as often as they should.
LORD SILSOE: It is done every five years.
LORD KENNET: And that is one of the ways in which a discrepancy arises between the rateable value and the theoretical rack-rent which may be charged.
On the point of whether or not the Government went near the estates, the noble Lord charged us with not having been to see certain estates which are in this position. I do not quite know which estates he was complaining about but there are a good many estates in a good many different conditions in the country, and while I should feel hound to defend the Government against any general charge of being ignorant about these estates, I hope the noble Lord will be prepared to exonerate us if we do not visit individual estates. Coming to the terms of the noble Lord's Amendment—
LORD HAWKE: Before the noble Lord, Lord Kennet, leaves the general and moves to the particular, I should like to ask whether he is reiterating the policy of the White Paper that the Bill is really intended to catch only ground rents. I am not quite clear about that.
LORD KENNET: Yes, it is intended to enable people to enfranchise only when they have a ground rent. The question is, what is a ground rent? For the purposes of this Bill it is reasonable to say that a ground rent is any rent that is not a rack-rent. I am informed that the actual wording of Lord Silsoe's Amendment would have what I think must be the opposite effect to that which he intends. I believe it is simply a question of a "not", which would literally define "a low rent" as one greater than a modern ground rent, which seems to me to be upside down.
LORD SILSOE: The noble Lord will remember that I made that point myself.
LORD KENNET: That is correct, the noble Lord did make the point. The

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Amendment provides for the modern ground rent to be assessed on the appropriate day, namely March 23, 1965, or the first day of the term if the lease was created after that date. The object is presumably to ensure that the qualification to enfranchise shall include a genuine ground rent, and to cut out tenancies which may originally have been created at rack-rents but which are now tenancies at low rents within the definition of the Bill because of the increase in rateable values in recent years. This test would be extremely cumbersome to operate. Before any leaseholder could exercise his right under the Bill he would, in most cases, have to employ a valuer to assess what an up-to-date ground rent would have been on March 23, 1965, and this would be a figure which the landlord could dispute. In the great majority of cases the result would be that by this test the rent currently payable would be a low rent.
The criterion of two-thirds of the rateable value not only is one which is given in the Rent Act 1920, and in certain respects, as the noble Lord himself pointed out, by the Act of 1954—and I will not, in this case, necessarily go along with him in his contention that in that respect the Opposition, when they were in Government, were foolish to introduce that test—but has the advantage of being understandable and easy to work. It has fifty years of tradition behind it and it has turned out to be a good means of distinguishing between a rack-rent and a ground rent.
The introduction of the noble Lord's Amendment would bring serious complexities into the operation of the Bill. Moreover, there are cases in which the test of a modern ground rent in the case of a long lease granted in the past decade might work wrongly, if since the lease was granted there had been development in the neighbourhood of the house which lowered its rental value. Then the leaseholder would find himself deprived of the benefits of the Bill owing to the disagreeable development nearby. The objection to the test which the noble Lord proposes to introduce is very much the same as the objection which I shall have to state to the Commitee in respect of the next two Amendments—those which substitute
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"one-third" or "one-quarter" for two-thirds of the rateable value.
The difficulty is that the Bill we are discussing has to provide for rents fixed a century ago, a decade ago, those which are being fixed now and those which are to be fixed in the future. A ground rent does not declare itself to be such; it is not born with a flag on it saying, "I am a ground rent"; so some form of mathematical formula has to be found. Whatever fraction one fixes on, whatever more complex procedure one adopts, such as that proposed by the noble Lord, there are bound to be some cases falling on the wrong side of the line which generate friction and difficulty. Some cases which do give trouble are long leases granted soon after the war for periods just above 21 years at rack-rents, as these may sometimes be less than two-thirds of the rateable value in 1965—just what the noble Lord based his arguments upon. On the other hand, I am informed that there are ground rents granted quite recently which are more than one-third of the rateable value. One could devise definitions of infinite complexity, with fractions to be applied according to when the lease was granted, not to mention that some long leases are continuations of previous leases with more or less property. The anomalies would always arise, whatever one did.
Now I come to the Government's point in resisting this Amendment. If there are to be anomalies, as there are, I think it is better that they should arise from a simple rule rather than from a complicated one, and it is in essence for the sake of simplicity that I would ask the noble Lord whether he could withdraw this Amendment. If he cannot do that, I would advise the House to stick to the simple rule which is in the Bill as it stands.
LORD INGLEWOOD: In reply to this debate, which is a very serious one, I think the noble Lord has missed a good deal of the point. It is perfectly clear, surely, that what the Government have tried to do is to deal with long building leases let at ground rents. I am sure the noble Lord does not wish to mislead the House, but it is in effect entirely misleading to pretend that there is not a generally accepted sense of what a ground rent is. The noble Lord, Lord Silsoe, has said that examination candidates—and I have been one in my day—

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have it rubbed into them that a ground rent in those circumstances is one-fifth, and I am sure it is still current to-day.
LORD KENNET: One-fifth of what?
LORD INGLEWOOD: Of rateable value.
LORD KENNET: Not rack-rent?
LORD INGLEWOOD: It is the same figure.
LORD HUGHES: It is not the same figure.
LORD INGLEWOOD: That is the figure Lord Silsoe gave; it is the same figure, he said.
LORD KENNET: If I understood the noble Lord, Lord Silsoe, I thought he said that they were often different.
LORD SILSOE: I am sorry, I did not hear either noble Lord.
LORD KENNET: I think it is to the interests of the House that this should be cleared up. I believe I asked Lord Silsoe whether he would agree that a rack-rent is often above rateable value, and I believe he agreed. Of course, this affects very much the question of one-fifth. If we are talking of one-fifth of rateable value that is one thing, but if we are talking of one-fifth of rack-rent which may be way above rateable value, that is another.
LORD SILSOE: The rateable value formula is a rack-rent. Rateable values are done only once every five years. Therefore during the period when they are four years old they are not the rack-rent. I do not think they are very far wrong just after they are in force. I hope that is a fair answer. The rack-rent is fixed every year; the rateable value is done every five years; a ground rent has no beginnings of being either.
LORD INGLEWOOD: I do not think I was so far wrong. I am going to return to my figure of one-fifth. Where a low rent, as it is called, for the purposes of this Bill is in payment for a lease of medium length, that rent must include an element of rent for the buildings on the land. To say that any rent which is below the figure of two-thirds is a ground rent and any figure over and above two-thirds is a rack-rent is lust misleading. We know what the full rental value of property
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is. One can test it in the market. It is fixed for the purposes of training for the profession, and surely for professional practice generally a ground rent it taken at one-fifth for all normal purposes. Why in heaven's name do the Government want to introduce another figure in this Bill unless for political reasons? We have heard political speeches from the other side, as well as professional speeches. The noble Lord, Lord Hughes, himself admitted he was taking part in a political auction in this Bill, and he could not have a figure which was not at least more favourable to the tenants' cause than any figure mentioned in Conservative proposals. I fear that is at the bottom of his decision, and I hone that in the course of time this House will be able to get a figure into the Bill governed by other considerations.
LORD HUGHES: I hope the noble Lord never becomes an official interpreter, because he can certainly attach to a form of words what the user never intended. I did not say that I had entered into an auction with the Opposition. I said I thought it very difficult for this Government to accord less favourable treatment than even the Tories had found it necessary to do. I should not have bothered to reply to this, but I wanted to say that I disagree intensely with what the noble Lord has said, and what the noble Lord, Lord Silsoe, said by implication, that a rack-rent and rateable value are the same thing. In the first place, the present rateable values are based on something now out of date; on figures taken in 1960, seven years ago. Secondly, the rateable value is not the same as gross value, and we have a much more up-to-date basis of assessing what are fair rents in the 1965 Rent Act. The information I have is that at present rents which have been worked out as fair rents under the 1965 Act are working out at 1·7 times the gross annual value. The noble Lord, Lord Silsoe, can shake his head, but these are the facts ascertained from the rents fixed under this recent Act. If we take account of the extent to which gross annual value is diminished to reach rateable value, we find that at the present time fair rents are being assessed at approximately twice rateable value. On that basis the one-fifth or one-quarter becomes two-fifths or a half.
LORD SILSOE: I must say that my figures are from my own head, too. I do not agree these figures, and I would ask the noble Lord where they come from.
LORD HUGHES: I cannot give the noble Lord any evidence other than this: that these are the figures ascertained from rents fixed by rent officers and the like. But we can easily, at the next stage, furnish the evidence as to this, and I can assure the noble Lord that they did not come out of my head, whatever may have come out of his.
LORD ILFORD: The figures that are used in the Rent Act are surely the assessments of the rent officer, and no more than that.
LORD HUGHES: The rent officer is supposed to arrive at a figure which is a fair rent for the subject in existing circumstances.
LORD BROOKE OF CUMNOR: May I play my not infrequent part of seeking to pour oil on the waters? It is now three minutes to eight, and the noble Lord, Lord Shepherd, announced earlier that we should adjourn at about eight o'clock. It seems to me, therefore, that we cannot deal to-night with all the Amendments to Clause 4, because though the noble Lord, Lord Silsoe, has spoken to Amendments Nos. 15 and 17, my noble friend Lord Molson has not had an opportunity to speak to No. 16. Indeed, the noble Lord, Lord Kennet, addressed most of his reply to No. 15. It would seem to me, from what the noble Lord, Lord Silsoe, said, that he regards Amendment
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No. 15, the one we are actually discussing, as theoretically perfect but practically inferior, in that it would make it very difficult in some cases to reach firm decisions. I therefore hope that perhaps the noble Lord may be willing to withdraw Amendment No. 15. We could then adjourn and deal to-morrow fairly quickly with the remaining Amendment, or Amendments, to Clause 4, because we have substantially debated the problem here, though my noble friend Lord Molson has not yet had the opportunity to put his solution to it. I do not know whether that course would be generally acceptable, but it seems to me that it might be the best way of proceeding without waste of time.
LORD SILSOE: I am very happy to do that, if it is the will of the Committee I just wanted to make quite clear that this was the theoretically correct way of doing, it. But if it is the will of the Committee, I am quite willing to withdraw Amendment No. 15 and to rely on No. 17.
Amendment, by leave, withdrawn.
House resumed.

MANCHESTER CORPORATION BILL
The CHAIRMAN OF COMMITTEES The CHAIRMAN OF COMMITTEES informed the House that the opposition to the Bill was withdrawn: the Order made on June 20 last discharged, and Bill committed to the Committee on Unopposed Bills.
House adjourned at eight o'clock.